By PHYLLIS KORKKI
Published: December 31, 2009

NYTIMES-With companies sometimes receiving hundreds of applications for a single job, it is becoming more common for hiring managers to conduct initial screening interviews over the phone. This saves them considerable time and money — especially if a candidate lives out of town.

Don’t take these interviews lightly. “It is important to prepare for a telephone interview just as you would for a regular interview,” said Alison Doyle, a job search specialist for About.com, which is owned by The New York Times Company.

The employer will normally call or e-mail you in advance to set up an interview time. If possible, arrange for the interview to be over a landline phone, as it tends to be more reliable than a cellphone. Make sure that children, pets and other sources of interruption will be out of the room. Keep a glass of water nearby.

Phone interviews can often last a half-hour to an hour, Ms. Doyle said; be sure to have your résumé in front of you, along with a list of your accomplishments. Long pauses or halting responses caused by a lack of preparation could keep you from making it to the next stage. Do your best to be personable, but don’t overdo it by, say, trying to tell a joke and guffawing.

One advantage of a phone interview is that you don’t need to worry about what to wear (although dressing up might make you feel more confident). But some companies have started to conduct video interviews, Ms. Doyle said, sending Webcams to be used temporarily by applicants who don’t have them at home.

New York Times - For all the hand-wringing about the weaknesses of health care, one aspect of it has remained strong: its ability to provide jobs. In fact, health care employment has increased during the recession, while employment as a whole has declined, according to data from the Bureau of Labor Statistics.

Within the private sector, more than 11 percent of the American work force is engaged in health care work, compared with just 3 percent before 1960, the bureau says.

Regardless of how health care reform shakes out, the industry jobs picture is likely to remain robust, given the aging population and technological advances in medicine.

High school and college students take note: the positions expected to post some of the largest increases include registered nurses; personal and home care aides; home health aides; nursing aides, orderlies and attendants; medical assistants; licensed practical and licensed vocational nurses; pharmacy technicians; and physicians and surgeons.

Jane Donaldson spent £200,000 doing up her bungalow but like many vendors can’t find a buyer

by David Smith - Times Online

Competition is a good thing, so the break-up of Britain’s rescued banks, announced last week, should be a positive move for the housing market. Although nothing is imminent, the disposals approved by the European commission will increase choice. Lloyds TSB-HBOS has a mortgage-market share of about 30%, so the split should be beneficial, and has been lauded by Which? and other consumer groups.

Marrying the proposed break-up with the Financial Services Authority’s regulatory reforms, it seems clear that the mortgage market of the future will look different. Competition is not all one way — in the past couple of years, smaller building societies have been absorbed by bigger competitors — but there is the prospect of new players.

The key issue remains: will there be enough mortgage capacity to support reasonable activity in the housing market? The big picture on approvals for house purchase is that they are still rising. The Bank of England’s latest monthly figure (for September) was 56,215: up by 68% on the same time last year, and more than double the November 2008 low.

That has been enough to support the rising house prices of recent months, perhaps surprisingly. Halifax reported a 1.2% increase in October, a fourth consecutive monthly rise. Prices are up by 2.9% since the end of 2008 and by 7.1% from the April 2009 low. Yet approvals remains well below pre-crisis norms. In all bar one month from January to June 2007, they were more than double the latest figure.

The drop in mortgage activity — despite the recent recovery — is even more striking when you look at all approvals, including remortgages. At just under 110,000 a month, it is barely more than a third of pre-crisis levels.

So this is not merely a question of competition in the mortgage market; there is the important issue of how much lenders can lend. Nobody expects a return to the levels of the first half of 2007, but a proper recovery in the housing market requires considerably more lending than now. And it is not clear we are going to get it.

* Average price falls of 6.6% are likely in the property market next year, as the backlog of pent-up demand that has brought recent growth is gradually eroded, while supply increases and economic growth remain weak. In its market forecast last week, Savills estate agency said that a gradual return to house-price growth is expected once the economy starts to recover and unemployment falls — with a probable 2.7% rise in average prices in 2011, steadily growing to 5.5% in 2015.

Save Big on Credit by Getting Loans for Less: The 'Do's' of Raising Your Credit Score

By ELISABETH LEAMY
ABC News Consumer Correspondent

This week I'd like to continue our conversation about how to Save Big (not small) -- something we could all stand to do right now. This week's topic: how to raise your credit score to Save Big on credit.

As I've been telling you in the past few columns, I recently wrote a book called "Save Big," but it doesn't come out until January, and I feel like people need the information right now because of the crummy economy. So I'm sharing my favorite tips and tricks in this space each week in an effort to help and to get a conversation going in which you also share big savings ideas with me.

I maintain that the best places to find Big Savings are among our top five costs: houses, cars, credit, groceries and health care. Sandwiched right in the middle is credit, a puzzling one. Most people don't think of credit as an expense, and I'm trying to change that. We purchase credit just like we purchase houses and cars. The price of credit is the interest. For example, the interest owed on a $200,000 mortgage at 7 percent is $279,160 over the life of the 30-year loan. The credit costs even more than the house!

There are two ways to Save Big on credit: by using less of it or getting it for less. Today let's tackle the latter. The higher your credit score, the lower the interest rate you will be charged for loans. A lower interest rate can save you tens of thousands of dollars over the life of the loan.

Let me blow you away with some examples: 620 is the lowest score you can have and still get a mortgage. If you raised that score to 720, right now you would qualify for a mortgage at 5.093 percent interest instead of 6.46 percent interest. Here's how much that saves you each year on a $300,000 mortgage:
FICO Score … Cost of Loan
620 .................. $22,656/year
720 .................. $19,536/year
BIG SAVINGS = $3,120/year

The $3,120 savings a year is nice, but get this. If you kept the loan for 30 years, your total savings would be $93,600. Now let's look at a car loan. In this case, raising your score from 620 to 720 lowers your interest rate from 12.780 percent to 6.348 percent. Amazing. If it's a three-year auto loan for $25,000, here's your savings:

FICO Score … Cost of Loan
620 ..................$30,240/three years
720 .................. $27,504/three years
BIG SAVINGS = $2,736/three years

That's $2,736 that you can put toward your next car! OK, now that I've got you motivated, you'll want to know what steps you can take to raise your credit score. There are a bunch of do's and don'ts. This week I'll tackle the do's, next week the don'ts. Some are slow, steady steps. Others are faster, flashier moves.
• Pay down debt: If you have any extra cash on hand and you can put it toward your credit card debt, your score will rise as soon as the payment is reported to the big three credit bureaus. It is the fastest single step you can take.

New rules proposed by the Financial Services Authority threaten to exclude even more aspiring owners
Paula Hawkins


Conditions for buyers in need of a home loan have rarely been bleaker — but new rules on mortgages threaten to exclude even more aspiring owners.

TimesOnline-Regulations proposed by the Financial Services Authority (FSA) this week, as part of a mortage review, aim to strengthen the market. They include stricter affordability tests for borrowers, an end to self-certification loans and a ban on “toxic combination” loans, such as a mortgage offering a high loan-to-income ratio to someone with a poor credit record. But industry brokers say the plans could make borrowing more expensive for all and almost impossible for a significant minority.

“The FSA says the plans are ‘designed to tackle the problems identified while maintaining a vibrant and sustainable market’. But this mortgage market is not vibrant by any standards,” Melanie Bien, director of the mortgage broker Savills Private Finance, said. “Not only that, but regulation costs, and this cost will be passed on to the consumer in the form of more expensive mortgages.”

Of particular concern is the decision to ban self-certification loans. Ray Boulger, of Charcol, another broker, said: “The full-frontal attack on self-cert mortgages seems based on a major misunderstanding by the FSA.”

Boulger said that the FSA was treating all “income non-verified loans” as self-certification deals when only a small proportion of these are; most are simply fast-tracked. “This is the process where on a mainstream mortgage, the lender exercises their right not to ask for paper proofs because they determine that the mortgage is low-risk.”

