Full speed ahead in European asset management

McKinsey Insights & Publications
Three types of firms made the most of another banner year in European asset management. Lagging performers should take note.
The right strategy can unlock strong, profitable growth, explain the authors of Africa’s Business Revolution.
As more capital becomes available, competition increases, and lessons from past excess and inexperience result in better performance, private equity firms are reevaluating their strategies and internal capabilities.
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Youngme Moon and Felix Oberholzer-Gee decide to “grade” The New York Times’ news coverage, before sharing their quick takes on other random things. They also share their After Hours picks for the week.

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AG Sulzberger Interview with Kara Swisher (Recode Decode Podcast)

You can email your comments and ideas for future episodes to: harvardafterhours@gmail.com. You can follow Youngme and Mihir on Twitter at: @YoungmeMoon and @DesaiMihirA.

HBR Presents is a network of podcasts curated by HBR editors, bringing you the best business ideas from the leading minds in management. The views and opinions expressed are solely those of the authors and do not necessarily reflect the official policy or position of Harvard Business Review or its affiliates.

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Health care practitioners have traditionally relied on clinical heuristics to select, encode and process information from the patient.  When a patient is presenting with multiple and complex issues, these heuristics reduce the patient’s difficult question of “what’s wrong with me” to easier ones, such as “is this person presenting with depression”?   The use of heuristics is then reinforced by operationalizing evidenced-based care into protocols, procedures and checklists designed to increase efficiency and reduce variation in process.

The trouble with this approach is that medical professionals are so busy looking for what they’re trained to find that they can often completely ignore information staring them in the face.  When Harvard Medical School famously conducted research in this area, 83% of radiologists studied did not see a gorilla superimposed on an X-ray, even when it was 48 times the size of the nodule they were looking for. Optical tracking devices showed the radiologists had all looked directly at the gorilla.

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While the heuristics-based approach is logical at one level – given the operational and cost pressures faced by health services – the impact on patients is that too many receive multiple diagnoses and treatments, without recovering. When Monash Health (an integrated health care provider based in Melbourne, Australia) gathered data, both quantitative and qualitative, in the form of patient journey maps and admissions and diagnostic information, we found that re-presentation among mental health patients was rising, even though the percentage of new patients presenting had fallen over the previous 10 years.

What’s more, over 50% of the most frequent presenters have had over four different psychiatric diagnoses and have received the recommended treatment for the conditions concerned. Further analysis revealed that the reason for this failure was the fact that underlying trauma issues in the patients concerned had not been treated. Because we had not been primed to attend to the significance of trauma in our patient’s lives, it was hiding in plain sight from us, like Harvard’s gorilla.

How could we avoid missing the gorilla in future?

Learning to see what lies beneath

The answer, our research told us, was to build strong trust-based patient relationships with our patients, in which clinicians could work more responsively with patients to uncover and eventually treat their traumas. This would require building a feedback loop in the treatment process to ensure the system could adapt and change.

To pilot this new approach, Monash Health established the new Agile Psychological Medicine Clinics (aPM Clinics).  At each interaction, the clinician requests feedback from patients on treatment outcomes and their experiences of interaction with Monash professionals. This builds in an opportunity for patients to air their concerns and provide data in their own way, which takes clinicians out of their heuristic box.   And although the process creates extra work on the spot, it also enables the therapist to respond and adapt promptly to what the patient is telling them and ensures that a patient is treated in the context of their culture and preferences.

The results from the experiment are encouraging. Patients visiting the clinics have on average reported high overall satisfaction levels (96%) with their work, dialogue, and relationship with their therapist.   The patients receiving trauma treatment have experienced a 52% improvement in their trauma symptoms and a 39% improvement in depressive symptoms (from severe to mild). And, significantly, the proportion of patients in the group re-presenting themselves during treatment has decreased by 30%.  All are clinically significant results.

Let’s turn to look at an example of what the new process is delivering

A Case in Point

In January 2016, Ash (not her real name) turned up in Emergency for pain and severe difficulty walking. She was admitted into the neurological ward for assessment; but no biological origin was identified. This was not her first visit to Emergency.  Over a period of eight years, Ash had already received several psychiatric diagnoses from different specialists – PTSD, depression, and other disorders – and had remained on anti-psychotics all that time.

After the neurological admission in 2016, Ash was referred to the Agile Psychological Medicine Clinic.  The clinic established that Ash’s first diagnosis for schizophrenia, which was treated with anti-psychotics, had been given after the traumatic birth of a son who turned out to have severe developmental issues. Through the years following she was not only her son’s primary caregiver, she was also in an abusive relationship.

Although Ash had been asking for treatment for her trauma since that traumatic birth and had repeatedly complained that the medication turned her from a smart woman to someone who could not make a sandwich without following written instructions, she had been caught up in a pattern of clinical activity that largely ignored the information she volunteered, and the question of her trauma was almost completely ignored

After just 14 sessions of treatment at the Clinic targeted on the trauma of her son’s birth, Ash no longer met the criteria for schizophrenia, PTSD, depression, or any of the other diagnoses she had received. She is off all antipsychotic medication, feels she has her life back and has been studying at university for the last two years.

Building empathetic, patient relationships is not only proving effective in treating seemingly intractable mental health sufferers such as Ash.  We are finding that many chronic patients presenting with physical symptoms also benefit from the approach.

