This is my monthly very high level look at events in the ICT industry over the month of August. More details will be available at the Eagle website over the next day or two.

This time last year (August 2006) we reported on a number of significant acquisitions … IBM in particular had a busy month buying ISS ($1.3B), FileNet ($1.6B), MRO Software ($740M) and Webify; Sandisk bought M-Systems ($1.6B) and LogicaCMG bought WM-data Nordic ($1.5B). There were also a number of announced layoffs at CSC, CA, AOL and Sun.

So … what about August 2007? It did not seem to be quite as busy, perhaps supporting our perception that many of us in the IT space decided this was theyear to catch up on some Summer vacation, recharge the batteries and get set for a blockbuster Fall!

There were a number of M&A deals this month with perhaps the most significant resulting in Acer becoming the World’s 3rd largest PC vendor through the acquisition of Gateway for $710 million. India’s Wipro paid $600 million for a US company, Infocrossing. Citrix shelled out $500 million for Xensource, Dell paid $340 million for ASAP software and HP paid $240 million for Neoware.

We also learned that the hackers are getting more sophisticated and proliferating with the readily available “hacker kits” on the internet! I guess Monster might have learned about that this month too! A study told us that the top reason people left a job was “private reasons” … is that kind of like “mind your own business”? The Indian cell phone market appears to be growing, and is now Nokia’s second largest market … but China still take the biscuit with around 500 million subscribers!

As the days shorten Fall is coming on fast and it feels like the Summer has gone way too fast! I hope you enjoy this month’s Industry news … later!

Every month I get my three business book selections from Executive Book Summaries and one of last month’s books was Driving Change by Mike Brewster and Frederick Dalzell. It is the story of UPS, the success that company has enjoyed and the “secret sauce” that helped the company to succeed.

As a business owner I am always interested in the strategies for success that have worked elsewhere and I try to then understand how Eagle can take advantage of similar approaches or strategies.

The UPS “secret sauce” really boils down to culture, execution and a knack for transformation. The author talks about transformation being a part of this company’s DNA.

UPS has its roots in the American Messenger Company started 100 years ago in 1907. So immediately you know this is a company with staying power and that change has come about over a 100 year period. When they started their main source of revenue was delivering Western Union telegrams, went on to deliver small parcels and for its first 50 years did practically no business to business deliveries.

Some UPS facts …

UPS has a global footprint, serving 180 countries and yet as recently as 1985 UPS operations served The US, Canada and Germany.

Today UPS is largely defined by its brown trucks and uniforms, but it also runs the 8th largest airline in the world!

UPS invests about $1 billion a year in technology, ensuring that those 15 million packages a day are tracked and the 427,000 employees are working like a well oiled machine!

In terms of measuring success … UPS had the biggest IPO in history back in 1999. For its first 25 years in business UPS share prices never decreased in value … even in the great depression!

UPS’s growth and success has never really come from a new innovation or invention. Its strength has come from reinventing itself over the years and executing its strategies flawlessly. Any company can learn from UPS, you don’t need to be in a “sexy” space or have sexy innovative products … UPS just keep getting better at what they do, and they do it well!

Every now and then I think I need to write a blog entry that is a little off the wall. Today is one of those days! I’m not going to tell you about great attitude, or about the customer service faux pas of an unnamed (for now) Eagle supplier… or even how to find great staffing companies!

Today I’m going to tell you that if you want to get a passport for another country it would appear that is not a big problem … for a price! So maybe there is a Canadian business opportunity!

I’m a little naive in the matters of politics, and certainly I would never suggest that the odd politician might be less than 100% on the “up and up” … but I came across this little story in the economist. It was called Citizenship for Sale and was dated February 2007, not so long ago!

There were several countries named but it appears that the bargain basement passport comes from Dominica, where for something less than $100,000, citizenship can be had.

Now I have an entrepreneurial spirit and I’m thinking to myself that based upon both GDP, and population, Canada’s citizenship has to be worth $350,000! Let alone the fact that it is one of the nicest places in the world to live … when its not Winter (did I say that?)!

Hmmm … so we could easily create a new city somewhere in this vast land and add 250,000 new citizens! This could create a nice windfall of some $8Billion or so for the Canadian economy. All that is needed is a good staffing company that could take this concept and for a very reasonable fee we could add another centre of Canadian culture, fuelled with rich people!

Now there is an innovative business notion! (I did say this would be an “off the wall” posting)!

I often write about attitude and the need to be positive. One of my favorite sayings in “Walk Fast and Smile” … the simple message being that by doing those two things you will project energy and positive enthusiasm.

One of my favorite blog entries last year was about Life and the Pursuit of Happiness … written shortly after picking up my latest motorbike, which STILL brings a huge grin to my face!

We all need a reminder every now and then to focus on the positive in our lives and one of the little “nudges” I get is a little booklet called “Bits & Pieces”, which is delivered monthly. It contains quotes, stories and other motivational items, and takes just a few minutes to scan.

Here is a quick one from a recent copy … a study of nuns for 50 years concludes that people with a positive attitude outlive their counterparts by 10 years! I suppose if you are a miserable person then you might be happy to die younger … me, I’m gonna keep smiling and walking fast!