However, the proposals will not be implemented for some time — and may not be introduced at all. “This is a discussion document,” Boulger said. “If the responses to it are sufficiently robust, then the FSA will have to take another look at the issues. I think most brokers and lenders will say that the FSA has gone too far.” Interested parties have until the end of January to respond to the proposals. For many, the process of getting a mortgage will remain the same, although you may have to give a more detailed breakdown of your financial situation on an application, so the process could take longer. The FSA has said that lenders need to “calculate the free disposable income a consumer has to pay for the mortgage” — this could include not just income after tax, but all debt repayments, utility bills, the cost of eating out, alcohol and cigarettes. Lenders would also be encouraged to “stress test” an applicant’s ability to pay, by assessing how the borrower would cope if interest rates were to rise.

“To check this accurately would be very difficult and very intrusive,” Boulger said. It would also be bureaucratic and expensive and this would likely raise the cost of borrowing. However, it would not be without precedent — similar affordability tests are already used by lenders in France.

“Thankfully, the proposals did not include caps on loan-to-value,” Bien said. There are no caps on loan-to-income or debt-to-income either. But it is unlikely that high loan-to-value loans will become plentiful — or much cheaper — for some time.

The self-employed, particularly those who have only recently gone solo, face a much more difficult mortgage market. If self-certification loans are banned, you would need to come up with two years of accounts or two years of self-assessment forms to prove your income. If you do not have these, you will not be able to get a loan. “A sizeable majority of borrowers would be at serious risk of being denied a mortgage,” Boulger said. It would also mean that those who have a mortgage on a self-certification basis might find it difficult to remortgage without the proper accounts.

There is some good news for borrowers: banks and building societies will no longer be allowed to levy arrears charges if a borrower is already repaying their debts.

IT professionals can do a lot to avoid layoffs, but they could be unwittingly doing even more to make themselves a target for downsizing.
By Denise Dubie

September 08, 2009 — Network World —

IT professionals can do a lot to avoid layoffs, but they may be unwittingly doing even more to make themselves a target for downsizing.

How to make yourself layoff-proof

“No one can get too comfortable in their position right now. If you get complacent and have no intentions of improving upon yourself, you will lose your job to that person – and there is always at least one – who is constantly looking for ways to better himself and add more value to the business,” says Colt Mercer, a network engineer at Citigroup in Dallas and a Network World Google Subnet blogger.

Here IT professionals and career experts point out five ways high-tech workers could earn themselves a spot in the unemployment ranks.

1. Be invisible

Now is not the time to go unnoticed.

“It’s not the time to shrivel and try to be invisible to management. Many people tend to default to hide-and-retreat mode when layoffs come up, but that could call more attention to you and make it appear you aren’t contributing enough to be kept around,” says Adam Lawrence, vice president of service delivery at talent and outsourcing service provider Yoh.

Even those working hard could unknowingly be at risk due to their in-office time. Some IT workers who operate from a home office might need to make a few extra trips into work to remind managers, in person, of all that they do.

“Being visible during downtime is a big deal. If you are always remote and people at the office don’t see you as part of the team, that could cause problems,” says Bryan Sullins, principal tech trainer at New Horizons in Hartford, Conn., and a Network World blogger covering Microsoft certifications and training. “Often it can be a case of out of sight, out of mind, and remote workers could unwittingly become a target to be cut.”

2. Let skills stagnate

There may be no training dollars, but that doesn’t mean managers won’t be considering IT pros’ lack of updated skills when making layoff decisions. Regardless of the current economic trouble, high-workers should always be looking for ways to advance their knowledge.

“IT staffers that don’t maintain their certifications and stay trained show poor strategic thinking and will very quickly find themselves behind the curve,” says Chris Silva, senior analyst at Forrester Research. ‘Turning a blind eye to new technology and thinking it can wait will wear thin in a down economy. Managers don’t want staff that add to the ‘can’t do’ list in times like these.”

And the employee who uses the excuse about lack of dollars won’t make points when it comes to cutting staff.

“A pet peeve of mine is people asking companies for more than they are willing to give,” says Rich Milgram, CEO of Beyond.com, an online job board. “There has to be some level of mutual understanding about what contributions can feasibly be made on both the employer and employee’s side. There are low- and no-cost training options if the employee is willing to make the effort.”

3. Snoop in systems

It goes without saying that IT workers shouldn’t abuse their access to company confidential systems, but industry watchers warn that if layoffs are going to happen, those high-tech pros with questionable practices will be the first to go.

“It is really easy for an IT person to see what others are doing and to look at confidential data, without being caught,” says Beth Carvin, CEO of Nobscot Corp., a maker of employee retention and other HR-related software based on Kailua, Hawaii. “But if you are suspected of some shady stuff, that would be reason enough to bring your name to the top of the layoff list.”

And even if the practices aren’t breaking corporate policies, IT professionals need to be on their best behavior. Try to avoid abusing a flexible schedule with long lunches and don’t use your high-tech position as a reason to spend too much time on the Internet for non-work-related activities.

“If you are the person viewed as someone just logging their hours to collect a paycheck and don’t plan to contribute more than the minimum, management will see that and you will become vulnerable,” says John Reed, district president with Robert Half Technology.

4. Make demands

Pay cuts, hiring freezes, layoffs – none of these factors suggest it’s an appropriate time to ask for a raise. Yet experts say some will use their ongoing service to a company during a recession as a reason to demand more money and other benefits.

“Now is not the time to ask for a raise; now is not the time to complain about needing more time off,” Sullins says. “In these cases, the squeaky wheel will get the shaft.”

While it may seem to IT pros they are going above and beyond and deserve compensation for their efforts, those in the position to fire staff might not want to hear it.

“Right now, employees should be nodding their heads a lot, not being surly or pushing back on responsibility,” says Sean Ebner, regional managing director for IT staffing and recruiting firm Technisource

5. Spew negativity

Employers now more than ever want positive attitudes on staff, and those spewing negativity will be weeded out.

“The truth is that everybody from a technical standpoint is replaceable. I notice more than anything the negativity an employee displays. Negativity is contagious, and once an employee goes that route, it is nearly impossible to turn them back,” says Michael Kirven, principal and co-founder of IT resourcing firm Bluewolf.

Smartmoney-Several months ago, asking your manager for a raise may have gotten you an incredulous stare. But with the worst of the economic downturn seemingly behind us, today you may have a better chance.

Since the recession began in December 2007, 6.7 million workers have lost their jobs, according to the Department of Labor. Some economists project the unemployment rate, which stood at 9.4% in July, will reach double digits by 2010. But signs that the recession is over have started to spring up this summer, including good news on the housing front and a marked rebound of the stock market.

Still, the economy will take a while to heal completely, and those looking for work may find little improvement in the job market, especially if the country enters a period of “jobless recovery,” a trend typical of past recessions in which the labor market lags behind other measures of economic growth.

But if you’ve held onto your job through the recession, now may be the time to ask your manager for a promotion — assuming, of course, that you can prove you deserve one.

“Companies are so thinly staffed right now that any surge in their business puts pressure on them,” says John Challenger, the chief executive officer of outplacement firm Challenger, Gray & Christmas. “They need to keep their key people and that gives you more bargaining room than you had before.”

Here are eight tips that will help you prepare for that conversation.

Have realistic expectations

Even if business is picking up, a 10% raise may not be a possibility in this year’s budget. In 2009, employers budgeted for the lowest base-salary increases in 33 years: 1.8%, down from 3.7% in each of the previous two years, according to a recent study by benefits consultant Hewitt Associates. “An employee thinking about a raise needs to be aware that there’s less money available,” says Ken Abosch, the compensation practice leader at Hewitt. “High performers are first in line. Companies are going to work harder to take care of who they think are their outstanding employees.”

