Ombudsperson Due Care: United Way 211 Services

9 December 2010

In as much as I keep promising myself that I won’t do pro bono work anymore, I’ve done, once again, a fair amount of it this year.  An email or phone call comes in, I open the intake document and before I know it my “little voice” is telling me to take the case anyway regardless of payment.  In any case though I believe “we”, as professionals, are obligated and have a duty to follow through and provide additional due care that often extends outside our ADR procedures.

The definition of “due care” has legal, moral and personal safety terms in it, check your local dictionary.  During intake we are alert to personal safety issues at all times and so even after our diligence is complete, the obligation may not be over.  In such circumstances I recommend United Way 211 Information and Referral search engine to assist you, the ombudsperson, in the role of personal coach, advocate and facilitator to assist “impacted” clients.  This is a very effective role, as a third party in an advocate role because the gate keepers for services and resources will cooperate more fully than if the distressed client is representing themselves.  The UW 211 Service has been very effective and helpful to me as a “one stop” resource for any community in the USA where community services are now needed to help stabilize the “aftermath” of failed negotiations or life threatening event.

In my most recent case where I used United Way 211 my client had no computer, but had contacted me to assist her and her 3 children regarding eviction.  My decision to help was sealed when I was able to confirm her story with the FBI field agent in charge of her case where Citibank and Chase Bank employees are charged with mortgage fraud.  She gave me his number and he returned the call in minutes confirming she’s a material witness in his case.  After she lost her home she found expensive housing near her sons local high school and took it to try and keep his life stable too.  The results over the last year is that the stress of everything crumbling, like for millions now in the world, is she ended up losing her job as a Certified Physician Assistant and went on Social Security Disability.  To make a long story short we faxed “permission” to be an advocate for her with the property management company.  Negotiations lasted 3 days, which is all I was willing to spend, as they took the tactic of participating in conference calls to negotiate freezing her rent and avoiding any increases till June of 2011 when her son graduates high school and they can move.  No answers were ever given, though we could tell they were sending the request through channels.  In the end the property management took the position that “the going market rate” for her 3 bedroom apartment was actually higher than the increase.  I couldn’t leave the conversation without pointing out that the only reason they could do that was that they were ignoring “extended family” and “multi-tenant” rules of the property where more than one bread-winner occupies the unit.  Negotiations failed, eviction notice pending in 3 days.

What followed was half a day of consoling the client who was now extremely distraught.  As soon as I verbally and firmly assured her I would not “leave her behind” she settled down and began to focus with me; we got to work.  I told her I needed some time to put some things together.  In some cases I simply refer people to United Way 211, but in this case, she had no Internet, only a phone and was so emotionally impacted I had to lead and support her for a while.  Within one week we had her a new apartment under a state subsidized program and by her son’s high school.  We had move in funds from a local charity listed in UW 211 saying they specifically provide that in emergencies.  We also secured her a refurbished used computer from a Christian Ministry in the area.  She’s also applied for food stamps and disability is now approved through 2011 given “letters” we obtained to prove her case.

In closing, the “due care” process in my experience often extends beyond handling a case and in many cases the political and corporate “wranglings” that go on to delay critical decisions for the client go on into perpetuity.  Time is most often on the side of the larger more powerful entity in such situations.  You therefore should develop contingencies, make it part of your “best practice”, in your own practice to assist clients who are often emotional and severely “impacted” by slow bureaucracy that may just be benign about assisting or employees are “bound” by policy and procedure that takes years, if ever, to process.  Additionally, if UW 211 has gaps in resources needed, simply Google a list of non-profits by zip code for the case at hand and see what pops up.

