Part 2 of 2. Click here for part 1. Can all those rules and regulations designed to protect buyers and allow them to cancel contracts your counselors spent hours to sell actually be good for business?
Yes they can, with properly drawn contracts and well-trained counselors.

Truth in Lending
If the buyer is permitted by the terms of the contract to pay the obligation in more than four installments, regardless of whether interest is charged or not, there are Federal Reserve rules that apply. The rules are based on the Federal Truth-In-Lending Act as amended and Regulation Z (12 CFR 226, et. seq.).

For purposes of this article, we have focused on the traditional method of financing, which the rule characterizes as "Closed End Credit." This kind of credit provides for an amortization of the purchase price over a fixed period of time at a specified interest rate, such as: five years, with monthly installments, at 8 percent interest. The Truth-In-Lending Act and Regulation Z require the seller to disclose the following information to the buyer:

the amount financed.
the right to receive an itemization of the amount financed or a reference in the contract to where the amount financed is itemized.
the amount of the finance charge.
the finance charge expressed as an annual percentage rate.
the total of payments.
the number and due dates, along with the amount of those payments necessary to pay the full obligation.
the total sales price.
descriptive explanation of the annual percentage rate, the finance charge, amount financed, the total of payments, and the total sales price.
the amount and how delinquency charges are calculated and charged.
the creditor's polices on finance charge rebates or prepayment penalties.
whether or not a security interest is retained by the creditor until the obligation is paid in full.
a statement that the consumer  should refer to the contract documents for any additional information about nonpayment, default, right to accelerate, prepayment or abatement penalty provisions, and so forth.

Regulation Z requires that these disclosures be "clear and conspicuous" and that they be grouped together and segregated in the contract from the rest of its provisions.

There is no question that installment sale cemetery and funeral prearranged contracts are covered by the Truth-In-Lending Act and Regulation Z. There is a provision for state exemption—where the state law may be the same as or more restrictive than the federal law, but I am not aware of any state exemption application or a circumstance where a state exemption was granted by the Federal Reserve. The federal law preempts state law.

The Federal Reserve has provided a form for sellers to use in disclosing the required information. The form is referred to as the "Federal Box," and in theory, using it should ensure sellers that they are in compliance. The Federal Box looks like H-l: Credit Sale Model Form (see below).

 
Going back to my previous point on the importance of consistency in language, you should make sure that your consumer contracts are consistent with the language used in the Federal Box. In your contracts, where the purchase price is calculated, the references should be to "total sale price," "cash down payment," and "unpaid balance (amount financed)" in order to be consistent with the terms used in the Federal Box.

Finally, the Federal Box must be outlined in bold so that it sticks out and the buyer's attention is drawn to it, and the interior boxes that disclose the "annual percentage rate" and the "finance charge" also must be highlighted or made bold in comparison to the three boxes next to them.

Consumer Remedies
A buyer can void or collect ascertainable damages as a result of consumer contracts which do not comply with FTC or Federal Reserve requirements. In either instance, the buyer may also collect attorney's fees and expenses. All the buyer has to do is show that the contract (or contracts—the law permits class action claims) is incomplete or inaccurate as to one or more material elements of the mandatory disclosures or that the contract does not use the terms defined and required to be used.

Since contracts that do not comply with federal requirements can be voidable, those contracts not only are not an asset to the company using them, they are contingent liabilities that may actually reduce the value of those companies. That is why sophisticated potential buyers of a cemetery or mortuary business examine the form, content and extent of use of consumer contracts as a significant element in their due diligence.

The Funeral Industry Practices Rule
There are other mandatory federal disclosures arising out of the FTC’s Funeral Industry Practices Rule. If a seller is contracting to deliver funeral and burial merchandise and services, the seller must comply with the funeral practices rule.

Those disclosures are numerous and comprehensive and could be the subject of another article. Interested readers are directed to the rule at 16 CFR 453, or more generally to the FTC Web site, www.ftc.gov, where there are lengthy explanations on complying with the rule. There is also an FTC sample form of contract that provides some insight into the FTC's perspective, a consumer guide for funerals and other information.

Buyer's Protection Is Seller's Protection
Over the three decades that I practiced law, I heard a steady din of complaints about these rules and others adopted by federal and state regulators to protect consumers from themselves. Yet, as I suggested earlier, these contract disclosure requirements provide your company the opportunity to strengthen its position in a contract dispute and can even help your counselors make a sale that otherwise would not be made.

Let us first consider the case of the sales counselor making a home presentation. Because the buyer has the right to cancel, the "I can't make a decision today; I need to think about it" objection evaporates. All the counselor needs to do is point out that if the prospect changes his or her mind, the contract can be canceled simply by delivering the attached cancellation notice to the seller.

If the price being offered is a program price only good that day, the potential buyer has even more incentive to buy today, not tomorrow. The buyer has nothing to lose and everything to gain.

Experience suggests that most prospects know and understand why they purchased funeral or cemetery arrangements preneed—the risk of cancellation is not great, particularly if the counselor has done a good job of explaining the advantages of prearrangement, which are sizeable. Therefore, you should encourage counselors to point out and explain the right of cancellation and other buyers' protection clauses in the contract, and use them as additional reasons to justify closure then and there.

Once the cooling-off period has expired, there can be no question as to whether the contract is binding on the customer. After all, the notice of right to cancel is required to be in "immediate proximity to the space reserved in the contract for the signature of the buyer." Since the right of cancellation was right there near the signature space, surely the customer read it. Even if the customer did sign an agreement without reading it, by doing so he or she assumed the risk of loss.

Parenthetically, most states require another disclosure that arises from the Uniform Commercial Credit Code that requires, among other things, a statement (also in close proximity to the space where the buyer's signature goes) that the buyer not sign the agreement before reading it or if it contains any blank spaces, and that the buyer is entitled to a copy of the agreement.

What about a customer who dishonorably asserts that he or she did not receive the notice of cancellation form? To prevent that from happening, in our funeral homes we make the notice, in duplicate, an actual printed portion of the contract. Further, we require the customer, as part of the "buyer's acknowledgment," to concede in writing that he or she received the notice of cancellation attached. Finally, we also have gone the extra mile by noting on the contract whether the sale was a "home" or "office" sale, so that the applicability of the cooling-off provision can be determined from the face of the contract.

Our policy is that our counselors and funeral directors must discuss these provisions with the prospect. In fact, Illinois state law requires that in prearrangements the customer acknowledge that the cemetery or funeral home representative explained the material terms of the contract before the contract was signed.

In summary, an educated customer is in a better position to appreciate and understand the contract if the counselor takes the time to explain why and what the terms mean. Once explained and disclosed, these buyer's protections make it virtually impossible to get out of the contract (and improbable, as well, as the customer will understand and appreciate the significance of the transaction).

These disclosures become, then, additional tools for the counselor to use to reaffirm the importance and fairness of the deal, to emphasize that the customer is protected and to give him or her confidence in the principle that there is more value there than just a couple of spaces or a casket. What the customer is really acquiring is a long-term relationship. When that is understood, there is truly great power in legitimacy.

What does your cemetery or funeral home have to fear? I submit that there is nothing to fear. If the counselor did his or her job right, the customer will not want to cancel. If the counselor didn't convince the customer, then it wasn't a deal anyway and all of the signed agreements in the world won't change that. In the end, contracts are only as strong as the people who stand behind them.

Reprinted with the permission of Wakarusa River Management Co., Copyright 2004. All rights reserved. Neither the author nor the publisher is providing legal advice through publication of this article. If such advice is needed, the services of a qualified attorney should be sought.

Protecting your funeral home or cemetery from lawsuits and bad publicity isn't just a legal and public relations issue, it's an ethical one. Creating an ethical workplace is not an indefinable goal; there are specific steps you can and should take to make sure you and your employees are behaving ethically to each other, to other businesses and to the customers whose trust we need.

(Editor's note: This article is excerpted from a workshop at the ICFA 2004 Convention & Exposition in Nashville.)

Today in the business world in general there seems to be a problem with a lack of ethics. We've all read about corporate wrongdoing, improper trading practices on Wall Street and, within our own profession, the Tri-State Crematory scandal.

In our profession, we rely on our families' trust, and in the current business climate we have to work to keep it. As managers, we believe an ethical organization can be created.

Successful leaders need to see that having an ethical system in place is important for the long-term success of the company, and that like most other systems, the pieces are interrelated—it's not good enough to have one piece, you really need a complete system.

You need to identify the ethical values important to you, and you need to communicate them to your staff. You yourself need to live by those values and hold the people who work for you accountable for doing the same.

You need to have ways to reward, recognize and celebrate ethical behavior when it happens. You need to have guidelines in place so people know what to do, whom to go to and how to get help if they are unsure about how to deal with something.

As a profession, we continue to base a majority of our sales compensation on commission and that can make it difficult, when you are rewarding only productivity (paying people according to how much they sell), to also stress the importance of ethics and the long-term health of your company. Think about that when you evaluate your compensation package, when you hire and train salespeople.

Finally, you need to monitor and audit constantly, because you can't just trust blindly.

Examples from the Field
In addressing this topic, we need to include a disclaimer: We know we're not perfect; we're not setting ourselves up as the epitome of ethical behavior. But this is a topic we are passionate about, one we try to address in our own organizations.

Three examples from our own workplaces:

• Toson Hentges: We have been doing random drug testing at our company, and not long ago one of the employees selected refused to take the test. He was a fairly valuable sales counselor, and I tried to convince him to take the test, but he refused. I gave him an ultimatum: Take the drug test or go to drug counseling. He quit. I was very upset, because, as I said, he was a valuable counselor and I didn't want him to leave, but I did not make an exception for him.

• Thompson: Years ago, when I hadn't been at Mountain View very long, I happened to learn that a body we had received from the medical examiner's office had been buried without the viscera being replaced in the abdominal cavity. I was appalled—this was part of the body that hadn't gone in the ground. I called the family, told them what had happened, apologized and asked what we could do to try to make it better.

To my great amazement, they said they were shocked that I was honest enough to tell them about our mistake, since there was no way they could have known if I hadn't. We talked about the situation and they were satisfied with the solution we reached, which was to commit the additional remains to the ground in a vault above the casket.

Over the years, I've had to deal with other difficult situations, some harder than that one, and I have yet to be disappointed by a family's reaction. My staff knows that when we make a mistake, I'm going to call the family. I make it clear to our staff that this is how we handle things. I've made that a kind of mantra that I keep in the back of my mind: "We have to be willing to tell families when we make it a mistake." I don't ever want to lose their trust.

• Thompson: In the category of "rules apply to everyone," I had a problem with one of our sales counselors, who had a tendency to "forget" that we have a lead protection system. This counselor got a call from a friend and, without checking the lead protection system, wrote up a funeral plan worth several thousand dollars for this person, who was an active lead for another counselor. The customer called to tell me she would cancel the contract unless her friend got the commission, but I felt it was important for my sales counselors to trust what I tell them. We returned the customer's money, and I think it will be a very long time before that sales counselor ignores our lead protection system again.

Avoiding Frog Stew
People who end up doing unethical things don't necessarily start out as bad people, as people whose goal is to cause trouble for your cemetery or funeral home. It often starts out very small. Maybe someone takes a little bit of money, gets away with it and from there, the situation snowballs.

We call this "boiled frog syndrome," or "frog stew." When you throw a frog into a pot of boiling water, its reaction is to jump back out, and it survives. But if you put a frog in a pot of room-temperature water and then gradually bring the water to a boil, the frog doesn't sense the temperature change, doesn't hop out and gets boiled to death. The same thing can happen with people and ethics. Ethical behavior slowly gets away from us and before we know it-frog stew.

