Collaborative Features in Google Drive
In 1996 Larry Page and Sergey Brin, both students at Stanford University, began collaborating on a search engine called BackRub. More than a year later in Septeber 1997, Google.com is registered as a domain name. The name “Google” is a play on words and for the founders represents their mission to organize what would seem to be an ever growing, or infinite, amount of information. August 1998, Andy Bechtolsheim, Sun co-founder, stakes the company with $100,000.00. The following month Google Inc. files for incorporation. That same month, Google sets up in a garage and hires their first employee. December 1999, PC Magazine ranks Google search engine as number one among the Top 100 Web sites for 1998. The following year, Google raises US $25 million in investments and the founders reluctantly hire a Chief Executive Officer. Over the next six years, Google grows quickly with an ever expanding list of acquisitions. Many of these acquisitions themselves grow into noteworthy applications such as Google Earth and Google Maps. In 2004, this growth lead to an initial public stock offering. The sale raised US $1.67 billion and gave Google a market capitalization of US $23 billion (Google.com, 2016).
In 2015 Google became part of “Alphabet” a new holding company that was created to acknowledge Google’s diversified investment portfolio that ranged from self driving cars to home automation systems. According to its founders, “the decision to slim down Google and make it a subsidiary of the newly created Alphabet… is intended to allow each company to focus on what it does best” (Newcomb, 2015).
Google wisely places its success on the people that they have working for them. Their company overview boldly states that they “hire people that are smart and determined and we favor ability over experience.” In order to keep the kind of energy and creativity needed, Google seeks to maintain “the open culture often associated with start ups”. To that end, Google encourages and promotes transparency. This is part of the creative process and is needed to foster creativity. Known as the Googleplex, their administrative headquarters are located at 1600 Amphitheatre Parkway, Mountain View CA. Even the offices and on site cafes are designed to promote collaboration. The goal is to encourage interaction among staff “within and across teams” (Google.com, 2016).
When examining how Google relates strategically to their IT functions. You can see some real trends. They are clearly focused on collaboration. They are pushing Cloud computing and they have a strategy that’s based on mobile enterprise development. Within the first few years of their existence, Google drafted a list of “Ten things we know to be true.” Among that list is number five which states that “you don’t need to be at your desk to need an answer.” This statement speaks to the ever increasing mobility that people now expect with their technology. Smartphones are mobile phones with advanced computing capabilities. Statista.com predicts that with more than 1.4 billion smartphones sold annually, by 2017 a third of the worlds population will own a smartphone (Statista.com, 2016).
According to Google, the world is increasingly mobile and people want access to information wherever they are and whenever they need it. Google has benefited from this consumer demand for mobile experiences by partnering with phone manufactures such as Samsung (Google, 2016). Samsung devices operate on the Android operating system (OS), which is an open source mobile software platform, developed and owned by Google. Google’s Android OS is used in several mobile devices, but Samsung’s products have the largest market share. According to the International Data Corporation In the first quarter of 2015, Android devices held a 78% share of the smartphone market and Samsung had the largest share of any smartphone manufacturer with 24.6%. Today the Samsung company is known for its mobile devices and currently produces two of the more popular models (e.g., Galaxy S and Galaxy Note). But the Google – Samsung relationship is not as simple as Samsung using Google’s software. Several other agreements and ventures have come out of this partnership (Zucchi, 2016). “In order for an organization to grow as it conducts business in eCommerce, it must explore new business ventures. With information technology, this means new collaboration, skills, and roles, bringing this aspect of the organization to play a crucial role in its success” (McKeen and Smith, 2012).
Google Apps for Work
According to McKeen and Smith (2012) “for top line growth to occur, customer value, new product development, and product and service innovation capabilities need to be realized.” In general when people think about office work they think about Microsoft Office. What debuted as an add-on for Windows 2.0 has become a major force in business. The modern administrative office is dominated by computers running Word, Excel, and Powerpoint (TheWindowsClub, 2016).
According to Mark Kaelin (2015), Microsoft Office 365 controls more than 25% of the enterprise market, which is triple the enterprise market share the company held the year prior. In response to Microsoft’s increase in market share, Rich Rao, Head of global sales, Google Apps for Work, announced Google’s response. “We’re so confident that Docs has all the features you need, without the ones you don’t… we’ll cover the fees of Google Apps until your contract runs out. We’ll even chip in on some of the deployment costs and set you up for success with one of our Google for Work Partners” (Rao, 2015).
The basic enterprise version of Google Apps carries a subscription price of $5 per user. The basic enterprise version of Office 365 carries a subscription price of $8 per user. That $3 difference can really add up for a large organizations (Kaelin, 2015). For Not-for-Profits, Google has an unbeatable pricing strategy…it’s Free. Under its charitable givings programs Google provides free access to “premium Google products. Through this process, Google eliminates or reduces IT costs. In order to participate nonprofits must be members. Qualifying agencies receive the following benefits at no cost.
- Create unlimited email accounts for your staff on your own branded domain through Gmail
- Store files in the cloud: 30GB of storage space per account across Gmail and Google Drive
- Collaborate in real time with colleagues on grant proposals, meeting agendas, and more through Google Docs
- Conduct surveys, training assessments and event sign ups through Google Forms
- Manage appointments and schedules in Google Calendar
- Monitor group discussions and distribution lists through Google Groups
- Hold video conference calls for up to 15 participants at a time on your desktop or mobile device; audio and screen sharing tools included
- Free 24/7 support by phone, chat and email
- Work online through any modern browser; no hardware, no updates
- Securely access your data from mobile devices
(Google for Not for Profits, 2016)
Collaboration Focused
According to McKeen and Smith (2012), “there are many different ways that people within an organization can communicate: email, instant messaging, texting, telephone calls, or talking directly to another person.” However some challenges in communication are also the byproduct of new technology and with more people working outside the office, collaboration can feel more difficult. Some of those challenges are perceptional. Some individuals report that electronic communications are impersonal and lacking the human element. Other challenges are created because of increased security concerns. “The content of electronic communications can present security issues, ethical concerns, and dilemmas in moral conduct.” Internal controls imposed on employees can be viewed negatively but remain necessary to safeguard information. Other issues are related to cost and training.
Google’s Collaboration Platform allows the end user to be, mobile centric, project driven and collaborative focused. Mobile-centric allows the end user to access their work from any computer, smartphone, or tablet. From field operations to telecommuting, mobility allows the employees to make better use of their time. Because time is money, project-driven initiatives help get the job done faster, cheaper, and with better quality by taking advantage of Google’s tools.