Time it right

“You do want to go see your boss after you’ve done something that really made an impact,” Challenger says. A good time to have the talk is after you’ve finished a project or results have come in that make your value to the organization clear. At many companies, management meets to make promotion decisions once or twice a year: Talk with your manager ahead of those meetings.

Know what to ask for

A promotion is different from a raise, and in today’s environment you may have better success asking for the former. Companies are still too mindful of the bottom line and convincing your manager to pay you more for the work you’ve been doing all along is difficult, Challenger says. “But when you get promoted to a higher-level job, more pay will in most cases come with that extra responsibility.” If you’ve been given additional responsibilities in the course of company downsizings, for example – and have demonstrated that you can handle them successfully – be sure your manager is aware of your accomplishments.

Showcase your value

Your boss probably doesn’t keep a list of your accomplishments – so prepare one to share with him or her before you have the conversation. “You need to convince your boss that you are truly adding value to the situation,” says Lori Dernavich, an employee performance advisor based in Hoboken, N.J. “If you can, tie a dollar amount to it.”

Keep the personal out of it

Your boss doesn’t want to hear that you need to make more money because your spouse lost his or her job or that you’re falling behind on your mortgage payments. “Chances are, your boss is having a hard time, too, in this recession,” Dernavich says.

Prep for the 'no'

Even if you’re convinced you deserve a raise, assume that you’ll hear ‘No,’ says Tory Johnson, the CEO and founder of Women for Hire, a New York-based employment company. In that case, ask when you can revisit the question: in three or six months, for example, or after a certain milestone has been achieved (such as landing a certain number of new clients). Ask for specific recommendations on what you can do to get your manager to approve your request and follow up on your conversation with an email thanking your manager for his time and confirming the details you discussed. “Then mark your calendar to follow up and get busy on making it happen,” Johnson says.

Negotiate

Turned down? Negotiate other benefits, Challenger says: more time off, a better title, work place flexibility. Or ask for a performance-tied bonus. Companies spend almost twice as much on so-called variable pay today as they did 15 years ago, according to Hewitt Associates. “The real upside pay opportunity is coming through bonus arrangements,” Abosch says.

Step up your game

Even if you’re denied a promotion, now is the best time to earn one in the future. “As organizations go through layoffs, that creates opportunities for people to step up and get additional responsibilities,” says Ed Rataj, the managing director of compensation at CBIZ Human Capital Services (CBZ: 7.19*, -0.09, -1.23%) in St. Louis. If you’ve been asked to work longer hours or perform additional duties, don’t complain that they’re not in your job description. Instead, take the opportunity to showcase your value to the company and earn that promotion for when you ask again down the road.

Matthew Herper, 08.25.09, 06:52 PM EDT
Beth Jacobson pushed doctors to try a novel approach in an effort to save her dying husband. Now she wants $300 million.


Forbes-In 1996, Beth Jacobson was watching her husband, a 35-year-old cardiologist, die from the blood cancer multiple myeloma.

She spent her nights reading medical journals at his bedside and her days calling doctors. One Saturday night, Judah Folkman, the famed Harvard cancer researcher, returned her call, and they came up with the idea of trying thalidomide, famed for causing birth defects as an anti-nausea drug, but also then being tested to treat leprosy.

Thalidomide didn't help her husband, who soon died. But the next patient who got it had an amazing response. Now thalidomide (brand name: Thalomid) and a related drug, Revlimid, generate $2.2 billion a year for Celgene ( CELG - news - people ) of Summit, N.J. And Jacobson believes Celgene stole her idea. She filed suit against the drug company in the U.S. District Court of New Jersey and is asking for $300 million in damages and 25% of future profits from the drugs.

"I'm proud of the work I have done, I'm proud that so many people are alive today because I came up with this idea," says Jacobson, a lawyer in private practice. She says she "reluctantly" decided to sue when it became apparent the company had no intention of compensating her for her contribution.

A Celgene spokesman says her "allegations have no merit," and that the company is confident in the patents that protect its medicines.

Jacobson's lawsuit illuminates the tension in the increasingly complex relationships between drug companies and patients. In recent years, research funding and expertise from patient advocacy groups has become a powerful force in the invention and development of new medicines. Vertex Pharmaceuticals ( VRTX - news - people ), Gilead Sciences ( GILD - news - people ) and Novartis ( NVS - news - people ) all have had medicines sped up through the efforts of organizations like the Cystic Fibrosis Foundation and the Leukemia and Lymphoma Society.


The worst fear of companies benefiting from this new trend is that they'll have to pay the patients back somewhere down the line. Until now, Jacobson's story has seemed like an illustration of how patients and companies could work together.

There is no doubt Jacobson played a pivotal role in developing Celgene's drugs. In a 2001 letter to shareholders included in her complaint, Celgene's chief executive and chief scientist said her efforts provided "an important first step in identifying Thalomid's potential as a multiple myeloma therapy."

It was her husband's doctor, Bart Barlogie of the University of Arkansas Medical Center, who ran the first clinical trial to show Thalomid's effect in multiple myeloma. The results were published in The New England Journal of Medicine in 1999. Thalomid had been approved for leprosy the year before, but it very quickly became used mostly for myeloma. Celgene quadrupled the price of the drug over the next eight years.

The New England Journal article thanks Jacobson by name "for her persistence in recommending the clinical evaluation of thalidomide in the treatment of multiple myeloma."

But just because she played a key role in Thalomid's development doesn't prove that Celgene owes her a dime. Jacobson's lawsuit appears to rely on a novel legal gambit: suing under New Jersey law on counts of "misappropriation of an idea" and "unjust enrichment."

Those arguments are "a long shot" says Linda Fentiman, a professor of law at Pace Law School in White Plains, N.Y. "We allow people to make gifts," says Fentiman. "There's no evidence there was a bargain. It doesn't seem fair on a gut level that they profited, but I don't see any legal basis for either misappropriation or unjust enrichment." She also notes that in the lawsuit it is disclosed that Jacobson had been asked to apply for a seat on Celgene's board in 2005, but that after a new chief executive took over the idea was nixed.

Jacobson's lawyer, Douglas Kline of the Boston firm Goodwin, Procter LLP, says Jacobson was "plainly in mind that there was real economic value in this idea. Beth had the novel idea, she disclosed the idea in confidence to Celgene, and Celgene has used the idea to generate for itself financial profits."

In some previous press accounts of Jacobson's phone call with Judah Folkman, including one published in Forbes, he is the one who suggests thalidomide as an option. In her current lawsuit, the story is told somewhat differently. The filing says that he mentioned thalidomide as one option in childhood leukemias, but that using it in myeloma was her idea. Folkman died last year.

There is absolutely no doubt that Beth Jacobson had an idea that changed the lives of thousands of patients and transformed a tiny biotechnology company. We'll have to see if she is owed any money as a result.

HarvardBusinessSchool-Older Internet users may remember the battles over the commercialization of the Web in the early 1990s, when the first Mosaic browser was introduced. Back then, pioneering adopters passionately condemned the first Web advertisers and tried to bring down their sites with "flaming" attacks. The fight was lost as consumers voted for free information supported by advertising over subscription services.

Ironically, online advertising and the commercialization of the Web achieved important goals of the resisters: to preserve the Web as a medium for free publishing and communications. A recent TNS study reported the leading activities of Internet users as: used a search engine to find information (81 percent); looked up the news (76 percent); used online banking (74 percent); looked up the weather (65 percent); researched a product or service before buying it (63 percent); visited a brand or product Website (61 percent); paid bills (56 percent); watched a video clip (51 percent); used a price comparison site (50 percent); listened to an audio clip (44 percent ).


All of these activities either are subsidized by advertisers, or take the place of traditional advertising, information search, and purchasing and banking transactions. Free access to information entertainment, along with speedier and more convenient transactions, are a great deal for consumers. Social networks and the easy connections they facilitate are transforming social life and have helped to elect a President. They also increase productivity in the larger economy.