How do you go about ensuring ethical behavior within your company? You have to develop an ethical system, just as you have a financial system and a marketing system. After all, the presence of ethical behavior is just as intrinsic to long-term organizational success as effective communication, good planning or proper financial management. Once that system is in place, it must be supported by the company leaders and management practices. It can't be put in place and neglected; it must be supported all the time.

The first step is to identify the ethical values you want upheld, make them crystal clear and make sure they address everyone. Don't think only about how your employees interact with customers; think about how they interact with each other, with vendors and with the community at large.
Don't make assumptions. You may think that all of your employees know that it's not OK to go out to real fancy dinners with a vendor on a regular basis and refuse to see any other vendor with a similar product, but maybe some of them don't know. You need to make sure the values you want upheld are well communicated:

• Get your management team to write down your ethical values. It forces you to be specific, and it forces you to be accountable as managers. If you're going to put something out there for employees to follow, it's important that the managers do so.

• Make sure they're widely disseminated. I think all of us have had the experience of walking into a business where they have a section of a wall beautifully decorated with a picture of the founder, and maybe a list of the trustees and a copy of their mission and values statement. But if that plaque on the wall is the only place your values statement appears, you are a company looking for trouble.

You need to talk about your ethical values in the employee newsletters, in e-mails at company meetings, during performance reviews. You need to be talking about it all the time. Otherwise, next thing you know people are taking longer and longer lunch hours. After all, who's going to notice? And then maybe a sales counselor decides to cover the down payment in order to make a sale. After all, won't the boss just be happy about the sale? It's very easy to talk yourself into moving just one step away from OK, and pretty soon you're several steps away and then-frog stew.

• Talk about your ethical values when you're interviewing job applicants. Remember, it's a two-way process: You're evaluating candidates and they are evaluating your company. It's only fair that you tell people what your expectations are and that you make sure they know you take these ethical standards seriously as a company.

• Talk about ethics all the time. To quote Gary O' Sullivan: "Talk about it till you puke."

Embedding Values in Your Company's Infrastructure
• Consider ethics in hiring. Evaluate how well job candidates seem to fit in with your values. When someone is hired, include another discussion of values in the orientation process.

• Make sure your company's leaders and managers live the values they are preaching to employees. As a supervisor, you need to act like you're being watched, because you are. Every day, every action, your employees are watching you. Are you doing what you tell them they are supposed to do?

In doing research for this presentation, we read about a consultant working for a large Fortune 500 company. He was talking to the head of human resources, who was really upset because so many people in his department were cheating on their expense reports. "We're supposed to be setting the example for the whole company," he said, "and my department's one of the worst. I can't figure this out."

It didn't take the consultant long to find out that the department head, who traveled all the time and was entitled to fly first class, was trading in his first-class tickets and pocketing the difference. So it really was no surprise, for example, that his employees were charging the company for meals they could have had but didn't.

Your staff looks to you to set the tone, to set the example. You need to realize that the little things count.

Thompson: As an example, one day I caught myself doing something I shouldn't have. There was someone I didn't want to talk to, and instead of telling the switchboard operator to say I was unavailable, I told her, "Just say I'm not here." That wasn't true, and by asking her to lie, I was saying to my employee that under certain circumstances it's OK to lie.

Now, how long do you think it's going to take before that employee starts thinking to herself, "Well if it's OK to lie there, then here's another situation where it might be OK to lie. Cindy's not here to ask, but it was OK over there, so I'll do it over here." And if you've got 10 or 20 or 50 employees, that could multiply exponentially. You can't be there all the time, so how are you going to know when they do this?

You have to show zero tolerance for ethical violations. Decisions shouldn't depend on how productive an employee is. As in the case of the valuable sales counselor who refused to take a drug test, you have to make your decisions in terms of the values you have established.

• Avoid establishing internal conflicts. Make sure your company's reward systems and performance appraisals are congruent with your ethical values.

If you are telling employees, "We love our customers and it's important for you to spend a lot of time with every family—we want you to take all the time it takes," but then all they get rewarded on is the numbers, you've created a problem.

Maybe you've got someone who isn't quite as productive as some of your other sales counselors, but their customers love them. They get the best referrals because their families trust them. Are they not valuable? We say they are valuable to your company, but if you say, "We value people who value our customers" on the one hand and on the other hand, base payment just on numbers, you're putting employees in a no-win situation. (We don't mean to say that people who care about their families don't get the numbers; we're exaggerating to make a point.)

• Watch for and address external conflicts. The funeral and cemetery profession may not be as open to them as some other businesses, but we should be proactive.

Thompson: We have someone at our cemetery who works with outside construction companies who are doing projects nearby and want to bring us excess dirt from job sites. We make it very clear that the choice of which companies are allowed to do this is not a matter of slipping our employee some money.

Building an Ethical Toolbox
Your company has to build for each of your employees their own ethical toolbox, because they're not going to be able to call you every time and say, "I'm not sure what to do." You need to build their skills and abilities.

Awareness, skills and values are needed for an ethical toolbox.

Awareness means you need to raise the issue of ethical dilemmas to your staff. They need to learn to be aware that ethical behavior is something you want them to be careful about. Build their awareness so that when something is going on that's not quite kosher, they'll realize it.  

Next, you need to make sure that they have the skills to deal with any questions or problems that come up, or that there are resources at your company they can turn to. You can put systems in place to help your employees when they are faced with an ethical dilemma. One company we read about had an 800 line for people to call when they thought they had come across unethical behavior.

And third, you need to make sure that employees perceive ethical behavior as something they need to practice to be successful at your company.

If you have awareness without skills, for example, you've got a problem. An employee might say to himself, "I don't think that's really cool, he's giving all the business to his brother-in-law," but if your company hasn't told employees what to do in a case like that—there's no 800 number to call, there's no one on staff designated to tell—the employee is kind of stuck.

You want your employees to realize what your ethical values are, to be aware of problems and to have the ability (skills) to do something about them so that when they become aware of a problem or are faced with an ethical dilemma of their own, they will act.

In doing our research, we ran across a page from the Enron code of ethics, distributed in 2000, which wasn't that long ago. Let's look at a few excerpts:

"Moral as well as legal obligations will be fulfilled openly, promptly and in a manner which will reflect pride in the company's name.... Employees will maintain the confidentiality of the company's sensitive proprietary information and will not use such information for their personal benefit…... Relations with the company's many publics—customers, stockholders, government, employees, suppliers, press and bankers—will be conducted in honesty, candor and fairness."

These statements probably look familiar to a lot of us. You may have something very similar in your own company's employee manual. We all know what happened with Enron: They ended up serving frog stew. So simply putting a code of ethics in place is not good enough.

Enron probably handed this out to every employee, maybe had all of them sign an acknowledgement form. But it looks like they never followed up. We need to educate our employees about ethical behavior all the time, on a daily basis.

Can all those rules and regulations designed to protect buyers and allow them
to cancel contracts your counselors spent hours to sell actually be good for business?
Yes they can, with properly drawn contracts and well-trained counselors.

The genesis of this article is the three-part series reprinted by International Cemetery & Funeral Management magazine in the winter and spring of 2002, "The Prego Defense," which discussed seller's protection in funeral and cemetery contracts. That series sought to discuss how we as sellers of funeral and cemetery merchandise and services could clarify the allocations of risk in our consumer contracts to protect ourselves from less than scrupulous consumers.

The goal in this article is to discuss federal regulatory requirements as they apply to consumer contracts, to emphasize again the importance of consistency among our contracts and related instruments or documents and to discuss how regulatory requirements can protect us in dealings with customers as well as with regulators.

Customers who want to avoid living up to their contractual obligations may try to find some area in which the cemetery or funeral home is not complying with all of the technical requirements of federal and state laws. A properly written contract that ensures compliance can give us great power from a negotiating standpoint.

The Power of the Written Word
We are all not Indians and our word is not always good. Chief Joseph once observed: "Good words do not last long unless they amount to something."

In the context of preneed consumer contracts, there is usually a material lapse of time from the date the agreement is entered into and the date the merchandise and services are actually delivered or realized. So while prearrangement is good both for the seller who has gotten the business and for the purchaser who has locked in prices and gotten peace of mind, if it is not completely clear what the prearrangement covers—and  does not cover—misunderstandings may develop at the time of delivery.

As experienced cemeterians and funeral directors, we should find this risk of misunderstanding not merely foreseeable but obvious. All the more reason then to make such contracts clear and consistent. A good contract should:
clearly state what is being purchased;
clearly state what is not being purchased;
set forth appropriate times and terms for performance;
permit substitution of merchandise and services;
permit delay in performance for circumstances beyond the cemetery or funeral home's control;
provide for clear default consequences, including how to get out of the deal if the consumer does not perform;
limit or permit assignment dependent upon whose rights are to be protected;
permit the cemetery or funeral home the right to correct errors; and
make the contract binding upon the consumer's successors in interest.

Consistency and Simplicity
Consumer contracts should be written with a clear appreciation that they will be acted on by individuals who are not lawyers and, more often than not, are not the ones who entered into the contract in the first place but rather their survivors.

Choose simple words rather than complex ones. Make sentences short rather than compound or complex. Use short, simple paragraphs and order them in a logical sequence.

Be consistent. For example, don't refer to the consumer as the "buyer" in one place and as the "purchaser" in other places. Don't call an outside container a "vault" in some places and a "box" in others. The importance of consistency extends beyond contracts. The same definitions, language, terms and conditions and so forth should be used in related instruments such as cemetery deeds (or burial right certificates), rules and regulations, merchandise certificates, delivery acknowledgments, interment authorizations and other schedules or instruments used in conjunction with the transition or affecting the nature of the transaction.

Crafty lawyers can use inconsistent or conflicting language against us. It is often presumed that ambiguity and inconsistency should be construed against whomever drafted the contract, so if there is a debate, the burden will be on the cemetery or funeral home to clarify what the deal was.

Therefore, if there is anything to be learned from this article, it is that whoever drafts your company's contracts should resist the lawyer's natural tendency to make consumer contracts as complex and full of "legaleze'' as possible. Complex language often fosters debate—though it's true that lawyers often disagree over even the simplest language!

To illustrate what I mean, I offer this example, attributed to Robert H. Mundheim, general counsel to the U.S. Treasury Department during the Carter Administration, of the way lawyers see and do things. Here is what Mundheim had to say: "When an ordinary person wants to give an orange to another, he merely says, 'I give you this orange.' But when the lawyer does it, he says: 'Know all men by these presents: l hereby give, grant, bargain, sell, release, convey, transfer and quit claim of all my right, title, interest, benefits and use whatever in, of and concerning this chattel, otherwise known as an orange, or citrus or erantium, together with all the appurtenances thereto of skin, pulp, pith, rind, seeds and juice, to have and to hold the said orange together with its skin, pulp, pith, rind, seeds and juice for his own use and behoof to himself, and his heirs in fee simple forever, free from all liens, encumbrances, easements, limitations, restraints or conditions whatsoever, any and all prior deeds, transfers or documents whatsoever, now or anywhere made to the contrary notwithstanding, with full power to bite, cut, suck or otherwise eat the said orange or to give away the same, with or without its skin, pulp, pith, rind, seeds or juice.'"

What the ordinary person said in five words, Mundheim turned into 147 words. The effect of either statement is the same. The relative efficiency of drafting the two statements is easy to see. Certainly the example is an absurd one, but you get the point. Show this to your lawyer—maybe he or she will get the point, too.

Buyer's Protection
Government, in its wisdom, has elected to adopt massive and complex statutory and regulatory schemes to protect buyers from unscrupulous sellers (or maybe to protect buyers from themselves). In addition to federal statutes and regulations, most states require consumer contracts to include mandatory disclosures that essentially give buyers numerous technical reasons why they should not have to honor their contracts.

