Reducing Payroll Costs Closer to Home

I have been slowly following a series of cost reductions that seem to touch a lot of people I know (yes myself included). We have all heard the stories on the news about automotive workers, home builders, and financial industry types losing jobs and not having anywhere to go. These seem so distant though (despite my brother-in-law being laid off from GM and my sister-in-law, his wife, being laid off from Expedia). Yeah there are some home builders here putting people out of work, there was WaMu, there is Russell. We don’t have much in the way of auto workers around here though. We’ve got a fair amount of airplane and boat makers instead that seem to be less impacted. We clearly aren’t as bad off as other areas hit harder by the declines in these sectors.  Michigan has the highest unemployment rate at 12.6%, which is drastically different than Seattle’s unemployment rate of 8.7% (ranking it 191st on the list of major metropolitan areas). So what are the entities around here doing to reduce their costs if they aren’t closing up shop or laying off people? Surely the value of goods here in Seattle can’t be higher than the value of the goods elsewhere.

Organizations around here do seem to be reducing their costs. My friend Nathan has some great advice on reducing costs of running your business and the importance of cash flow. Other organizations out there (companies, nonprofits, government agencies) are all showing an interest in preserving cash too. Besides the great ideas for reducing operating costs that Nathan has, there are the payroll costs that usually take up a bulk of the costs. Obviously the fastest method to reduce the cost on people was to get rid of the dead weight these organizations were  carrying around for unnessessary projects or simply in an inneffective workforce. These are the numbers that we track on a grand scale. This is also what we hear the most of… “My friend lost their job”. The Bureau of Labor Statistics (BLS) is the agency that tracks these numbers. Their report for Washington State has things like, construction jobs being down 12.4%, Education and Health Services, Other Services, and Government as having an increase in jobs (1.3%, .3%, & 1.2% respectively), and a total of only a 4% drop in the last twelve months…

What do all these rises and drops in wages mean to the value of the goods we are buying and selling? Looking further at the data, the rise in the average hourly wage at a national level is roughly $5 over the last 10 years, that’s $.50/year. With an average hourly wage of $13.27 in January of 1999 and $18.43 in January of 2009. This doesn’t even include the rest of the real cost of hiring employees. Clearly we as employees cost more money these days (even if the output we are making is worth less due to decreased demand). The result? A paycut…. Of course!

The average paycut seems to be 5-10% (reflecting that on the hourly wages, 5% of $18.43, puts us back at the hourly wages of August 2007 – 10% puts back to the hourly wages of March 2006). With these kinds of cuts should we be looking to value our assets at these levels? The stock Market is much lower than the ’06 levels, the current value of the Dow is at 1998 levels. Should we be looking at wages from these levels? I sure hope not, that’s more of a 25% paycut…

So if we aren’t going to lay off a bunch of people, but we need to make our companies operate at the levels of 2006 and 2007, and perhaps even 1998. There needs to be methods for doing so, paycuts, benefit reductions, and furloughs seem to be popular choices. A few that I have heard about recently are summarized below. What about you? Are you an employee or a business owner? Are you part of a cost reduction? If you are an entrepreneur – are you paying yourself less?

Some non-layoff measures I’ve heard of lately (local and not so local):

Paycuts:

EMC Corporation – 5% accross the board for 2009, perhaps re-instated in 2010, then again maybe not. Executive staff took a previous paycut.

Siemens Business Services – Managers & directors took a paycut

Denali Advanced Integration – 5-20% paycut depending on level and margin contribution. Raises and bonuses frozen.

Microsoft – lowering the amount they are paying vendors by 10%, removing cost of living adjustments this year.

401(k) reductions:

EMC Corporation – no 401k matching

Chase (wamu) – no 401k matching

Furloughs:

Siemens Business Services – 5 days mandatory

USBank – US Bank’s furloughs were voluntary.

King County – 10 mandatory days (everyone takes them at the same time), Cost of Living Adjustments still happening (so more base pay, plus a few days off w/o pay)

Planned Parenthood – 5  mandatory days (take them at your convenience)

Add more in the comments or email and I’ll add them to the list…

Entry Level eMail Admin

I was asked an interesting question today by a helpdesk technician….

I think I am a great helpdesk support tech, but I would really like to make a change and move up the ladder to become an entry level email admin, what should I do?

Wow!! The first step here is to recognize where you want to go – and this tech had it nailed!! If you are in this position – this first step is a biggie!

After further discussion I found that this person already had identified why they wanted to go into email administration, why they felt they were competent enough, and  what they wanted this to lead to.

The technician felt that email was looked at in the company as high priority application (despite it not being a core business application) and this person wanted the corporate visibility and close customer interaction that this would give them. Further, the technician realized that there is more training freely available for things like email administration then more highly customized applications so they felt they had a better shot at growing their skill sets.

The technician had been fielding outlook related tickets for some time and had begin to read more support articles on the web. Having already achieved a computer related associates degree and working on a MIS degree, the tech felt that they could comprehend things beyond the basic outlook issues.

The end goal for this tech was far beyond email administration though. The tech was looking to get into enterprise architecture (which is drastically different then basic email administration) – but the tech was thinking that with the support calls they were taking interacting with groups all over the company, it was easy to assume that an email admin would gain insight into these other areas.

Impressed as I was at the ambition, I was skeptical of the question…. I had never been approached in this way before for such candid advice. Happy to be in a position to give the advice though, I thought carefully and started with the basic response about how to learn the technology. I then setup some follow-up time to make sure that this person was going to be successful in their long term goals. I wanted to post the advice I gave here for others to use. First the basics of learning the technology, I’ll post on the other stuff after I actually deliver the advice!