How can we quantify the economic impact of the Internet? A recent study we prepared with Hamilton Consultants for the Interactive Advertising Bureau uses three methods to value the contribution of the advertising-supported Internet to the U.S. economy:

1. Employment value. The Internet employs 1.2 million people directly to conduct advertising and commerce, build and maintain the infrastructure, and facilitate its use. Each Internet job supports approximately 1.54 additional jobs elsewhere in the economy, for a total of 3.05 million, or roughly 2 percent, of employed Americans. The dollar value of their wages is about $300 billion, or around 2 percent of U.S. GDP.
2. Payments value. The direct economic value the Internet provides to the rest of the U.S. economy is estimated at $175 billion. It comprises $20 billion of advertising services, $85 billion of retail transactions (net of cost of goods), and $70 billion of direct payments to Internet service providers. In addition, the Internet indirectly generates economic activity that takes place elsewhere in the economy. Using the same multiplier as for employment, 1.54, then the advertising-supported Internet creates annual value of $444 billion.
3. Time value. At work and at leisure, about 190 million people in the United States spend, on average, 68 hours a month on the Internet. A conservative valuation of this time is an estimated $680 billion.

The advertising-supported Internet also helps the economy by fostering innovation, entrepreneurship, and productivity, particularly among small businesses that create most new jobs in the U.S. In addition, larger companies in this sector, such as Cisco, Google, or Adobe, have been a haven of relative stability through the current economic downturn and boost the U.S. balance of trade through their global sales.


Consider also the social benefits of the Internet, harder to quantify but including the power of access to information as well as greater flexibility in balancing work and family obligations through telecommuting. The economic downturn is accelerating consumer interest in social networks and online communities as a source of support. And 19 percent of all U.S. marriages are now the result of bride and groom meeting via the Internet.

When regulators start trying to constrain the Internet, let's be aware of its enormous and ever-increasing economic and social impact. The Internet is an economic powerhouse that drives U.S. competitiveness and productivity.

John Baldoni
1:17 PM Monday August 3, 2009


HarvardBusiness-The fire chief is clearly displeased. He angrily upbraids his firefighting team for disregarding his direct order to evacuate a building that was on the verge of exploding. The firemen had their reasons for doing what they did, but in overriding direct orders they put themselves and their unit in added danger. Notably as the chief is chastising the team, he makes it clear that he considers the unit to be among the very best at what it does.

This scene is from Rescue Me, the long-running drama series created by and starring Denis Leary. While the particulars are fictional, the behavior of the chief and the firefighters should be a lesson to anyone in management. Highly performing teams, especially those that have worked together for a while, often abide by their own rules. On the one hand, it is a secret to their effectiveness; on the other hand, when teams ignore directives from their management, it can spell trouble.

Managers of such teams are blessed with effective productivity, but cursed with dealing with attitudes that lead to teams doing what they want to do when they want to do it. This makes for good drama in a television series, but causes rifts that can fracture organizational effectiveness. The challenge for the manager is to insist on discipline as well as underscore respect for the team's abilities and accomplishments. Here are some suggestions for mining the team's effectiveness but maintaining organizational unity.

Pay tribute. Recognize the team for what it has achieved. Make certain individuals on the team know how much you respect them and their work. Go out of your way to make them feel welcome. Talk up their accomplishments to higher ups. In short, make the team feel special. Compensation should reflect how well the organization regards the team's contributions.

Instill values. Critical to team success is cohesiveness, pulling together for the greater good. The same applies to teams within the organization. Make it clear that no team is above the company. At the same time, respect the fact that individual members will have greater allegiance to their team members than to members of other teams. A savvy boss will find ways to leverage the team's cohesion to benefit the entire organization by putting the team into positions where its success will reflect well on the entire organization.

Adhere to policy. High-performing teams like to do things their own way. This is a key reason for their success. Allow the team, as you would individuals, to figure out things for itself and execute its ideas in its own way. However, make it clear that whatever the team does must be done on time and on budget. Above all, hold the team accountable for both good and not-so good results.

Finally, strike a balance between creativity and discipline. You want to challenge the team to think and act creatively because its ability to do things differently contributes to its success. At the same time, its creativity must be in service to organizational strategies and objectives. That is, the team can "freelance" methods but not objectives. Projects it undertakes must complement the organization's mission.

Let's face facts. When push comes to shove, a highly productive team should be given the latitude it needs to achieve. Treating this team as a first among equals is appropriate. All teams need to be treated fairly but those that do more than most deserve special treatment. So often it is the collective triumphs of high-performing teams that enable the whole organization to succeed.

Bottom line, a savvy manager will give a highly productive team plenty of room to succeed. Experienced managers learn the boundaries so they can keep all of their teams, not simply the high achievers, on a path that maintains individual team pride and benefits the entire organization.

Note: The reference to a scene in Rescue Me is from Season 5, Episode 15.

By Mya Frazier • Bankrate.com

A few years ago, using the Internet to market a small business simply meant to create a presence online with a simple, informational Web site.

Then came the demands of search engine optimization to ensure Google and Yahoo searches yielded top-ranked results for your company. Was your business's Web site chock full of the key search terms that would bring it to the attention of customers?

Today, social media is transforming the small-business marketing landscape. Social media are Web- or mobile-based tools for sharing and discussing information. It's not just for seeing who your high school sweetheart married. Businesses can tap into powerful networking sites and other social media to drive customers to their shops or companies.

If done right, small-business owners might even be able to slash their traditional marketing spending to zero. Writing blogs (short for "Web logs") or ongoing online commentary and using social-networking sites, such as Facebook, MySpace, LinkedIn, Twitter and YouTube, can provide inexpensive but powerful online marketing.

Because it's free, people think it's easy to create a social media presence. But this attitude can lead to missteps. So before you dive headlong into social media, take some time to observe the customs and social norms of these new forms of communications, says David Spark, founder of Spark Media Solutions, a San Francisco-based firm that helps companies tell their story through social media.

"Think of social media as a cocktail party," says, David Meerman Scott, author of "The New Rules of Marketing and PR" and "World Wide Rave," books about how to create buzz online. "You don't go into the cocktail party and go into the middle room and scream at the top of your lungs and say, 'Buy my products.' ... What works is you have some meaningful conversation first. And that's just how social media works."

If you decide to take the social-networking plunge, here are five ways to harness social media to help your business.

1. Use free sites. Use free online services, such as the mobile short-message site Twitter, and popular networking sites Facebook and MySpace, to post significant news, specials or events. For example, you run a small Italian restaurant with a loyal following. You could create a Twitter account and upload the lunch or dinner specials via "tweets," or short messages of up to 140 characters, daily to customers' smart phones or to other Web sites.

"All you have to do is give a (Twitter) handle and start a conversation. You could put the Twitter handle on the menu or in the restaurant," says Chris Abraham, Abraham Harrison LLC, a Washington, D.C.-based digital public relations agency. Granted, social networking sites are still for early adopters.

"You aren't going to get Aunt Matilda to tweet about the experience she had at dinner," Abraham says.

Abraham considers Twitter one of the easiest ways for a newbie to social media to get started.

"It's more challenging to do Facebook," Abraham says. "You have to create a personal profile, create a page and so on. With Twitter, if you're Joe Smith with Motorcycle Emporium, you don't have to create a page. And you can create Twitter updates via a phone or mobile device easily."

"Don't try to reinvent the wheel," he says. "There are lots of people sold on really expensive solutions, but two of the best investments for reaching out to people and engaging with them are free on Twitter and Facebook."

2. Shift marketing costs to social media. After learning how social networking operates, use social media to free up traditional marketing dollars for your small business by putting it online. You can quickly learn which of your Facebook or MySpace "friends" or online "group" members received and responded to your message.

Stanya Doty has cut her print marketing budget to zero. As owner of Simple Indulgences, a wine and high-end gift shop in Delaware, Ohio, she began using Facebook in December 2008 to communicate with her brother but quickly realized the online marketing possibilities.