Happy Holidays too to all…


Ethical “Disconnect”: Corporate Business Models, Universities & Student Plagiarism

2 August 2010

What I’m about to set forth here is my opinion based on years of business experience, being a part-time university instructor and more recently an “independent” ombudsperson separate from any formal affiliation with “institutions”, be they universities, corporations or government.  I sometimes, not frequently, get propositioned with e-mail and phone calls to participate with college students by mentoring, tutoring, expert opinion interviews, mock ADR sessions etc.  I also get requests to take online tests, complete homework papers, make capstone or thesis proposals and other forms of “cheating” and plagiarizing of course work.  I also recently took an anonymous call from a student who’s on campus ombudsman office, due to policy, would not “take the case”, but they seemed “guilty” as charged because they had difficulty disclosing details while engaging in anonymous guidance?  It’s this last call that’s prompting this article.  As the fall school cycle approaches I must point out, more than any other situation and issue facing America today, this is the most critical and damaging to all areas of our society, especially business, the economy and commerce.  Here’s why…

I have had, on occasion, the opportunity to bring up the topic of cheating and plagiarism with associates and colleagues and to my own astonishment, the topic of discussion is quickly diverted and participation “shunned” and even warnings or caution given not to bring it up again.  In fact, this moment, I’m well aware that the only reason I can discuss this here in my own blog is I’m not employed by an institution that would most likely view this content as politically incorrect; and I’m ethical and confidential about my “sources” at such times as this.  Nevertheless, here is just a tiny pinch of interesting Internet and media “discussion” I’ve picked up so as to have my perspective and some background on this issue IF you’ve been lifting the rug and sweeping it away yourself.

In a recent study by the Center For Academic Integrity it was discovered that cheating by university students is a “pandemic” at this time.  Some highlights of the study:

  • 90% of students surveyed said they didn’t believe cheaters would be caught.
  • 85% said cheating is necessary to get ahead
  • 75% of students admitted cheating.
  • 90% of foreign students at New Zealand universities admitted plagiarizing work in an anonymous pole.

Here’s a story and video about a university “pulling degrees” ad hoc after investigating “complaints” from employers.

Here’s a CNN story showing how the Internet enables plagiarism and the International listings for thousands of on-line libraries of papers for students and custom writing of papers guaranteed free of plagiarized content… clearly the definition of plagiarism has a new liberal shift.

You too are probably familiar with the very early Harvard Law School and University of Virginia media publicized scandals and I won’t detail those, but there is a lot happening now that the Internet enables the “seamless” work group business model between students, professors/instructors and corporations.  I researched these and others and discovered that back then, like now, this moment, the majority of university ombuds offices will not take any case where there is a dispute between faculty and students regarding “unethical” test or homework practices.  They have to stay politically correct while the reputation of individuals and media scandals “damage” the innocent and honest students that worked hard to maintain the quality and standards of their alma mater and employer, not to mention their own self-esteem.  A huge gap here in ethics, morality and doing the right thing.

Some of the attitudes I’ve run into, not from a handful, but dozens of MBA and Ph.D educators is very lax and liberal to say the least.  I’ve heard of and watched them doing work for students on-line, believe it or not, under their own names when the obvious thing would be to create a “pseudo” personality to do such unethical practices.  To them it’s “okay”, they give a variety of “rational” arguments, my favorite is that President Clinton “redefined” what sex is and isn’t, they realized that applies to other “ethical” areas also.  No harm done they insist and in this economy they say they need the income if they are unemployed.  For me personally, in these conversations, I refuse to “breach” my personal ethics and take a steadfast “death before dishonor” stance.  With one person I argued back that this was all fine until one realizes that the new CPA had their exams and tests taken by someone else and the law shields them from liability between their client and the government.  Or how about the engineer that builds in a design flaw on a new car or worse yet and aircraft resulting in recalls, waves of financial loss and even crashes that kill people by the family or whole plane loads… disgusting.  This last week a scandal regarding FBI agents cheating on a “legal knowledge” test is also adding to my personal bias now in getting this post out.  Again, this is just the tip of it all and I lose more “friends” this way…

I’ve also talked with university students that told me it was the unspoken yet accepted “culture” in certain circles in the university to work on projects that a professor was project lead for that a corporation was outsourcing to the university for because it’s cost-effective in that the “donation” made to the institution is tax-deductible, they get the results needed for their next product innovation and funds for R&D have dried up and are not tax-deductible or have policy limits.  This is fine, a competitive strategy indeed, but passing down work this way and then “making issues” or holding the student responsible is a the typical negative end result.  In this “power structure” the student is at a severe disadvantage. The students then describe the “pressures” from professors if they don’t produce, effect on grades and so they know they can go “outside” and on-line to get published “ideas” AND employ the Web2.0 model linking to anyone globally that can do the work.