Keeping an Eye on Our Most Vulnerable Patients at Home

This is the motto of Monash Watch, a service that focuses on the small number of people who are identified as being at high risk of three or more admissions in the subsequent 12 months using an algorithm based on administrative and routinely collected clinical coding data.  Since these “top 2%” of acute hospital presenters in any year are responsible for 25% of direct health care costs, the program aimed to reduce patients’ reliance on acute hospital services by helping them improve wellness.

Based on the Patient Journey Record System (PaJR), an analytics software developed by Carmel Martin, an expert in chronic illness and patient-centered care and an adjunct professor at Monash Health, the service offers patients lay telecare guides, who call participants one or more times per week.  The same guide calls the same person each time, the goal being to build a relationship of trust with the patient.

After running through a simple script of health questions the guides discuss the patient’s responses with them and engage them generally in a relatively unstructured dialogue that is driven by the patient and which is recorded and analysed by PaJR.  The software generates alerts if responses suggest health decline, and if a change in condition is confirmed, the patient is handed off to a clinician for follow-up.

The telecare guides can also detect changes in health status by listening carefully to the words in the responses, the change in intonation, and pauses, because they have come to know their patients as people, not just as anonymous check-a-box responses to questions. As they have grown into their jobs, they have become skilled at observing and communicating the signals and messages that patients give them.  We call our tele-care guides “professional good neighbours” and that is exactly what they have turned out to be.

Over time Monash guides and coaches have observed a number of common features among their patients: many had lost a sense of purpose, had become depressed and/or anxious, and were experiencing pain. Some had resorted to self-medication with pills, opioids, and alcohol. By delving more deeply into the stories trusting patients told their tele-care guides, the Monash Watch team found that once again a history of prior trauma often lay at the roots of the conditions presented.

Most Monash Watch patients recognize that treatment – even for trauma – will be unable to significantly undo the physical impact of their past on their health but they also report that having someone lay who is in regular contact and is willing to listen to anything on their mind reduces anxiety and restores hope – and that itself has a positive impact over time, and helps reduce the frequency of unsettling visits to Emergency.

The general lesson that we have learned from these experiences is that building an empathetic, trust-based relationship with patients is not a nice-to-have but a must-have.  It creates the possibility of identifying underlying hidden conditions whose treatment prevents the occurrence of overt symptomatic conditions that cause distress to patients and place huge strains on the capacity of healthcare services.  Empathy saves not only lives but also money and time.  It’s time to build a place for it in the clinical process.

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Uber and Netflix have fundamentally shifted consumer behavior and disrupted incumbent firms. In our research, we’re beginning to see signs that Wall Street is being threatened by similar forces.

Uber and Netflix’s success were generated through two critical strategies. First, they created a combination of breakthrough product innovation and breakthrough business model innovation—the definition of category creation. Second, Uber and Netflix appealed to a younger superconsumer before they entered the category, which caught the market leaders flat-footed.

In financial services, there are signs that traditional products like mutual funds are beginning to wane. Higher-fee, actively managed funds lost $500 billion in assets since 2015, with much of it flowing to much lower cost passive funds (e.g. index funds). But total net inflows of money into all mutual funds and exchange traded funds is at its lowest levels since 2014.

Meanwhile, new investment exchanges and IRA accounts are emerging that provide alternative investments versus traditional stocks, bonds and mutual funds, that have similar liquidity but greater transparency, and were previously only available to the ultra-wealthy.

One next-generation example already available today is YieldStreet, which offers a wide variety of debt investments—including real estate, marine finance, and litigation finance–that have generated an internal rate of return in excess of 12.5% on half a billion dollars invested on the platform to date. Similarly, access to the world of startup investing was limited to “exclusive clubs” like venture capital funds and high net worth angel networks. Now, platforms like AngelList, WeFunder, and Republic enable ordinary retail investors to participate in this stage of a company’s growth. According to a survey we conducted with Research Now/SSI on investing and retirement of 2,000 nationally representative households, 15% of total households are extremely interested in this. Through these platforms, Main Street investors can screen startups by industry, review business plans, and ask questions of founders directly.

Perhaps the biggest sign of future disruption to traditional Wall Street incumbents is how young these alternative investment superconsumers are. Our data shows that the consumer that is ‘extremely interested’ in alternative investments is very young and high income, with an average age of 35 and average annual income over $130,000. In contrast, the consumers least interested in alternative investments is in the mid-fifties with average income. It’s clear more money could go to investments: according to a survey of 3,000 Americans aged 18-44, one in three spent more money on coffee than they invested in a year. This is not surprising, since 67% find investing scary and confusing and 52% believe the ‘investment market is rigged against people like me.’

Remember that many younger investors grew up in the 2008 recession and perhaps never trusted the stock market. Growing more investors (especially younger ones) by getting more of them off the sidelines is key; the question is how to do so?

Disruptors show the way by bringing investments that are easier to understand and more purpose- and passion-driven, both of which are highly appealing to millennial investors. You can now invest in ‘fix and flip’ real estate investments via companies like Groundfloor, Lending Home, and PeerStreet. They allow investors to lend money to ‘fix and flippers’ who buy a home, renovate it and sell it at a higher price. WeFunder, a startup exchange, focuses on finding high-purpose-driven and high-passion investments, has found that many of its investors are themselves superconsumers of the companies they were investing in. They found their superconsumers were excited to invest, as they clearly had a stake in ensuring the company’s long-term viability, much like Kickstarter does with product innovation but with the added benefit of investment growth potential.