"I thought, 'Oh, my gosh, there are so many people here,' " she says. Indeed, Facebook boasts 200 million users worldwide.

In April 2009, she began promoting monthly wine tastings via a Facebook page for the shop that quickly attracted 100 members. Combined with an e-newsletter created using the do-it-yourself, e-mail marketing Web site Constant Contact, she keeps enough buzz going about her shop that her advertising budget for local print ads no longer seemed necessary. She usually sends out about 700 e-mails, with the response rate sometimes reaching nearly 50 percent. It sure beats a postal mailing.

"If I sent out a postcard with postage and paid for all that, I'd still have no idea who read it and who threw it away," she says.

Indeed, unlike a print ad, Doty gets instant, measurable results. "On Facebook, you can see who has responded to invites," she says. "It's easy, it's cheap and I'm actually appealing to people that at first know me from the store and then hopefully … pass the word along throughout their networks."

3. Do your own social-media optimization project. Learn about the competition in your industry and geographic region that are tapping social networking. Spark recommends starting by researching the competition in the major search engines -- Google and Yahoo.

"Type in keywords and phrases that people would use to find you, like 'plumber' and 'San Francisco.' If you don't appear in the top percentage of pages, take a look at the Web site of those plumbers that do show up," says Spark. "Look at their pages, and usually they will have a lot of content on their sites."

To increase a business's presence on the Internet, Spark advocates companies create blogs, newsletters and other articles on their sites to bolster the number of keywords -- terms that search engines recognize -- to boost their ranking in all-important Web searches.

"That's the way people discover you," he says. "Take that plumber in San Francisco. The right search terms might just be 'clogged toilet and San Francisco.'"

"That tells me I should write ... in my blog about how to fix a clogged toilet and mention that I am a plumber in San Francisco," he says.

4. Take social-network marketing to the next level. Create and post richer content about what your customers would expect from someone in your business. Don't view social media sites as a place to simply hype your wares. It's a place for conversation.

"Social media is about earning attention," says Scott.

"What's most important is to forget about what your company does. Instead, think about the people who are buying your products. Simply hyping products and services online and in social media sites completely backfires. People are not looking for products but for something fun. They are looking to make connections," Scott says.

So it's all about having something interesting to say or show. It could be a blog or a video on the video-sharing Web site YouTube.

For example, if you're a caterer, instead of talking about your service, create engaging culinary content. Imagine positioning yourself as a gourmet magazine on the Web, complete with links to a video you uploaded to YouTube.

"A caterer could create a blog with information about how to create a fantastic party, and each blog post or YouTube video could be another installment," Scott says. "On the Web, you are what you publish and being on the Web is about publishing information."

So back to that plumber faced with the prospect of dropping an expensive Yellow Pages listing but worried about customers not finding him if they have a burst pipe or a misfiring shower head. Scott recommends the plumber post a list of "the 100 home fixes for common plumbing problems."

"All of a sudden you are going to get indexed very highly in the search engines, and people are going to share that content with their friends," he says. "When someone puts an update on Facebook asking if anyone knows a good plumber in Boston, a friend might point to your content."

5. Use blogging to drive search results and help new customers find you. Lately, blogging has gained greater attention, with the advent of "microblogging" on Twitter. But consider the time commitment and strategy before launching an account.

Even with the spread of microblogging, Abraham remains a big fan of traditional blogs, which are lengthier and show up on Web sites. In general, no matter what form the blog takes, it should be consistent over time.

"If you can't keep up one (blog) post a day or 12 tweets a day, do one tweet every Thursday. Consistency in blogging or tweeting will create a relationship of trust with your followers or readers. Do it once a week, but for the next two years," Abraham says.

And don't spend extra money on blogging software, technical help or a ghost writer for your blog.

"To get started, try free free services like WordPress or Blogger," he says. "The technology should not get in the way of the communications."

Kevin Plank, founder of Under Armour, on motivating employees and improving employee morale during a recession.
By: Inc. Staff

Published June 2009

Q: I run a start-up. How do I keep my team motivated, passionate, and focused on our product in this challenging economy?

A: Motivation, passion, and focus have to come from the top. I'm a big advocate of the power of positive thinking, particularly for small businesses. Your attitude is contagious. There's been a lot of negative news about the economy lately, but if you have a good product or service, I believe you'll find a way to make it. So keep on moving and don't use the economic climate as an excuse to fail. I'm convinced that there's no better time to start a small, nimble business.

You should also make sure you communicate with your team on a regular basis. When we had fewer than 25 employees, I brought the entire team together at least once a week. We'd talk about a lot of things, including major decisions that were on the table. I listened to everyone's opinions, and, without fail, they'd bring up things I hadn't thought of. More important, my team members knew that they were part of the process and that their voices mattered. Employees are more motivated when they feel needed, appreciated, and valued.

At our size now, it's tough for me to meet with all of the employees, but I still think face-to-face communication is important. We have casual gatherings a few times a month, called MVP lunches. I meet with six or seven people who have been identified as potential stars, and I just listen to them talk about what's working -- or not working -- in their departments. I learn a lot, and they get a chance to be heard.

I'd also recommend hiring employees who have leadership skills. At Under Armour, I call them engines, and I place them strategically around the organization. Look for people who aren't afraid to make the big, tough, decisions -- people who want pressure and responsibility. They are innately passionate and inspired, and they make other people want to work hard for them. When you find people with these characteristics, use them wisely. They'll certainly make your job easier, especially when it comes to keeping the rest of your team motivated.

You're retired. You've got time. The working world is now your oyster, if you can still digest one.

By Stanley Bing
Last Updated: June 17, 2009: 9:48 AM ET

(Fortune) -- Ah, the bucolic fields of retirement! How they beckon! Time to sit with your feet in the sand and your head in the clouds. After a lifetime of labor, the golden years stretch before us like ... a blasted tundra. Wait a minute. That's not right. The land of the retired is calm, restful, and ... about as exciting as a dead fish. Okay, the truth is, as enticing as it might seem to hang up one's socks, years and years of unbroken leisure can grow stale real fast. The good news is that a host of happy careers awaits the energetic, ambitious retiree who has avoided the shoals of recessionary disaster. Each offers its own enticements.

Treasure hunter

All you need is the time, a beach, and a good metal detector!

* Job description: Must be willing to spend great amounts of time on a beach, in an empty lot, or at a garbage dump, slowly combing the surface with a magnetic gizmo. Must be willing to defend substrata acquisitions from wily competitors and have a good relationship with sales outlets for sometimes disdained inventory.
* Qualifications: Applicants must have own bathing suit and flip-flops, as well as state-of-the-art technical apparatus. Certain arm strength and stamina required.
* Compensation: That big score could be right around the corner, just like when you were hawking tech stocks at Bear Stearns!

"Before" picture model

Okay, you don't look as good as you used to. You have less hair and more avoirdupois, or perhaps less, if you're the scrawny type. Fortunately, our society is big into makeovers, and magazines, websites, and pay-TV infomercials are in constant need of people who look as if they could use one.

* Job description: Appear in variety of media looking miserable, showing off your worst attribute, unless you're concealing something even more deplorable.
* Qualifications: Look like hell, be willing to show it.
* Compensation: Antimodels make big bucks, even if they can't walk down a runway without tripping!

Miniature-golf caddy

* Job description: Lurk around miniature golf courses looking for opportunities to carry other people's club. If somebody actually allows you to do so, perform with distinction.
* Qualifications: Clean clothes. Must be courtly and polite to avoid possible police interest.
* Compensation: You can keep all your tips.

Plant person

Feeding. Watering. Plants are living creatures too, even though they don't move around as much as you do (marginally). A particularly important assignment in the desert climes where you'll be spending a lot of your time.

* Job description: Go to offices and homes to feed and water flora and the occasional fauna that's been left alone while owners are out.
* Qualifications: Must have own watering can, although water to be utilized is generally free and available. Possible need for personal hose, although that is negotiable.
* Compensation: Minimum wage, although promotion to dog-sitting has been known to happen.