The corporations themselves want to be profitable for shareholder quarterly earnings statements, if public, or if private, stakeholders in a joint-venture have a lot of power and “outsourcing” of jobs cuts labor costs to bring projects in on-time and on budget. Unfortunately students have told me that this business model and philosophy is well learned by students who “outsource” their own work, once they learn how, on basic subjects that they can’t do too because they don’t have the time or skill to learn or do the work, but have plenty of money for from student loans, scholarships, family trusts and even under the table stipends that are more linked to college athletics in the media than what we are discussing here.  Mixing up “priorities” gets in the way too of proper decision-making and is another factor I see personally.  Additionally, there’s a huge “ego” problem as students go to their party and brag how their work is being done as they speak, they outsourced it, just like the company they want to work for when they graduate.

To wrap this up, from my “arm-chair”, it’s already too late and it will take “ethical individuals” establishing a reputation that differentiates them from the majority of unethical student/university/corporate society to “make it right”. Surely such ethical individuals will soon be scapegoats and become disenfranchised quickly as they go against the grain of the “accepted cultural practices”.  Add to this a VORTEX of increasing or doubling of tuition to prop up faculty retirement funds from recent Wall Street loses, raising or holding to large salaries for existing faculty or corporate executives, no job for them “as promised” after graduation because it’s outsourced; and the corporate, university, government sponsored capital all link together in “cycle” to keep the status quo at tax payer expense in a severely economically contracting market.  NO ONE has the answer or is facing the reality of this mess because we compromised our educations choosing immediate gratification today over quality and delayed gratification based on honest work, ethics and true merit.  We wonder how Intellectual Property is “lost” to a foreign market?  The answer to that question, though outside the subject of this article, is also answered in this same relational business education “corrupt” model.  This is the conundrum.  This is the critical “big picture” mess everything is in nowadays and it’s embedded in the ever closer relationship between individuals and institutions linked directly to compromised educational and corporate business values at ALL levels of society.


Ombudsmanship & Successful Contract Negotiations

19 July 2010

Over the last six months I’ve been working on a long-term “contingency” project, something I said I’d never do anymore, but this time I just “knew” I could provide experience and skills needed to solve a long-standing deadlock.  In addition to that, a conservative modeling of the contract projected gross earnings of $2,000,000 the first year had a significant influence too, not to mention new jobs and filling a recognized gap in corporate communities nationwide.  The client contacted me and for about an hour at the beginning of 2010, she laid out a long and winding road of cycling back and forth over decisions between her and a Fortune 500 company seeking her organizations Wellness Program services.  She “knew” she didn’t have “control” over the situation and was perplexed as to how to get out of the whirlpool of wasting time, energy and resources and find a mutual solution for both sides.  Not to keep you, the reader, bored with all the background details, I’ll just say that after 12 full months all terms have been re-negotiated and the contract signed as of this month.  Success… here is what made the difference and you can consider it too.

First, I took an “asymmetrical” approach and to save even more time I simply offered to work day by day with her on whatever issue popped up and we would look at it and find the solution.  Key to this was COMMUNICATION and having complete open channels and reciprocity between us at all times.  I chose this approach after doing a case history and realizing the company was good at serving the end customer directly, very knowledgeable and skilled, but not at all familiar with partnering or sub-contracting to a larger entity.  All of the principles of The 6 C’s of Sociocratic Peace Building were also applied between “our team” and their entity.

Second, we re-established communications with the Fortune client on the basis or “excuse”, that it’s a new year and “whatever happened to our contract discussion from last summer” and within 24 hours an “invitation” came back indicating they’d like to pick them up and begin again IF some substantial changes could be made.

Third, the “terms” came over and an analysis began. In “corporate speak” there is a lot of talking, but no communicating and the “terms” I read indicated that I had a client that didn’t “speak the language” and her Fortune client knew what they wanted, but didn’t know the “how” to get it and this is the “unspoken” path to success… if one can “sense” it and see it.