How much disruption could Wall Street be facing? It depends on how prepared and proactive they are. The alternative investment superconsumer represents about 20 to 25 million households who have approximately $25 trillion dollars in investable assets and nearly $8 trillion in retirement assets. These consumers are willing to shift 20 to 25% of their retirement assets—nearly $2 trillion dollars—into an IRA that specializes in investing into alternative assets. Eric Satz, CEO of AltoIRA says, “Retirement dollars are the jet fuel for democratizing alternative investments.”

The youth of these superconsumers is perhaps the most critical insight. Incumbent Wall Street firms never had a relationship with these younger superconsumers, so it was much harder for them to anticipate the disruption.

Consumers who don’t enter the category at the normal point are particularly scary for traditional firms. By not entering at the expected age, they may never enter the category and show subsequent generations a different way.

ESPN was conducting business as usual until it peaked at 100 million subscribers in 2011; it’s declined to 87 million subscribers today, largely due to cord cutters who never had cable. New York City taxi struggles have been even more dramatic – taxi cab medallions there trade today at approximately $200,000 per medallion, down from as much as $1.3 million just five years ago, because young people adopted Uber instead of taxis, hurting taxi revenues.

The average age of a traditional wealth management firm’s customer is in the mid 50’s. Much like the threat that millennial cord cutters pose to cable TV companies, traditional financial institutions are not likely to see this coming and will face similar disruption challenges unless they take action now.

MIT Sloan Management Review

Artificial intelligence has had some justifiably bad press recently. Some of the worst stories have been about systems that exhibit racial or gender bias in facial recognition applications or in evaluating people for jobs, loans, or other considerations.1 One program was routinely recommending longer prison sentences for blacks than for whites on the basis of the flawed use of recidivism data.2

But what if instead of perpetuating harmful biases, AI helped us overcome them and make fairer decisions? That could eventually result in a more diverse and inclusive world. What if, for instance, intelligent machines could help organizations recognize all worthy job candidates by avoiding the usual hidden prejudices that derail applicants who don’t look or sound like those in power or who don’t have the “right” institutions listed on their résumés? What if software programs were able to account for the inequities that have limited the access of minorities to mortgages and other loans? In other words, what if our systems were taught to ignore data about race, gender, sexual orientation, and other characteristics that aren’t relevant to the decisions at hand?

AI can do all of this — with guidance from the human experts who create, train, and refine its systems. Specifically, the people working with the technology must do a much better job of building inclusion and diversity into AI design by using the right data to train AI systems to be inclusive and thinking about gender roles and diversity when developing bots and other applications that engage with the public.

Design for Inclusion

Software development remains the province of males — only about one-quarter of computer scientists in the United States are women3 — and minority racial groups, including blacks and Hispanics, are underrepresented in tech work, too.4 Groups like Girls Who Code and AI4ALL have been founded to help close those gaps. Girls Who Code has reached almost 90,000 girls from various backgrounds in all 50 states,5 and AI4ALL specifically targets girls in minority communities. Among other activities, AI4ALL sponsors a summer program with visits to the AI departments of universities such as Stanford and Carnegie Mellon so that participants might develop relationships with researchers who could serve as mentors and role models. And fortunately, the AI field has a number of prominent women — including Fei-Fei Li (Stanford), Vivienne Ming (Singularity University), Rana el Kaliouby (Affectiva), and Cynthia Breazeal (MIT) — who could fill such a need.

These relationships don’t just open up development opportunities for the mentees — they’re also likely to turn the mentors into diversity and inclusion champions, an experience that may affect how they approach algorithm design. Research by sociologists Frank Dobbin of Harvard University and Alexandra Kalev of Tel Aviv University supports this idea: They’ve found that working with mentees from minority groups actually moves the needle on bias for the managers and professionals doing the mentoring, in a way that forced training does not.6

Other organizations have pursued shorter-term solutions for AI-design teams. LivePerson, a company that develops online messaging, marketing, and analytics products, places its customer service staff (a profession that is 65% female in the United States) alongside its coders (usually male) during the development process to achieve a better balance of perspectives.7 Microsoft has created a framework for assembling “inclusive” design teams, which can be more effective for considering the needs and sensitivities of myriad types of customers, including those with physical disabilities.8 The Diverse Voices project at the University of Washington has a similar goal of developing technology on the basis of the input from multiple stakeholders to better represent the needs of nonmainstream populations.

Some AI-powered tools are designed to mitigate biases in hiring. Intelligent text editors like Textio can rewrite job descriptions to appeal to candidates from groups that aren’t well-represented. Using Textio, software company Atlassian was able to increase the percentage of females among its new recruits from about 10% to 57%.9 Companies can also use AI technology to help identify biases in their past hiring decisions. Deep neural networks — clusters of algorithms that emulate the human ability to spot patterns in data — can be especially effective in uncovering evidence of hidden preferences. Using this technique, an AI-based service such as Mya can help companies analyze their hiring records and see if they have favored candidates with, for example, light skin.

Train Systems With Better Data

Building AI systems that battle bias is not only a matter of having more diverse and diversity-minded design teams. It also involves training the programs to behave inclusively. Many of the data sets used to train AI systems contain historical artifacts of biases — for example the word woman is more associated with nurse than with doctor — and if those associations aren’t identified and removed, they will be perpetuated and reinforced.10

While AI programs learn by finding patterns in data, they need guidance from humans to ensure that the software doesn’t jump to the wrong conclusions. This provides an important opportunity for promoting diversity and inclusion. Microsoft, for example, has set up the Fairness, Accountability, Transparency, and Ethics in AI team, which is responsible for uncovering any biases that have crept into the data used by the company’s AI systems.