Artisan-cheese taster

In some cases it's hard to tell a cheese that's turned from one that's just naturally stinky. But it's an all-important question for those seeking to charge $18 a pound for it.

* Job description: Must taste all kinds of cheese without gagging and be capable of giving appropriate response. Certain cheese-related jargon is required, such as use of the terms "aroma esters," "coulant," and "morge." Fair knowledge of mold is also advisable.
* Qualifications: A working nose and somewhat pretentious mien. Ability to drink wine while nodding for a long time without falling over.
* Compensation: Quite good for those who ascend to the party circuit; all the cheese you can eat (often with bread, crackers, and fruit).

Writer of iPhone apps

There isn't anything too stupid to sweep the world. You have years of providing that kind of value under your belt, don't you?

* Job description: Write applet for iPhone; sell to Apple; collect big bucks.
* Qualifications: Must know Apple code and be comfortable with any idea that a sane person would consider "way too small."
* Compensation: Infinite. Some guy has made a bundle creating the illusion that when you tip the iPhone, you're actually "drinking" a glass of beer. Another applet "ripples" the screen when you touch it. How about a fly walking across the display? Has that been done yet? No? It's my idea! Mine!

Greeter

People often feel a little bit at sea right after they've parked their cars, walked to a store, and entered. In recent years the opportunities have blossomed for individuals who want to crouch in a secure location and then leap out and say hello to people.

* Job description: Wear T-shirt. Stand in prime location to encounter those entering retail establishment. Smile. Say, "Welcome to YOUR STORE HERE," inserting the name of your store there. Do NOT actually say "YOUR STORE HERE." It defeats the purpose.
* Qualifications: No drool on chin, except in certain chains now in Chapter 11.
* Compensation: Minimum wage, but a great opportunity to meet people! And it's 14% less boring than watching the stock crawl all day.

Airport chauffeur

Many people your age do not drive well enough to pick up the grandkids at the airport. But you do, as long as it's very bright outside and there isn't a lot of traffic and they don't keep changing the layout of the airports the way they always seem to be doing and the passenger pays the tolls and gas doesn't get any more expensive and something about your oil filter. What was it again?

* Job description: Drive people to and from the airport.
* Qualifications: Driver's license, car, chauffeur's cap (optional).
* Compensation: $50 each way, more or less. (Make sure to get it upfront.)

Mall cop

See that kid in front of Fuddruckers? He's running with an ice-cream cone!

* Job description: Must keep an eye on all matters of interest at both external and internal areas of local mall facility. Intercede where possible, as long as there is no danger of injury to self. Must stand for hours on end without falling asleep on one's feet.
* Qualifications: Two feet or the appropriate prosthetics. Scheduling flexibility. Capacity to deal with small children without resorting to nightstick.
* Compensation: Steady if unimpressive. Possibilities for advancement if willing to handle mop.

Grass monitor

Cutting grass at your retirement community is an expensive proposition for the board that runs the facility. It's a well-known fact that a "watched pot never boils." What's less understood is that the same concept goes for lawns, even those that are sod.

* Job description: Mow lawn.
* Qualifications: Must be able to negotiate with aggravating condo board, and then be able not only to cut the grass but also to suffer continual advice and criticism from fellow residents. Must provide own golf cap.
* Compensation: $7 per hour; occasional glass of lemonade.

Early-bird specialist

Diners often hate it when they go to a restaurant and find nobody eating there. Your job in this case is to arrive for a full steak dinner with unlimited salad and huge dessert cart at 4:30 p.m. every day to make the establishment look busy. You can do that, can't you?

* Job description: Show up when the restaurant is about to open. You do that anyway, don't you? Sit down, taking up as much room as possible. Eat. Unbuckle belt. Return home and go to sleep at 6 p.m.
* Qualifications: Must be able to wolf down an 18-ounce New York strip while others are just waking up from afternoon nap and the sun is still high in the sky. Sometimes requires altering entire meal schedule to accommodate breakfast at 4 a.m. and lunch at perhaps 10 a.m.
* Compensation: The very best table at the cool spots that everybody is fighting to get into once it gets dark out.

CEO of a bailed-out, TARP, or Chapter 11 corporation

Just listen to what the guys in Washington are telling you to do, and you'll do fine for a while. Try not to snore during conference calls.

* Job description: Must be willing to sit quietly in one's office and wait for instructions from Mr. Emanuel, Mr. Geithner, Mr. Bernanke, Ms. Clinton, Mr. Wieselfreund (who runs the commissary), or if you're really in trouble, Paul Krugman.
* Qualifications: Must have run a prior iteration of some large corporation into the ground.
* Compensation: $1 per year, but all you can eat in snacks.

Former Vice President of the United States

He's the poster child of all retired working people, and of anybody who might have felt that once they left their former employment they would be marginalized. Heck, he's in everybody's face!

* Job description: Get out there and defend!
* Qualifications: Must be ill-tempered and willing to go to the opening of an envelope.
* Compensation: Unclear. But there may be a book in it somewhere.

Matthew B. Crawford, 06.17.09, 04:55 PM EDT
The skilled trades--carpenters, electricians, plumbers--can't be outsourced to China, and the work can be deeply satisfying.


When I graduated from college with a degree in physics, I moved to Los Angeles to look for work in the aerospace industry. But I got no response to the many résumés I sent out. My time in college began to seem less like an investment and more like a form of consumption--an expenditure of four years and a fair bit of money with no clear economic rationale (though it certainly had other attractions).

My savings depleted, I found myself going around the parking lot of a home improvement store, putting fliers on the windshields of cars to advertise my services as an electrician: "unlicensed but careful." This was work I had done throughout high school and college. The flayers generated immediate response; there was clearly more demand for my services as an unlicensed electrician than as a credentialed physicist. Further, I always took pleasure in the moment, at the end of a job, when I would flip the switch and see the lights come on.

These days, most people are grateful to have any job. But since the economy is currently getting reshuffled, this is also a good time to reconsider some basic assumptions about what a good job looks like. In the last 30 years, we have learned that manufacturing jobs are insecure in a global economy because anything that can be put on a container ship will be made wherever labor is cheapest.

In the last 10 years, a similar logic has emerged for the products of intellectual labor that can be delivered over a wire, as Princeton economist Alan Blinder has pointed out. Accountants, editors and architects in the U.S. find themselves competing with educated, English-speaking people in other countries. But some services can be performed only on-site. The Indians can't fix our cars--they are in India. Nor can the Chinese build you a new deck.

The work of electricians, plumbers and auto mechanics cannot be outsourced. That is reason enough for a young person to consider going into the trades. But let's take a broader view of the matter and consider also the possibility for real satisfaction, which may or may not be present in the work we do. Human beings seem to be built in such a way that we want to see a direct effect of our actions in the world and feel that these actions are genuinely our own.

Consider the striking fact that when Henry Ford introduced the assembly line in 1913, most workers simply walked out. His biographer, Keith Sward, wrote, "So great was labor's distaste for the new machine system that toward the close of 1913 every time the company wanted to add 100 men to its factory personnel, it was necessary to hire 963."

Obviously, the men who walked out had other options. Early on, the automotive industry had recruited people from carriage shops and bicycle shops--all-around mechanics who took pride in their skill and knowledge. To merely pull the same lever over and over on an assembly line was stultifying, and insulting too. Eventually Ford raised wages enough to keep the line staffed, and people got used to it.

This story has a parallel in our own time. White-collar work too gets routinized and dumbed-down. This fact often gets obscured by the fact that you may need an academic credential to get the job. I went to graduate school in the early 1990s and loved every minute of it. With my new master's degree, I landed a job as an "indexer and abstractor." I was to write brief summaries of articles in scientific and other academic journals.