The basic enterprise version of Google Apps provides; Gmail, Docs, Calendar, and Cloud Storage. More than 2 million firms and 25 million individuals utilize the Google “web based professional office suite (Blum, 2010). These tools utilize Google’s ultimate strength… search capability. Because everything is stored in the cloud, virtually any device that can access the internet can be used to interface with your documentation. But good internet access is a requirement. If you don’t have reliable internet access, you’re better off with the traditional applications like microsoft word.
Google Drive makes it easy to quickly give colleagues and clients access to view, download, and collaborate on documents, spreadsheets, and presentations. No email attachment required (cloudbakers, 2016). Google drive appears to have the most potential for collaboration. Anyone working on word documents has had the pleasure of receiving the “final, final, final version” of a paper and the following reconciliation needed before submitting. While word has an option for “tracking changes”, Google drive lets multiple individuals interact in real time on the same document. There is no final, final, final version. There is only one version.
Google calendar is a little different than the traditional Outlook calendar. It is basically a “Master Calendar with a bunch of little calendars all in one place. You can set up separate calendars for personal, work, pleasure, or any other reason you can think of. The search capability allows for quickly finding and referencing information. The collaborative features include the ability to share your calendar with others. This feature allows the owner to set permission levels to control the amount of power others have to make changes. Its also integrated with Gmail. Google scans your e-mail and automatically creates events. In example a hotel reservation confirmation e-mail would automatically create an event on the calendar. And like all of the Google apps, it is available anywhere there is internet access (cloudbakers, 2016).
HIPAA
One significant drawback to Google Apps is that not all of the Google apps are available for healthcare providers. The federal register 42 CFR part 2 addresses the healthcare confidentiality rights of patients in the United States. The Health Insurance Portability and Accountability Act (HIPAA) has strict penalties for health care agencies that violate their confidentiality rules. Because of this oversight, health care agencies are looking for “HIPAA” compliant systems. While Google does allow HIPAA functionality, it requires end users who are including Personal Health Information (PHI) in the Google Core Services to sign a Business Associate Agreement(BAA). Additionally, Google does not allow PHI in some of its Non-Core services. Per the user agreement those Apps must be disabled. Those would include, YouTube, Google+, Blogger, and Picasa web Albums. To manage end user access, administrators can create different organizational units (Google Apps for Work HIPAA implementation guide, 2015).
Summary
Google Apps is a powerful tool that utilizes cloud based storage and Google search as a foundation for its alternative to Microsoft 360. Acknowledging that Microsoft is the current market leader in this area, Google has targeted the professional office market and is making headway. With more than 2 million firms and 25 million individuals using the Google “web based professional office suite they have a firm foundation to build on. The healthcare industry is primed for adoption of the Google enterprise application but HIPAA issues remain a barrier.
About the Author
Jerry Landers is the Executive Director for Aspire Indian Health and Vice President of Business Development for Aspire Indiana. You can learn more about the mission of Aspire at http://www.AspireIndiana.org or by following me on Twitter @JerryELanders
I blog and tweet about health care, business and social media.
References
Blum, J (2010). Google Apps for Your Business:The Good, the Bad and the Ugly. Retrieved from https://www.entrepreneur.com/article/207688
Cloudbakers (2016) Google Drive for Work. Retrived from http://www.cloudbakers.com/google-drive-for-work
Google.com (2016) About Google. Retrieved from https://www.google.com/about/company/history/
Google.com (2016) Our Culture. Retrieved from https://www.google.com/about/company/facts/culture/
Google.com (2016) Ten things we know to be true. Retrieved from https://www.google.com/about/company/philosophy/
Kaelin, M (2015). Google may be declaring war against Microsoft and Office 365. Retrieved from http://www.techrepublic.com/article/google-is-declaring-war-against-microsoft-and-office-365/
McKeen, J. D., & Smith, H. (2012). IT strategy: Issues and practices (2nd ed.). Upper Saddle River, NJ: Prentice Hall.
Newcomb, A (2015). Google Becomes Part of Alphabet:What You Need to Know . Retrieved from http://abcnews.go.com/Technology/alphabet-shakeup-spells-change-google/story?id=34206273
Rao, R. (2015). Going Google Just Got Easier. Retrieved from http://googleforwork.blogspot.com/2015/10/going-Google-just-got-easier.html
Statista.com (2016). Statistics and facts about Smartphones. Retrieved from http://www.statista.com/topics/840/smartphones/
WindowsClub.com (2016). The History & Evolution of Microsoft Office Software. Retrieved from http://www.thewindowsclub.com/history-evolution-microsoft-office-software
Zucchi, K (2016) Samsung and Google: A Beautiful Friendship? Retrieved from http://www.investopedia.com/articles/personal-finance/062515/samsung-and-google-beautiful-friendship.asp
Britex and Export Trade
The European Union (EU) is a political partnership that represents a cooperative economic relationship between 28 member countries. The member countries are composed of Central and Eastern Europe. The member countries work together to set policies and to promote their collective interests. While the scope of EU decision making varies depending on the subject being reviewed, for matters of economic and most social concern, the members have agreed to a collective process. As part of the accord, the member countries share a single market that allows people, products, and capital to move freely between the members. With the exception of nine member countries including Britain, the EU shares a common currency called the Euro. Lithuania became the most recent country to join the Eurozone on January 1, 2015 (Archick, 2016).
Formation of the European Union
The “Single European Act” of 1986 was the first modification of the acting treaties for the European countries. It impacted the Treaty of Paris signed in 1951 and the Treaties of Rome, signed in 1957. The 1986 Act provided several important steps for the unification of Europe. First, it approved or legitimized the “European Council” which acted as a committee where heads of state or their designee could meet for formal negotiations. The primary goal of the accord was to establish a common market which included a shared monetary policy. In addition to pursuing a “common market” the act also addressed integration of social rights. The signing of the 1986 Act was the first step toward a 1992 target for full integration (Historiasiglo20.org, 2003).
According to Hill (2014, pg 264-265), the “Single European Act” was “born of frustration among members, that the European Council was not living up to its promise to improve economic activity between the member countries.” By the early 1980’s the European Council had failed to adequately remove barriers that prevented free trade and investment. Additionally, technical and legal standards needed for economic growth remained unfinished. As a result, prominent business leaders mounted a campaign to end the European Council’s economic division. This resulted in the establishment of the Delors Commission.