Sometimes AI systems need to be refined through more inclusive representation in images. Take, for instance, the fact that commercial facial recognition applications struggle with accuracy when dealing with minorities: The error rate for identifying dark-skinned women is 35%, compared with 0.8% for light-skinned men. The problem stems from relying on freely available data sets (which are rife with photos of white faces) for training the systems. It could be corrected by curating a new training data set with better representation of minorities or by applying heavier weights to the underrepresented data points.11 Another approach — proposed by Microsoft researcher Adam Kalai and his colleagues — is to use different algorithms to analyze different groups. For example, the algorithm for determining which female candidates would be the best salespeople might be different from the algorithm used for assessing males — sort of a digital affirmative action tactic.12 In that scenario, playing a team sport in college might be a higher predictor of success for women than for men going after a particular sales role at a particular company.

Give Bots a Variety of Voices

Organizations and their AI system developers must also think about how their applications are engaging with customers. To compete in diverse consumer markets, a company needs products and services that can speak to people in ways they prefer.

In tech circles, there has been considerable discussion over why, for instance, the voices that answer calls in help centers or that are programmed into personal assistants like Amazon’s Alexa are female. Studies show that both men and women tend to have a preference for a female assistant’s voice, which they perceive as warm and nurturing. This preference can change depending on the subject matter: Male voices are generally preferred for information about computers, while female voices are preferred for information about relationships.13

But are these female “helpers” perpetuating gender stereotypes? It doesn’t help matters that many female bots have subservient, docile voices. That’s something that Amazon has begun to address in its recent version of Alexa: The intelligent bot has been reprogrammed to have little patience for harassment, for instance, and now sharply answers sexually explicit questions along the lines of “I’m not going to respond to that” or “I’m not sure what outcome you expected.”14

Companies might consider offering different versions of their bots to appeal to a diverse customer base. Apple’s Siri is now available in a male or female voice and can speak with a British, Indian, Irish, or Australian accent. It can also speak in a variety of languages, including French, German, Spanish, Russian, and Japanese. Although Siri typically defaults to a female voice, the default is male for Arabic, French, Dutch, and British English languages.

Just as important as the way they speak, AI bots must also be able to understand all types of voices. But right now, many don’t.15 To train voice recognition algorithms, companies have relied on speech corpora, or databases of audio clips. Marginalized groups in society — low-income, rural, less educated, and non-native speakers — tend to be underrepresented in such data sets. Specialized databases can help correct such deficiencies, but they, too, have their limitations. The Fisher speech corpus, for example, includes speech from non-native speakers of English, but the coverage isn’t uniform. Although Spanish and Indian accents are included, there are relatively few British accents. Baidu, the Chinese search-engine company, is taking a different approach by trying to improve the algorithms themselves. It is developing a new “deep speech” algorithm that it says will handle different accents and dialects.

Ultimately, we believe that AI will help create a more diverse and better world if the humans who work with the technology design, train, and modify those systems properly. This shift requires a commitment from the senior executives setting the direction. Business leaders may claim that diversity and inclusivity are core goals, but they then need to follow through in the people they hire and the products their companies develop.

The potential benefits are compelling: access to badly needed talent and the ability to serve a much wider variety of consumers effectively.

Business.com
Holiday Marketing: 5 Reasons Why Customer Loyalty Programs Are Essential

Loyalty programs can help companies and organizations land new customers and nurture them into devoted brand advocates. It seems like the perfect time for this is right after Halloween when the holiday marketing floodgates burst open with brand messages from far and near. When this happens, holiday marketing messages are everywhere in the warmup to the holiday buying frenzy begins.

For some, the holiday marketing season may seem like a bit much, but the world's brands do quite well during the season – at least the ones that do it right. Holiday season brand winners evoke emotions, promote sharing and somehow manage to create tangible, memorable moments.

There is no specific formula for success. The best holiday marketing campaigns come in all different shapes and sizes. Still, there are practical methods for achieving the best results during holiday loyalty program promotions.

During the already frenzied holiday season, savvy marketers increase the value of their goods and services by further developing a sense of urgency. Most importantly, marketers make sure that consumers have the best buying journey experiences possible during the holidays.

One element of successful holiday loyalty program building is maximizing pay-per-click (PPC) ad spends. Partnering with influential local charities is another way that brands build goodwill with consumers.

Additionally, email campaigns – which are still leveraged by 86 percent of modern marketers – are a standard staple for brand building. Adept marketers are skilled in several disciplines for leveraging email to reach consumers, such as automation tool deployment as well as subscriber engagement and growth strategies.

For those launching email marketing initiatives for the first time, they must choose solutions that integrate with existing digital resources to save time and money as well as simplify reporting. Furthermore, it's vital to take advantage of email application automatic drip functions to boost conversion rates.

Editor's note: Need an email marketing service for your business? Fill out the below questionnaire to have our vendor partners contact you with free information.

Leveraging data to build loyalty

Effective loyalty programs increase customer retention, boost sales and improve buyer satisfaction. Enterprise leaders can use big data technology to personalize loyalty offers and increase the likelihood that consumers will return to use their points.