It sounded really challenging. But my quota, after 11 months on the job, was 28 articles per day. The only way to meet the quota was to stop thinking, and in fact I was given rules for writing these summaries that were based on the supposition that it could be done in a routinized, unthinking way. The job paid $23,000 a year. I never did get used to it.

As far back as 1942, Joseph Schumpeter wrote that the expansion of higher education beyond labor-market demand creates for white collar workers "employment in substandard work or at wages below those of the better-paid manual workers." What's more, "it may create unemployability of a particularly disconcerting type. The man who has gone through college or university easily becomes psychically unemployable in manual occupations without necessarily acquiring employability in, say, professional work."

The current glut of college graduates, many of them with heavy debt loads, may need to overcome this problem of being "psychically" (not physically) unemployable in manual occupations, a disability acquired from sitting in classrooms from age 5 to age 22. I am happy to report that it is possible. After getting a Ph.D. from the University of Chicago, followed by another prestigious-sounding but soul-killing job at a think tank, I opened a motorcycle repair shop.

Motorcycles are made on assembly lines, but the work of fixing them isn't too far removed from what those craftsmen in the bicycle and carriage shops were doing. There's a lot of thinking involved, and it is always my own thinking. In fact, the work of diagnosing mechanical problems is often more intellectually challenging than my think tank job was. "Motorcycle mechanic" is a less prestigious answer to give at a cocktail party when someone asks what I do, but in saying it, I feel more genuine pride.

Entrepreneurship in the trades carries certain hazards. It helps to have a spouse with health insurance and a steady paycheck. All around, it's a mixed bag. But so is the white-collar job market. The most compelling reason to consider the trades is that there is a basic human satisfaction to be had from taking a tool in hand, and seeing a direct effect of your actions in the world.

Matthew B. Crawford is the author of Shop Class as Soulcraft: An Inquiry Into the Value of Work.

Ten Autos That Will Sap Your Wallet -- and 10 That Won't
By COURTNEY PANNELL
Forbes.com
June 14, 2009

From seeking greater fuel efficiency to carpooling, some American drivers are looking for ways to save on ownership costs.

But one thing most can't do without is car insurance. Each of the nation's 50 states has laws that require drivers purchase liability insurance or provide enough "proof of financial responsibility" to cover a claim in case of an accident.

Premiums are dropping; the average in May was at its lowest point in a year at $1,871 per car, down from the national average of $1,982 in October, according to Insurance.com's RateWatch, a Web site that tracks annual average insurance rates. But they continue, for most, to be a major outlay. Still, consumers worried about the bottom line have options.

The 185-horsepower, 2009 Hyundai Santa Fe costs an average of $832 a year to insure, the lowest of a list of just under 300 2009 models surveyed. The Saturn Vue costs an average of $911 a year to insure, and a Kia Sedona can be covered for an annual cost of $857.

Owners of luxury autos such as the BMW M5, the Mercedes-Benz G-Class and the Porsche 911 pay for that kind of prestige--$2,020, $2,088 and $1,819, respectively. But those who drive the $80,790 Nissan GT-R, the 2009 Motor Trend Car of the Year, pay an average $2,533 a year. The sports car's super-charged 3.8-liter, twin-turbocharged 24-valve V6 engine helped it to the top of the list.

Behind the Numbers

Our numbers come from Insure.com, an online information clearinghouse for consumers. The company calculated nationwide average car insurance premiums for almost 300 2009 model-year vehicles. Averages are based on a 40-year-old male driver who commutes 12 miles to work. This driver has policy limits of $100,000 for injury liability for one person; $300,000 for all injuries and $50,000 for property damage in an accident; and a $500 deductible on collision and comprehensive. This policy also includes uninsured motorist coverage. Rates were averaged across multiple ZIP codes and insurance companies.

Of course, a car's value will jack up a driver's outlay, as will the driving record of the person behind the wheel, says Jack Nerad, executive editorial director and market analyst for Kelley Blue Book.

Other factors can play a part too, such as potential loss. For example, the Hummer H2 was the eighth-most stolen car in America, according to the Insurance Institute for Highway Safety, which determined its list by claims per 1,000 divided by average loss payment per claim; it is also eighth-most expensive vehicle to insure on our list.

A consumer's ability to compare is another factor. Shoppers may be most familiar with big companies with representatives located nationwide. Comparing the rates at these brand names with those found online and at independent agencies will yield the best deals. Make sure to compare limits and features side by side.

Driver stereotypes also play a role. Expensive, high-performance autos often attract "riskier" drivers, says Nerad, and such vehicles are more expensive to fix or replace when involved in accidents. Likewise, autos like sports cars that are popular with younger drivers usually have a higher premium since younger drivers are considered riskier drivers.

Larger vehicles like SUVs and minivans are more likely to be family vehicles driven by mothers, who are historically less dangerous drivers. With lower risk comes lower loss potential, and thus a lower premium. Eight of the top 10 least expensive vehicles to insure are either minivans or SUVs.

But even those with a need for speed are likely to see premiums drop slightly. And, along with premiums, insurance rates have fallen after an increase last year of 8%. Wyoming, South Dakota, Utah and Idaho experienced the largest rate decreases in May, from 9% in Wyoming to 5.5% in Idaho.

As insurers compete for increasingly discerning consumers, expect this downward trend to continue for the rest of this year.

This guide will provide you with an overview of how to determine what business suits you, what you can afford, and how to perform due diligence on the business.

By: Darren Dahl


Amidst all the bad economic news these days, there is a silver lining: It might be the perfect time to buy a business -- for the right buyer, that is. The volume of businesses sold is reportedly way down for the year, more than 70 percent according to some business brokers, which is more of a result of the tightening of the credit markets than a dearth of opportunities. In fact, organizations that track the industry like the International Business Brokers Association, which represents the nation's 1,950 business brokers, as well as online markets like BizQuest.com and USABizMart.com, which post business-for-sale opportunities, report that the listing volume is steady or up compared to past years.

In many ways, the market for businesses is running in parallel with the housing market: supply currently exceeds demand. When you add together the dearth of motivated and financially qualified buyers with an ample supply of businesses for sale, you wind up with a buyer's market; the first many brokers say they've seen in decades. That means that those buyers that can go knocking on doors with cash in hand, or at least with a solid credit score, will find they have far more power to negotiate the terms of buying the business of their dreams. At the same time, given the number of companies struggling through the tough economy, buyers have to be more careful than ever about making sure they don't get stuck buying a lemon.

So where do you get started? The first step you need to take if you want to buy a business is to find a business you want to buy. This guide will provide you with an overview of how to determine what business suits you, what you can afford, and how to perform due diligence on the business.

Searching for a Business Opportunity

1. Determine Your Commitment
When it comes to buying a business, the window shoppers seem to outnumber the serious players, says Larry Greene, managing partner of Business Team, a brokerage in Newport Beach, California. "I get calls from the same guy every few months asking me about my new listings," he says. "He's been doing that for six years." While there's nothing wrong with having some fun by shopping around, finding your dream business will require an organized search in which you can narrow your focus on those businesses that both fit your skill set and your financial requirements -- both how much you can spend as well as how much income you can expect to bring home.

2. Establish What You Can Afford
Brokers say that most people go about looking for a business backwards by looking at some "magic" income numbers such as the same salary they made from their last corporate job, rather than looking first for an industry where their skills could translate. While few would begrudge the investment banker who dreams of buying a restaurant or a bed and breakfast, the truth is that he or she probably couldn't land the necessary financing to fund such a radical career switch. That's why it's important to you're your finances into account. Here's a quick checklist to help you determine what you can afford:

* What kind of down payment can you afford to make? With an SBA loan, you will likely be required to foot at least 20 percent of the total purchase price up front.
* Do you have the kind of good credit, typically a FICO score of more than 700, which would enable you to secure financing from a bank or other lending institution?
* What kinds of collateral, such as equity in your home, can you bring to the table?
* Do you have access to any other sources of income?