Fourth, we replied with a proposal and began to negotiate the terms.  The “key word” that really opened things up and caused an immediate “surge” in activity was to propose a “pilot program” lasting 90 days.  This offers “both sides” the opportunity to discover if it’s going to work or not and then a decision is made.  We are now, the moment of this writing, PAST the pilot program point and a full open end contract was awarded.

Fifth, if you see “gaps” in terms between the two entities one side has to come forward and break the dysfunctional cycling of “talk” and demonstrate “substantive” solutions.  This has a cost attached, always, and for the first time, yet another barrier was over come because we put actual costs in a proposal.  In the closing rounds the Fortune client tried to get into a position so as not to have to pay for custom operational and administrative infrastructure required to manage the partnership and this took the longest time of back and forth discussion and providing substantiation of costs.  There’s a danger in this at this stage, but I won’t go into that to keep short here, but let’s just say there are “levels” of disclosure towards the objectives and goals as long as you keep pointing them out and repeating them as needed.

Sixth, the “compass” or guiding principle I gave my client in the beginning was to always answer this question in your own head at any given moment and stage of negotiations. “When are you in adversarial, neutral or consensus mode with your customer/client/partner?”  The practical answer to this question is that at any given time one never really knows, but you must “sense” where you are and RESPOND appropriately to keep a once stalled process moving forward.  You could be adversarial about points in the contract and communicating from a neutral stance and be in consensus on intentions and you have to constantly contemplate all of these dynamics.

In closing, most of “our” work is ad hoc to some situation, contract, relationship “gone bad”, but as I’ve written before and in this case specifically, you can provide “intervention” during the process of coming to terms between entities without lawyers and other “polarizing” traditions.  The minute you say, “I’ll have my lawyer look at this contract before I sign it”, you just performed a “mea culpa” that you may NEVER get an opportunity, as a party to an agreement, to bring to favorable outcome.  In this case my client never did this, but rather stayed neutral and kept a diplomatic position enabling and empower everyone to later move forward once communicating details of every single point was covered and substantive demonstrations of the capacity to “perform” were provided. This provides “confidence” on both sides to “get married” and begin a mutually beneficial, job producing, health preserving program.  For me personally, my “formula” for combining ombudsman ADR during a business activity as an ombudmanship skill continues to be viable and therefore substantiate my work in “the blue ocean” of opportunity.  Good luck in your endeavors too…


Ombudsman ADR: The “Due Care” Process

1 July 2009

Recently a young couple from Ontario Canada emailed me asking for my “intervention” on their behalf with the Ontario Provincial Ombudsman’s Office.  Their expectation was clearly that I would “leap into action” and make everything “right” based on their perceptions of my blog and the drastic economic hardship situation they’re in, still in this moment; and that I could “fix” it.  Their communication and situation, as it is with millions of people nowadays, was filled with panic and chaos in the messages and material they emailed to me.  I have to admit, I initially took the “case” at face value with the idea that I could “facilitate” and expedite their issue that was pressing in on them in their dire quest towards getting “communication” going with officials in government.  This case is about not taking short cuts, making assumptions, but remaining diligent and objective at all times; and keeping with “due care”… here’s why.

In business we’ve all heard of “due diligence”, the process in business and finance of determining the validity of information, peoples identity, facts, confirmation, the truth and many other factors in what is usually a very long checklist of items needed for a broad variety of organizations to “make a decision” and determine risk prior to any formations, transactions or partnerships.  “Due Care” is less diligent, but highly relevant for our profession in terms of determining the validity of a complaint, fact checking and then getting the information from “others” or various sources so as to form a basis, substantiate or confirm information provided by everyone party to the complaint or issue.

For this couple the concise issue was very complex, more complex than I realized after saying “yes” email it all.  By the way, the good thing about Gmail is whole “conversations” come over “in tact and in sequence”; and in this case this saved me tons of time as I could read pages of email in order of response (or see gaps) by each Canadian government agency.  In brief, the case is about an “engaged to be married” couple (complainants) who have put off the ceremony due to the economy and her loss of job, his loss of “normal” overtime hours, their apartment complex going “condo association” and being forced to move (about now from what I remember) their financial obligations on student loans, credit card debt, funds needed to put down deposits to move and the “key” issues of child support to his 3 children with his ex-common law wife who is now remarried.  I can’t help but put here, “are all of you who are considering an ombudsman career ‘sure’ you want to do this?”  Anyway, I took the case knowing I’m “on the outside working in” as the dynamic if I’m to take any “direct contact” approach, but am hoping to “coach” them to resolve it themselves.