Unfortunately, the federal and state disclosure requirements often conflict with each other, which can make writing an enforceable contract impractical, so lawyers truly have their work cut out for them. In addition, these mandatory disclosures come from the government, the expert at making the simple complex. Finally, these disclosures are written in legaleze, in the grandest of the Mundheim model, so drafting something simple and short is virtually impossible. Of course, while these disclosures must be in consumer contracts, most consumers ignore them anyway because they don't know what that "stuff" means.

I have restricted the technical requirements in this article to federal disclosures. Make no mistake; however, your state has its own requirements. Hire competent counsel and make sure your contracts include them all.

Buyer's Right to Cancel:
The Three-Day Cooling-Off Period
If the sale is made in the home, commonly known as a "door-to-door" sale, the Federal Trade Commission requires that the buyer have the unilateral right to cancel the contract. The FTC rule consists of two basic elements.

First, the contract must contain a written disclosure of the buyer's right to cancel in substantially the following form:

"YOU, THE BUYER, MAY CANCEL THIS TRANSACTION AT ANY TIME PRIOR TO MIDNIGHT OF THE THIRD BUSINESS DAY AFTER THE DATE OF THIS TRANSACTION. SEE THE ATTACHED NOTICE OF CANCELLATION FORM FOR AN EXPLANATION OF THIS RIGHT."

Since the disclosure only applies to home ("door to door") sales, I have chosen to expand the notice to indicate that it does not apply to "office sales." That way we can use the same contract form for office and home sales.

Second, the buyer must be provided a Notice of Cancellation in substantially the form shown below.

This mandatory notice is required when there is a sale, lease or rental with a purchase price of $25 or more, whether in single or multiple contracts, in which the seller's representative personally solicits the sale at the buyer's residence. For purposes of the rule, the buyer's residence may include a temporary residence such as a hotel or motel room, a convention center, fairgrounds, restaurant, the buyer's business or a dormitory lounge—i.e., any place other than the seller's place of business.

There are, of course, exceptions to the rule, but in almost all cases, sales counselor or funeral director presentations in the home will be covered. In short, all contracts where sales are made should include the disclosure and the cancellation form so that you can be sure, as in "The Prego Defense," it is "in there."

Finally, the rule requires that the disclosure must be placed in "immediate proximity to the space reserved in the contract for the signature of the buyer" (16 CFR 429.1 [a]). As with most federal laws, whether or not you are in compliance with this rather ambiguous placement requirement is a matter of opinion. Lawyers like that because everyone has an opinion. (For a more in-depth review of the rule, the reader and counsel are referred to 16 CFR 429.0, et. seq.)

Preservation of Consumer's Claims and Defenses
The FTC also has adopted a disclosure and notice rule that states that regardless of to whom the sales contract may be assigned by the seller, the consumer retains the right to assert claims and defenses against the assignee. This preservation of the consumer's claims and defenses may be found in the Code of Federal Regulations at 16 CFR 433. It requires the following notice in consumers contracts:

Notice to consumer: Any holder of this consumer credit contract is subject to all
claims and defenses which the debtor could assert against the seller of goods and services obtained pursuant hereto or with the proceeds hereof. Recovery hereunder by the debtor shall not exceed amounts paid by the debtor hereunder.

(Note the use of "hereto," “hereof” and "hereunder," all in two sentences of great Mundheim legaleze.)

The purpose of this disclosure is to prevent the seller from factoring or assigning the contract to a financial institution where the institution could assert that it had no notice of any claims or defenses that may make the contract unenforceable. While in theory the notice would be effective only if the contract was assigned, the reality is that if it is possible that the contract could be assigned (and why wouldn't the seller want that flexibility?), then the disclosure is mandatory.

Reprinted with the permission of Wakarusa River Management Co., Copyright 2004. All rights reserved. Neither the author nor the publisher is providing legal advice through publication of this article. If such advice is needed, the services of a qualified attorney should be sought.

Part 2, in the October issue of ICFM, will cover truth in lending, consumer remedies, the funeral industry practices rule, buyer's protection as seller's protection and a model form for credit sales.

Figuring out which mower or backhoe to buy may be tough, but it's nothing compared to deciding who to hire to operate the mower or backhoe.
Whether you've got a grounds staff so large that some people do nothing but run a string trimmer or a staff so small that the backhoe operator also sits down with families to design monuments, you can't afford to take hiring lightly.

WHAT: We've done a 180-degree turn on the whole subject of hiring. Thirty years ago, our process was something like: "Run down the street, and if you see a warm body moving, try to get them to take the job." Today, we're like the Marines: We're always looking for a few good people. It doesn't matter what time of year it is, we're always looking. We want the best of the best. We might interview 15 people to fill two jobs.

WHY: To carry through what you're trying to do at your cemetery you need the right people. It doesn't make a bit of difference how much good equipment you buy, you've got to have the right people with the right attitude and the right standards to operate that equipment the way you want it to be operated and to do the job in a way that will keep your customers happy.

If you don't start out with great people, even training becomes so difficult—never mind the problems the person may cause down the line. It's crucial you go through an exhaustive search to get the right people.

HOW: Most of the people we hire full-time start out as seasonal workers. This gives us a chance to examine their overall work habits and work ethic. The possible downside is that when you're hiring seasonal workers, you may go in with the mind set that you just need good technicians for specific jobs, and not think down the road to the possibility that some of these people may become full-time. That's one reason we've decided to ratchet up the standards for seasonal workers. We're trying to remind ourselves, 'These people could be full-time in a year."

Most of the people who move from part-time to full-time staff do so at the recommendation of a supervisor. A person who does a good job of mowing the grass and string trimming and basically keeping the grounds looking good 40 hours a week is not necessarily qualified to move up to the backhoe level and start operating a $70,000 piece of equipment and maneuvering it around our expensive monuments and landscaping. And of course the supervisory level requires different skills.

We also realize that not everyone who comes to work at Spring Grove, whether part-time or full-time, will be here in five or 10 years. Some people use the training they get by working here to qualify for another job, maybe to run their own landscaping business. There's nothing wrong with that.

We might post a job opening internally and advertise it outside as well. We generally advertise in the suburban community press, rather than in the larger paper. This helps us target specific areas at less cost. For seasonal or part-time help, we advertise at the colleges as well.

1. Don't automatically give an applicant extra credit for previous cemetery experience. In certain positions we might want someone with experience, but for the most part, just because a person has worked at another cemetery for several years doesn't mean we'll be hiring that person. We're willing to train. In fact, Spring Grove has its own way of doing things, and if a person worked at another cemetery some of the training may involve undoing the training they got there. You want your employees working to your standards, not saying to themselves, "Well, that's the way we did it at Soandso Cemetery—that should be good enough."

2. Set up a check list for qualifications that must be met. We have a fact sheet they have to fill out: Can you lift 40 pounds? Do you have a valid driver's license? We like applicants to have a high school diploma or GED, since many positions, such as backhoe operator or marker technician, require a good ability to read and write.

3. Consider an applicant's job history. Maybe you don't want someone who's had 10 jobs in 20 years. At Spring Grove, we want someone who is likely to have some longevity.

4. Interview to discover work ethic and attitude. Attitude is crucial, yet this is something no one studied in school. Who ever signed up for Attitude 101? So this is something you'll have to try to discover through the interview process. Here's how:

• Use open-ended questions, not questions that elicit a "yes or no" response. Ask what they liked best about their previous job, what they liked least, how they interacted with people. Ask them to tell you their best success story as far as helping a customer. Things like that will give you an idea of whether they're a fit for the cemetery business or not. Another good question: ''Tell me about your last boss. Describe how he or she handled your work relationship." If you ask an applicant that and the jugular vein on the neck starts to throb, that can tell you a lot right there!

The bottom line is, ask a lot of questions and then sit back and listen and observe. Make mental notes about what you're hearing and it shouldn't be difficult to determine whether that person will be coming back for Interview Round Two.

• Include several people in the interview process. We can't stress enough how important it is to have more than one interview, and to involve the employees the new person will be working with. We also have at least two people conduct each interview. You want to get multiple views on whether the person is a good fit for your company and the position.

We do two to three interviews for a new hire (someone who hasn't worked for us part-time). Maybe two supervisors or a manager and a supervisor will conduct one.

And before someone is hired, there has to be an interview involving the people he or she would be working with. This is good for the interview process; it will result in different questions and insights. It's amazing what you'll learn during the debriefing process after you've talked to an applicant, the things that some people will have noticed that others didn't.

It's also good for your employees to get a feel for whether they want to work with this person. Even if you only have two employees, if the two don't get along, you're going to spend all your time dealing with their conflicts.

Doing this also creates "buy-in" and team camaraderie. Years ago, when employees were told on Friday afternoon that someone new would be starting on Monday, it was "the managers decided," "they hired someone." And the employees would think, "I wonder who the heck they're bringing in?" Now, when the new person starts, they're welcomed to the team by some of the people who were part of the process.

• During the interview process, let applicants know what your company has to offer the right person besides money. Good employees will be interested in more than the starting pay. One of the things we learned as we've refined this whole process is that money isn't the only thing that motivates people.

When companies are having trouble filling positions, the automatic response is "you've got to pay more, you've got to pay more." But back when we were chasing after people to work here, we were already paying well—very well—and we're convinced that's not an issue, at least not here. You do have to be in the ballpark as far as pay, certainly, but people want more out of a job than money. What else can you offer? Communication and recognition.

Communication: People want to have a feeling that they are part of things, that what they do matters. An applicant will want to know, ''Can I be a part of what's going on here, or is working here going to be a matter of 'Do what you're told, keep your mouth shut and keep on mowing'? Am I going to be kept informed about what's going on?"

At Spring Grove, it doesn't matter if you're a vice president or a student who's a part-time string trimmer, you're going to know what the company's vision is and you're going to know that we're all working together as a team. People like that. They like feeling that they're "in" on things, that they're being kept informed no matter what their job is.

In too many companies, the attitude is, "Well, that's something the officers will decide. We don't tell the line people about that" But those line people are the people who are getting the job done! They're the ones who need to know where the company's going and what the vision for the company is.

Recognition: We have a sign that says, ''People work for money, but they excel for recognition." We don't do enough of it in the American workplace. Every way and every chance you get, recognize people. Find people doing good things and let them know right then and there. Have all kind, of recognition programs.

Of course, doing these things will help you keep people once you've hired them. We've had people tell us, "Wow, what a great company to work for. Nobody I worked for ever asked my opinion before. Nobody had an appreciation event."

5. Consider doing some testing. We're still developing this, but we've had great success with testing that determines personality styles. We had used it for years in hiring sales people before we started using it on the operations side.

We definitely do testing now when we're advertising for our supervisory jobs, using a test designed for the purpose. It's helped us make decisions we would not have made if we'd just gone with our gut feelings.

The testing organization we dealt with designed a test that tells us how people would handle a hypothetical situation if they were supervisors. The first time we did it, the test results surprised us at first, but when we read over them, we could see that they were accurate, and we've never looked back.

6. After you select a candidate, do a pre-employment check. We pay a third party to do it, and it costs less than $50 per check. Most of the time—maybe 70 percent of the time—it comes back exactly as you expected, with everything the applicant told you checking out. But then there are the times it doesn't.

Sometimes it's bizarre what you find out—sometimes people just lie. The person said he had a valid driver's license but doesn't. We've had serious problems show up—gun law violations, robberies. It might take a week longer to get the new person on the job (assuming everything checks out), but the extra time and expense are definitely worth it. Think what it could cost you in the long run if you hire some scam artist.

7. Require drug screening. No one starts to work here without taking that final step. And again, people know they'll have to pass a drug test to work here and yet sometimes you get the results and it's "oops."

No matter what you do, of course, you won't be immune to some bad hiring decisions, but if you take these steps you should have plenty of successes.

Managers of funeral homes and cemeteries, like managers of all businesses, must carefully consider whether each employee is entitled to overtime compensation.

