Two articles arrived in my inbox recently that give further perspective into the definition of this "New Career Economy".

If you’ve followed my writings, you’ve seen the phrase "New Career Economy" several times. Let’s review what we’re talking about here. The term “New Career Economy” came out of a study in 2005 that was commissioned by The Entrepreneur’s Source. The word “New” in the phrase unfortunately did not mean “Improved.” Instead, it predicted a growing storm on the horizon related to careers (i.e. jobs). Some o f the predictions at the time seemed overly pessimistic, even though the “storm clouds” were just appearing:

• Increasing down-sizing of corporations due to outsourcing, efficiency improvements, mergers and relocations.
• Massive pension deficits and the threat of the insolvency of Social Security programs.
• More frequent layoffs and lengthier amounts of time on layoff.

Economic upheaval forced by colossal consumer, corporate and government debt. Enormous corporate bankruptcies were forecast. Longer work hours and less pay for those “fortunate” enough to stay employed.

So back to the two articles I received. The first was a Washington Examiner article by Steve Adams.

Two quotes from the article caught my attention:

• “The modern office/factory-model job as we know it actually could be headed for extinction. Goodbye, permanent employment. Hello, contingent work, contractual employment and ‘composite’ careers.”
• William Bridges, the visionary executive development consultant and author who named this phenomenon “dejobbing,” foresaw this years ago: “What is disappearing is not just a certain number of jobs -- or jobs in certain industries or jobs in some part of the country or even jobs in America as a whole. What is disappearing is the very thing itself, the job.”

Wow! The article goes on to discuss the predicted ìlookî of careers in this future which are largely based on a more freelance, independent contractor model where greater percentages of people are essentially self-employed. To the author’s credit, he even discusses some of the upsides of this future world, such as more independence, less feeling of entitlement and more self-reliance.

The second article came from MSNBC.com and was written by Eve Tahmincioglu. Several observations from the article are worth noting:

• Monster.com saw a 46.2 percent spike in contract job postings in March compared to the same month last year... Overall job listings increased 32 percent in the same period.
• Littler Mendelson, one of the largest employment law firms in the country, predicted in a report last year titled “The Emerging New Workforce” that 50 percent of new jobs that emerge after the recession will be contingent positions, and as a result “as high as 35 percent of the work force will be made up of temporary workers, contractors or other project-based labor.”

Gary Mathiason, senior managing shareholder at Littler Mendelson, expects to see a rise in the use of contingent workers in highly skilled positions - including scientists, engineers, professionals and managers - as companies aim to do more project-based work with small groups of professionals they can bring in as needed. He compares it to making a movie, where producers bring in the crew needed to get the job done.

This article goes on to discuss the frustrations and instability that workers feel as a result of the changing career economy. It also talks about this business model being a “mainstay” of the economy even after economic conditions improve, but at the same time may be countered somewhat by regulation and government programs aimed at potential abuses of worker classifications.

So what’s the point of sharing all this scary information? Simple. It does us no good to stick our heads in the sand and ignore the warning signs. When the "New Career Economy" predictions were made five years ago, they seemed preposterous.... too scary to believe. Yet what actually transpired over the last two years happened faster and scarier than the predictions!

Our challenge is to think beyond even the initial problem of finding work to support ourselves and our families in this New Career Economy. More than simply having an income is the question of how we build wealth, save for retirement, fund the recreational pursuits of our lives and ìmake our markî in the world. If more of us are going to be self-employed (forced or voluntary), doesn’t it make sense to look for ways to do it successfully? For those of us choosing the route of business ownership, the New Career Economy puts more pressure on us to get it right, make our businesses thrive, and create them in such a way as to make them an asset which serves the rest of our life rather than a place to go to work serving the business.

It will take collaboration. The image of business owner as the independent free-wheeling loner who goes from rags to riches by the force of his or her character is a rarity today. Instead riches will come to those who find mentors, coaches, associates, partners, etc. who help support their business and each other, thus lifting all of them to greater success.

Jerry Baltus
The Entrepreneur's Source Franchise Coach 

New Career Economy® and The Entrepreneur’s Source® are registered trademarks of TES Franchising, LLC. All rights reserved.
 

It’s a bit early, but have you thought about what your New Year’s Eve resolution for 2010 will be? With 2009 being a tough year for many financially, maybe a resolution or a promise to yourself regarding your career is in order. The corporate world has protected and sheltered many for years, however, there are no certainties any longer. Multi-billion dollar industries, like the telecommunications, pharmaceutical, and the automobile industries, which once employed hundreds of thousands are now truly diminished in size, and find themselves back pedaling (if they exist at all anymore) for the bad decision making and lack of future visionary planning. And who’s accountable for the many jobs lost? No one really. Executive decision makers move on and dedicated employees are left wondering what happened.

Whether it is security or loyalty, being an employee today is riskier than ever. It’s no longer safe for individual employees to leave their destiny, income and lifestyle to others who don’t have their best interests at heart. In this New Career Economy, with unemployment rising and long-standing companies closing, it’s time to revisit your original dream and look at business ownership as a means to self sufficiency and financial security.  