The Delors Commission is generally seen as the most successful at advancing European integration. The commission proposed that all impediments to the formation of a single market be eliminated by December 31, 1992. The result was the single European Act which was signed in 1986 and became law in 1987. The Delors Commission was named after the key figure, Jacques Delors. He started his career at the Banque de France in 1945 before being appointed General Secretary for Permanent Training and Social Promotion (1969-1973). He was a member of Prime Minister Jacques Chaban-Delmas’s cabinet (1969-1972). He was elected as a Member of the European Parliament in 1979. Delors was also President of the Economic Monetary Affairs Committee of the European Parliament from 1979 to 1981. Prior to this, he had served as the Minister of Finance and Economy in France. In October 1996, Jacques Delors founded the think tank Notre Europe, today known as the Jacques Delors Institut (Jacques Delors Institute, 2016).
The “Single European Act” was not without its detractors. Most notably, Margaret Thatcher, was outspoken about her agenda to shrink the government’s involvement in both economic and social welfare. Thatcher saw the “Single European Act” as a step in the wrong direction. In September 20, 1988, Thatcher shared her views at the College of Europe in Bruges Belgium.
“My first guiding principle is this: willing and active cooperation between independent sovereign states is the best way to build a successful European Community. To try to suppress nationhood and concentrate power at the centre of a European conglomerate would be highly damaging and would jeopardise the objectives we seek to achieve. Europe will be stronger precisely because it has France as France, Spain as Spain, Britain as Britain, each with its own customs, traditions and identity. It would be folly to try to fit them into some sort of identikit European personality…” – (Thatcher 1988)
Jacques Delors rebuttal to Thatcher took place the following year at the College of Europe in Brussels. Delors famously stated “History is accelerating and we should make it with her…” (Historiasiglo20.org, 2003). Delors had the advantage of a seismic change in world politics. On November 9, 1989 the Berlin Wall fell. The Berlin Wall was constructed to stop the flow of immigrants between East and West Berlin and came to symbolize the political division between a free market and communism. The Berlin Wall was created under the authority of Premier Khrushchev and did successfully stop the flow of immigrants but it also isolated the West Berlin residents leading up to the Berlin Wall Blockade and the subsequent Berlin Airlift (History.com, 2016).
On June 12, 1987, in his speech at Brandenburg Gate West Berlin, Germany, President Ronald Reagan famously stated “Mr. Mikhail Gorbachev, open this gate! Mr. Gorbachev, tear down this wall!” (Air University, 2016). The symbolic and literal destruction of the Berlin Wall was the precursor to the eventual collapse of the Soviet Union which occurred in 1991.
The first European ramification of the collapse of the soviet block was the reunification of Germany, now the German Federal Republic. With approximately 80 million citizens the reunited Germany now represented a significant portion of economic muscle. Now larger than either Britain or France the newly minted country was a potential risk for some. Francois Mitterand, the President of France, used the reunified Germany as a means to encourage the European integration process. His logic was based on the assumption that a Germany securely attached to the European Union (EU) would be less of a potential future risk. Helmut Kohl, the Chancellor for Germany, also pushed for European Integration as a means to both display its new political muscle and to quiet any potential fears or hostility toward the country. This shared goal, between France and Germany, for integration of the EU was known as the “French-German Axis”. In a common message the two leaders drafted a single letter…
“In the light of far-reaching changes in Europe and in view of the completion of the single market and the realisation of economic and monetary union, we consider necessary to accelerate the political construction of the Europe of the Twelve. We think that this is the right moment to transform the whole of the relationships among the member States into an European Union and to endow it of the necessary means of action.” (Archick, 2016)
After several years of continued debate and discussion, the Treaty of Maastricht was signed and came into force February 7, 1992. The actual debated and negotiations surrounding the European Councils work was criticised for low levels of transparency and the fact that it was restricted to high level political officials (Historiasiglo20.org, 2003).
What Is the Euro and the Eurozone Crisis?
Nineteen of the EU’s member countries share a common single currency. Together they are often referred to as “the Eurozone.” The introduction of the euro began in January 1999. In addition to a shared currency, Eurozone countries also share a common central bank, the European Central Bank (ECB). While the member countries share common monetary policy they do not share fiscal policies. Each member country exercises their independence in establishing spending and taxation policy (Archick, 2016).
The “Eurozone Crisis” began as a “debt crisis” in Greece during 2009-2010. In 2009 investors became nervous about the amount of debt that the Greek government held. The prevailing wisdom at the time, thought the debt was too high. As a result the markets demanded higher interest rates for Greek bonds, which in turn drove up the cost to borrow, which further aggravated the Greek debt crisis. In 2012 the Eurozone crisis began to reduce in intensity. This diminished intensity was largely the result of the recovering markets. Named “Grexit”, in 2015, the anti-austerity party used the potential Greek exit from the EU as a negotiating tactic, requesting debt relief and relaxing the austerity measures put into place (Archick, 2016).
The Schengen Area
The Schengen Area refers to 22 EU members including Britain. Within the Schengen Area internal border controls have been eliminated, allowing individuals to travel without passport. The Schengen area is based on the Schengen Agreement of 1985. Named after the town it was signed in. In 1999, the Schengen Accord was adopted into EU law. In addition to eliminating internal borders, participants countries agreed to improve coordination between their criminal justice authorities. As part of that strategy they created the Schengen Information System (SIS) a “large-scale information database that enables police, border guards, and other law enforcement and judicial authorities to enter and consult alerts on certain categories of persons and objects.” Both Ireland and the UK opted out of the Schengen free movement area but still take part in some forms of the agreement related to criminal justice collaboration, including access to the SIS (Archick, 2016).
Britex
The conflicting opinions of member countries demonstrates a growing divide between those members that want a closer affiliation through greater integration and those members that prefer to keep the EU as an intergovernmental process so that they may better protect their national sovereignty. Despite this conflict many members still report that the EU strengthens both their political and economic clout. Regardless, tensions continue within the EU. This is evident by the June 23, 2016 referendum held in the United Kingdom. During the referendum, 52.5% of the vote supported the UK in exiting the UE (Wheeler, 2016).
Britex is the shorthand term most commonly used to reference Britain leaving the EU. Now that the referendum has been passed the next steps are uncertain. According to Wheeler of the BBC (2016), Britain has to invoke Article 50 of the Lisbon Treaty. The Prime Minister, our his successor will need to decide when to make that decree. Article 50 has only been active since 2009 and no country has yet used it, so no one really knows how the Britex process will work. What is know is that Britain will continue to remain a member of the EU until it no longer is and that might take some time.