After days of review on my “down time” I started my “due care” process.  I didn’t take a complaint form as it was not applicable.  Soon what became the core finding was that the government office that makes adjustments in decrease or increase in child support levels year to year had then forward their “findings” to the court.  The “court orders” their child support rate obligations to the 3 children changed, in this case it was  “significantly up” and final “hearings” to confirm this were pending.  To the couples credit they “did the math”, I was proud of them, as they sent the percentage calculations over to me on their “one person” salary income household, subtracted obligations and the new percentage of income the increase in child support represented as a “chunk” shall we say, of their total household income.  Calculations were also correct.  In the end, long story short again, calculations by the government office and given to the court were formulated on 2008 wages, which were “loaded” with overtime hours.  Now, for 2009, everything has collapsed, their normal two wage earner household now unable to “gross minimum wage” anymore and the “threat” of being “forced” by government to comply looms over them with possible seizures of bank accounts and drivers license suspensions (needed to go to work).  What I was able to do was find where a few “missteps” on their part in the government policy and procedure had been “anxiously circumvented” rather than processed in “order of sequence” and so we got them back on track by now filing an “objection form” with the government agency and I helped them “refine and consolidate” their message.  I am confident “O’ Canada”, you will listen to your citizens needs here and be “fair”.  I’ve “kept the door open” for this couple and have not heard back in about 5 weeks now, but it should proceed okay now as they are “back in sequence” with government procedures on their issue.

Additionally, all OO’s in this type of scenario can provide advice and “listen” so as to “calm panic”.  You can provide “wisdom” about available community resources, sharing a place to live with others in similar situations temporarily, identify resources in their community for them as they are “focused” on the crises and not focused in making choices to “sustain” themselves; and much more.  Be careful about “credit counseling” as this is a separate profession and industry that is regulated; and so don’t make a “mistake” and over step your due process while exercising your “due care” procedures.

In the end this case never required that I “engage” the Canadian Ombudsman’s Provincial Office in Ontario.  The clients had contact them and received “no response”, but I suspect it’s because the couple had not exhausted proper procedure with the responsible government agencies they were “complaining” about.  Due Care requires “we” insure such processes are exhausted and completed before an ombudsperson engages.  If “due care” and taking time to review “every word” of the case had not been completed “diligently”, I could have “over stepped” or even worse; advised them into taking action maybe creating a  “polarizing” incident.  You too then?  Due Care at all times, be sure, be professional, be objective and consider policy and procedure of those entities clients have “issues” about in complex scenarios.


The New Ombudsman: An “Open Letter” To Our Profession

24 June 2009

Last Saturday morning I woke up from a pleasant sleep and began to remember an unusual dream.  I’m adrift in the middle of the ocean, looking around as I effortlessly tread water and look around the horizon for land.  I don’t see any, but the sharks near me get closer and closer, though I’m not afraid in the dream, in real life Jaws pretty much did it for me along with the fact at age 7 I witnessed a shark attack on a little girl at a beach in California.  Anyway, back to the dream.  So, I notice I feel confident and am not afraid of the sharks and a huge gray battleship comes cruising by and all of a sudden I’m on the stern of a Destroyer looking aft and a “battle group” of war ships is chasing my ship now.  The COMM signals “battle stations” and I purposefully began to move and take my station.  It’s here the dream ends and at the time it was very confusing and out of context from my normal peaceful life.  Ever so subtly this would signal change and make sense.

It’s not lost to me that I’m “open and vocal” as an independent consulting organizational ombudsman in his first year of formal practice.  I have nothing to hide about this, but I also know from decades of experience in business, it isn’t long until you attract others to you who do not see things the way you do and feel that you are rocking the boat and creating problems.  I would in fact say that the problems are already there, have been there and the time is here to wake up and make changes.  This is what the “new ombudsman” is about.