In the future, blockchain technology could completely disrupt the current loyalty program paradigm. Currently, brands incur considerable expenses to store collected loyalty program data. However, blockchain may provide a solution for verifying, storing and securing brand loyalty information at a fraction of what it traditionally costs to manage these campaigns.

Here are five reasons why brand loyalty building during the holidays is smart and essential.

1. Loyalty programs are a cost-effective way to build business.

Some entrepreneurs may think of loyalty programs as initiatives that consume cash and resources and may, or may not, succeed. However, it actually costs more money to go after new customers. So much so that the cost of a loyalty program is marginal compared to expenses incurred when prospecting for new clientele. Promoting brand loyalty programs among an existing consumer base is more likely to provide a marked return on investment.

2. They deliver more than improved sales.

Demographic data is one of the most important resources available to marketers. Detailed consumer data helps marketers to develop strategic plans that promote sales.

In today's fickle buying environment, marketers must understand what promotes sales as well as what deters conversions. Loyalty programs, in a sense, are a form of research that helps advanced data science marketers understand consumer buying patterns. 

3. Consumers love loyalty programs.

Brands that offer loyalty rewards stand out from competitors that don't offer similar programs. Loyalty programs send a message to consumers that a brand is interested in more than profit. This kind of reward initiative helps brands build a rapport with consumers that is mutually beneficial. The simple show of goodwill provided by loyalty programs results in positive outcomes for enterprises. 

4. They are a great way to boost brand recognition.

Loyalty programs encourage new consumers to make a repeat purchase faster than they would without an incentive. Additionally, since these programs make existing consumers feel valued, they improve brand sentiment and increase the likelihood that buyers will recommend goods or services to friends, family members, and associates. The more that a consumer feels appreciated, the more likely they are to provide referrals. Some may even become brand advocates. 

5. Loyalty programs have a successful track record.

While loyalty programs may yield varying results, they're time-tested and have proven to be effective repeatedly. Business leaders have successfully deployed loyalty programs across a number of industries. In fact, the growth hacker movement originated from a model based on the loyalty program framework. Growth hackers, who use most of their time and resources to expand their business, have viewed customer loyalty as the easiest way to promote new business development.

Brands enable enterprises to create a sense of belonging and build strong emotional relationships with consumer bases. Loyalty programs give business leaders the opportunity to deliver experiences that improve with each engagement. These experiences build a foundation that only improves with each interaction. By putting the spotlight on consumers, loyalty programs make the prospect of patronizing brands and sharing recommendations more appealing.

During the holidays, consumers are exposed to a multitude of emails, social media ads, television advertisements and other marketing channels. Savvy entrepreneurs can leverage loyalty programs to stand out among the competition during the holidays.

Loyalty programs aren't all business. As a matter of fact, they make shopping fun for consumers, and they're the perfect opportunity to promote positive memories that will leave a lasting impression with consumers.

6 Small Business Problems and How to Overcome Them

The business of your dreams is up and running – and it's challenging enough without adding one more thing to manage or figure out. If you're striving to learn how to run a sustainable, successful small business, it will take effort. Once you understand the most common obstacles that arise in the first couple of years that your business is up and running, you can plan ahead to not let them take you down. 

Here are six of the most common problems small businesses face and how you can overcome them. 

1. Lack of cash flow 

When you're running a business of any size, you can never have too much cash. However, you can definitely have too little. According to a recent report, 67 percent of small business owners report lack of capital as a major challenge. It's unfortunate but true: Entrepreneurs have a difficult time getting access to capital when they need it. 

The solution for cash-strapped entrepreneurs is to find some options and figure out which works best for the business. Traditional business loans and 401(k) business financing are both options to learn more about. If you'd prefer not to go the financing route, you can aim to try to keep that hard-earned cash in your pocket. Start by projecting cash flow for the year, month and quarter to help you know where you stand. You can also improve receivables by giving incentives to your customers and clients who pay them on time. 

2. Too few hours in the day 

If it seems like the clock is moving in fast forward, you're like a lot of other small business owners out there. The constant interruptions, from phone calls to emails to meetings and last-minute deadlines, pose challenges for entrepreneurs. Not to mention the fact that you're wearing multiple hats. Want to combat the numerous time drains that suck the hours away? 

Take back your time. Time can fly or drag, and it's based on what you're doing. Take that concept into account as you plan your schedule. Track the time you spend accomplishing specific tasks and manage that time to eliminate the minutes lost on unproductive thoughts. Book time with yourself so you can focus on your top priority projects, and don't be afraid to avoid distractions, such as not answering emails and phone calls. 

3. Unforeseen roadblocks 

You never can predict when the unknown will happen. Events like a recession or a hard Brexit are somewhat unpredictable and scary for small business owners. Budget constraints and reduced spending power make it tough for a small business to thrive. Poor sales and economic uncertainty are challenging, but you don't have to let these events sink your business. 

If a time comes when your business needs to prepare for a recession or hard Brexit, try not to panic. Go ahead and be proactive. Now is a good time to evaluate and eliminate debt. Consider downsizing and do what you can to reduce overhead costs to free up cash. As long as you manage your business effectively and focus on providing high-quality customer service and products, your business can survive unforeseen roadblocks and come out stronger than before. 