3. Figure Out What Skills You Have
Before you even begin searching for a potential business, you should narrow your choices by asking yourself some of the tough questions up front that will help get your search off on the right foot, says Larry Martin, head of Benbrook Business Services in Chester, New Jersey. Begin by looking at your own qualifications. Ask yourself the following questions:

* What skills do you have that would translate best to owning a business? For instance, do you feel comfortable selling?
* Is there a particular business sector like retail, service or manufacturing that matches up well with your skills?
* Are there any specific qualifications like a professional license that you would need before acquiring a particular business?
* Do you want to manage employees or would you rather run the company yourself or with your spouse/partner?

4. Consider Lifestyle Impact
Todd Gilson spent three years looking for a business before he finally bought Accent Purchasing Solutions, a printing shop located in Fort Collins, Colorado, in early 2008. In addition to looking for a business that would benefit from his 12 years working in marketing, Gilson says he and his wife (who has a job outside the business) used three main filters in narrowing down their choice: what they could afford, what the business would earn, and whether it was within 60 miles of their home. It's crucial to consider the impact that buying a certain business would have on your lifestyle, such as what type of hours you are willing to work, whether you're willing to relocate for a business opportunity, and whether your spouse would be willing to be part of the business and/or use your home as collateral in a deal. Using a network of brokers and e-mail alerts he set up on sites like BizBuySell.com, Gilson says he finally found a business that met all his criteria: the shop earns about $2.5 million in annual revenue with good cash flow and is located just a few minutes from home. "So far it's the best thing I've ever done in my life," he says. "But I still lose sleep over the debt."

Narrowing the Search

Once you have lined up your support team and done your homework on your financing options, it's time to begin drilling down into specific businesses you have interest in. This is the point where you research needs to move from the phone and computer and into the four walls of your new potential business. But this is also where many breakdowns begin. Many buyers approach sellers fully expecting to get every proprietary detail of the business up front like detailed tax returns and customer lists, "but that's simply not going to happen," says Peter Berg, of Transworld Business Brokers in Florida. Consider that most sellers will be approached multiple times by potential buyers, so understanding that you won't be able to get every piece of information about the business up front is something you'll need to be comfortable with, at least for a while.

1. Sign a Non-Disclosure Agreement
The first step then, is to agree to sign a standard non-disclosure agreement and then schedule a meeting with the seller. At that point, you'll also get access to other cursory, though more detailed information on the business such as a pro forma financial statement that shows the kind of cash flow the business has generated for the owner over a certain time period, including any benefits and perks paid directly to the owner – a figure known as the seller's discretionary cash flow. Larger businesses might even share audited financial statements, which would highlight the business's EBITDA. (See Sidebar for a more detail look at the difference between SDCF and EBITDA).

2. Meet with the Seller
This is also where you should schedule a phone call and an actual site visit with the seller. A mistake buyers make at this stage, at least, is ignoring the fact that the seller likely hasn't told his or her employees that he or she has put the business up for sale, Berg says. That means the buyer needs to be somewhat flexible in communicating with the seller – such as by willing to talk or visit after normal business hours or on weekends to avoid creating tension in the workplace.

3. Be Prepared with Questions
When you do get your audience with the seller, it's your chance to begin crossing out the inaccuracies you might find between what you found in the listing and what you see with your own eyes, such as the condition of the building or the amount of inventory in the warehouse. "This is where you start to follow your instinct and to see if something smells wrong to you," Berg says. This is also where you can start asking seller the kinds of questions that will help you either get excited or cold feet about buying the business. The goal, again, is to try and get a feel for the business beyond what any numbers might tell you by asking questions of the seller like:

* Why are you selling?
* How has the business been coping with the down economy?
* What part of the business drives the largest part of revenues?
* Who are you customers? Do any of them make up more than 10 percent of revenues?
* What keeps you up at night about the business?
* How much vacation do you take each year?
* How much salary do you take home?
* What's kept you from expanding the business?
* Would you be willing to stay on as a consultant to the business?

After learning what you can from the seller, it's time to ask yourself, "Is this a job I could have fun in?" and, "Is this the kind of business I can really grow?" Trusting your gut might lead you to walk away -- or even plunge ahead.

The Difference between Income and Cash Flow

Earnings Before Interest, Taxes, Depreciation and Amortization (EBITDA) is the figure that offers a fairly reliable estimate of the kind of cash a business generates to pay down debt, pay taxes and offer a return to investors.

Sellers' Discretionary Income (SDI) or Seller's Discretionary Cash Flow (SDCF), on the other hand, is a figure used more often in smaller businesses because it accounts for the salary that the company's owner pays himself, along with any other benefits or perks like a company car or life insurance policy.

In other words, SDCF = EBITDA + owner's salary + perks & benefits.
Inc.Com

Advice From 'Good Morning America' Financial Pro Mellody Hobson on Which Bank Account Gives You the Most Bang for Your Buck


By ALICE GOMSTYN
June 11, 2009

As the economy and the stock market continue to churn stomachs across the country, more and more Americans look to simple bank accounts for a safe place to park their cash. This year, the personal savings rate has risen to 5.7 percent, the highest since February 1995.

So which account is right for you? Here's what "Good Morning America" financial contributor Mellody Hobson, the president of the money-management firm Ariel Investments, had to say about the matter.

Comparison Shopping

Hobson says you should head to the Internet to find a bank that will give you the highest interest rate on your savings. Web sites like Bankrate.com report national and local rates for all types of bank accounts.

But, she said, it's also important to note that sometimes banks pay a fee to be listed on comparison sites, so it's in your best interest to investigate multiple sites when trying to find the best possible rate. Don't, however, base your decision only on rates. The fees, restrictions and minimum balances required by each account should also factor into your decision.

Generally, you'll find that Internet banks offer higher rates than traditional banks because they do not have support all the costs that go into running a brick-and-mortar bank.

Make sure that whatever bank you choose is insured by the Federal Deposit Insurance Corporation. The FDIC insures accounts up to $250,000 per person. For more information, check out www.myfdicinsurance.gov.

The Highest Yield: CDs

Certificates of deposit, or CDs, will give you the best interest rate, but they also require that you keep your money there for a set period of time. The duration of a CD is determined by your bank, but they usually range from three months to five years.

The longer the CD's duration, the more interest you will earn. Right now, a six-month CD currently averages about 1.58 percent, while a one-year CD averages 2.10 percent and a five-year CD averages 3.10 percent. You can, however get better rates. Ascencia Bank, an Internet bank, is offering a six-month CD with a rate of 2.03 percent, and a 4 out of 5 star rating from Bankrate.com on its scale of "safe and sound" banks.

Ally Bank, the online banking arm of GMAC Financial Services, has a one-year CD with a rate of 2.49 percent, with no minimum deposit and a 3 out of 5 star rating at Bankrate.com, which means it's at least as safe as the average bank.

Savings Accounts

The national average for savings and money market accounts is about 1.33 percent right now. Both accounts are very similar, but you can't write checks from a savings account, and the number of transactions you make in a money market per month is usually limited.

Right now, the best interest rate on a high-quality savings account is at iGObanking.com at 2.02 percent. The bank doesn't require a minimum account balance, and you only need $1 to open the account, and it has a 4-star rating from Bankrate.com.

For money market accounts, Zions Bank has a very good 1.92 percent rate and a 3-star rating from Bankrate.

Checking Accounts

Checking accounts are convenient, but that convenience comes at a price. Their interest rates are markedly lower than rates on other types of accounts.

"Just know that you're never going to make a lot of money on a checking account," Hobson said.

The average checking account currently yield 0.71 percent. You can get a higher rate at Salem Five Bank, which offers 1.4 percent interest. Charles Schwab Bank, meanwhile, pays 0.75 percent, which is close to average, but what it lacks in interest it more than makes up for in benefits, Hobson said: The Schwab account has no ATM fees nor any account minimums and it's a very trusted brand.