Unintended Consequences
In large part the EU was created to establish a single European market and this accomplishment is seen by many as its greatest asset. The concept of the single market was to increase trade, create jobs and lower prices. Peter Mandelson famously said “the markets don’t like instability and they don’t like uncertainty”. The whole concept of Britain exiting the UE creates all kinds of uncertainty. According to Buttonwood (2016), a columnist for the economist.com, as soon as the results of the referendum began to come in, the markets responded. The pound dropped to its lowest level since 1985. “It was the worst day for sterling since the currency floated in the early 1970s.” The impact was also felt in equity markets around the world. The Nikkei 225 average in Tokyo dropped by an initial 8%. The Financial Times Stock Exchange (FTSE) 100 dropped 500 points within minutes of the opening; Frankfurt’s DAX index fell 8.6%. S&P futures indicate a 5% drop, and the US Treasury 10-year bond yield fell a quarter of a point in overnight trading. Uncertainty has real economic impact and both businesses and investors will remain conservative by postpone investment plans until they have a clear picture of what this will mean.
Another unknown is what impact Britex will have on pensions, savings, and mortgages. During the referendum, the Prime Minister referenced the “triple lock for state pensions” would be jeopardized. This references an agreement that increases pensions by a minimum of the level of earnings, inflation or by 2.5% depending on which is highest (Wheeler, 2016). Some have speculated that the Bank of England might need to increase further plans for quantitative easing, as an alternative to cutting interest rates. This would result in lower bond yields and annuity rates. This would have a negative impact on anyone taking out a pension annuity resulting in less income. Concerning mortgage cost, the prime minister stated that the average cost of a mortgage could increase by up to £1,000 a year (Wheeler, 2016).
Summary
It took years for the EU to evolve and become a single market. The concept of the single EU market was to increase trade, create jobs and lower prices. Britain’s exit from the EU creates all kinds of uncertainty. Uncertainty about how the exit will impact jobs, pensions, and other financial tools. This uncertainty leads to financial instability. “Markets don’t like instability and they don’t like uncertainty”. We are already seeing the financial impact of that uncertainty, not just in Europe but around the world. Another assumption is that because it took years for the EU to evolve, it may very well take years for Britain to fully withdraw from the EU. This prolonged process will further dampen the British economy, as uncertainty and instability remain a common issue. When the impact of this decision finally hits home, meaning when the average citizen begins to feel its impact, we may very well see another referendum.
About the Author
Jerry Landers is the Executive Director for Aspire Indian Health and Vice President of Business Development for Aspire Indiana. You can learn more about the mission of Aspire at http://www.AspireIndiana.org or by following me on Twitter @JerryELanders
I blog and tweet about health care, business and social media.
References
Air University (2016). President Ronald Reagan – Berlin. “Tear Down This Wall” Retrieved from http://www.au.af.mil/au/awc/awcgate/awc-ref.htm#speeches
Archick, K (2016). The European Union: Questions and Answers. Congressional Research Service 7-5700 RS 21372 Retrieved from https://www.fas.org/sgp/crs/row/RS21372.pdf
Buttonwood (2016). Brexit and the markets: a seismic shock. Retrieved from http://www.economist.com/blogs/buttonwood/2016/06/morning-after
Hill, C. W. L. (2014). International business: Competing in the global marketplace (10th ed.). New York, NY: McGraw-Hill Education.
Historiasiglo20.org (2003) The Single European Act and the road toward the Treaty of the European Union (1986-1992). Retrieved from http://www.historiasiglo20.org/europe/acta.htm
History.com (2016). Berlin Wall. Retrieved from http://www.history.com/topics/cold-war/berlin-wall
Giaque, Jeffrey Glen. 2002. Grand Designs & Visions of Unity: The Atlantic Powers and the
Reorganization of Western Europe, 1955-1963. Chapel Hill, N.C.: University of North
Carolina Press
Jacques Delors Institute (2016). Jacques Delors – Founding President of the Jacques Delors Institute. Retrieved from http://www.delorsinstitute.eu/011016-2033-Jacques-Delors.html
Kiplinger Letter (2016). Forecast for Executives and Investors. Washington DC Vol. 93, No. 25
Lind, J. (2003). “Apologies and Threat Reduction in Postwar Europe.” Paper prepared for delivery at the Memory of Violence Workshop, Massachusetts Institute of Technology, January 24-25, 2003 Retrieved from http://web.mit.edu/rpeters/papers/lind_apologies.pdf
Thatcher, M (1988). Speech to the College of Europe (“The Bruges Speech”). Retrieved from http://www.margaretthatcher.org/document/107332
Wheeler, B (2016). The UK’s EU referendum: All you need to know. Retrieved from http://www.bbc.com/news/uk-politics-32810887
Van Ham, Peter. 1999. Europe’s Precarious Centre: Franco-German Cooperation and
the CFSP European Security. European Security 8:1-26
Van Ham, Peter (2016). Brexit: Strategic Consequences for Europe. Netherlands Institute of International Relations ‘Clingendael’. Retrieved from https://www.clingendael.nl/sites/default/files/Brexit%20Report%20February%202016.pdf
Not All Wounds Are Visible
Ever wonder what it’s like to go through Basic Training? Do Drill Sergeants really yell all of the time? Is the gas chamber really that horrible? What’s it like to go to war? How hard is it to return home after?
Suicide
According to the armytime.com, military suicides have increased since the start of the wars in Afghanistan and Iraq with current estimates that a veteran commits suicide every sixty-five minutes (Haiken, 2013). Faced with the stigma of post-traumatic stress disorder, high unemployment rates and loss of the military camaraderie, “many veterans report feeling purposeless upon returning home” (Goldberg, 2011).
- From 1999-2010, the suicide rate in the US population among males was 19.4 per 100,000, compared to 4.9 per 100,000 in females.
- Based on the most recent data available, in fiscal year 2009, the suicide rate among male Veteran VA users was 38.3 per 100,000, compared to 12.8 per 100,000 in females.
Source National Vital Statistics of the US Department of Health and Human Services
“America is losing its battle against suicide by veterans and service members,” authors Dr. Margaret C. Harrell and Nancy Berglass concluded. “And as more troops return from deployment, the risk will only grow.” Suicide is rampant among those who are currently serving too. From 2005 to 2010, approximately one service member committed suicide every 36 hours (Goldberg, 2011). In 2012 the number of deaths by suicide for active duty soldiers hit an all-time high of 349 or almost one a day. That means that during 2012 more soldiers took their own life by suicide than soldiers that lost their life due to combat (Haiken, 2013).