The first bit of advice was simple – go get a book, a VM, and some time!!

Starting to read about and play with these things is always the first step. Understanding the tools and the concepts behind using them begins to even the playing field when approaching a new technology. Think about when you learned to drive – the first thing you did was to get a book and take a class about driving (or maybe your parent took you into the car and gave you some one on one instruction). The first step here was understanding what the tools were (guages, pedals, gear shifter, etc). The second step was to take a car for a spin!! Yeah it was thrilling to get behind the wheel – a danger to society – but it was in a safe environment with people watching over you or at least controls in place to prevent a disaster. Step three? Well you practiced!! You practiced driving, you re-read the manuals, and you asked questions of your parent or instructor about how to actually drive and what to do in different situations (4 way stop, 5 way stop, etc).

Learning a new server product is not a lot different – and should be approached in a similar fashion. If you jumped behind the wheel of a production email system today you would be a threat to society – if you jumped behind the wheel (or administration tools) of a virtual test environment – like a controlled driving practice – you would be less of a threat and more likely to learn something. Add to this some knowledge about what the tools are called (what are the guages to look at in the email system? What pedals make email go slower and faster? How do passengers get in and out and do they need to buckle up or can you buckle up for them?) There are loads of questions that the books will give you instant insight to. This is why starting with a book or a class from no knowledge is critical. This is also why starting in a test environment is critical. Applying that basic knowledge from the books is easy to do incorrectly (yes – push the gas pedal but not THAT hard). 

With a healthy dose of book/class knowledge and some real time investigating the different components of the email application, such as:

• How does email come in and out of the system
• How do users access the email from their desktops, laptops, and mobile devices
• How are spam and virus messages captured
• How are mailboxes added/removed from the system
• How are resource/shared mailboxes and distribution groups handled
• How are size limits, email addresses, etc configured

A savvy technician would be ready to spend some time with a production system working on basic tasks with confidence. This confidence is the key, a team of email administrators and architects would rightly be weary of letting just anyone touch the system, but being able to demonstrate an understanding of these basic components – a tech could easily convince a more senior administrator that they are worthy of an opportunity to learn more.

Obviously there are more things this tech is interested in learning from me, and we are planning to chat again late next week – I’ll post again after we chat….

Exchange 2007: Health Checks

Did you see Doug’s Exchange Server Health Checks posts? Based on his extensive exRAP engagements in the field, Doug has put together some concise easy to follow guidance that everyone can use to evaluate the state of their environment. Check out the tools and the six part series

• The Tools
• Operations (part 1)
  
• General Administration (part 2)
• Security (part 3)
• Server Performance (part 4)
  
• Routing (part 5)
  
• Active Directory (part 6)

Seattle Mind Camp

Only a few tickets left for Seattle’s Mind Camp 3.0!! Better hurry if your planning on attending. Andru has assured me the audience will be top notch thinkers in the Seattle area along with those that wanted to know what a top notch thinker really was. I’m sure I fit somewhere between the two so am excited to attend this year. Everyone has great things to say about Mind Camps of the past…Blogging is welcome!!

Also if you are interested in sponsoring, there are some great opportunities for large and small organizations alike to sponsor the event.

Shoot me an email or post a comment if you want to discuss messaging and communities (wikis, portals, email, mobility, etc) at MindCamp 3.0. I am hoping to provide some more venues to discuss messaging, wikis, and collaboration in the seattle area. November 17 is the next Exchange User group (if you are interested in attending that let me know), I will of course do everything I can to use the Exchange user groups to discuss messaging at large (not just MS) so let me know what you want :-).

Exchange Connections 2007

Paul is a busy guy, but he is taking the time to get the Exchange Connections conference organized for next spring. Everyone is buzzing about it already. That’s right this year’s fall connections hasn’t been held yet, but he is already getting ready for next years!

The Call for papers is out…..

If you want to present feel free to send your information to Paul.
If you don’t want to present, then let me know what you want to learn about, I am taking ideas for next year’s connections from you. Let me know what you want to know and the most voted for or best topic will be it

This could a panel like I’m planning for the local user group in december, information on a specific MS technology, information on a non-MS technology (storage, mobility – including blackberry or SyncML, etc), or information on implementations, cost justification, testing, etc…..just let me know

If you are in between wanting to present and wanting me to present your topic…. I am also offering a way for you to partner up with me or someone else to get on stage and present. That’s right, you get the experience, with a little help (I did my first presentation this way and it really made things easier).

Btw, if you are going to the Fall Exchange Connections 2006, be sure to stop by the Ferris Research Booth!

MEET FERRIS RESEARCH AT EXCHANGE CONNECTIONS, LAS VEGAS
Get Free Technology Planning Advice

If you’re going to Exchange Connections and would like to meet Ferris Research, do get in touch. David Ferris, Lee Benjamin, and Bob Spurzem will be there November 7-9 at our booth, #222. The Exchange Connections registration page is here. It’s a good show for Exchange support staff.

Free Technology Planning Advice

We’ll be happy to provide free technology planning advice. Or if you’re a vendor, perhaps you’d like to brief us on your offerings and plans. We’re available as follows:

• Tuesday, Nov 7
  • 5pm-7pm
• Wednesday, Nov 8
  • 9am to 10:30am
  • 12:45pm to 2:30pm
  • 3:30pm to 5:30pm
• Thursday, Nov 9
  • 10am to 11:30am
  • 12:30pm to 2:15pm