We are all in sales

Written by Eric Petersen, CIC

Everyone in your organization is in sales. There I said it. Don’t agree with me? Keep reading and let’s see if I can change your mind.

To start, I want you to reflect on a recent experience that you’ve personally had where you purchased a product or service from someone; not a nameless, faceless online purchase, but from interacting with a real person. Think about how many people you interacted with during that process. Was there just one person involved? Probably not. 

After an initial consultation/call with a typical “sales” person, you probably were handed off to a “customer support” team member who helped finish your product order or schedule the service. There may even have been a different person(s) who delivered the product/service. 

No matter how many people were involved, they all contributed to your customer experience with that company. They all had a chance to help or hurt your experience which will determine whether or not you will buy from them again or refer them to your friends. 

We recently hired a contractor to install an egress window in our basement. After getting quotes from multiple places and learning about how they would install the window, we made our decision and picked a contractor that was in the middle of the price point, but seemed to have a good process in place. They made getting the initial estimate easy and told us exactly what to expect with scheduling and when the crew came out to do the work. In all, we spoke to four different people during the entire process; the initial owner (salesperson), the customer service representative who scheduled our work and let us know exactly when the crew was going to be coming, the job foreman and a crew member (who I happened to talk to when they first arrived before the foreman got out of his truck). 

It was clear that everyone within that company understood they were all responsible for selling a great experience to us, even the crew member. It was such a wonderful interaction that we are already thinking about hiring them again for a second window in our basement, something we hadn’t originally planned on doing. 

And that’s the beauty of this organizational mindset! We are most likely going to buy from them again, because of the experience we had. They all did their part in ‘selling’ us why they are the best option for egress windows. 

Now think about my story and relate it to your tree care company. How many of your team members communicate with the customer? How many opportunities does your team have to impress or turn off customers and/or potential customers? 

From the initial sales conversation to the completed work, everyone within your company has a part in making that experience a wonderful one. That even includes the person in the office who is only crunching numbers as well as your shop mechanic who doesn’t have any interactions except with your machines. These team members provide the customer facing employees with valuable services or expertise that allow them to shine even brighter when working with the customers.

Afterall, isn’t that the point of a sale? You want to get a customer to select your company so you can provide them with the unmatched customer experience that you believe only your company provides, right? 

So how do you begin to create this mindset so everyone sees themselves as a vital role in the sales process? 

The first step is that everyone must understand how your company helps your customers. That doesn’t mean your in-office bean counter needs to know how to properly rig a branch over a fence during a removal, but it does mean they need to know that your company has the skills, equipment and expertise to perform that job safely and efficiently for your customer. They need to know the basics of what ancillary services you provide that help the customer’s trees and properties even further. When each team member truly understands how your company can help your customers, they all have the opportunity to add value throughout the customer journey, which leads us to the second step, cross-selling.

Cross-selling additional services usually are reserved for the prototypical sales people because most people do not want to pressure people into buying more from them. However, if you have nurtured a sales culture within your company, everyone who interacts with a customer may be able to suggest additional services to the customer or at a minimum be able to identify a cross-selling opportunity. To properly instill this throughout your company, you need to consciously discuss the work that you do for your customers with everyone. There needs to be consistent success story messages that are delivered organization-wide so people learn and remember how your team has helped your customers. With repeated internal communication regarding how you’ve helped customers, your team will naturally start to think about it and see opportunities to gain more revenue from your existing customers. 

Lastly and perhaps most importantly, you need to debunk the negative connotation that often comes with sales. Clearly everyone in your company knows that you don’t have a business if there are no customers and for that to happen, someone has to sell your service. But you need to cultivate a team sales culture so that everyone understands that no matter what their role is, they play a part in it. If you need to build in incentives for your employees who don’t have sales in their job title start to understand the concept, do so. Have an after work cookout/happy hour if the office team can cross-sell ‘x’ number of jobs or if the in-field crew upsells plant health care services to 10% of the jobs that they are on. Whatever the incentive is, give those employees a chance to see how they can benefit personally from additional sales to the company. 

So, do you now agree with me that everyone in your company is in sales? If you’re struggling with your sales team or want to learn how to improve the sales process within your company, reach out to an ArboRisk team member or register for our Thrive Sales & Marketing Package today.

How costly is a poor business culture?

Written by Kevin Martlage

In past weekly tips, we have spent quite a bit of time talking about the importance of having a supportive business culture. Additionally, we have written numerous articles about how to assess, develop and sustain that supportive culture to help further your company and retain your employees. One thing we have not specifically covered is what is the impact financially on your company when not having a supportive culture starts to get in the way of your ability to advance.