According to Haiken, “69 % of the suicides recorded were by veterans age 50 and older. But another way to look at this is that 31 % of these suicides were by veterans 49 and younger or in other words, by men in the prime of life.”
Homelessness
According to the National Coalition for Homeless Veterans (NCHV), the U.S. Department of Veterans Affairs (VA) states that the nation’s homeless veterans are predominantly male, with roughly 8% being female. The majority is single; live in urban areas; and suffer from mental illness, alcohol and/or substance abuse, or co-occurring disorders. About 13% of the adult homeless population is veterans. Homeless veterans are younger on average than the total veteran population. Approximately 9% are between the ages of 18 and 30, and 41% are between the ages of 31 and 50. Conversely, only 5% of all veterans are between the ages of 18 and 30, and less than 23% are between 31 and 50 (NCHV, 2013).
- One in seven homeless people previously served in the military
- 1.5 million Veterans are at imminent risk of homelessness
- The 2012 Annual Homeless Assessment Report (AHAR) to Congress, prepared by HUD, estimates there were 62,619 homeless Veterans on a single night in January in the United States
- 33,000 veterans have been given permanent supportive housing by the Department of Housing and Urban Development and the Department of Veterans Affairs since 2009
- Almost a third of veterans between the ages of 18 and 24 were unemployed last year, according to unpublished BLS data, the Center for Progress reports
- In 2010, nearly 1 in 10 veterans with disabilities were out of work
- In 2010, nearly 1 million U.S. veterans reported being in poverty over the last year, the Center for American Progress reports
Source: Center for American Progress 2013
What can we do?
According to the NCHV veterans need a coordinated effort that provides secure housing, nutritional meals, basic physical health care, substance abuse care and aftercare, mental health counseling, personal development, job assessment, training and placement assistance.
While we can’t currently do everything that our veterans need, Aspire Indiana is proud to be a part of the InteCare Supportive Services for Veteran Families (SSFV) project. The goal of the SSVF Program is to promote housing stability among very low-income Veteran families who reside in or are transitioning to permanent housing, and of course to help our veterans break the cycle of homelessness.
Today the InteCare SSVF project serves veterans in Marion, Madison, Shelby, Johnson, Hancock, Hamilton and Boone Counties. For qualifying veterans, the SSVF program will provide the following services as they relate to housing stability:
- Outreach services
- Case management services
- Peer support services
- Assistance obtaining VA benefits
- Assistance obtaining other public benefits and needed services within the community
- Temporary financial assistance that is necessary to stabilize housing
- Housing counseling & assistance with housing searches
- Financial planning as it relates to stabilizing housing
- Transportation services
- Child care services as it relates to stabilizing housing
To receive supportive services under this program, you must:
- Be a Veteran, or the member of a family in which the head of household, or the spouse of the head of household is a Veteran
- Meet income eligibility requirements: Your household annual income cannot exceed 50% of the area median income (AMI)
- Be homeless or at imminent risk of becoming homeless
What is the definition of a Veteran under the SSVF program?
A Veteran is a person who served in the active military, naval, or air service, and who was discharged or released under conditions other than dishonorable.
For further information or to arrange an eligibility screening appointment please contact (855) 896-4345. SSVF staffs are available to make community presentations and can make arrangements to meet with SSVF applicants at other locations when necessary.
To help spread the word Aspire is working with InteCare to market the program through social media. So I would invite you to visit the new InteCare SSVF page at the link below and to “like” the page. Then share this information with your friends and family.
https://www.facebook.com/InteCareSSVF
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
You can also follow Mr. Landers on Twitter @JerryELanders
References
Eleanor Goldberg, (2011), Veteran Suicide: Are We Losing The Battle? Retrieved Nov 5, 2013 from http://www.huffingtonpost.com/2011/11/02/suicide_n_1070491.html
Melanie Haiken, (Feb 2013), Suicide Rate Among Vets and Active Duty Military Jumps – Now 22 A Day, Retrieved Nov 5, 2013 from http://www.forbes.com/sites/melaniehaiken/2013/02/05/22-the-number-of-veterans-who-now-commit-suicide-every-day/
3.Kemp, J. & Bossarte, R. (2012). Suicide Data Report, 2012. (Report prepared for the U.S. Department of Veterans Affairs) Available from http://www.va.gov/opa/docs/Suicide-Data-Report-2012-final.pdf
Bureau of Labor Statistics (March 2013), Employment Situation of Veterans Summary, Retrieved Nov 5, 2013 from http://www.bls.gov/news.release/vet.nr0.htm
National Coalition for Homeless Veterans (2013), FAQ About Homeless Veterans, Retrieved Nov 5, 2013 from http://nchv.org/index.php/news/media/background_and_statistics/
Staff Turnover among Behavioral Health Professionals
Webster’s dictionary defines employee turnover as “the ratio of the number of workers that had to be replaced in a given time period to the average number of workers.” The Bureau of Labor Statistics conducts a monthly survey designed to gather data on job openings, hires, and terminations named the Job Openings and Labor Turnover Survey (JOLTS). The “data serve as demand-side indicators of labor shortages at the national level.” The survey does collect information on turnover among “Health Care and Social Assistance” providers but it does not break the data down into the subcategory of behavioral health care provider. The JOLTS information would suggest that national turnover across all industries is approximately twenty-three percent annually and within the category of health care it is approximately nineteen percent annually.
According to the February 2013 minutes of the Indiana Council of Community Mental Health Care (ICCMHC) Human Resources Committee meeting, the combined turnover rate among the Indiana CMHC’s is higher than the national JOLTS data, with the lowest reported agency turnover rate at twenty-three percent and most agencies reporting much higher annual turnover rates that were above thirty percent. Nationally, within rural settings, turnover among behavioral health care providers has reached as high as ninety percent (Jobs to Careers 2013).
Why is turnover in behavioral health so much higher than other types of health care agency? Pay is notably lower among social workers and the job can be very stressful. CNNMoney.com highlighted social work in their 2013 article “Stressful jobs that pay badly” stating that “high stress and a meager paycheck are just another day at the office.” While CNNMoney.com portrayed social work as poorly paid stressful jobs, they also highlighted the dedication of the social workers and how important the services they provide are for the community (CNNMoney.com, 2013).
Performance and motivation are multifaceted subjects that are impacted by many variables. A quick literature review demonstrates that many studies have been conducted on employee motivation and compensation plans. Those studies, in general, “assume that higher performance requires greater effort” or that higher performance requires inconvenience on the part of workers. In order to provide incentives, these models predict the existence of reward systems that structure compensation so that a worker’s inconvenience is incentivized. These incentives or “rewards” can be both monetary and non-monetary so they may take on many different methods. In general, almost everyone is motivated by monetary compensation to some degree, many to a moderate degree, and most to a great degree when compensation is properly designed (Baker, Jensen and Murphy, 1987).