The federal government's new overtime regulations, drawn up with an eye toward clarifying the standards for "exempt" status and reducing litigation, are scheduled to become effective 120 days from their release on April 20.

In these final regulations, the U.S. Department of Labor modified the requirements for the "white collar" exemptions under the Fair Labor Standards Act. As many of you are aware, the DOL published "proposed" regulations in March 2003. After receiving and analyzing over 80,000 comments, the DOL issued the new regulations.

The final regulations retain some of the proposed changes, make some additional modifications and in some cases revert to concepts in the former regulations. Even though some old and confusing concepts remain (i.e., "discretion and independent judgment"), the DOL offers some additional guidance for employers.

We provide here a general review of the final regulations' key provisions, including brief explanations of the ways in which they modify the old and proposed regulations.

The New Exemption Standards
• General DOL Goals Accomplished:
1.    Modernized the minimum salary level required for each exemption from $155/week ($8,060/year) to $455/week ($23,660/year).
2.    Streamlined the exemption duties requirements by eliminating the obsolete "long tests" and creating a "standard duties" test for each exemption.
3.    Expanded the employer's ability to dock exempt employees' salaries.
4.    Narrowed the "penalty" for improper deductions from exempt employee salaries and created a "safe harbor" for unintentional violators to avoid penalties and litigation.
5.    In some areas where there has been confusion, though the regulations were not modified, the department provided additional guidance and examples to help make the regulations clearer.

• Executive Exemption. Imposing a higher burden on employers, the DOL modified this exemption to require: a salary of at least $455/week paid on a salary basis (as defined in the regulations); a primary duty of management; direction of the work of at least two full-time employees or the equivalent; and the authority to hire and fire, or to make effective recommendations as to employment actions.

The DOL also eliminated a proposed special exemption for "sole charge" executives and modified an exemption for 20 percent owner-employees.

• Administrative Exemption. Resurrecting the "discretion and independent judgment" requirement, the DOL reverted back to the existing standard, except for the salary level.

The requirements are a salary of at least $455/week paid on a salary basis (as defined in the regulations), a primary duty of office or non-manual work directly related to the management or general business operations of the employer or its customers and the exercise of discretion and independent judgment on significant matters.

The DOL eliminated its proposed change that the employee have a "position of responsibility," meaning performing work of "substantial importance" or requiring a "high level of skill or training."

• Professional Exemption. Under the professional exemption, there is the "learned professional exemption" and the "creative professional exemption." Although neither exemption appears to have changed much beyond the new increased salary level, the DOL has issued more guidance.

Significantly, however, the DOL changed course regarding how the specialized knowledge required for a "learned professional" is acquired. Despite proposing to dilute its focus on a four-year academic degree requirement and allow for expertise acquired through work experience or military training, the DOL reversed its position. The requirement will continue to be a specialized course of "academic" instruction.

The final regulations specifically address funeral directors and embalmers as professional positions. They make clear that "licensed" funeral directors and embalmers who are licensed by and working in a state that requires successful completion of four academic years of pre-professional and professional study, including graduation from a college of mortuary science accredited by the American Board of Funeral Service Education, generally meet the requirements for the "learned professional" exemption.

The DOL indicates that 16 states have such licensing requirements. In states such as Colorado (no educational requirements for funeral directors or embalmers) or those other states that require only a high school education, no "professional" exemption would apply .

• Highly Compensated Employees Exemption. This new category requires that the employee is paid total compensation of at least $100,000/year, at least $455/week of which is salary, and that the employee performs at least one of the duties of an exempt executive, administrative or professional employee.

• Computer Employee Exemption. Although the DOL did modify this exemption, the changes appear to be a streamlining effort rather than an overhaul. The requisite salary level increases to $455/week, but payment on a salary basis is not required and the alternative hourly option remains at $27.63/hour. The final regulations continue to limit this exemption to computer systems analysts, computer programmers, software engineers or other similarly skilled workers in this field, and not for office computer maintenance/repair employees.

• Outside Sales Exemption. Although not appearing to change much, once again the DOL emphasizes that this exemption is for truly "outside" sales employees—those employees regularly traveling out of the office to visit customers—not "inside" sales workers such as telemarketers.

Department of Labor Guidance for Certain Occupations
Because classifying employees as exempt can be confusing, the DOL has produced a list of various occupations, indicating those that may be exempt under the FLSA. The following is a brief summary:

• Blue Collar workers. The DOL explicitly states that the above exemptions are exclusive to ''white-collar'' workers, and do not include workers who perform work involving repetitive operations with their hands, physical skill and energy.

No matter how highly paid, non-management employees in production, maintenance, construction and similar occupations are entitled to minimum wage and overtime pay under the FLSA. Such "blue collar" employees gain the skills and knowledge required for the performance of their routine manual and physical work through apprenticeships and on-the-job training.

• Veterans. Veteran status alone is not sufficient to exempt an employee. Military training, for example, is insufficient in itself to meet the professional exemption standards.

• Financial Services Industry Employees. Financial services industry employees will generally qualify as exempt under tile administrative exemption, assuming that the work actually performed is consistent with that type of industry.

However, an employee whose primary duty is selling financial products does not qualify for that exemption. The exempt status of financial services employees is based on the duties performed, and not the type of customers served.

SUCCESSION PLANNING
What will happen to your funeral home or cemetery after you retire?
Are you training someone you trust to succeed you?
The future of your company—your legacy—can hinge on a good succession plan.

For many Americans, owning and operating their own business is a dream come true.  Being your own boss and making or breaking it on your own terms has a certain allure that inspires many entrepreneurs. But once a business is established, there's more to think about than where the next contract will come from. You need to make plans for how the company will evolve in the years ahead and after you stop working.

While people often assume the family business will just pass from one generation to the next, statistics suggest otherwise. According to the U.S. Small Business Administration, only 30 percent of all family businesses succeed to the second generation, and of these, only 15 percent survive into the third generation.

If yours is a family business and more than one of your children has joined, you face some especially delicate issues. They include determining what roles your children will play now and what management responsibilities they will take on later. Very fortunate families transition
smoothly, but that may be less because of luck than because of good planning. So smart business owners develop a plan with contingencies.

How to Prepare
Whether you intend to transition to relatives or to close members of your company's "family," or you plan to hire your replacement or even sell the company outright, a good business succession plan helps the process. To prepare for the transition, ask yourself some important questions:

•    Have you discussed your vision for the company in a way that is clear to all involved?
•    Is it more important to you that your successor be the person best able to run the business or best able to keep peace in the "family"? (If you're lucky, that will be the same person.)
•    Do those not selected to lead have a clear picture of what their role is to be, and have you prepared them well to take on that role?
•    Do you have a backup plan if any of your designees decline the responsibility you have in mind for them?
•    Is a buyout part of the transition, even if it's to family members or longtime employees?
•    Will you stay on as a consultant, or turn over the reins all at once?

These questions are important whether you are passing the company to family members or unrelated employees.
If you have always been a sole proprietor, you'll need to adjust to sharing responsibility during the transition. If you're sharing it with an adult child, that will likely require an even greater sensitivity.

To some people, leadership comes naturally; others make great team members but are less inclined to take the risks associated with leadership. Be aware of these kinds of issues and mentor your replacement. Keep in mind that a mentorship is not a dictatorship. Learn to step back and let your replacement assert his or her authority. Sooner or later, that person will be in charge and needs to practice that leadership.

Allow a reasonable time for the transition; six months to two years may be appropriate. But once you start the process, don't leave it open-ended. The new manager needs to know when he or she will formally take the helm and so do the employees. Otherwise, everyone will continue to defer to you and management may break down.

Business Agreement
Whether your successor is an employee or a family member, you need to draft and sign a business agreement to clarify:

•    Who is responsible for what?
•    Who owns what assets at what values?
•    How to handle banking and income distribution?
•    Who controls access to information (such as records and financial statements)?
•    Any conflict resolution that may be needed.
•    How the baton will actually be passed, including buy-sell agreements and contingency planning?

Throughout this process, you should rely on your financial advisor for guidance and recommendations. Transitioning a business can have complex financial implications, and even a good business planner can benefit from a financial consultant who may be able to make suggestions about insurance, estate planning, wealth management and other issues the business owner may not have considered.

Being a sales manager means developing your sales skills to a new level, as well as becoming a leader and developer of people.

Going some online research recently for an upcoming speech, I discovered this amazing statistic: When you run a search through Google, it scans over 4 billion pages of information on the Internet in about 0.2 seconds. If a human looked at the same number of pages and only spent one minute per page, it would take 5,707 years to accomplish the same task.

That is incredible. It is any wonder people's expectations are going up every day? Companies and consumers are raising the bar every day. Companies expect more from their staff because their customers are expecting more from them. And everyone wants everything quickly.

But how can a sales manager operate more quickly? Is there technology that can scan faces and tell the sales manager whether those people will succeed or fail in sales? How can a sales manager meet the challenge of keeping people motivated, focused, positive and productive?

Sales never get better—people do!
Many managers focus on trying to improve their sales. That is not possible. Sales are created. How does something that doesn't exist until it is created get better before it even exists?

Sound confusing? The premise is simple: Sales never get better—people do. When we improve our salespeople's attitudes, skills, habits and competencies, then, and only then, will their sales improve.

The obvious next question is, ''How do our people get better?" The answer: Our people never get better until we, their managers, do. It's managers' ability to lead, direct, coach, teach and motivate that allows their staffs to improve.

Organizations never grow faster than their leaders. Therefore, as a sales manager, you must continue to discover new concepts and skill sets which you can in turn transfer to your staff, helping them improve on an ongoing basis.

One way a manager can get better faster is by understanding certain basic principles, the fundamentals of how something works. Once you discover a principle, understand how it can serve you and internalize it into your own thinking, you then can act—perhaps faster than ever before.

It is only when we get better and have a clearer understanding of what we do and how we do it that we can make our people better. And it's only when our people get better in attitude and skills that our sales improve.

Principles don't change; only technique and application do
For thousands of years, people wanted to fly, but one attempt after another failed. Then on a cool December day in 1903, at 10:35 in the morning, the principle of manned night was discovered. With their historic 12-second flight of only 36.6 meters, the Wright brothers knew they had broken the code, discovered the principles.

Over time, those principles became better understood; the people designing aircraft internalized the concepts and continued to act on what had been discovered. Here is an amazing example of how internalizing a principal works: It took man 6,000 years to discover the principle of a controlled flight. It then took us only 68 years to learn to fly 238,857 miles to the moon.

Principles don't change, only technique and application do. To accomplish more in a shorter period of time requires us to discover, understand, internalize and act on the fundamental principles of sales management success.

What are the principles that can help a sales manager be more effective every day? Many readers will find that they are already familiar with these principles, or at least some of them, but most of us forget, and we can't internalize what we forget.

As a professional, you must dedicate yourself to discovering principles that will allow you to do your job better, help make your people better and, as a result, increase your sales.

There are three basic premises on which the career of a successful sales manager is founded:
• Having the ability to hire, develop and keep the right people.
• Acknowledging that being a sales manager can be one's life work—a true profession.
• Understanding that a sales manager is rewarded on the basis of performance.

People
The sales manager's role revolves around people—finding them, training them, developing them and creating an environment where they are willing to give their all and want to stay.

Successful sales managers are always looking for the principles that will allow them to attract, hire, train, develop and keep the right people in their sales organization. Following are three principles and the power they possess to help you get better at focusing on the people aspects of sales management success.

Principle: Only hire people with the proper ID.
Power: In his book "Good to Great," Jim Collins dispels the myth that "people" are our greatest business assets. The right people are, he says. Finding the right people is essential to any organization's growth and well-being.

Saying you should look for people with the "proper ID" is shorthand to help you remember to look for the right personal elements as well as the required professional acumen.

