From the December 1997 issue of Entrepreneur

Since smaller companies are less likely to have a drug testing program in place, they are at greater risk of hiring and then suffering the consequences of drug and alcohol abusers than larger businesses, says Dee Mason, founder and administrator of the Business Against Substance Abuse Coalition in Columbus, Ohio.

The results of hiring a substance abuser are not always clearly visible. "Unless there's an accident of some sort," Mason says, "the employer often does not realize this culprit is syphoning off the bottom line."

Mason cites five areas where losses can occur:

1. Productivity. A substance abuser is 33 percent to 50 percent less productive than a nonabuser.

2. Absenteeism. "Substance abusers miss an average of three weeks more a year of work, and they are three times more likely to be tardy," Mason says.

3. Medical claims. Abusers claim 300 percent to 400 percent more in medical benefits.

4. Pilferage. Fifty percent to 80 percent of workplace theft has been traced to substance-abusing employees.

5. Accidents. Abusers are 3.6 times more likely to have an accident on the job, 5 times more likely off the job, and they file 5 times more workers' compensation claims than nonabusers.

In addition, Mason says, employers can be held liable in court for the behavior of employees both on and off the job, as long as they are operating within their job descriptions.

Establishing a substance-abuse prevention program reduces losses and liability. And, if you do federal contract work of $25,000 or more annually, or if you have received a federal grant, you are required by the Drug-Free Workplace Act of 1988 to have a verifiable program in place.

An effective drug-free workplace program includes:

  • a written policy that clearly articulates expectations, practices and consequences;
  • employee education;
  • supervisory training;
  • drug testing; and
  • an employee assistance plan.

Mason says small businesses have a number of resources to help with creating and implementing a cost-effective drug-free workplace program. She suggests checking with your local chamber of commerce or trade association for assistance. Or call Community Anti-Drug Coalitions of America at (800) 542-2322 for referrals to resources in your area.


Jacquelyn Lynn is a business writer in Winter Park, Florida.

Train Track

On-the-job training (OJT) is probably the most common training method, especially in smaller companies. But getting the maximum results takes commitment, structure and follow-through.

William J. Rothwell, associate professor of human resource development at Pennsylvania State University in State College, and author of Improving On the Job Training (Jossey-Bass), makes these suggestions for OJT:

  • Articulate what you want to accomplish. You need specific goals to develop an effective program.
  • Do an honest assessment of how you are currently handling OJT. Most companies do what Rothwell calls "the old `follow Joe around the plant' approach" because they've never thought of doing it any other way. But the lack of structure produces inconsistent results; when the training ends, you won't be sure what the employee has and hasn't learned.
  • Identify one area to work on. Select one department or function to serve as your model.
  • Develop a curriculum. Gather employees who are good performers, along with one or two strong managers, and ask them to list the particular activities required by the job you've identified. Organize those activities into categories, then sequence the work according to the way a newcomer should learn the job. Use that to create an organized checklist of what the new employee needs to learn.
  • Train the trainer. Just because someone does a job well does not mean he or she is a good teacher. Invest in training programs to teach employees how to train others.
  • Use traditional steps. The sequence is simple, says Rothwell: Tell, show, do, follow up.

A strong OJT program can be an effective tool for your human resources development program, Rothwell says. Once you have thoroughly researched the job requirements to implement training, you'll have a solid foundation for the selection criteria you use in making hiring decisions. This can help you develop better interview questions and skill evaluations. It will also help with career development of existing employees and suggest appropriate cross-training needs.

Web Checkup

Taking advantage of the Internet's popularity requires more than just creating a Web site; it requires developing one that performs as a business management and marketing tool. Is your site as effective and user-friendly as possible? Hillary Bressler, president of .Com Marketing, a Web site development and marketing firm in Orlando, Florida, says these are the areas to consider when critiquing your site:

  • Navigation. It's critical that visitors be able to navigate your Web site easily. Bressler recommends a navigation bar on each page so visitors can click on an icon or button and move to other areas of your site without having to return to the home page.
  • Home page link. Each page of your site should be linked to your home page (use your navigation bar to do this) so visitors who have entered your site through a link from another site or who have browsed around several pages can easily return to your home page.
  • Interactivity. Be sure visitors have a way to let you know they've been there and give you feedback. "I recommend a `contact us' area where people can fill out a form with their name, address, e-mail address and comments," says Bressler. This allows visitors to ask for more information and gives you an excellent way to build a list of prospective customers to use in future marketing campaigns. The contact page should also include your physical address, phone number and e-mail address.
  • Speed. Web surfers may not have the patience to wait for complicated graphic files to load, so don't invest a lot of time and energy in meaningless artwork. You'll want to include your logo, graphic elements that help identify the page and site, and any appropriate product images. But don't get so carried away that it takes too long for your site to open, or visitors will get bored and go somewhere else. You can also use graphic compression tools to reduce the size of graphic files so they load faster.
  • META tags. These are the codes--either single key words or longer descriptions--that help the Internet search engines categorize your site. Check with your Web site builder to be sure your site includes the appropriate META tags.
  • Content and purpose. Look at your site through the eyes of a stranger and ask yourself if it makes sense and if it's targeting the right audience, Bressler says. "It's important that your home page let the Web surfer know exactly what you do and that every other element of the site promotes its basic purpose."

Eyes On The Prize

Business trendies have become preoccupied with thinking their way out of the box; homebased business owners, on the other hand, are trying to think their way in. Dun & Bradstreet's (D&B) Business Solutions in a Box is just one of the prizes luring home office owners to compete in the Homebased Entrepreneur Challenge, a new contest sponsored by D&B and Entrepreneur's Home Office magazine. Top awards include a cash prize of $10,000, an IBM laptop computer, Proven Edge Professional Edition Software and Business Solutions in a Box, with personalized problem solvers ranging from insurance and financial services to marketing and risk management. George Martin, executive vice president of mass marketing for D&B, calls Business Solutions in a Box "an enabling program."

How do you qualify for the goodies? Simple. Just gripe to us. In 100 words or less, describe how you solved your biggest business challenge, headache, nightmare, roadblock or black cloud. "We want to help businesses resolve their problems earlier and more quickly," says Martin, "by tapping into our huge database and years of experience."

Two monthly winners--from November 1997 through March 1998--will receive Business Solutions in a Box and a one-year subscription to Entrepreneur's Home Office magazine. All entries must be received by March 31, 1998. For official rules or an entry form, call (800) 357-7299, ext. 420.

Second Chance

As business volumes fluctuate and companies try to find their optimum staffing levels, the question of whether or not to rehire a former employee is becoming increasingly common. Billie Morgan Allen, Ph.D., professor of management at The University of Southern Mississippi in Hattiesburg, says there are advantages and disadvantages to consider.

On the plus side, it's possible to reduce the chance of making a hiring mistake because you know the former employee's skills, abilities and working style. "You know the person, and they know your system," says Allen. "If they were successful before, it eliminates the risk in hiring."

However, she cautions that you need to carefully consider why they left, what they've been doing in the meantime, and why they want to come back. In these days of low unemployment, you may be tempted to rehire a marginal employee because you need bodies, or you may have allowed yourself to forget an individual's undesirable traits. That can be dangerous, Allen says, from both a quality perspective and because of the impact on the morale of other employees.

When hiring, it's a good idea to take a close look at former employees. But, says Allen, "Be careful. Think it through, and make sure you have all the facts."

Where Credit Is Due?

You've heard the warnings about extending credit, but turning down credit risks isn't as easy as it sounds. If you deny credit to another business, you must follow certain federal guidelines when you tell them your decision. The provisions of the Equal Credit Opportunity Act (ECOA) became mandatory for business creditors in 1997 and are designed to protect companies from illegal credit discrimination.

Within 30 days of denying credit to an applicant, you must provide a notice containing a statement of the action taken, the specific reason for the denial of credit, the name and address of the creditor, and a copy of ECOA Notice 701(a), which is a statement of the ECOA anti-discrimination law. Also include the name and address of the federal agency that administers compliance. Consider drafting a standard letter that includes these points, with the reasons listed with check boxes next to them.

Some specific reasons for the denial of credit may include delinquent credit obligations, unfavorable references, the need for additional references or the inability to verify references. Do not cite your own internal standards and policies or the applicant's failure to achieve a qualifying score on your scoring system, as these would not be specific enough to comply with the requirements of the guidelines.

You must maintain records on credit applicants for up to one year, depending on the size of the company you denied credit to and whether they request additional information about your decision. For complete information on your rights and obligations as both a business creditor and borrower, contact the Federal Trade Commission, Sixth & Pennsylvania Avenue N.W., Washington, DC 20580, (202) 326-2222.

Contact Sources

Business Against Substance Abuse Coalition, (614) 224-4506, deemer@aol.com

.Com Marketing, (407) 774-4606, bressler@commarketing.com