A key to building a supportive business culture is not only developing trust through effective and intentional communication and conflict resolution, but it also includes your ability as a leader to keep your employees engaged, motivated, and focused. Employee engagement can be defined in numerous ways, but fundamentally it is your team’s emotional commitment to their work, the company goals, and their daily impact. Employee engagement is a key indicator of a leader’s ability to lead and motivate members of their team towards their personal and company goals. This engagement must be deeply rooted in trust, communication, and mutually serving intentions to ensure that engagement is in alignment with the needs of the employee and the goals of the company.

There are numerous articles that have been written about the importance of employee engagement as a driver of organizational success, however there are three critical areas you must focus on to drive impactful employee engagement. Those areas include communication, execution, and trust, and specifically the alignment of expectations around those three areas. To find out more on how to focus on and develop those three areas, I encourage you to check out the article I wrote entitled, “What If Everything You Knew About Business Culture Was Wrong?” That article dives into the importance of looking at your business culture critically around those key areas.

As you continue to build a supportive business culture, it is critical to also think about how you will ensure a high level of employee engagement within that culture. Employee engagement is the number one driver when it comes to the fiscal impact a poor business culture may have on your company. When you think about employee engagement, there are typically five key indicators that are considered. Those key indicators include Performance, Productivity, Absenteeism, Retention and Customer Satisfaction. Those five areas are critical when it comes to building the employer / employee relationship which is the cornerstone of your company’s ability to deliver for your customers.

In a 2023 University of Pittsburg article, “Employee Relations: A Critical Area of HR Management” the author outlines specifically the benefits of focusing on employee relations. Those benefits include:

• Improved employee morale and engagement
• Increased productivity
• Improved retention
• Decrease absenteeism
• Decreased costs (due to eliminating high turnover)
• Positive company culture

The article also points out, “When employees feel valued, supported, and heard they are more likely to be engaged and motivated to perform at their best. Improved employee engagement will lead to better outcomes for the company, including increased revenue and a positive reputation.”

So, as leaders, if you can focus on building the employee relationship, while ensuring that you are aligned around properly supporting them and their values, you will continue to impact the key indicators of employee engagement critical to the overall success of your company. That focus will positively impact the financial performance of your company while also helping to build a sustainable and effective culture your employees enjoy working in.

If you look at the five areas of employee engagement mentioned earlier, it is easy to then understand how focused attention can positively impact the financial performance of your company. However, if you are not focused on employee engagement you can begin to impact your company financially as follows:

• Performance – A disengaged employee can begin to cause problems which impact overall employee morale while creating a potentially toxic work environment. This then creates a higher level of turnover and absenteeism while impacting performance.
• Productivity – A recent Gallup report said unengaged employees are 18% less productive than their engaged co-workers. Those that are unengaged cause the overall productivity of the company to drag while other must “step up” to help cover the loss in productivity.
• Absenteeism – The Center for Disease Control and Prevention (CDC) says the loss of productivity associated with absenteeism cost US Companies $225.8 billion annually. This includes approximately $3,600 for each hourly employee in unscheduled absenteeism annually.
• Retention – When employees are not engaged in their work, they become unhappy and eventually leave. This results in higher turnover which equates to a significant fiscal impact to the company for sourcing, hiring, training, and on-boarding. There are a lot of statistics out there, but on average it costs 6-8 months of an employee’s salary to replace them once they leave!
• Customer Satisfaction – Non engaged employees, who are not happy and feel unsupported, will provide poorer customer service, which will result in a loss of revenue and a low customer retention rate.

 Employee engagement and its level of importance in the supportive business culture you develop and sustain is critical to the overall financial success of your company. The five critical areas listed above are just the beginning when it comes to the fiscal impact a poor business culture can have. Outside of employee engagement, you must also think about the lost time that is created when conflict is not resolved properly, communication is not intentional, and trust begins to be broken. As a leader, my number one encouragement to you is to remain focused on the support and engagement of your employees. Of course, the financial success of your company is important, but without an engaged team and an aligned and supportive business culture your sustainable success may be in jeopardy.

If you would like to learn more about developing and advancing your business culture, please check out one of our numerous Thrive packages or contact a Thrive Consultant today.

What is company culture and why is it important?

Written by Kevin Martlage

Austrian American management consultant, educator, author, and leader in the development of management education Peter Drucker once coined the phrase, “culture eats strategy for breakfast.”

While that statement could be discussed, argued, and debated based on your thoughts and approach to leadership and strategy, the essence of what Drucker is trying to say is extremely important for you to consider as a leader and business owner. So, what is company culture anyway?

Your company culture is your brand and what makes you unique in a variety of different areas. It can be defined by your company values, attitudes, and beliefs which lead to you providing a supportive and nurturing environment for your employees, your customers, and your stakeholders.