The "I" reminds us to look for people who have integrity, intelligence and initiative. The "D" reminds us to look for people with desire, determination and discipline.

The ID concept reminds us that integrity and discipline are required for sales success.

Remember: "Without the first quality, a person can cause great damage to your organization; without the last quality, a person will never do much of anything for your organization."

Principle: Confused people don't act
Power: People need a clear vision of what to do, how to do it and when it needs to be done. If the sales manager doesn't make the requirements of the task clear, as well as how they are to be executed, people won't act. Having a clear objective of what needs to be done, how it should be done and the timeframe for getting it accomplished is essential for both the salesperson and the sales manager.

Give your salespeople a clear and specific track to run on:

• Make sure they know what to do: "It is your role as a salesperson to find new prospects."

• Make sure they know how to do it: "Here are five possible ways of locating new prospects."

• Make sure they know when to do it: "Every day you need to spend a minimum of two hours focusing on getting new prospects."

Establishing expectations clearly also gives the sales manager the standards by which to manage.

Remember: Where there is no vision, the salespeople fail to thrive.

Principle: You train people initially; you develop people perpetually.
Power: When people come into a sales organization, they are initially trained on the products and services the company offers. They are trained on the pricing, financing options, the delivery systems and all the information needed to sell for this particular organization and/or in a certain profession.

They are also trained in the basics of the sales process, though if they have previous sales experience, they may receive less in the way of actual sales skills training.

In any case, eventually that type of training ends, with the exception of minor updates, such as training on new pricing or administrative procedures. And, it is unfortunate but true that in many cases, once trained, salespeople are never developed. You need to remind salespeople of fundamental sales skills to reinforce those skills, and you need to teach and coach them in advanced sales skills.

Effective managers know that once people are trained on the basics of the business, they should forever be developing their skills. Continuous improvement is critical for the future development of a sales staff. You must not only remind salespeople about the fundamentals of the sales process because it's easy to get off track, but also make sure they are learning new skills at higher levels that will help them grow as sales professionals.

Remember: Initial training has an end, but the ongoing development of a person never does.

Professionalism
When sales managers commit to selling as their life's work, they start looking at things differently. They come to realize the more professional they become, the better quality people they can attract and keep.

Once the commitment is made to become the consummate professional, the sales manager finds the power to achieve the discipline necessary to reach new levels of success.

Following are three principles and the power they possess to help you get better at focusing on the professional aspects of sales management success.

Principle: Demonstrate the behavior you expect.
Power: Leaders of the organization set the tone for everything. They are, like it or not, the model. It is so important for sales managers to realize that every behavior they demonstrate sends a message, a message of what is acceptable and what is not.

Sales managers who follow this principle are always early for any meeting. They always address things that are not in alignment with the company's values at the appropriate time and in the correct manner. They walk with a sense of mission and talk with strength of purpose. They understand that their every behavior, action and word is creating the model of "how things should be done around here."

Remember: Your organization will be a reflection of your behavior.

Principle: Do what you say and only say what you can do.
Power: One of the most important things sales managers need from the members of their sales team is trust. Trust must be earned through the things you say and do. When people trust their leaders they will follow them, and when they don't, they will instead always question them.

Professional sales managers understand that the greatest quality they can possess is that of integrity. You establish your integrity over time by being a person who does what you say you will.

Too often, sales managers will answer a question or grant a request without taking enough time to think the situation through. When it later turns out they gave the wrong answer or they can't follow through, their integrity is damaged. When building a career, it is important to do the things you say, but to also be careful what you say.

Remember: We are judged by others by what we say and what we do.

Principle: Use your influence, not your authority, to get things done.
Power: Sales managers who use their authority or position to get things done have a difficult road to travel. Managing this way never brings out the best your people have to give. It's a management style that doesn't breed loyalty, only contempt.

Sales managers who use the ability to influence others in a positive way get more done—and get it done better. When people are doing things because they want to, they put more of themselves into the task and take pride in owning the job.

Influencing others requires building relationships. It requires effective communication and trust from those who follow you. The sales manager who masters the art of influence establishes a committed group of people willing to do whatever it takes to reach the department's goals and objectives.

Remember: The ability to influence far outweighs the authority to demand.

Performance
A sales manager is in a paid-for-performance profession. However, the sales manager can't produce all the sales volume an organization requires. After all, if one person can produce all the sales needed, there's no need for a sales manager.

Sales managers must produce results through the efforts of other people. Their ability to manage and lead their organization successfully not by doing themselves but by getting things done through other people is critical.

Following are three principles and the power they possess to help you get better at focusing on the performance aspects of sales management success.

Principle: You can't be a manager and not lead.
Power: Managers must not only be effective sales managers, they also must be inspiring leaders. Leaders think strategically; managers implement tactically. Leaders set the goals; managers reach the goals. Leaders foster teamwork; managers mobilize the team.

Understanding this principle allows managers to have a clear understanding that there are times when they are managing—getting things done—but they are also always leading.
 
Being clear on the leadership role of being a sales manager is critical to the long term success of the organization. Inspiring leaders are masters at creating and communicating a clear vision of where the organization is going and how they intend to get there.

An effective leader is good at driving change, at getting people to commit to the overall goals and vision of the company while getting everyone in the organization working together.

Remember: You may not be managing at any giving moment, but you are leading every second.

Principle: Sales managers are always selling.

Power: When people move from the role of salesperson to sales manager, regardless of whether or not they are selling managers, they never stop selling. As a matter of fact, they start selling at a new level, and selling new things.

For example, ask any salesperson the biggest sale they've ever made, and they can tell you off the top of their head. If you ask a sales manager that question, his or her answer should be a name: Susan, George, Barbara or Bill. It should be the name of someone they have sold on entering the profession, or joining their company, who subsequently became a star performer, selling hundreds of thousands or perhaps millions of dollars in products and services.

Selling people on themselves, on reaching higher goals, on the importance of making that second effort—these are just few of the sales a sales manager has to make. Successful sales managers realize they are selling some idea, concept or attitude to someone every day.

Remember: The day a sales manager stops selling is the day he or she stops succeeding.

Principle: You may not always be hiring, but you should always be recruiting.
Power: Most sales managers hire during a time of crisis. They hire when they need someone now. Too often, they therefore make hasty decisions that are not in the best interest of either their company or the person they hire.

Often sales managers recruit when sales are not going well, which may mean morale is down, as well. A new person coming into such a negative situation may soon leave, believing the opportunity is not what they were led to believe it would be.

This is why sales managers should always be recruiting, whether or not they are hiring at that particular moment. They should always be talking about the opportunity their profession offers. They should always be educating their marketplace about the fact that they are always looking for top sales talent.

Since you never know when a top-producing person may leave your organization, and because you never know when the best sales talent in your market may be looking for a change, you should always be recruiting.

Remember: Every week you don't recruit, the next month you may settle for a lesser degree of performance.

People, professionalism, performance
Building an effective, professional, ethical and productive sales organization is the result of years of commitment, effort and determination.

A successful sales organization is made up of people who see selling as their profession of choice and understand that performance is an everyday responsibility.

A successful sales manager is one who can attract the right people, help them become professionals and achieve consistent performance. To do this, sales managers must operate on a set of principles that provides them with a clear vision of what is possible.

Sales management success requires a lifelong search to discover the principles that will transform them and in turn allow them to transform their people, who will then transform our business.

This requires discovering the right people and then helping them understand that selling can be a true profession, helping them internalize your organization's purpose and influencing them to act.

Remember: If you practice the principles, you will possess the power.

Whether employees are working with chemicals in the maintenance shed or in the embalming room, it is the manager's responsibility to ensure their safety.
Review your company's program for meeting OSHA requirements, and learn what the additional requirements are for employees dealing with formaldehyde.

Violations of OSHA hazard communication and formaldehyde regulations constituted nearly one-third of all OSHA citations in funeral service and crematory operations from October 2003 to September 2004.

The Hazard Communication Standard is the OSHA regulation that requires proper evaluation and communication to employees of all hazards involving chemicals used or produced at the workplace.

Formaldehyde is subject to its own regulation above and beyond that standard, which we will deal with in depth after first reviewing the standard for all chemical hazards.

The hazard communication standard
The foundation for your hazardous materials management program starts with your hazard communication program. Issued on August 24, 1987, the Hazard Communication Standard is intended:

".... to ensure that the hazards of all chemicals produced or imported are evaluated, and that the information concerning their hazards is transmitted to employers and employees. This transmittal of information is to be accomplished by means of comprehensive hazard communication programs, which are to include container labeling and other forms of warning, material safety data sheets and employee training."

OSHA requirements for hazard communication
Under the provisions of the law, each employee who works with hazardous chemicals will receive information about those chemicals through a comprehensive hazard communication training program.

Chemical manufacturers and importers are required to evaluate the hazards of the chemicals they produce or import, and must transmit the information to employers using those chemicals via labels on containers, Material Safety Data Sheets (MSDS) and training.

The law is designed to ensure that all employers receive the information they need to inform their employees properly, and to design and implement employee protection programs. In addition, it will provide necessary hazard information to employees so they can meaningfully participate in and support the protective measures instituted in their workplaces.

The goal of every hazard communication program is to reduce the incidence of chemical source illnesses and injuries in the workplace.

Employers are required to protect their workers, both by managing the work environment and by providing employees with training regarding any job-related health effects and chemical hazards they may face from toxic substances, and safe work practices with respect to those hazards.

How OSHA interprets this law
You must train employees before they are exposed to any hazardous chemicals. Training must be done each time a new hazard is introduced into the work area, or whenever an employee is assigned to a new work area.

A substance-specific Material Safety Data Sheet must be available for all substances, and products must be properly labeled. Giving an employee an MSDS to read does not satisfy the intent of the law with regard to training. The training:

•    must cover the hazards of the chemicals in the work area,
•    must review how the employer controls these hazards though its hazard communication program,
•    must allow employees to ask questions,
•    could include a short test, for documentation purposes, and,
•    in some states, must be repeated every year.

Employers are responsible for protecting their employees from all hazardous chemicals known to be present, including any that contractors bring on-site. To ensure such chemicals are addressed, contracts should include provisions for obtaining Material Safety Data Sheets and require that all contractors' materials be labeled.

Companies must have a right-to-know program, as outlined on this page.

Making your hazardous chemical inventory
To identify which chemicals in your workplace need to be included in a hazardous chemical inventory, first study the label on each product. This must be done on all containers, regardless of size. Hazardous chemicals can be found in containers ranging in size from 2 ounces to a 55-gallon drum. The warning words to look for:  HAZARD; WARNING; DANGER; CAUTION.

If anyone of these warnings appear, the chemical must be listed on your inventory.  Manufacturers' labels are not consistent, and the warning information will not always be found in the same place on the label. Inspect each label carefully to determine if the product is hazardous.

To conduct a workplace inventory, walk through and identify chemicals by department, and list all chemicals or hazardous materials observed. Consult the purchasing department for a list of any additional chemicals, and review Industrial Hygiene Accident Reports, if any.
Evaluate your building materials for asbestos. Include PCBs in transformers, if any are on site. Be sure to consider any by-products or intermediates given off by operations performed in the workplace.

Once you have identified which products contain hazardous chemicals, you should include the complete chemical trade name, the name of the manufacturer, how often the chemical is used, the size of the container(s) and how much is stored on your list. If a product can be hazardous, you must have a Material Safety Data Sheet on file. To obtain an MSDS, you must contact the manufacturer or distributor in writing. In requesting an MSDS, be sure to use the exact trade name.

If a product can be purchased at a retail store, it may not need to be put on your list, and an MSDS may not be needed. However, a product needs to be listed if it is used more frequently or in a different manner than normal.

