Business owners often seek extraordinary solutions to corporate
growth problems; however, after making significant investments, the
net results often are incremental improvements at best. There are
simple corrective actions that substantially can increase business
revenues, profits and corporate value.
An ideal organizational structure reflects a pyramid with a
large base of junior employees topped by significantly fewer senior
leaders. The logic is that if you follow a standard pricing model,
profit margins are much higher for junior employees than margins
associated with senior employees. You can reach this conclusion by
following what I refer to as "the rule of three," which considers
direct costs (such as an employee's salary), overhead and
For example, assume you pay a junior-level employee $17.50 per
hour. Multiply that number by three to determine the amount you
should charge a customer per hour for that employee's work. In this
case, the amount would...
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