I think that every entrepreneur would love to come up with that new and innovative business idea that is so disruptive to the established players that it would create a new paradigm and huge opportunity.

Some time ago I wrote about the SpringWise website which features some really innovative businesses and ideas for businesses. Just visiting this site gets the creative “juices” flowing and the ideas start to percolate.

There have been a few books on this kind of subject …

Blindsided … by Jim Harris is one I read some time ago. It talks about real life examples of companies that have “blindsided” their competitors through disruptive ideas or technology. One of the prime examples being Napster, which has created lasting change. The music and movie industries are still grappling (some say badly) with the repercussions of Napster.

Becoming a Category of One … by Joe Calloway is another example of books in this space. This idea is a little different, but again talks about a disruptive approach to business that will cause a business to rise above all its competitors and become not just the leader in its category, but in effect a category of its own.

Blue Ocean Strategy … by W. Chan Kim and Renée Mauborgne is a great example of this kind of book. This book talks about companies that have redefined their markets to become a new market. Cirque du Soleil is a great example where the old circus concept was reinvented to create a new concept that has become a world beater.

Business 2.0 magazine has a feature on CNN Money and I was just reviewing a list of 15 companies that they see as potential disruptors. Many different industries, different ideas and concepts but always original thought … I love it! The article is called the Next Disruptors, features 10 companies and then list 5 more up and comers!

I hope you enjoy these glimpses into the companies of tomorrow as much as I do.

Often in this blog I talk about business ideas, sales thoughts, staffing industry nuances etc. Every now and then there is a subject that crosses all boundaries and trust is one of them.

I found an interesting article on the web that talks about ten easy ways to lose your customer’s trust … and #5 was “Don’t Talk with your customer “ sounds like something I might blog about!

Trust is an integral part of any relationship whether it is personal or in business, whether it is between individuals or companies. The establishment of trust takes time and energy and yet it can be hurt or lost so quickly.

A good sales person will build trust with their clients and prospects by making promises and then delivering. The best way to do this is to start really small and DELIVER! For example, “I will get back to you with an answer by Wednesday” … if you do get back to the client on Wednesday, or before, then you start to establish credibility and build trust. I will send you some information right away, I will follow up in a month to make sure its working … all easy promises to keep, and easy ways to start to build trust. All are also easy ways to fall on your face! Miss the deadline, forget to follow up and your credibility is gone. If there is any “shakiness” in the relationship already then the client will be looking for you to fall on your face and it will just be another nail in the coffin of that relationship.

On Wednesday I blogged about a company that I have found to be supremely unimpressive. On Tuesday I phoned their CEO, a VP and another person leaving urgent voice mails. Not one of them phoned me back (the second time the CEO has chosen to ignore me). Late Tuesday night I had an email from the VP. On Wednesday, after blogging, I received a phone call from a different VP, and there was even a sign that he might be trying to build some credibility. He actually apologized (probably the first person from that company I can remember doing that in a year) and said he would also follow up by email so that I would have both ways to contact him. A good start … well, 24 hours later I still have no email. Guess how much trust and credibility exists!

I received an email from a friend today. His wife arrived home unexpectedly and found 3 of the gardeners swimming in her pool and the 4th sunning himself on a lounger. Guess how much trust and credibility they have!

As a parent I give my son a fair bit of leeway, but he has earned that trust. However it would also be easy for him to damage the trust if he were to do something foolish.

Trust is built over time and hurt in minutes. It also ties in to Covey’s emotional bank account concept, because if you have a good track record of building trust then a lapse can be forgiven. If you don’t have the “deposits” in the bank account then going overdrawn can be “game over”! Ask any divorce lawyer!

Some time ago I wrote an entry about lessons to be learned from Air Canada. Air Canada has a capability to be very exasperating to Canadian travellers and has a reputation among frequent travellers for less than stellar customer service. Of course the options in Canada are often limited!

Over the past year I have had dealings with a supplier that have left me speechless, and that is a significant feat! This is a company that over promises and under delivers … consistently! This is a company that truly believes in treating its clients consistently … badly! This is a company that makes every mistake in the book … and still they are in business.

Here are some lessons from a company that makes Air Canada look like gods …

1. Communicate with your clients.

2. Set expectations and meet those expectations.

3. When something goes wrong … communicate with the client.

4. If the client calls you … return the call.

5. If your client is upset say “sorry”.

6. If the client needs you to do something, at the very least … communicate with the client.

7. If the client’s CEO calls your CEO, make sure your CEO does not ignore the client!

8. If your company direction changes and negatively impacts a client … communicate with that client.

9. If you are on a conference call with the client do not cut them off every time they try to speak … communication with a client means listening as well as talking.

10. When the client finally gives up on your company ask them why … I’m sure they will communicate back!

Steven Covey, author of the Seven Habits of Highly Effective People talks about the concept of an emotional bank account and it is a notion I like.