4. Trouble hiring and retaining excellent employees 

It's not too hard to hire a few people, but it can be if you want top talent to be part of your team. While you may have an interested prospect, it isn't always easy to agree on a salary. And even if you do, you never know how long someone will stay with your business. Many small business owners find employee recruitment and retention to be an area of struggle. There are various reasons that employees may not want to work for your business or leave the position after a few months. Some of these reasons are within your realm of control, but some are not. Even if you're unable to change the circumstances, you can figure out how to best navigate the situation. 

Just like you learned how to create a customer referral program that showed your customers you appreciate them, you need to show your employees how much you appreciate their hard work. When you hire someone, offer a robust salary and benefits package. Ensure you're competitive in the industry if you want to attract and retain top-notch talent, and do everything in your power to keep those employees stay content.

It's also a good idea to provide recognition to employees, such as extra time off work and gift cards. Make sure to offer mentorship program and encourage work-life balance for employees. Aim to promote from within if possible and always strive to have a line of open communication. 

5. Not savvy at marketing 

Marketing can seem really overwhelming if you don't have a degree in it. This is why many small business owners consider marketing a challenge. However, excellent marketing is vital to the success of your small business, so you have to prepare yourself to take on this challenge or pass the baton to someone who can. 

If you aren't a social media whiz and don't consider yourself to be a skilled writer, don't worry. There are a lot of people who are good at these tasks and they can help you. Seek out professionals, and remember that you can't do it all. It's okay to be an entrepreneur who excels at running a business and to pass on tasks that aren't your strengths. 

6. Navigating state, federal and government regulations 

Small business owners often fret when it comes to abiding by the many regulations – federal, state and industry regs. The long list of regulations that are subject to change make this an ongoing challenge.

First, you need to decide the structure of your business. Once you make that decision, you need to ensure you understand topics like federal and state taxes, workers' compensation insurance, unemployment and sales tax. Reach out to experts for guidance along the way. 

There are some major challenges that come along with the rewarding journey of entrepreneurship. You may or may not encounter these issues and trials, but in case you do, it's always smart to be prepared. Now is the time to get out there and show the world that your business is not going anywhere but full steam ahead.

6 Surefire Ways to Project Your Voice to Increase Confidence

Have you ever sat through a presentation from the back of a room and struggled to hear what the person up front was saying? Or, have you sat at the front of a room and painfully listened to someone yelling nearby?

Presentations are a necessary part of business all over the globe. A survey by Prezi found 70 percent of employed Americans agree that presentation skills are critical to their professional success. And while so many agree that presentations are necessary, almost half admit to tuning out presenters during meetings.   

Voice projection is a powerful skill to learn if you're giving presentations. It’s necessary to ensure your audience can hear you clearly and understand your message. But projection is more than a matter of raising your voice and speaking louder. Learning to project your voice correctly can help your message resonate with all your listeners, keep their attention and influence their behavior – no matter where they are seated.

Here are six ways to improve your vocal projection and make an impact on your next audience:

1. Check Your Posture

How you stand can affect your breathing and challenge your ability to project. Make sure you stand in neutral position, feet shoulder-width apart. Keep your shoulders back and avoid slouching. This posture helps you take deep breaths and helps your diaphragm control the rate of speed and power at which your air is released as you speak.

If you are sitting, do so on the edge of your seat. Avoid crossing your legs, as this can compromise your breathing. Keep your back straight and your head held up to avoid straining your voice while speaking.

2. Breathe Deeply

Your breathing can affect the way your voice projects. Shallow breaths taken between words limit the power you can generate in your voice. Instead, be mindful of your breathing. Take deep breaths using your diaphragm to pull as much air into your lungs as possible. The air you breathe generates power in your voice, allowing you to broadcast the sound farther without straining your vocal cords or causing throat irritation.

Pause throughout your presentation, offering you a moment to breathe deeply. It will help calm your nerves and alleviate stress. Pauses will help you clear your mind, help you focus and slow down your rate of speech, and make it easier for everyone to hear what you have to say.  Research shows a slower pace of speech increases the ability for listeners to understand what you say.

3. Exercise Routinely

Staying in shape helps you develop the breathing skills necessary to have a robust and resounding voice. Cardiovascular exercises ensure proper oxygenation to the muscles and force your body to stretch your lungs and use your diaphragm. This trains your body to breathe more effectively and use air more efficiently. With regular exercise, taking deep breaths will become second nature. You won’t have to focus on breathing to project sound. It will begin to come more naturally.

4. Enunciate

Proper pronunciation helps to ensure audience members can understand what you are saying, even in the back of the room. Words typically misheard are those in the past tense and those ending in an “ing.” Be sure to articulate every syllable in a word to avoid sounding like you’re mumbling. Emphasize your words with energy as you speak. This will help each word sound clear and audible.

Even the best presentations can be lost on audiences when poorly delivered. Speaking too quietly or quickly makes the audience work too hard to understand you. Concentrate on speaking clearly. Avoid filler words such as “uh” and “um.” These sounds can easily blend in with your speech, making the words you want to say sound garbled.

5. Get Immediate Feedback

Understanding how you are perceived when speaking can help you uncover areas of weakness. Get feedback from someone you trust who can share their perception of your presentation. Get their opinion on what you need to focus on to improve next time.

Another way to discover opportunities to improve is by recording yourself speaking. You can do this in a meeting, presentation or as you practice in preparation on your smartphone. Immediately watch the playback and carefully observe your posture, your breathing, enunciation and voice projection. Take notes and mindfully work on those areas. If you’re recording yourself in preparation for a presentation, continue to fine-tune each skill, record yourself and watch the playback. Don’t stop until you see skills become a habit.