In his paper titled Compensation and Incentives: Practice vs. Theory, Baker summarizes his literature review by stating “Evidence, from research on compensation plans indicates that explicit financial rewards in the form of transitory performance-based bonuses seldom account for an important part of a worker’s compensation.” Baker cites separate studies on pay and performance, and finds that “their evidence indicates that pay is not very closely related to performance in many organizations that claim to have merit increase salary systems”.
A firm’s compensation method can be split into three subcategories labeled-“the level, the functional form, and the composition.” The level of compensation is the total cost of the pay package to the employer. The level of compensation governs the quality and quantity of workers an organization can entice (Baker, Jensen and Murphy, 1987).
According to Jobs to Careers, the community mental health industry is operating in a dynamic business environment in which a number of related industries are competing for behavioral health care providers. Those competing entities include school corporations, hospitals and even primary care settings. At the same time fewer individuals are entering the profession and a national health care shortage is being projected. Those agencies that are able to provide quality behavioral health care staff will be the companies that can compete more effectively. Currently, the demand for qualified staff has never been greater (Jobs to Careers, 2013).
Most corporations understand that turnover can be very costly to organizations when both the direct and indirect cost of recruiting, orienting, and training of replacement employees is fully recognized. Lost productivity is also a real cost that is no less important than any expense that is paid with cash (Bliss, 2007). With demand for behavioral health increasing and supply limited, any and all efforts should be directed at increasing efficiencies within the system. Addressing the high turnover rate appears to be a logical opportunity.
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
References
Leedy, P. D., & Ormrod, J. E. (2010). Practical research: planning and design (9th ed.). Upper Saddle River, New Jersey: Pearson Education, Inc., publishing as Merrill.
Zahorsky, D. (nd) Fighting Employee Turnover Costs. Small Business Information. Online About: Small Business Information. Retrieved July 2013 http://sbinformation.about.com/od/hiringfiring/a/reduceturnover.htm.
Bliss, William G. (2007) Cost of Employee Turnover – The Advisor. Retrieved July 2013 http://www.isquare.com/turnover.cfm.
Bureau of Labor Statistics (2013), Job Openings and Labor Turnover Survey, Retrieved July 2013 http://www.bls.gov/jlt/jltover.htm
Jobs to Careers (2013), Behavioral Health, Retrieved July 2013 http://jobs2careers.org/sector/behavioral-health/
CNNMoney.com (2013) Stressful jobs that pay badly, Retrieved July 2013, http://money.cnn.com/galleries/2009/pf/0910/gallery.stressful_jobs/index.html
Lawler, Edward E., (1987), The Design of Effective Reward Systems, Englewood Cliffs, NJ, Prentice Hall.
Mobley, William H., (1982), Employee Turnover: Causes, Consequences, and Control, Reading, MA., Addison–Wesley.
Steers, Richard, M., & Porter, Lyman, (1991) Motivation and Work Behavior, New York, McGraw Hill.
USGovernmentspending.com (2013), US Health Care Budget, Retrieved July 2013, http://www.usgovernmentspending.com/health_care_budget_2012_1.html
Social Media and Professional Ethics
Access to the Internet is everywhere. Communication and privileged information is now at our fingertips. Do we as professionals have a responsibility to help our industry by establishing a Code of Ethics?
For example, within the behavioral healthcare industry, social media has created new ways in which professionals and their clients can interact. Is it harmful or even appropriate for a therapist and a client to share the types of information that are posted on Social Networking Sites?
Let’s start by defining what the term social media means. The general definition used by Merriam-Webster dictionary is “forms of electronic communication (as Web sites for social networking and micro-blogging) through which users creates online communities to share information, ideas, personal messages, and other content (as videos).”
Social media is different from traditional media.
- Traditional media is one way communication. Social media is two-way communication, so it’s very important that businesses monitor what customers are saying on line.
- People can instantly share your message with their network who then can share it with their network thus, creating what every social media marketing person wants: a “viral message”.
- Social media operates in real time.
- Traditional media is polished and managed. Social media is quick and most times less polished.
- Social media is dependent on “user generated content”.
Today social media sites utilize more of the internet than any other type of site. According to Reynolds, “the total time spent on social media in the U.S. across PC and mobile devices increased by 37 percent to 121 billion minutes in July 2012 compared to 88 billion minutes in July 2011” (Reynolds, 2013).
According to Reynolds…
“Social media technologies take on many different forms including magazines, Internet forums, weblogs, social blogs, micro-blogging, wikis, social networks, podcasts, photographs or pictures, video, rating and social bookmarking. Technologies include: blogs, picture-sharing, vlogs, wall-postings, music-sharing, crowdsourcing and voice over IP, to name a few. Many of these services can be integrated via social network aggregation platforms” (Reynolds, 2013).”
Why is social media important?
With more than 1 billion monthly users, Facebook is the current front runner for social media sites. Today the average Facebook user is connected to 31,000 individuals within their “extended network” (Work 4, 2013). To further exemplify the role now played by social media, the health care industry has begun to recognize the potential influence that social media now plays in marketing their products. According to a 2012 PricewaterhouseCoopers (PwC) HRI Social Media survey, social media as a marketing strategy should be heeded.
- 41% of consumers said social media tools influenced their choice of a specific hospital, medical facility or doctor
- 34% said it would influence their decision about taking a certain medication
- 32% said it would affect their choice of a health insurance plan
In 2012 IBM systems conducted their own social media survey and found supporting evidence for social media as a “business intelligence strategy.”
- 91% of consumers like to share their brand experience with others.
- 61% of consumers rely on user reviews for making purchase decisions
- 81% of consumers have received purchase advice via social media
- 74% say social media has influenced their buying decisions
- 90% of consumers trust the recommendations of friends and family.
From a business perspective the value of a Facebook “like” is pretty subjective and very dependent on the industry. According to Brad Chacos of Productivity and Social “a Facebook follower could be worth nothing at all, as little as $3.60, as much as $22.93, exactly $136.38 more than a non-follower, or a whopping $214.81 for a nonprofit organization” (Chocas, 2012).
In part because of the growing popularity of social media, the Health and Human Services’ Office of Civil Rights (“HHS”) has modified the Health Insurance Portability and Accountability Act (HIPAA) marketing definition. In summary, the concluding rule outlines ”marketing” to mean any communication about a product or service that encourages the individual receiving the communication to purchase the product or service.
