Managing the Mediocre

How do you manage employees that are just okay -- not incompetent, but not the people you wish you had. Do you keep them around?

Ernie Schenone Jr.
Chocoholics Divine Desserts, Clements, Calif.

In a perfect world, every staffer would be a superstar -- and these superstars would manage themselves. Alas, the real world is peopled by the satisfactory and the barely satisfactory. How to handle your laggards? For author and human resources expert Pierre Mornell, the answer is simple: Ditch them. Notes Mornell: "If you hire okay people, you'll have an okay company."

On the other hand, turnover is costly and the repeated axing of C players will kill morale. Instead, try polishing your nonstars, so they shine at least a little. Let them know that you're concerned about their performance, says Leigh Thompson, a professor at Northwestern's Kellogg School of Management. Express confidence in their potential. Help them set very specific goals -- even daily goals, if that's what it takes. Give them a month to improve. If they don't, start throwing meaningful glances toward the door.

Remember, staffers cannot exceed expectations if they don't know what those expectations are. Communicate your own goals by publicly recognizing those who meet them. Cross-fertilize best practices: If one high performer has top-notch sales strategies, make sure she shares them with the rest of the team. "You can't tell a person how to have their next brilliant idea," says Thompson. "But you can create the kind of culture that makes it easier for that to happen."

Lawsuit Prevention

How do I prevent frivolous lawsuits? My company is being sued, and we believe that we eventually will win. But I've spent more than $50,000 on legal bills and don't want to have to go through this again.

Steve Sarowitz
AmeriPay Payroll, Elk Grove, Ill.

There's nothing you can do to prevent someone from filing a lawsuit, frivolous or otherwise. But there are steps you can take to limit the costs of defending a legal claim. Include a binding arbitration clause in all your contracts. That will keep disputes on the fast track and out of the courtroom. If you're worried about employee lawsuits, you can buy liability insurance that specifically covers such actions. Or institute a severance program that awards a standard payout to employees who sign a release promising never to sue you. Some companies even strengthen such contracts with attorney fee provisions, stating that the losing party will pay the legal fees for both sides.

Cracking a New Market

My company sells communication services, such as public speaking and accent-modification skills. When I was located in Pennsylvania, training departments were my best customers. But in Tennessee, where my business is now based, people say they have no need for my services. What is a good response when I am told, "We don't need this service"?

Katie Schwartz
Business Speech Improvement
Chattanooga, Tenn.

"Prospecting is like the forging of steel," says Linda Richardson, a sales training consultant in Philadelphia. It is grueling, sweaty work that -- when done right -- produces sparks. Prospecting in a new market, particularly a new market that doesn't quite get what you do, is even harder. That means you work harder. Count on being phonebound three hours a day at first, as you rustle up face-to-face appointments with HR and personnel managers. Offer to conduct discounted public speaking seminars at their offices or to drop off sales materials and reference letters that sing your praises. If prospects insist they don't need your services, ask whom they know who does. And never forget to follow up.

When you're not on the phone or breaking bread with prospects, build buzz, says Lisa Wehr, who moved her company, OneUpWeb, from Alaska to Michigan. Offer to write a weekly advice column in your local paper. Place ads in the business sections. Get active in community organizations, your chamber of commerce, your church. Once you land your first local fish, display it prominently. The sight of a fellow Tennessean turned expert communicator should educate and motivate the uninitiated.

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