6. Seek Accountability

Mentors, voice coaches and trustworthy peers can help you identify areas of improvement and hold you accountable to ongoing practice. Find someone who can help you focus specifically on presentation skills, including voice projection. Voice coaches are ideal to help you learn proper skills for breathing, vocal-cord strengthening, enunciation and more. If a voice coach isn’t readily available, mentors and peers can help provide continual feedback. They can point out bad habits and observe changes as you practice.

The ability to influence others isn’t just something you’re born with but a learned trait that requires focus, dedication and practice. Implement these six tips to help your message resonate with your audience in a more powerful, impactful way.

Creating a Successful Company Culture: YouEarnedIt CEO Shares Advice

Studies have shown that your company's culture has an impact on everything from employee turnover and engagement to productivity and your bottom line. Recent research from Deloitte discovered that 94 percent of executives and 88 percent of employees believe a distinct workplace culture is important to business success. 

As the co-founder and CEO of YouEarnedIt, Autumn Manning knows quite well the benefits that come from creating a successful company culture. Her HR platform helps improve a company's bottom-line performance metrics by enhancing the employee experience. 

Manning is a workplace expert and culture champion who has used her background in behavioral psychology and human capital management to re-examine the way businesses and employees interact and engage. She co-founded YouEarnedIt in 2013 and has the grown the company tremendously in the past five years. Today, more than 400 global brands are using the YouEarnedIt platform to provide real-time recognition to their employees. 

We recently had the chance to speak with Manning about the benefits of having a positive company culture, how to assess the current state of culture and how to change your culture if you aren't happy with the one you have. We also asked her some rapid-fire questions about her career and advice she has received over the years. 

Q: What are the tangible benefits that come from having a positive culture? What are the downsides of having a more toxic culture? 

A: In the current job market, with low unemployment rates, multi-generational workforces and the awareness of what "great" looks like, employees expect and want so much more than just a paycheck. Creating a rewarding and engaging workplace culture goes a long way toward retaining employees (especially your top talent), improving job performance such as revenue, customer experience and profitability, and ultimately creating an organization better aligned to where the company needs to go.   

When looking at what matters to today's workforce, employees want a deep sense of connection to others at work, a sense of meaning and purpose, to know they have an impact on the community and lives of others, and appreciation for the hard work and effort put in each day. When you offer these things across your culture to employees, they are happier, healthier, more productive, and the best brand stewards for other recruits and your customers than one could ever ask for. 

On the other hand, a big mistake companies make is not having a clear understanding of what culture is, and more importantly, the executive level not owning and prioritizing culture. Culture also changes over time as your business grows. If leadership doesn't have an intense focus on both building and sustaining the right culture for your business and the people you want to attract, an accidental culture creeps in, one that can be toxic and works against what you have worked hard to create. 

This plays out in many ways: lack of collaboration, impacting speed to communication and creative problem solving; surprise resignations of your top talent because they don't stand for bad culture long, and missed sales and service opportunities for your customers. 

Pay attention to it. Drive it from the top. Make it a regular strategic priority of your business.  

Q: What is the best way to assess the type of company culture you currently have?                    

A: As an executive, you can tune into a few things: how problems are solved, and whether the employees take ownership of not only identifying the problems, but participating in the process of solving them. Asking your various team members what they are working on, and why, will help you see how much alignment and consistency exists across teams, individual contributors and management. 

If this is disconnected, the culture isn't supporting a highly engaged, high performing workplace. After all, a good culture is synonymous with strong operations where the workforce is aligned to what matters, why it matters, and there is ownership and belief that they impact the success (or failure) of these things. 

Of course, there are the traditional measures of culture that are very valuable and shouldn't go unmentioned: measuring engagement regularly, having periodic meetings to get organic feedback on the employee experience, and feedback sessions with teams at various periods of their employee lifecycle to ensure you hear directly from them. Ask them to describe the culture, how it helps or hinders their experience, and work to solve what needs to be solved. 

Q: If you are an established business and want to change your culture, what is the best way to go about it? 

A: Focus on the employee first and tap into what truly moves the needle above and beyond everything else. When companies put employees at the top of the pyramid and listen to what's meaningful to them, everything changes. 

The end results for companies that prioritize the employee experience are extraordinary – eNPS (Employee Net Promoter Score) scores go up, turnover of top performance goes down, and sales metrics, profitability and safety metrics are positively impacted. In addition, teams collaborate more and are better aligned to the mission and values of the organization enabling the company to have a stronger foundation for growth.  

Q: How do you determine the type of culture that is best for your business? 

A: Culture at every organization is different, but at the end of the day leadership has to make culture a strategic priority they talk about and are actively engaged in. Stepping back and asking yourself what behaviors and values you want to be known for, and which ones will get you to a place of success is how I think about starting culture. What people do you want to attract? What behaviors and mindset will serve your customers the best way? 

Once you have this, starting to craft your practices around these things is the next step. If quick communication and transparency is important, your organizational practices should enable those things to happen. If serving others is important, your culture should enable the service to others. Determining the best type of culture starts with the end in mind: your mission, your vision and what success looks like for you, your company, and the people. 

Q: Whose job is it to drive your company's culture? Is it the top executives? Is it managers? Is it the employees? Or, is it a combination of all three? 