Is anyone proposing ethical rules for social media?
The American Psychological Association (APA) has stepped up and established a social media policy. However, they designed their policy for their APA designated forums, not as a general social media guideline. Many of the rules are good common sense but the policy reads more like a legal disclaimer than an ethics protocol (APA, 2013).
A quick Google search for “Social Worker and Social Media” will generate hundreds of links with the vast majority that I explored dedicated to generic Human Resources policies designed for restricting the use of social media while at work. That’s a losing strategy. While IT staff can prevent or monitor utilization of social media sites on office equipment the large majority of social media enthusiasts now access those sites via smart phones and mobile devices. The 2013 “National Business Ethics Survey of Social Networkers,” found 75 percent of social networkers spend time on these platforms while at work, and 28 percent spend an hour or more on social networks each day (Bascuas, 2013).
In her September 2013 article titled “Ethics Corner: Beyond the Friend Request,” Kathryn Chernack, DSW says, “Social Media is not a term specifically mentioned in the National Association of Social Workers (NASW) Code of Ethics.” Chernack qualifies her statement by adding that the “Code does provide a useful guide for making ethical decisions when using social media.” In her closing remarks, Chernack references the standards detailed in the NASW and Association for Social Work Boards Standards for Technology in Social Work, which states the need for technical competence in social work. Concerning social media, Chernack summarizes her assessment by saying that Social Workers have a role in maximizing the benefits of using social media in their worksite by knowing how and most importantly,” knowing when not to use them.”
In my opinion we clearly need dialogue and review of the role and scope played by social media. This dialogue and review should lead to the development of a social media code of ethics. The evidence is clear that social media is here to stay and that it already has significant influence on the health care industry. So I ask you again…. Do we as professionals have a responsibility to help our professions establish a Code of Ethics?
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
References
American Psychological Association (2013), APA Social Media/Forum Policy, Retrieved Sept 20 from http://www.apa.org/about/social-media-policy.aspx
Jason Falls, (August 2009), Why Social Media Demands Professional Ethics, Retrieved Sept 19, 2013 from http://www.socialmediaexplorer.com/social-media-marketing/why-social-media-demands-professional-ethics/
Chris Borgan,(October 2008), The Ethics Imperative in Social Media, Retrieved Sept 19, 2013 from http://www.chrisbrogan.com/the-ethics-imperative-in-social-media/
Calgore (Sep 2012), Social Media and Professional Ethics, Retrieved Sept 19, 2013 from http://blog.i-reconnect.com/2012/09/25/social-media-and-professional-ethics/
Mashable (March , 2012), Ethics and Social Media: Where Should You Draw The Line?, Retrieved Sept 19, 2013 from http://mashable.com/2012/03/17/social-media-ethics/
CVynthia Reynolds (September 2013), What is Social Media, Retrieved Sept 20, 2013 from http://editwrite101socialmedia.wordpress.com/2013/09/15/what-is-social-media/
Work 4, (2013), The joy of Facebook Recruiting, Whitepaper
Brad Chacos (Oct 2012), What’s a Facebook Like worth, Retrieved September 23, 2013 from http://www.pcworld.com/article/2011309/whats-a-facebook-like-worth.html
Katie Bascuas, (July 2013) New Ethics Study Shows Two Sides of Social Media Coin, Retrieved September 23, 2013 from http://associationsnow.com/2013/07/new-ethics-study-shows-two-sides-of-social-media-coin/
Kathryn Chernack, (September 2013), Ethics Corner: Beyond the Friend Request-Other Ethical Challenges Posed by Social Media, Retrieved September 23, 2013 from http://naswil.org/news/networker/featured/ethics-corner-beyond-the-friend-request-other-ethical-challenges-posed-by-social-media-use/
Role of Business According to the Social Responsibility Perspective
There are several business concepts of Corporate Social Responsibility (CSR), Baron reflects on two. The first is Milton Friedman’s Profit Maximization. Friedman’s views are based on the basic economic principle that the role of business within society is to “generate well-being through economic efficiencies” and efficiencies are created when markets are competitive. Building on his views of the role of business, Friedman’s formation of CSR is “to conduct business in accordance with the owner’s desires, which generally will be to make as much money as possible while conforming to the basic rules of society.” Friedman is very clear in asserting that profit maximization is the priority and that calls or attempts to broaden the objectives of businesses to other than profit maximization “will weaken the free enterprise system and the well-being that flows from it.” (Baron, 2010, P 622)
In contrast with Friedman’s perspective is the “Statement on Corporate Responsibility”, issued in 1981 by a task force of the Business Roundtable. The Roundtable was created to “examine public issues that affect the economy and develop positions which seek to reflect sound economic and social principles.” The statement released reflects the views of a stakeholder and states that business is “to serve the public interest as well as private profit”. The belief is that by giving “consideration to balancing the legitimate claims of all its constituents, a corporation will best serve the interest of the shareholder”. The Roundtable identifies seven stakeholders: customers, employees, financiers, suppliers, communities, society at large, and shareholders. The Roundtable wants all sides to be heard but does not want stakeholders making managerial decisions. While the Roundtable wants to consider all stakeholder concerns, it also understands that it is impossible to “assure that all will be satisfied because of the potential for competing agendas. (Baron, 2010, P 629)
In Friedman’s view, the role of government is to “impose taxes, determine expenditures, interpret law and mediate disputes.” When “social cost” creates market imperfections, then the role of government is to identify and protect entitlements. Government may use “market-like mechanisms”, such as cap and trade systems, to counter high transaction cost, but those types of functions should be reserved for government and held in check by a system of checks and balances. For Friedman, requests for increased scope of CSR means that the “expenditure in question” was not agreed upon by the majority and so not enacted by legislation. In simpler terms, calls for expanded CSR, is an undemocratic process. (Baron, 2010, P 623)
The role of the individual in CSR is a simple one and is at the roots of CSR. Because a corporation is comprised of individuals, those individuals create the socially responsible culture. Both individual and corporate social responsibility is voluntary; it is about going above and beyond what is mandated by legal responsibility. Therefore, the individual must not only behave in ethically and socially responsible ways, but, as a stakeholder, he must also advocate for corporate social responsibility.
