If you ever wanted to know why it is more important than ever to work for yourself — online or in a similar capacity — just take a look at this recent piece of business news:
Lowe’s Cos., the No. 2 home improvement retail chain, is cutting 1,700 managerial jobs while adding up to 10,000 part-time workers in order to better staff its stores for weekend shoppers.
Sadly, I completely understand why Lowe’s is taking this action — essentially, the company is saving on the costs of benefits and related items by having fewer full-time workers and more part-time ones. (Ignore the PR reason “to better staff its stores for weekend shoppers.”) In today’s tough economy — and even before the so-called Great Recession, which might even lead to the return of the Great Depression — it is an all-too-common practice.
When I was an M.B.A. student, a finance professor asked my class a question: “What is the goal of any business?” Most of us responded, “To maximize profit.” That was only half-correct. The true answer? “To maximize the value of the company for the shareholders.” Usually — but not always — that involves the maximization of profits. (One significant exception is when analysts decide to focus more on revenue than profit as a sign of a particular company’s strength. But I digress.)
Perhaps I have become cynical in my young age of thirty, but I have been — to put it bluntly — screwed over by enough bad bosses and business owners since I graduated from college to realize that my finance professor’s axiom is indeed true. It is just one reason why I advocate that you should work for yourself using SEO wiki and social-media history. I do this by offering SEO-consultant services and being a professional blogger.
Now, it is important make a point. The modern, corporate strategy of maximizing profits by minimizing salaries, benefits, and related items will indeed provide short-term growth — but at the cost of long-term success. Studies on organizational and corporate culture have determined what creates positive and negative employees — and the results are not exactly the inverse of each other.
First, the factors that foster negative attitudes the most is poor compensation and a lack of job security. Understandably, it makes employees angry and frustrated. I have seen this personally at two companies for whom I worked — one in journalism in Boston and one of the Israel start-up companies in the Israel high-tech industry. People were (respectively) unmotivated to write good articles or increase traffic when they knew that their already-poor pay would never increase or that someone would always be fired every week because of the management’s impatience.
However, the factor that fosters positive attitudes the most is not the opposite (good compensation) because the good feeling that arises after a salary increase dissipates after just a few weeks. What keeps employees positive is the work environment — friendly co-workers and bosses, praise for work done, job security, and duties that are liked. Most people, according to research, would rather work for such a company with a slightly-lower salary than for a firm that pays very well but feels like a slave-labor camp.
If a company wants to maximize the efficiency of its work force, it should not pay poorly and create a positive environment. However, Lowe’s — among other firms — seems to be doing just the opposite despite the fact that the actions will hurt the long-term value of the company while short-term profits increase.
Personally, I think it all boils down to both greed and short attention-spans in the modern age. While it is obviously good for public companies to produce quarterly reports, investors give them too much weight. Quarter-traders (who are slightly better than day-traders) buy or sell based on short-term performance even though financial wizards like Warren Buffet have always correctly posited that the best investing strategy is to buy shares in companies with good business-plans and long-term visions — and then hold for years. A company that takes a quarterly loss from investing in capital will see more growth down the financial line. But firms, obviously, must do what will please their investors over the next quarter — since, as my professor said, the goal of a business is to maximize its value for the shareholders.
So, I understand why Lowe’s did what they did. But that does not make it prudent over the long-term. Any retail store like Lowe’s will live or die based on the interaction between low-level employees on the customers who provide sales revenue. And every full-time employee who becomes part-time and loses his benefits will be unhappy — and that will be evident, if even in a subconscious way, to customers.
Happy employees benefit companies in long-term ways that are not quantifiable on a profit-and-loss statement. For example, a friend of mine in the United States earned a high five-figure salary before he was laid off in the Great Recession. Now, every open job in his field is paying tens of thousands less. While the company may be imagining larger profits by paying lower salaries, the fact remains that every person hired will not be happy — they will be less productive, and at least the good ones will jump ship to another firm (one the economy improves) that does not nickle-and-dime employees whenever it can. In the end, the company will lose.
What Famous Blogs May do for Their Owners
Still, the financial reason is understandable — albeit short-sighted. And in such an environment, can people be blamed for giving the digital finger to the rat race and then working for themselves online? Companies may complain of a lack of quality employees at the moment, but I would hypothesize that many are starting their own small businesses rather than work as a slave to employers who no longer care about them. In the Internet Age, after all, the barriers-to-entry are low.
If you want to work for yourself, it will be important to establish an online presence that will be ranked among the top blogs and famous blogs. After all, no matter what product or service you offer, your efforts will amount to a digital nothing if people don’t know about it. So, it is important to choose good SEO marketing-software to market yourself online.
Samuel J. Scott, a former journalist in Boston turned Internet marketer in Israel, is the founder and publisher of My SEO Software and Director of Digital Marketing and Communications and SEO Team Leader at The Cline Group. You can follow him at Google+, LinkedIn, Facebook, and Twitter. His views here and elsewhere do not necessarily reflect those of his company and clients.