So, I wake up Monday morning and proceed to begin my day and open an email titled “abc INQUIRY” all in capitals with a straightforward message from a board member of the organization.  He asks me to call his office at a specific time and date to discuss an issue that’s best dealt with over the phone.  Keep in mind I embrace this organization and a handful of its members have been mentors for me, but my direct experience is less than satisfactory.  To make this long story short, I’d placed my call, left a message and last Tuesday got the courteous call back.  In my mind I “forgot” the battleship dream and began to talk with them as if it were a social visit and I was wrong.  It seems this individual was “elected” by the BoD of the organization to approach me about misuse of their copyrighted material.  I listened to the case and the less than black and white verbal description of what prompted the BoD to take a focus with me on such an issue and when all was said and done I “capitulated” and said I’d remove the copyrighted content from my web site.  No, I’m not willing to “argue” the copyright fair use laws with them, which in my defense here was within my rights as I didn’t “hide” the author of the material, but rather used it in full display.  A violation would be if I had used the material and “extracted” it from their material and “made it my own” and this was not the case.

My battleship is going to maneuver now, not for a broadside, but simply to watch and see what will happen next, but in addition to all my “blog material” here on this site that advocates innovation and change and new methods, I’m going to now make some “direct” observations.

First, the world is in the biggest chaos of change ever seen in a long time.  Our profession is OBLIGATED to move and change and get into serving people, organizations and communities rather than keeping to themselves in their historical and bureaucratic ways.  In business strategy you are a “silo” unable to effect any impact or difference for your members let alone the broader external communities that you are in position and chartered to serve.  Yes, there are economic and legal constraints, but you accepted them early on and made the ABA your “master” even over the distributed network of offices and members you serve.  There are plenty of ways to be proactive and empower and enable people into the profession if you would but open your doors and at least look like you are interested in supporting “ombudsmanship” in the broader scheme of life.  My personal experience with your organization is mixed.  Again, I can’t tell you the respect and admiration I have for several members who in their work reach “outside” the bounds of the organization and inspire and educate and promote the organizational ombudsman profession.  If you don’t know who they are, call me, I’ll be glad to differentiate them from the rest.  The rest are the ones who “keep the gate closed” and communicate with extreme dysfunctional and patronizing fashions only to waste time and energy and worse, convey a false sense of interest in anyone from “the outside” participating with them regardless of their published “guidelines” which convey a false openness.  The project that was at one point in time earlier this year on the table with them resulted in a complete “out of context failure of collaboration”.  My proposed contributions were within context to open and published “discussion” materials on their web site.  Me, being the experienced consultant I am, had a solution and was offering it free including a simulated model and the replies with “nays” attached were so out of context and the excuses so absurd I just couldn’t believe it.  There are other issues I’ve read about and observed, but I can only speak for myself here and will now stop… but you all need to wake up to your service and obligations rather than “nit pick” my copyright violations of your material and accept the legal “fair use” practices.

In reply to some of the other questions and discussion, no, I’m not interested in getting certified by any organization that has essentially “resolved” to accept the “resolutions” of the legal profession where consumers are trying to find alternatives.  In the end, every professional organization in the ADR field is the same and aligned with the legal profession, consumers want more choice.  Create your own standards and get “unconflicted” so as to differentiate “true” ADR mediation from what is now ingrained in consumers as legal mediation.  Help to define it and differentiate in the face of “opposing” views of competing organizations that took the terminology and “skewed” it to their strategic advantage in dominating all other related professional organizations and individual independent practitioners.  No, I’m not interest in your training programs, I’ve been “trained” multiple times and ways and am “experienced” beyond any benefit.  My confidence and “know how” comes from years of “travails” in very tough situations with 10s of millions of dollars and families livelihoods sometimes at stake.  At this moment, you’ve not endeared yourselves to me and while I was waiting and watching with many others like myself, boomers looking for a new career option asking me how to get started, we are all currently considering entering into this profession… I won’t be aligning with you, but still do hold to the admirable standards and ethics you advocate for “our” profession.