Personal protective equipment
Wherever hazards of processes or environment could cause injury or impairment in the function of any part of the body if absorbed, inhaled or touched, personal protective equipment must be worn. This may include protective equipment for eyes, face, head and extremities, protective clothing, respiratory devices and protective shields and barriers.

This equipment must be selected, provided and maintained by the employer. Where employees provide their own protective equipment, the employer is responsible for assuring its adequacy, including proper maintenance and sanitation of the equipment. All personal protective equipment must be of safe design and construction for the work to be performed.

Appropriate respirators must be used where there is atmospheric contamination by harmful dusts, fogs, fumes, mists, gases, smokes, sprays or vapor that is not controlled by accepted engineering means (i.e., enclosure, ventilation, substitution of less toxic materials).

The employer must provide respirators that are applicable and suitable for the purpose intended, and is responsible for establishing and maintaining a respiratory protective program. The employee must use the provided respiratory protection in accordance with instructions and training received.

Dealing with formaldehyde
Formaldehyde is a sensitizing agent that can cause an immune system response upon initial exposure. It is also a human carcinogen linked to nasal cancer and lung cancer.

Formaldehyde can be inhaled as a gas or vapor, or absorbed through the skin as a liquid. Acute exposure is highly irritating to the eyes, nose and throat, and can cause coughing and wheezing. Subsequent exposure may cause severe allergic reactions of the skin, eyes and respiratory tract.

Airborne formaldehyde can cause irritation of the respiratory tract, the severity of which worsens as concentrations increase. Ingestion of formaldehyde can be fatal, and long-term exposure to low levels on the skin can cause skin irritation, such as dermatitis and itching.
Embalmers are exposed to formaldehyde at concentrations averaging up to 9 parts per million during embalming.

Short-term exposures at levels up to 5 ppm cause eye, nose and throat irritation. At levels from 10 to 20 ppm, formaldehyde exposure causes cough, chest tightness and unusual heart beat Exposures from 50 to 100 ppm cause fluid on the lungs, followed by death.

Concentrations of 100 parts per million are immediately dangerous to health or life. Long-term exposure to low levels of formaldehyde may cause respiratory difficulty, eczema and sensitization.

The fact that formaldehyde is the subject of its own federal regulation, Formaldehyde Standard 29 CFR 1910.1048, emphasizes the need to protect employees from exposure. The requirements of the Formaldehyde Standard are in addition to the provisions of the Hazard Communication Standard.

Formaldehyde Protection Program
Employers are required by law to take preventive measures to protect employees from formaldehyde exposures, and must develop a Formaldehyde Protection Program, as follows:

Employ engineering controls. As the first step, engineering controls must be used to the maximum extent practical to eliminate or reduce employee exposures to acceptable levels. Engineering controls include enclosing and/or providing appropriate ventilation systems for operations.

Approved laboratory hoods or local exhaust ventilation can be used for all jobs involving the use of formaldehyde in embalming or other preparation.

Monitor exposure limits. Limits for employee exposure must be determined, and air monitoring or formal exposure assessment must be conducted. Monitoring is required unless it can be objectively documented that the operation cannot result in concentrations above the action level or short-term exposure limit under all expected conditions. Previously evaluated operations must be assessed if there is any change in procedure that may result in increased exposure.

Provide personal protective equipment. When engineering and work practice controls cannot reduce and maintain employee exposure to formaldehyde at or below the personal exposure limit, you must provide your employees with the proper protective equipment.

It is the employer's responsibility to select, provide and maintain this equipment, and to ensure that employees use it. Where the potential for skin and eye contact with formaldehyde exists, impervious clothing, gloves, aprons and chemical splash goggles must be worn. Showers and eyewash stations must be provided if splashing is likely.

Where airborne concentrations exceed allowable limits, respirators must be used. Respirator cartridges must be changed on a scheduled basis to prevent "bleed through."

Provide additional training. In addition to the applicable training requirements for hazard communication, personnel working with formaldehyde must receive annual information specifically about formaldehyde and training on their job assignments, as well as retraining whenever a new exposure to formaldehyde is introduced to the work area.

This training must ensure employees understand the hazards of formaldehyde and the control measures chosen. Employees also must be told about the signs or symptoms associated with exposure to formaldehyde, and how to properly report them to the employer, which helps ensure the success of medical surveillance and removal programs.

Provide medical surveillance. Medical surveillance must be provided for personnel exposed to formaldehyde at concentrations at or above the action level, or exceeding the short-term exposure limit, for those who develop signs and symptoms of overexposure and for all employees exposed to formaldehyde in emergencies.

Employers must maintain medical records in accordance with current personnel and medical guidelines. Employers must reassign employees who suffer significant adverse effects from formaldehyde exposure to jobs with significantly less or no exposure until their condition improves. Reassignment protection can continue for up to six months, until the employee is determined able to return to the original job or unable to return to work, whichever comes first.

Properly store and dispose of formaldehyde. Formaldehyde products must be stored in a cool, well ventilated area, and in accordance with any additional requirements listed in the MSDS.

Label all mixtures or solutions composed of greater that 0.1 percent formaldehyde and material capable of releasing formaldehyde into the air at concentrations reaching or exceeding 0.1 ppm. For all materials capable of releasing formaldehyde at levels above 0.5 ppm during normal use, the label must contain the words "potential cancer hazard."

Waste formaldehyde products must be stored in a labeled hazardous waste container for proper disposal, or made available for recycling, if practical.

Did you know that workers over 40 now have more standing to sue for discrimination?
Attorney Michael Pepperman briefs you on that development and more.

The Supreme Court recently handed down a very important decision regarding age discrimination that could affect your workplace. This ruling means that people over the age of 40 can sue under the Age Discrimination in Employment Act based on a new theory, that of "disparate impact."

In the past, if there was some statistical evidence of discrimination against employees over the age of 40, there really wasn't a whole lot the employees could do about it.

Now, the law of the land has changed, and you're going to have to be careful if you do something that will have a disparate effect on employees over the age of 40.

In today's business climate, that means that those of you who are considering changing your health insurance or pension benefits because of the high costs associated with them must be careful.

If you are considering such changes, I recommend that you consult with legal counsel before making any significant changes.

The case was Smith vs. the City of Jackson, Mississippi. The city had decided to change the pay rates to try to compete with the starting salaries of surrounding communities. They did this by giving people with five or fewer years of seniority 10 percent pay hikes; employees with more than five years of seniority were given a lower percentage.

Most of the employees with five or fewer years' seniority were under the age of 40, and a group of workers 40 or older sued the city, saying it was unfair that they got a lower percentage raise than younger workers.

The disparate impact theory has been around for a long time for Title VII, the statute that protects employees from discrimination on the basis of race, creed, color, national origin and sex.

It's interesting that the Supreme Court ruled in favor of the city, saying city officials had a legitimate business reason for the action they took—they had to compete with surrounding communities.

But in its written decision, the court laid out the disparate impact theory as a basis for lawsuits under age discrimination laws.

Your rights when there's talk of a union
I've gotten a number of calls over the years from ICFA members that go something like this: "Mike, there's a guy outside my gate handing out union cards to my employees. Apparently there's a meeting next week where the employees are going to get together with him, and I don't know what to do. I can't talk to the employees about whether or not they should join a union, I can't tell them what I think."

But you can. You absolutely can and should tell your employees if you feel unionizing isn't the right thing for them to do. Don't lie to them; don't make promises. Simply express your opinion.

If the guy handing out union cards comes on your property, you can ask him to leave, and if he doesn't, you can call the police.

Unless, of course, he's visiting a grave site, which is exactly what the guy in one case claimed he was doing. But when he was asked whose grave he was visiting, he couldn't answer, so the cemetery asked him to leave.

In one case, a supervisor was helping hand out the union cards. That is not protected activity. If employees want to give out union cards on their own time (not during work hours), the law protects them, but supervisory employees are not protected.

If you have a supervisor helping organize a union and you don't want a union, you can terminate that supervisor if you want to and he or she will have no recourse under federal labor laws. Or you can simply sit down with the person and tell him to stop.

Of course, you can always take the position that a union is OK, and if your employees want to organize one, that's fine with you, but most employers don't take that view, and I don't think you want your supervisors showing support for a union.

There's no right to a jerk-free workplace
I dealt with an interesting case one time involving a mean—some would say evil—salesperson. This person was a superstar of sales, the top producer, but had problems dealing with fellow employees.

Reading the complaints—a couple of people had actually put them in writing—could make your hair stand on end. People said this salesperson would yell at them, throw things at them and generally harass them.

Management was dedicated to having a harassment free workplace, of course, so they asked me what they should do. Though this salesperson was a star producer, even stars should not be allowed to violate laws protecting the workplace.

However, there is no federal or state law I know of that protects employees from a boss who's simply a jerk. There seems to be a common misconception that you can be sued over a supervisor who's a jerk, but you can't.

However, in a case where someone is throwing things at or pushing people, there are other issues. If someone throws a stapler at your head and hits you, you're got a battery claim.

In this case, it was clear there was a problem; you don't want to have a supervisor harassing employees physically or otherwise.

Even if it's not legal "harassment," it's certainly not good for morale. So the supervisor was counseled about stopping the behavior, and he did.

No paperwork, no termination
Another typical call involves salespeople who clearly, in looking at the sales quotas and sales produced, are not productive. But maybe the person is in a protected category (race, national origin, etc.), so the manager calls me for advice. Sometimes our conversation gees like this:

"What do you want to do?"
"I want to fire him."
"Have you ever sat down with him and talked to him about his performance?"
"No. Well, he knows. I've said things." "But have you ever had a formal meeting with him?"
"No."
"Is there anything in writing you've given him saying, 'Your performance is poor; you must do this to improve?" "No."
"And you want to terminate him?"
"Yes."
"If you do, you are going to bring down a world of hurt on yourself."

My advice in these cases: Sit down with the employee, review the sales quotas, discuss expectations and give him a certain period of time to improve.

Put everything in writing, including the notification that if he fails to improve, he could be facing disciplinary action, up to and including termination.

If you follow that procedure, you should not have to worry.

Treating customers with care, honesty and dignity helps us build ethical business practices and also helps us learn what standards to expect from ourselves.

As individuals with free will, we must determine for ourselves what ethical standards to follow. Therefore, it is possible that others' standards will differ from our own.

This can add to the struggle of deciding what is right and wrong in business, especially when something falls in a gray area. Many issues have two sides and will never have a black or white answer.

The basic question you should ask yourself when a problem situation occurs in your business is, "How will my decision affect my conscience?"

If your company discovers a wrongful burial and you correct the problem at midnight, without notice to the family, you might find yourself very troubled, even haunted by that decision. However, if you fess up to the family, apologize and then correct the problem, after it is all over, you are likely to feel good about your decision—and not likely to have nightmares.
 
In other words, honesty is the best policy. When you enter into a contract with a customer, you must follow through. If you find, after the customer has left, that you made a mistake in an agreement, such as putting down an incorrect burial location, you must not change the agreement. You must have the customer return and execute a corrected agreement.

If you make a verbal promise to the customer, you must follow through. A good example of this might be when you promise a grave will be sodded. Get it done! You must also follow through by checking to see that your promise has been fulfilled (since you are probably not going to sod that grave yourself). Always remember the Golden Rule: Treat others as you want to be treated.

Most of us know what unethical practices are in business. Stealing is unethical. If you remove someone's flowers off their loved one's grave and put them on someone else's grave, it's stealing. If you accept payment for services and don't render those services, you are stealing.

Lying is unethical. If you show a picture of a certain type of vault when you make a sale and then deliver a different type of vault at the time of need, you have lied to the customer.