We’ve all dreamt at one time about owning our own business -- maybe it’s time to think about it more seriously. Business ownership can give you more control of your life -- and it can be rewarding and lucrative -- when you find the right business concept that meets your lifestyle, goals, and needs.  As there are many roads to happiness in life, there are many ways to be successful at business ownership. A couple of things do come to mind as good to have in your arsenal of tools: passion, determination, and a little bit of business savvy.

As a business owner for 26 years now, I was apprehensive at first -- maybe a bit fearful. But over the years I’ve learned that FEAR stands for False Evidence Appearing Real. Opening a business means taking a risk and rising to challenge. The idea is to take the nervous energy and turn it into positive adrenaline to begin building your ideal business. Remember you are in charge now. You can call the shots and reap the rewards for your decision making.

If you are coming from the business world, you will find that your transferrable skills built up over time can be very transferrable when running a small business. There are many support groups for entrepreneurs both locally and nationally. Your Chamber of Commerce is a great place to start and you can actively find groups using Meet-Up, an online service bringing like groups together and advertising their meetings. National organizations like WEBB (Women Empowered by Business) also provide support and a network of business owners to call upon for advice and counsel.

So make your 2010 New Year’s resolution about making the career change that will give you the lifestyle of your dreams.  Whether you have an idea to run a startup business, buy an existing business or maybe consider franchising, there’s a plethora of advice and support available to help in your research.

As franchisees become operationally and financially successful in owning and managing their first franchise, oftentimes they begin to look for new avenues of growth. As in multi-unit franchising, multi-brand franchising can be very lucrative and has become a growing trend in the industry. While restaurant operators continue to dominate in this space, other industries including financial, real estate, business coaching, automotive and hospitality, are also becoming popular as well.

Investment diversification is a big reason why franchisees might consider broadening their portfolio of brands. In an uncertain economy, operating brands in different market segments can balance each other out if one sector gets hit harder than another. However, in contrast to that, there are synergies that complimentary brands offer like referrals, shared services, co-brand marketing, etc.

Franchisors also benefit from multi-brand franchisee relationships. They have fewer franchisees to manage and are selling more units. Their franchisees typically tend to be successful operators who understand franchising and have industry specific experience.

As a franchisee, multi-brand ownership has considerable advantages:

Centralized support. The existing infrastructure needed to support one franchise can oftentimes support other business units or franchise brands such as accounting, human resources, and operations. Here the multi-brand operator is growing profits without greatly expanding the home office staff.
Balanced economic cycles. Operating brands in several market segments can help smooth the ups and downs of an uncertain economy.

Balanced cash flow. Cash flow from one business can offset a slow market in another
Co-branding. For brands that bring some synergistic value to each other like a similar target market, money can be saved in advertising, shared real estate, referrals, and marketing and PR support.
Taking on a new challenge. For serial entrepreneurs always looking for that next challenge, the adrenaline rush of opening a new business or a new concept is addicting and more exciting than managing the daily operations of a single unit.

Similar industry knowledge. Experienced franchisees can benefit from their existing knowledge and experience by investing in a similar concept in the same industry. Market understanding, co-branding, and less ramp-up time all contribute to reaching a higher level of performance faster and easier.

There are any number of growth strategies a franchisee can consider to begin building an empire. Whether investing in multi-units or multi-brands, profitability is in the numbers. Do your due diligence, speak to franchisees, and follow your gut instincts. My guess is, if you are considering this kind of investment, you’re already doing something right.

Owning a single unit franchise can be a sure path to self-sufficiency. But many seasoned franchise owners know that the money is in the numbers – or number of units. Today, roughly 49 percent of franchisees are multi-unit owners.  So if you want to grow in numbers and become a multi-unit franchisee, successful franchisees will tell you a mindset change is needed.

As you begin to consider whether your next move should be as a multi-unit operator, believe it or not, today’s rocky economy might very well be opening doors for that type of franchisee growth.

While other business owners might find it hard to acquire credit, established franchisees oftentimes can bank on their relationship with their franchisor to support their growth. If a franchisee is a known and proven operator, franchisors may be open to negotiate franchise fees and other agreement terms allowing the franchisee to expand by purchasing existing units, or expanding untapped territories. Also, for retail business concepts, the plethora of available commercial real estate is forcing landlords to be more flexible in their agreements and to be more likely to negotiate terms. And, if the franchise business model requires employees, the high rate of unemployment can take pressure off finding and retaining talented, qualified employees.

Okay, so while the economy might be creating opportunities for franchise growth, once you become a multi-unit owner, what does it take in the long run to become successful? No matter what sector you invest in, you cannot build an empire without strategic planning and effective leadership. Your strategic plan should draw on a team of advisors that includes a franchise business coach, financial experts, legal resources, and others. Depending on how many units are at stake, building a multi-unit operation requires stepping away from micro-managing and becoming comfortable with delegation.

Taking your business to the next level also requires creating an efficient, high-performing infrastructure. You will save time, money and efficiency as you systematize many of the operational processes that work well for your one unit. And, depending on the number of units you invest in, you’ll ultimately need to create clearly defined departments (i.e. human resources, operations, training, etc.) staffed by the best people you can find.
Although the initial total investment for multi-unit franchising is higher than opening a single unit franchise, the risk can sometimes be lower. Owning more units can actually increase the overall probability of success. Also, multi-unit franchisees are likely to have more input with their franchisor, creating a win-win situation for both sides. My next blog will discuss the benefits of owning not only multiple units, but multi-brands as well.