As a business professional turned consultant who has spent the last 30+ years developing, building, supporting, and leading teams in both non-profit and for-profit organizations around the world, I have had the opportunity to work in a variety of different business cultures and with a lot of simply amazing people. Some of those business cultures have been more supportive and productive than others, but the companies that have had their culture defined as the ‘DNA’ of what they were about were the ones that I remember the most. To me, a defined and supportive business culture is the true X factor of what makes some organizations exceptional vs just being great. Culture is all about defining how you are serving each other and your customers and then making sure that everything you do is based on the culture and those things that you have identified as being important.

I spent 15+ years of my professional career working for one of the greatest companies in the world. FedEx and specifically FedexOffice. During my time with FedexOffice, I had the opportunity to advance to various levels of the company and was able to work alongside countless driven and influential people who were all extremely talented at what they did and brought to the table.

As you may or may not know, FedEx is also one of the largest companies in the world and in 2020 was #50 on the Forbes Top 500 list. In 2020 FedEx had over 850,000+ employees worldwide who were responsible for $69.217 billion in annual revenue. To work in that business culture and alongside so many diverse and great people is something that continues to have a significant impact on my view of the value of culture in any company.

With that many people working in locations all over the world, having their own values, beliefs, backgrounds, and personalities, you can imagine how difficult it may be to ensure that FedEx delivered upon the corporate strategy every day. With so many moving parts, divisions, trucks, packages, opportunities, and responsibilities it could be quite easy for things to go off track unless you have a great support mechanism to ensure each employee understands what is important. The FedEx support mechanism I want to share with you supports Drucker’s quote, “culture eats strategy for breakfast” and is something I feel strongly can help take you and your team to the next level.

FedEx has one sentence that defines their culture and their approach to that culture. It is known as the Purple Promise which has the purpose of building and earning trust and loyalty of the FedEx team members, their customers, and the communities in which they support.

The Purple Promise is simply this:

“I will make every FedEx experience outstanding.” 

The Purple Promise is something that is taught to every employee on their first day and remains an important part of how FedEx conducts their business around the world. The Purple Promise can be used in any situation, any decision, and any action you may be taking as an employee. Whether you are the most entry level package handler or the President of the Board, the Purple Promise is the life blood of FedEx and is evident in everything they do.

As you begin to understand the true meaning of the Purple Promise you understand that every action matters. Whether that action involves business conduct, integrity, decisions, your team, each employee, each package, every location, every driver, every truck, every plane, and even every individual shipping label, your actions, and the experiences you create are the most important part of what FedEx does. Regardless the gravity of a situation, the unhappy customer you may be dealing with, or the decision you must make, if you can honestly say you did everything you could do to make that FedEx Experience outstanding then chances are you made the right decision.

The Purple Promise illustrates Drucker’s point perfectly by saying it is the experience that is the most important, not the strategy. As a tree care company owner, if you were to approach everything you do by ensuring that the experience will be outstanding then how can you go wrong in your strategic planning, team member training, customer interactions, completion of your work, and most importantly how you approach your business as an owner and the support of your most valuable asset, your team.  

So, the real question comes down to this. What is your company’s ‘Purple Promise’ and how can you enhance your current work culture to ensure that your team is supported with outstanding experiences? Over the next 4 weeks, we will be investigating how important it is to have a supportive company culture as we dive into the financial and operational impact it can have on your organization.

As part of the Thrive family, we are offering a free business culture self-assessment to help you begin to identify some ways in which you can continue to enhance your company’s culture. The assessment is extremely easy to complete and will take you less than 5 minutes. Following the completion of your assessment, you will receive a summary of recommended areas of impact to consider as you continue to enhance your company culture.

 ArboRisk Insurance Thrive Program Free Culture Assessment

Insuring Permanently Attached Equipment

Written by Eric Petersen, CIC

It’s no secret, the vehicles that tree services are utilizing today are becoming more specialized and more important to the overall success of the company. Almost every vehicle that a tree service operates has some form of permanently attached equipment now. Whether that is the traditional forestry unit or a knuckleboom crane, the value of that truck with the attached equipment is obviously much different than what it was when the cab and chassis was rolled off the assembly line. Because of this, you should know what options you have on how that truck can be insured.   

To begin with, your standard Business Auto insurance policy is designed to pay Actual Cash Value (ACV) for Comprehensive and Collision coverage on your insured vehicles. This means the insurance company will calculate what the current value of the vehicle is at the time of the loss. They will look at comparable vehicles with similar equipment, take into consideration mileage and general wear and tear to determine the amount they will pay for the claim. 

That might be a fine way to insure the majority of your fleet, however, for a very unique or important truck, you may want to consider using your Inland Marine policy to insure some or all of the truck on Replacement Cost (RC). 