Abusing a customer is unethical. In our sensitive business, ethical violations can include psychological abuse. Take the example of a headstone damage, which can occur during mowing. If a customer comes to you to report such damage and you dance around the issue instead of acknowledging and taking care of it that could constitute psychological abuse. You must train your employees to be truthful so that you can honestly deal with customers.
It is always a good idea to have a mission statement framed and posted in your office so customers can see it. For example, your mission statement can promise customers that your company will:
•    honor their wishes,
•    take care of their loved ones with compassion, and
•    deal honestly with all customers.

The 5 areas to cover
There are five important areas you need to cover in business ethics: conduct, administration, confidentiality, competence and identification.

Conduct: Everyone who comes in contact with a customer must always engage in ethical behavior. It is wise to have everyone trained in your state's laws and to stress the importance of being truthful. If all employees are truthful to each consumer about what they are buying and are honest about any mistakes made, they will be practicing good, ethical behavior.

Administration: The people in authority must always practice ethical behavior. If you set an example of unethical behavior to your employees, you can expect them to learn from it and practice what they have learned.

Confidentiality: This is of utmost importance when dealing with customers. Giving out your mailing list is unethical. Letting someone know the cause of death of a decedent is unethical. Some of these practices are also illegal.

Competency: Being good at what you do leads to good ethical practices. If someone who works for you out on the grounds is constantly damaging headstones while mowing, that person is incompetent, and so is the manager charged with training and supervising that employee.

Keeping your equipment in good working order is also part of being competent. Using a lowering device with frayed straps is incompetent and unethical—not to mention the fact that it opens you up for an incident that could lead to litigation.

Identification: In the cemetery and funeral profession, a good identification system is a required business practice. This is so vital that if you do not have a good identification system, both for bodies and grave sites, you might be considered unethical.

Remember:
•    Treat each decedent as if he or she were related to you.
•    Honor your contracts and do a good job.
•    Maintain your cemetery in a fashion that makes you proud.
•    Implement checks and balances to make sure you properly identify bodies and cremated remains and inter remains in the proper place.
•    Admit your mistakes; contact your customer as soon as you become aware of an error.
•    Know and follow the laws and regulations at the local, state and federal levels.

We must do all we can to protect our families, who have suffered the ultimate pain of the death of a loved one, from any further grief.

Adapted from a presentation at the 2005 ICFA Convention

If you are going to run a sales program, you have to have a cost model that you're going to maintain. In any sound cemetery operation, I suggest that 70 percent of your sales ought to come from prearrangements; 30 percent of your revenue should come from at-need services.

Your cost of sales should be managed somewhere around 23 percent or less, providing a gross margin of 77 percent.

Your marketing should be 25 percent or less. Maintenance expense, 21 percent; administrative expense, 12 percent; operating expense, 58 percent; and net operating margin, 19 percent.

You need a weekly report for your sales program. Financial statements are always behind or done late, so it's hard to monitor your sales program without a weekly sales report.

I meet weekly with my sales managers, my administrative managers, accounting managers and operations managers to review our sales results and to determine what we can do to support the sales program.

We also analyze our sales reports every week so we know on an annual basis how we're doing, what pace we're keeping.

The weekly sales reports monitor:
• your at-need and preneed sales compared to budget;
• your staffing goals, average contract, unit sold;
• individual performance of sales managers, unit managers and memorial counselors; and
• family service ratios of preneed families to at-need families.

Adapted from a presentation at the 2005 ICFA Annual Convention

Owners and senior managers set the moral and ethical path for your organization. Your mid-level and lower-level employees are going to take their lead from the company owners.

The CFO of World Com instructed his employees to cook the books and because of the environment, they did it. He could have never done it himself; he didn't post the books. The environment in which WorldCom was operating made it possible for these things to occur.

Creating a positive environment
So let's talk about creating a positive environment. Is it obvious that you as management care about your employees? The employee needs to feel part of the team; you need to get them to think "this is my company, too." It is less likely you will steal from yourself.

Are your financial targets reasonable?
In an entrepreneurial environment like I'm sure most of us in this room are in, it's not hard to get from a stretch goal to something that's totally ridiculous. And once you get into totally ridiculous, it's hard to get anyone on the team.

Is your management style participative rather than autocratic? In today's world, I can assure you young people only like to work in a flat organization chart. This autocratic thing, the boss on the top and everyone else on the bottom, doesn't work today. It doesn't get them on the team; they won't feel like they're a part of your organization.

Do you have different discipline standards for executives and employees? This is a very big one. There's no way that "Do as I say, not as I do" is going to work. Your employees will pick up on this and they will not be happy.

Ultimately, the greatest fraud deterrence is when every employee from the top to the bottom makes a conscious decision to conduct their business in an honest and an ethical manner.

Sounds like common sense, but as managers you need to ask yourself, "Am I perceived as an honest person by my employees?" In the probably 200 fraud deterrence programs I've done, the answer is always, "But of course."

And then we get into a few things. Do I have the grounds people occasionally throw a bag of seed in my car to take home? People are watching. Do I use the petty cash fund as my personal slush fund? Do I use the company credit card for non-business purposes?

You might think "Hey, it's my company, I can do anything I want." That's true, but if you're looking for honest employees, remember the rationalization, "everybody else does it." People say, "I know the boss has done it."
Do I hold the books up to allow for a few extra contracts to get booked? That's fraudulent. That's a bad message to send to your accounting team: It's OK to do fraud. That's what was going on at Enron and plenty of others.

Do I allow bad debts to remain on the books when I should write them off? What are we doing: We're pumping up our bottom line. That's fraud. And your employees are going to pick up on that.

Hotlines
Use hotlines. I'm a big believer in hotlines. One of the problems they had at WorldCom is that there was no venue for the employee to go to. There was no safe place for a person who wants to be honest to report what they saw. At WorldCom it was even worse—the external auditors were reporting to the CFO. That was a no win situation.

In my experience, people will use a hotline. And if employees know that other employees who see them doing something can report it upstream, anonymously, it's a very good part of a fraud deterrence program. It's very reasonably priced; there are a number of companies that offer this. The association of certified fraud examiners has a hotline you can look at.

Don't hire crooks
We've all hired crooks at one time or another, and we may have some crooks on our payroll today. You want to get criminal conviction and credit checks. Hire a private investigation firm to do this; don't waste your time trying to do it yourself.

Check references. It's amazing how few people actually call references. They say, "I'm always going to get good references."
 
You never know; it's better to call. They may not exist—they may be fake.

Call the last two employers. At a minimum you are able to verify the position and duties and dates. That tells you something about how puffed up the resume is. Always ask this question: "Is he eligible for rehire?" and listen for the tone of voice.

What you're looking for is "Yeah, I'd love to have him back. He did a great job for me, etc." That's a good response. What you will hear if they are not so happy with this character or if they fired them is a lot of silence, or stumbling or mumbling, "Well, I've gotta check with my HR director and we don't give out that information," Be wary; that is a big red flag.

The last thing is drug screening. This is new for our profession, but it's been going on in general for a long time. Given the fact that financial pressure is caused more and more today by drugs, you should do it. You don't want a drug addict on your payroll. You're opening the door to all kinds of problems, not the least of which is financial.

Get your attorney to sign off on all this. You can do it as long as you follow the rules.

Adapted from a presentation at the 2005 ICFA Annual Convention

Use behavior-based interviewing. What is behavior-based interviewing? It is shown to be anywhere from two to five times more effective than other types of interviewing.

We ask the candidate for specific examples of how they've done things in the past that are job related. We would never ask a theoretical question like, "How would you handle this situation?"

I was once asked, ''Tell me how you would deal with an underperforming salesperson?" I said I would take an eight-step approach to this—I would have a discussion, then give a warning, etc., and after the final step I would terminate the person.

I noticed just the slightest smile on the interviewer's face and she said, "You got the perfect score on that answer." She showed me the method they used and sure enough, I got a 10 out of 10 on that answer.

But what she didn't know is that as a sales manager I was real wimp. I would give everyone way too many chances, I would bend over backward to help close deals for people who simply couldn't close. I would do their job for them because of a personality defect I have called empathy.

But you would never know this if you asked me how I would do things, because I had read all the right books and I had seen top performers in action. I knew what the policy was on how to do these things.

If you are asking hypothetical questions, you will inevitably get hypothetical answers.

With behavior-based interviewing, what you would ask me instead is how I handled an underperforming employee. You would get all the details and then say, "Wow, you did a great job of bringing that underperformer around. And just to confirm, your general manager at the time was John Smith?"

A typical behavioral question is to ask for two accomplishments you are most proud of. The bottom line is to make sure you get specific, concrete answers, and always try to link it to reference checks who can confirm what the candidate has said.

Are your salespeople who are paid commissions covered by or exempt from overtime under the new federal regulations? It depends.

As most of you are aware, last year the United States Department of Labor issued final regulations that modified the rules for determining whether employees are exempt from the mandatory overtime payment requirement of the Fair Labor Standards Act.

Under the general rule, employers must pay all employees overtime in the amount of one and one-half times the employees' regular rate for all time they work in excess of 40 hours per week, unless the employees qualify under one of the exemptions from the act.

A number of ICFA members have asked us about whether the new DOL regulations change the exemption from overtime for certain commission-paid salespeople under Section 7(i) of the FLSA.

Although the new final regulations do not make any changes to Section 7(i) of the FLSA, we would like to take this opportunity to review the Section 7(i) exemption and its application to commission-paid salespeople.

Two conditions must be met
Section 7(i) of the FLSA exempts retail salespersons paid on a commission basis from the mandatory overtime provisions if the following two conditions are met:

1)    the employee's regular rate of pay exceeds one and one half times the federal minimum wage; and
2)    more than half of the employee's compensation for a representative period (not less than one month) represents commissions on goods or services.

For new employees, the Section 7(i) exemption applies if:

1)    it can reasonably be expected, based on the performance of other workers in their group, that the new employee will meet the test; or
2)    it can reasonably be expected that the new employee will meet the test based on the track record of the prior occupant of the employee's position.

The Section 7(i) exemption applies to overtime, but not to the minimum wage law.  Employees who are paid on a straight commission basis must still receive at least the minimum wage for each hour worked, no matter how little commission the employee earns.
Be careful—both of the conditions must be met for the exemption to apply. If either condition is not met, then the employee is not exempt. Exemptions are determined on a workweek basis.

The following example serves to illustrate the application of the Section 7(i) exemption. Peggy Plots is employed by the ABC Cemetery as a salesperson paid on a straight commission basis. Plots works nine hours a day, five days a week. The commissions earned by Plots during a recent four-week period are reflected in the table above (Peggy Plots' Pay).

Condition One: Was Peggy Plots' regular rate of pay greater that 1.5 times the federal minimum wage?

The applicable federal minimum wage is currently $5.15 per hour. One and a half times the federal minimum wage is $7.72. Therefore, ABC Cemetery must pay Plots at least $7.73 per hour during the representative period for Plots to be exempt under Section 7(i).

As shown in the rate/hour column of the table, Plots' hourly rate of pay ranged from a low of $8.44 to a high of $12.89. Since ABC Cemetery paid Plots at a regular rate which exceeded the required regular rate of $7.73 in all four weeks, the first condition for exemption under Section 7(i) was satisfied.

Condition Two: Was more than half of Peggy Plots' compensation for the representative period commissions on goods or services?

Plots also satisfies the second condition for application of the Section 7(i) exemption because all of her compensation for the representative four-week period came from sales commissions.

When a condition is not met
Obviously, the example above is very simplistic and does not address what happens when one of the conditions is not met. When either of the conditions is not met, the exemption is destroyed and the employee must be paid overtime according to the general rule.

One strategy employers can use to effectively limit destruction of the exemption is to guarantee a base-level hourly wage for commissioned sales people that exceeds $7.72 per hour.

Also, employers sometimes set a minimum guaranteed level of commissions to ensure that commissions comprise at least 50 percent of employees' total compensation.