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
References
Baron, D. (2010), Business and Its Environment (6th ed). Upper Saddle River, NJ: Prentice Hall. P. 619-641
Corporate Accountability and Responsibility
The Enron scandal became public in 2001 and was followed by a long list of corporations that conducted unethical and illegal activities that negatively impacted the lives of millions of shareholders. Kenneth Lay, founder of Enron, developed a management team that used accounting loopholes, special purpose entities, and poor financial practices, in order to hide billions of dollars in debt. Lay and his team, then misled Enron’s board of directors and audit committee on those at-risk accounting practices. As a result, many executives at Enron were indicted and later sentenced to prison. As a consequence of the scandal, in 2002, the Sarbanes-Oxley Act was passed by legislators, which increased consequences for attempting to defraud shareholders. The act also changed the relationship between auditing companies and their clients, requiring the auditing companies to remain unbiased.
Six years after Sarbanes-Oxley was passed, Lehman Brothers filed for bankruptcy. In 2008, the Lehman’s bankruptcy filing was the largest in history even larger than WorldCom and Enron. At the time of its collapse, Lehman was the fourth-largest U.S. investment bank. The fact that Sarbanes-Oxley didn’t keep Lehman out of trouble creates questions about the value of these types of legislation. So if Sarbanes-Oxley is ineffective, what type of plan will bring about corporate responsibility and accountability to all shareholders?
I believe that the intent of Sarbanes-Oxley was to increase transparency, which would lead to accountability. While I support the philosophy, the first step in accountability is not transparency. The first step in becoming accountable….is wanting to be accountable. This is a statement about corporate culture and starts at the top of the agency. The development of a corporate compliance officer that does not report to the administration, but independently reports to the board of directors, is my second step recommendation. The corporate compliance officer should not be a third party accounting firm, but, instead, should be a part of the corporate executive team with the responsibility of guiding and advising the executive staff. They should be completely integrated, yet report to the board and not the CEO. Today, many of the executive staff managing publicly traded companies are incentivized to focus on the short term gains that temporarily improve stock price but are not necessarily good for the company in the long run. It is for this reason I would argue for my third step and recommend delayed bonus and incentive payments that are tied to long-term trends and not point-in-time performance. Finally, for my fourth step, I would recommend the adoption of International Accounting Standards, instead of the current US accounting practices. The international practice incorporates a “principle-based” approach that helps address some of the limitations that we experience with the US system.
In conclusion, I would like to suggest that expanding legislation like Sarbanes-Oxley only increases the expense and complexity of corporate operations while producing questionable benefit. True improvement in Corporate Accountability and Responsibility will only happen when the corporate culture changes. But, by creating an integrated corporate compliance office, changing executive pay incentives, and adopting better accounting practices, we will help create a level of transparency and accountability that should foster the right environment for corporate culture to change.
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
References
Cone, E. (2006), Compliance: Is Sarbanes-Oxley Working?, Retrieved from http://www.cioinsight.com/c/a/Trends/Compliance-Is-SarbanesOxley-Working/
Benner, K. (2010), Is Sarbanes-Oxley a Failure, Retrieved from http://money.cnn.com/2010/03/23/news/economy/sarbanes_oxley.fortune/index.htm
CEO Compensation
According to the Summary of Legislation Proposed, Enacted and under Discussion, prepared by the institute for Policy Studies, disproportionate salaries for executives first became a concern in the early 1980s, about the same time that deep cuts in the top marginal federal income tax rate took effect. Before the 1980’s, high top-bracket federal income tax rates of 91 percent on income over $400,000 was in effect until 1964. Following that a 70 percent tax on income over $200,000 was in effect until 1981. These high income tax rates made high salaries a non-issue. After all, corporate boards could offer million-dollar pay packages, but what would be the point? The bulk of any pay over the top income tax bracket would simply be taxed away.
Tax pressure on disproportionate salaries for executives has faded over the past quarter-century as the top marginal tax rate has decreased, currently at 35 percent. Today, compensation for top executives in the United States has now soared to over 400 times average worker compensation.
The incredible difference in pay has prompted a search for legislative initiatives seeking to address superfluous executive compensation. The passage of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 (H.R. 3269), addressed the rights of shareholders to vote on executive compensation. This legislation was developed to address excessive executive compensation that was scrutinized during the financial crisis of 2008 and 2009. (Dodd, 2010)
The basic concept of economics relies upon prices being set by the market. Compensation for executive staff should be no exception. Publically traded companies that are affected by the Dodd-Frank legislation might see certain executives leave their firms or seek employment in the private sector where the Dodd Frank rules would not apply. For example, Natural-Foods Grocer originally limited compensation for their top executives “to a multiple of the average of Whole Foods worker’s pay”. The cap, which covers salaries but not stock options, started at 8 time’s average pay, was raised to 14 times average pay in the early 1990s. As sales hit $5.6 billion and rivals tried to recruit Whole Foods managers, the board of directors raised the cap to 19 times average pay, or $607,800. According to Chief Executive John Mackey, the increase was needed “to help ensure the retention of our key leadership.” (Dvorak, 2007)
Another example of the failure of capped salary can be seen in the early salary structure of the ice cream company Ben and Jerry’s. In the early 1980’s ben & Jerry’s had a policy that no employee could make more than five times what the lowest paid worker earned. In 1986, this rule capped the CEO’s pay at $81,000. This policy was eventually scrapped in 1994 when Ben Cohen, the “Ben” of Ben and Jerry’s, retired from the top position. It proved difficult for the Vermont-based company to find an outside leader that would adhere to the unique policy set in place by the founders. (The Cape Cod Critic, 2009)
It’s just my opinion but I believe that the market should dictate compensation. If an individual is worth 400 times the average employee wage then they should be paid that much. The problem isn’t in how much an individual is paid. The Problem is in determining the individual’s worth to the company.
About the Author
Jerry Landers is the Vice President of Business Development for Aspire Indiana. While the beliefs and opinions expressed in this blog are solely those of Mr. Landers you can learn more about community mental health and how it intersects with business and media at http://www.facebook.com/AspireIndiana
Reference
Congress (2012). S. 3713–112th Congress: Dodd-Frank Wall Street Reform and Consumer Protection Technical Corrections Act of 2012. In http://www.GovTrack.us. Retrieved from http://www.gpo.gov/fdsys/pkg/BILLS-111hr4173enr/pdf/BILLS-111hr4173enr.pdf
Dvorak, P (2007), Limits on Executive Pay: Easy to Set, Hard to Keep, Retrieved from http://finance.yahoo.com/news/pf_article_102878.html
The Cape Cod Critic, (2009), Lessons From Ben and Jerry, Retrieved from, http://thecapecodcritic.blogspot.com/2009/01/lessons-from-ben-and-jerry.html
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