The New Ombudsman and Payment for Services

5 June 2009

In my “other practice” a majority of clients are having  “cash flow” issues including one client I have as their “business adviser” for their Bookkeeping, Accounting and Auditing firm.  This is just one case, but virtually ALL of the places I am “virtually” are filing more complaints and issues about not being able to reconcile Accounts Receivables, Invoices and even POS or Point of Sale transactions later “charge back”.  Traditionally these go to a collections department in a big company, but what do we do when our “one person office” has such a large percentage of dead accounts.  We “paradigm shift” do we not?  If I’m observing this across the board in the last 60 days… it’s “melting” quickly out there as it’s my job to “know” before clients get stung.

I’ve noticed now if I go into a pub and even some restaurants, they treat me like it’s “fast food”.  I suspect lower prices to compete in the current economy were the main “driver” to this.  I’m reflecting on my last experience in a recession in the 80s where more than once I was asked to “leave the table” with my party so they could seat another “paying party”.  Indeed, it was back in the 80s many changes in financial transaction procedures began.  Hotels “blocked” out payment on your reservation by phone in advance for the full stay and gas stations started “pay first” before you pump.  Also I’ve noticed that often my credit card is requested when I place my drink order.  “Why”, I ask, “do you need my credit card now?”  With a big smile and flip of some hair and hips, “we are just opening your tab now, that’s all”.  Translation:  “We want to make sure you are good for it now and not find out at the end of your meal you can’t pay”.  Indeed, they “block” out about $100 in advance to “see if I’m good for it” before my drinks and meal come to the table.  Have you noticed any of this?

I am eavesdropping and reading and “chat”ing with professionals who all do business over the Internet and 100% are now saying business has been drastically OFF the last 30-45 days and started declining 60-90 days back.  A lady psychologist and friend has told me she has no new clients this year at all.  For me personally, my number of clients is up, but my fee per invoice is down, BUT I’m surviving.  Why?  Lower fees for services and advance payment policies.

It’s time everyone moves to “advanced fee payment” cycles.  I’ve advised clients to begin doing this.  Net terms and credit cards are fast obsolete as we can’t risk discovering 90 days later that the client took services or products and now they are BK.  Many people are shocked, humiliated and embarrassed as they discover their bank, no notice, cut their credit card limit significantly.  These “surprises” are what is driving this change and my recommendation here to you.  This is the best “free” consultation you’ll get from me this year.  My advice is “our profession” should begin to take fees in advance, even legal firms, psychologists, CPAs and “me” are all doing this now just like the hotel, pub and gas station.  If it’s a huge project, consider an “escrow” account similar to buying a house.  If fees are over small claims limits locally, set that as the point to move to escrow with “terms” for payment and anything “under” that limit is “cash in advance” please.  Once the work is complete it’s the mutual decision that requirements have been met.  This works well for fixed fee contracts, but can also work for projects that expand outside of the original time and scope projected for completion.  The idea is the clients want a result or solution and we want assurance they can pay for services.  There is “risk” here, but it is not related to funds anymore if clients deposit the fee, the risk shifts to “ethics, quality, resolution, satisfaction” from all parties for your work.  Collections agencies are a joke right now, over burdened and no way to collect from “defaults” where people can’t pay as the economic tidal wave slowly moves across America.

You also have an excellent option with escrow.com which more and more professionals are using.  It’s gaining in popularity.  Again, the client(s) deposits cash, you perform your “ombuds role” with a clear “self directed” result (service agreement terms) and the clients “release” payment from escrow.com account.  They do take a percentage of the transaction based on amount of the transaction, but it’s worth it to “assure” payment and it’s tax deductible as “banking fees” for business.  They will also “investigate” if you and the clients cannot come to terms, additional fees for this, but if it’s clear this is “self directed” then risks of additional disputes are lowered and the conclusion of the ADR services should happen without a negative consequence.

So, your choice, continue to bill… give net terms and hope to get paid or change your “habits” to up front advance fees and/or escrow procedures.  These times require that we adapt to survive.    All of my clients and myself now take payment in advance.  My Bookkeeping, Accounting and Auditing client has had “no resistance” to this for all of May.  I used to offer “half day” rates as a minimum block of time, lately I’ve offered 30 minute phone consultations to be more affordable and this scenario has “many takers” lately and is leading to longer term “commitments”, which is the goal.