There is a new trend in the insurance industry where insurance companies are allowing tree services to separate out the coverage on a truck with permanently attached equipment between your Inland Marine policy and your Business Auto policy. Each insurance company will have different rules on this, but the most common approach is that the insurance company will insure the cab and chassis on the Business Auto policy for ACV and let you place the permanently attached equipment on the Inland Marine policy with a RC limit. 

With Replacement Cost, you will get the amount needed to replace the permanently attached equipment with a brand new attachment of like kind and quality, subject to the limit of insurance or Catastrophe limit of your Inland Marine policy. When thinking about the value of a knuckleboom crane attachment this can be a huge difference on your claim payout versus only getting Actual Cash Value. 

Other things to consider with splitting out coverage between the Business Auto and Inland Marine policies are the fact that you will have two claims and two deductibles for that one truck. You also may have two different claims adjusters to work with. Depending on the insurance company, many times you can only get RC on items that are five model years and newer, which can limit the number of items in your fleet that will qualify. Lastly, because the RC will be a higher value, insuring the permanently attached equipment on the Inland Marine policy for RC, the premium cost will likely be quite a bit higher. 

And while we are discussing very unique and important vehicles for your business, I’d like to remind you that you can purchase Business Income for those vehicles as well. We wrote a separate article on that topic that you can find here.

Because of the nuances and options of insuring vehicles within your fleet, it is important to work with your insurance agent to understand how your insurance company will handle the situation. While, it definitely takes more detailed effort and attention, to properly breakout the permanently attached equipment onto your Inland Marine policy, it has the benefit to truly help your company survive a bad accident with your prized vehicle.

Cost New – Business Auto Insurance

Written by Eric Petersen, CIC

A common question we get asked is what does the “Cost New” value mean on my Business Auto policy?

If you look on your Business Auto insurance declaration page you will see a dollar value listed for each of your trucks and trailers under the heading of “Cost New”.

This number is an important underwriting guide for the insurance company from an insurance pricing and claims standpoint. It does not set the limit of coverage for the vehicle but can cause problems with a claim and on your renewal if the amounts are drastically off. I’ll explain more on this at the end of the article.

First, let’s discuss what Cost New is and how it is calculated. 

The Cost New value should reflect the amount that truck cost when it first was manufactured.

This value is initially filled in by the insurance company with information they have on the vehicle according to the Vehicle Identification Number (VIN). It applies to only what would have been included from the manufacturer and does not account for any aftermarket parts or permanently attached items.

Many of the trucks and trailers that tree care companies own and operate have aftermarket parts/equipment added that dramatically changes the value of the truck. Think about the traditional forestry unit where a dump body and aerial lift or knuckleboom crane attachment are added onto a bare cab and chassis. That completely changes the value of the truck and it is so important to ensure that your Cost New values on your policy reflect the total value of the truck and attachments when it was first manufactured.

For example, (please note I’m making these numbers up!) let’s take a 2018 International 4700 with a forestry package (dump body and aerial lift) on it. The VIN of the truck will pull the Cost New of the cab and chassis. For this example we’ll say that number is $90,000, but the truck didn’t come off of the International assembly line with the dump body and aerial lift. Those parts were added afterwards. For the dump body and aerial lift components, we’ll assume they were $70,000 together. The value that should be listed on your insurance policy for Cost New will be $160,000. It doesn’t matter if you got a good deal for this unit in 2020 and only paid $100,000 for it as the Cost New is going to reflect the cost at the time it was manufactured and has nothing to do with what you paid for it. 

So how does Cost New affect the price you pay for insurance on the unit and will it affect how a claim is resolved?

The premium for physical damage coverage (Comprehensive and Collision) that the insurance company charges factors in the Cost New. So a higher Cost New will produce a higher premium and vice versa. That said, many tree care owners try to lower the Cost New to lower their premium. However, when a claim is filed for a vehicle the claims adjuster will look at the insurance policy to see the Cost New and any description of permanently attached equipment, in addition to the mileage and overall physical condition of the vehicle as well as finding the value of comparable vehicles to help determine what the appropriate value of that vehicle is. Having the most accurate Cost New, will help the claims adjuster give you the best value for the vehicle. To reiterate, the Cost New is not the coverage limit placed on the vehicle, but rather a factor that the claims adjuster will use to determine the amount they will pay for your vehicle. 

Lastly, we have seen insurance companies want to non-renew business auto policies with intentionally undervalued Cost New amounts. The insurance companies need to collect adequate premium for the exposure that they are insuring so they can be financially strong enough to pay the claims that they have promised to their policyholders. Since the Cost New plays a role in determining the price of your policy, the insurance company will want a reasonable value listed. 

To avoid any issues with claims or the renewal of your business auto policy, we always recommend to go through your vehicle list with your agent and ensure that not only are the vehicles listed correctly, but that they have proper descriptions of any permanently attached equipment and the Cost New accurately reflects a realistic amount.