A: Business leaders need to make culture a strategic priority, but it is up to everyone in the organization to be a part of it, drive it and reinforce it. For a company to succeed at building a strong, positive culture, I believe it starts with the CEO and the executive team. If there is clear alignment and buy-in there, then it's up to everyone else to drive it and own it. Managers are key because of the influence and authority they have in the organization, but every single hire should be one that is in alignment with the culture you have and want to build upon. 

Q: What are some tips on instilling the type of company culture you want in your employees? 

A: When it comes to culture, there are three ways executives can lead by example: champion culture from the C-suite, live out your core values, and over-communicate. While every aspect of culture shouldn't fall on leadership, you are the gatekeeper for your culture and the one who will inevitably decide – through your actions and your words – what is acceptable or not in your culture. 

It is extremely important to define culture and the values that support. This not only allows people to understand the behaviors, mindsets and practices that support your culture, but it also operationalizes it by enabling others to tie their work to these values. You can do this through real-time recognition and a performance alignment process that reinforces and rewards those who are living out the culture and the values. 

Finally, taking inventory of the communication and collaboration channels or mechanisms in place: how often is the CEO and the leadership team communicating to and with the company about what matters and how you get from here to there, including the behaviors that will get you there? What about managers to employees, and employees to other employees. I believe there is a direct correlation between communication and collaboration opportunities and the strength of a culture. 

Q: How should your company's culture impact your hiring decisions? 

A: Promoting culture to the candidate is a way to ensure you are stacking the deck with people who want to be a part of the culture and not just simply looking for a paycheck. Interviewing for cultural fit is something we do at YouEarnedIt and it has paid off, allowing us to vet candidates who share the values and beliefs we hold in high regard. Finally, somehow giving your candidate a glimpse of your culture throughout the process is key as well. Given the competition for top talent, candidates are interviewing us as much as we are interviewing them.  

When a company has a well-established culture, it also frequently plays a significant role in recruiting new talent. In today's job market, many candidates are looking to work for companies that align with their beliefs and vision. In fact, many candidates are willing to put a company's culture over other factors, such as money and benefits, when deciding where they want to build their careers.  

One of the best ways to communicate your company's value during the hiring process is by tapping into the people that know your brand best: current employees. These are your brand advocates and giving them an opportunity to interact with potential hires will allow employees to feel like their voice matters and new hires to feel like they are getting a full understanding of what your company stands for and has to offer. And, if you're able to give a candidate the opportunity to spend some time in the office observing or participating, it can really help them understand what a day in the life would be like. 

During the interview process, be upfront in your description of roles, responsibilities and desired skills to give potential hires a clear picture of what working at your company would look like. Not only has this been shown to help new hires stay in their job longer, but as a company you are setting them up for success from the start. 

Rapid Fire Questions  Q: What piece of technology could you not live without? 

A: Google Hangouts, Slack and YouEarnedIt. The use of these three technologies enable us to stay connected, collaborate in real-time, and reinforce our culture day to day. 

Q: What is the best piece of career advice you have ever been given? 

A: People can learn from anyone, or any situation, if you are willing to listen and apply. My step-dad instilled in me a love for education, a deep sense of discipline and commitment to the pursuit of excellence. And he helped teach me the importance of confidence, which has helped me many times as a female leader in technology. 

As a kid, when I would tell him an answer to a question, his response was always, "Are you sure?" After I expressed my assurance the first time, he would nudge again and make sure, "Are you absolutely sure that's right?" When I would waiver after that second prompt, he would offer, "You were right. Don't doubt yourself." 

Q; What's the biggest mistake you have made? 

A: When we were a younger business, I sometimes justified a hire and told myself that the skillset of the person isn't ideal forever, but is great for right now. Wrong. Any key hire you make has a material impact on your culture, the team dynamics, and the operations. There is no, "good hire for now" scenario. If the person isn't a stellar cultural and functional fit for the long haul, don't hire them. If you find you are having to make any justification in your mind whatsoever, it's a pass. 

Q: What's the best book or blog you've read this year? 

A: I return to Mark Suster's blog, bothsidesofthetable.com, often. He has honest, direct advice for entrepreneurs and doesn't shy away from the hard realities that come from trying to build a successful culture and business. Of course, "The Hard Thing About Hard Things" is like the entrepreneur's bible. I re-read it once a year. On a personal level, "The Ragamuffin Gospel" is one I revisit often as well. 

Q: What's the biggest risk you've taken professionally? Did it pay off? 

A: When I co-founded YouEarnedIt in 2013, I was hesitant to also become CEO for the first time. Although I ran operations at my last company, I didn't feel that I had "what it takes" to be a CEO while also raising my young children. Thankfully, I was convinced by my co-founder to take on the role and, over the past six years, have built the business and created something that truly makes a difference in the lives of thousands of employees.  

Taking money from investors of any kind is a big risk as well. Once you raise money, you are tasked to deliver on some serious promises and commitments to lots of people who bet on you and your company. That's why conviction, purpose, and a relentless pursuit of finding creative solutions to really hard problems is important if you are ever going to raise money for your business. 

Q: As a leader, what's the biggest challenge you face? 

A: Being self-aware enough to know what type of leader the company needs at any given point in time, and finding a way to align this need with my strengths and passions is critical and oftentimes challenging given all that comes at you when you are running a company (and being a mom). It requires tremendous self-awareness, the ability to look into the future with some data (never all the data you want) and make a call regarding the direction of the company or the future for an employee. It's important to take this seriously while making decisions quickly and with confidence.

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