The concept is that we have an “emotional bank account” for every relationship that we have. So an account exists between you and your partner, your child, your friend, your sister etc. Every time that you do something positive for that relationship, it is like making a deposit in the bank account. Every time you cause a strain on the relationship it is like making a withdrawal from the account. In order for your relationship to be healthy you want to keep that account in the positive! If it becomes overdrawn then you are putting the relationship at risk.

In my wallet I have a few little motivational reminders … one of them is from Covey and it lists the kind of things that cause deposits in the emotional bank account and the things that cause withdrawals. The fact the card is there reminds me to keep working those accounts!

It really doesn’t take much effort to either help a relationship, or to hurt it. The kind of things that help any relationship involve being thoughtful, kind, loyal, open, honest and truly trying to understand the other person. The kind of behaviours that cause issues involve thoughtlessness, deceit, being unkind, selfish, arrogant and not listening.

I think the bank account analogy is good because it reminds us to make deposits and that when we do occasionally cause pain that a relationship can handle that … if we make it up!

If you were to list the most important people in your life and look at those bank accounts what would you find? Are you being a good friend, partner, employee, boss and daughter? What little things could you do to add to those accounts? A thoughtful word, a quick email, a hand written card, a smile, a thank you … it really doesn’t take much but it can mean a lot.

Take care of those accounts they mean a lot more than the money accounts!

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Kevin Dee is CEO of Eagle (a Professional Staffing Company)

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I have spent a good deal of time on this blog talking about time management. In February 2006 I talked about Mondays and how many people can be unproductive particularly on Mondays because of a lack of organization.

In July last year I talked about goals (I actually talked about goals several times) and how they help you to take charge of your life! I talked about goals for 2007 back in January.

There was my 10 Practical tips to Manage Time from last September.

In May, following a week of vacation I talked about getting organized after being out of the office.

You would think with all that knowledge to share with the world I wouldn’t have any problems handling my own workload … wrong! Sometimes there really just are not enough hours in the day! So what to do?

Steven Covey’s “First things First” theorem breaks activities down into 4 quadrants!

1. Activities that are Important and Urgent.
2. Activities that are Important and Not Urgent
3. Activities that are Not Important but Urgent
2. Activities that are Not Important and Not Urgent

So … when all else fails, even though I should be trying to work in quadrant two, I am VERY focused on quadrant one activities. I am also very aware that I could be a workaholic, so I also find it important to set a limit for myself on how late I am prepared to work. That can change based upon circumstance, importance of the workload and other commitments.

Today is one of those quadrant one days … Gotta run!

One of the risks that we work hard to mitigate in the IT Staffing world is the risk of an independent contractor being deemed to be an employee (also known as co-employment). It is not even that simple, because if an independent contractor is deemed to be supplying their services as a “contract of service” rather than a “contract for service” then the consequences can be equally disastrous for all concerned.

So … what are those consequences?

1. The independent contractor could be disallowed all of their “expenses” related to running a business. This would likely be retroactive for some period of time (2 or 3 years?) and would amount to a serious financial hit.
2. The client and/or agency would likely incur penalties for not deducting standard deductions at source in addition to having to pay outstanding amounts going back some years.

What is the likelihood of this happening?

It is a rare occurrence, but it does happen. I know of several large companies that have been deemed to be “offside” in their transactions with independent contractors. Their approach is always to quietly pay what is needed and then implement stringent rules around the use of contractors in their organization.

We have been audited several times and always passed, but the issue almost always stems from an “independent contractor” doing something to indicate that they don’t really understand the difference between being independent and being an employee. For example: they try to claim Employment Insurance; they try to claim severance; or they claim workers compensation etc.

Canada Revenue Agency has a very active group of auditors who focus on this area of independent workers. Typically the IT contractor is well informed and is “onside” with the rules, but CRA does see this as an area of potential abuse and a source of potential tax revenues. If a highly skilled IT worker is paying income tax in the 40% to 50% bracket and some who looks just like them is paying at a corporate rate then CRA will be interested!

What Can Contractors Do to Mitigate those Risks?

In short … differentiate yourself from the employees in as many ways as possible! Some thoughts …

Do not show up at 8:30 and leave at 5pm every day, if that is how the employees act. Be there a little earlier, leave a little later and do not charge for every minute!
Do not accept training for free, along with the other employees. Pay something to differentiate yourself (its tax deductible).
Do not attend employee social events … unless you pay your own way.
Do not bring your personal problems to management at the client site.
Ensure that your contract does not exercise too much “control” … it should not indicate hours of work etc. as a company you are expected to deliver a service, not a set number of work hours.
Use your own tools as much as possible … use your own computer at home for all of the financials around your business, for time sheets and invoices etc. For business planning, for research associated with your job and anything else possible.
Arrange your payment schedule to be as “business like” as possible … monthly invoices are a good idea.
Look for ways to bring additional value, over and above the role you fill. Share knowledge, bring advice, be a “go to person” that is a positive influence.
Avoid office politics at all costs … be the independent business person.

I’m sure there are lots of other suggestions, but this is a real issue and over time it is very easy to fall into a “routine” and that may prove very costly if a contractor is deemed to be an employee!