The application of the Section 7(i) exemption to various scenarios can be complex. If you have questions concerning the Section 7(i) exemption or require assistance in determining whether one of your salespeople is exempt based on his or her particular circumstances, you should seek the advice of an attorney experienced in wage and hour issues.

Recordkeeping requirements
To rely on the section 7(i) exemption, employers also must abide by a number of recordkeeping requirements.

To prove application of the Section 7(i) exemption, employers must maintain and preserve the following payroll and related information for all employees paid on a commission basis for at least three years:
1)    full name and Social Security number;
2)    home address, including zip code;
3)    date of birth, if under 19;
4)    sex and occupation in which employed;
5)    time of day and day of week on which the employee's work week begins;
6)    hours worked each work day and total hours worked each work week;
7)    total additions to or deductions from wages paid each pay period, including employee purchase orders or wage assignments (also, in individual employee records, the dates, amounts and nature of the items which make up the total additions and deductions);
8)    date of payment and the pay period covered by payment;
9)    a symbol, letter or other notation placed on the payroll records identifying each employee who is paid pursuant to Section 7(i);
10)    a copy of the agreement or understanding under which Section 7(i) is used or, if such agreement or understanding is not in writing, a memorandum summarizing its terms including the basis of compensation, the applicable representative period and the date the agreement was entered into and how long it remains in effect; and
11)     total compensation paid to each employee each pay period, showing separately the amount of commissions and the amount of non-commission, straight-time earnings.

Proper application of the Section 7(i) exemption and recordkeeping can save employers money. On the other hand, the improper application of the 7(i) exemption can prove quite costly.

Therefore, seek legal counsel if you have any questions regarding the application of the Section 7(i) exemption or related recordkeeping requirements.

What worked in the past no longer works in funeral service, and some of the things being tried to reverse the trend are just making it worse. Why? Because they don't address what families want and are willing to pay for, this marketing expert says.

Many articles discussing marketing, whether in the funeral and cemetery profession or any other industry, begin with a definition of marketing as encompassing every activity within the business, not just the sales and advertising functions. Yet most people continue to use the terms marketing and advertising synonymously.

Simply put, anything your company does to generate new business or to hold customers is marketing—new buildings, pricing, employee training, sales tools and advertising all fall under the marketing umbrella.

Many death-care businesses, including vendors, are in desperate need of new marketing plans, and the situation has little to do with advertising. Those businesses suffering from high overhead and shrinking margins—which include most of the funeral homes in the United States—find themselves in their precarious positions because their marketing plans are failing.

Even if their advertising were more effective, these businesses would remain in a precarious position simply because their current plan of pursing additional volume at any cost is not viable at a time when many of the services they are offering are provided at a loss. For this reason, in this article I am going to address the issues of merchandising and pricing, which are integral aspects of a comprehensive marketing strategy.

If it's so popular, why is it so cheap?
Just as an illustration, let's begin with caskets. Casket companies have arguably provided the highest level of merchandising support in our business. Nonetheless, they consistently violate the most basic rule of merchandising: A product's more popular features should be reserved for the highest-priced models.

Everyone in the business knows that pink and blue are the two most popular colors for caskets. We also know that comer pieces, head panel embroideries and other structural features (such as the memory drawers) are very popular. But instead of being reserved for our highest-priced units, these features are (for the most part) available from the top to the near bottom of the line. Is it any wonder the public has difficulty seeing the value in higher-priced units?

Instead of being based on popular features, casket pricing reflects the cost of the materials used in manufacture. Certainly copper and bronze are more expensive materials than steel, and mahogany is more rare and expensive than oak and pine; but 90 percent of American consumers really don't care what the casket is made of.

They simply want an attractive, well built piece of furniture with special features, such as interchangeable corners, interiors that can be personalized and a choice of their loved one's favorite color—and they would be willing to pay for the features they want.

Applying this same analysis to funeral homes, we must ask why they include all of their services in their basic packages, thus depriving families of an opportunity to select—and pay for—additional services they may want. The funeral homes not only deny themselves the chance for needed revenue, they also deny families a choice so that they can select the package that best serves their needs.

Notice to the funeral and cemetery profession:
Consumers like choices.
Funeral homes must learn, as hotels have, that superior profits can be generated only by selling services, not merchandise. As funeral merchandise (caskets, vaults and urns) becomes more available from alternative sources, including retail outlets and the Internet, it will be increasingly difficult to realize a reasonable profit from the sale of these products. On top of that, funeral directors will increasingly face cremation families who will announce that they have no need for a casket or vault.

Profiting from services should be fundamental to the funeral business. Why else would funeral homes build and operate large facilities with rooms appropriate for large gatherings of people? Certainly very few funeral homes have anywhere near enough volume to simply operate as a furniture store; but most do serve enough families to profit as an event venue, making use of all their facilities.

Yet almost no funeral home effectively merchandises its services. Instead of incorporating graphics and other sales aids to help arrangers make effective arrangements, most firms operate under the assumption that families are fully aware of their options and will simply tell their arranger what they want.
 
Preneed lead generation is based on advertising concepts developed in the 1950s when mom stayed home with the children and seniors lived with their children, before answering machines and e-mail.

Cemetery direct mail advertising in the 1950s generated fifty times the results of direct mail today, at a time when postage was just pennies as opposed to $.39 apiece. The cost of getting a direct mail piece delivered is over $.40 apiece, including mailing lists and handling, and this is before the piece is created and printed.

Every knowledgeable preneed marketer in the business knows informative consumer seminars; family follow-up and public relations efforts generate leads of a far better quality than direct mail—at a fraction of the cost. Even so, cemeterians and funeral directors, led by preneed insurance companies, continue to flood the nation with direct mail appeals.

Incorporating consumer priorities into your marketing plan
The popular business book "Blue Ocean Strategy" discusses the concept that all industries operate under certain basic assumptions, so that every company within an industry ends up looking very much like all of the others. This makes price the only differentiation. The ongoing consolidation of the casket companies would be the anticipated corporate response to a declining market. Instead of creating a line of products geared to consumer priorities, the goal is to reduce overhead cost per unit while continuing to sell the same products.

As much as we would all prefer to sell American-made products, following this course to its ultimate conclusion will require funeral homes to offer lower-priced caskets manufactured outside the United States in order to get casket prices low enough so that families can afford to pay for the profitable services funeral homes are going to have to sell if they want to remain in business.

An objective observer of today's funeral homes would conclude that their priorities are, in descending order: 1. service, 2. large facilities, 3. vehicles, 4. clergy, 5. formality, 6. aftercare.

Suggesting "service" is a misplaced priority is tantamount to heresy, but the reality is most consumers are unable to evaluate a funeral home based upon service provided simply because they so seldom visit funeral homes. Furthermore, when people do visit a funeral home, they typically are so overwhelmed by the loss of their friend, the family's grief and the realization of their own mortality that afterward they can't remember the color of the casket, let alone the quality of service provided.

What about priority number 3, vehicles? Consider for a moment the lunacy of trading in a 6 to 10 year-old hearse with 15,000 miles on it in order to incur debt for a new vehicle. I cannot conceive of anyone believing that consumers select a funeral home based on the age of the hearse. Yet funeral homes maintain their vehicles beautifully just to sell them before they even reach midlife.

That money could be put to much better use: Create a reception room where families can socialize after the funeral. Buy equipment for creating video tributes the family will treasure for generations.

Then there's priority number 4, clergy. Research indicates fewer than 5 percent of individuals would consult a clergyperson to recommend a funeral home, yet funeral homes invest an immeasurable amount of time and money in church bulletins and contributions in the hopes of influencing local clergy.

The reality is that families who attend church are already familiar with their funeral home options, and most people without a funeral home preference do not attend church on a regular basis. On top of that, Episcopalians, Presbyterians and some Methodists encourage members to minimize funeral services or to let the church handle the service.

What does research show about how consumers decide on a funeral home? The influences they cite are listed in the table at the top of this page. Looking at this list gives us some variables we can control to produce tangible benefit to our funeral businesses. As consumers ourselves, we can understand why people would be more inclined to contact a funeral home where they know a staff member or one that's more convenient.

But how many funeral homes include in their promotional budget funds for building the community's awareness of their staff? As the second-most-volunteered reason for selecting a funeral home, building the community's familiarity with staff members should be a promotional priority.

When it comes to facilities, the funeral profession persists in building large facilities strategically located in places central to a very large population. Why not build several smaller buildings, each very convenient to a specific population? Families want a funeral home that's convenient for them and their friends, not one "conveniently" located between two fair-sized cities.

Summary
Reviewing funeral service from the consumer's perspective, we find that funeral businesses, like most others, focus resources on areas that deliver little in the way of customer value. This situation offers opportunity to those who realize the current way of doing business runs counter to what consumers want.

To take an example from another business, consider that for generations, roadside motels all included restaurants and lounges with their facilities. They continued to do this even after the interstate highway system was created and hotels and restaurants began to be built near the exits, giving families plenty of alternatives to eating where they were sleeping.

Even though the restaurants and lounges consistently lost money, motels continued to include them until Hampton Inn ignored the well defined norm and opened facilities offering only sleeping quarters and a free continental breakfast. Competitors finally appeared, but for years, Hampton Inn enjoyed a monopoly on this popular concept.

Returning to the funeral business, think about how operating differently would allow a funeral home to offer families better value and a more rewarding service, as well as to build relationships with new families who would turn to them in the future, even though other funeral homes ultimately will attempt to copy the leader's success.

The basic truth is, most funeral homes are suffering badly from shrinking margins, and still looking for solutions in the well worn business practices that brought us to our present state of affairs. Developing a new strategy or marketing plan focused on consumers could be the key to discovering a more profitable way to operate your funeral business.

You need good employees, of course, but to make everything work right, you also need formal business processes, policies, procedures and automation.

I’m not going to tell you how to run your cemetery; I'm simply going to describe 10 "best practices" based on what we're doing at Rose Hills. It's up to you to decide whether they would work for your organization.

How do you determine something is a "best practice"? We use five criteria:

1. Does it do something for the customer? Does it improve the delivery of products or services for your families?

2. Does it benefit your company? Does this practice help you become more profitable, reduce costs or increase safety?

3. Does it benefit the employee? Does it increase employee morale, or foster teamwork and buy-in?

4. Does it also improve the community?

5. Does it raise the bar for the entire profession and make funeral and cemetery services that much more relevant to consumers?

The Rose Hills Top 10

10. Have in place a good performance management system. You can't hit the target if you don't know what you're aiming at. A good system becomes an effective tool for communicating with your employees.

The system we've been using is built around the job position profile, which is different from a job description.

A job description basically lays out what a job is; the education requirements for it and so forth.

A job profile has three key items: the parts of the job, the standards for doing it and SMART goals. Have you ever heard anyone say, "In my job I wear many hats?" When you're creating a job profile, you're listing those "job hats."

At Rose Hills, the members of my operation team all have very similar job parts, such as operating within budget, or delivering customer service at levels we set for ourselves. Also, all managers and supervisors are expected to always have their safety hat on, so there is a risk management job part.

Leadership is also a major component of their jobs, so we need to identify what good leadership looks like. For instance, are we communicating effectively with our team and our staff?

All our managers at Rose Hills have a human resources development component to their jobs, meaning they're expected to train and grow and nurture their employees.

And lastly, our managers and supervisors have a personal development aspect to their jobs. We expect people to participate in events such as ICFA training, evening classes, the Chamber of Commerce—something outside of work to develop their skills.

Each of these job parts has what we call a job standard. For business management, it might be something like: "Performance is satisfactory when all planned projects are completed on time and on budget. Performance is satisfactory when targeted customer service goals are achieved or exceeded."

Each job part has one or more related job standards, and these typically don't change from year to year. If you're in the same job, what's expected of you doesn't change from year to year.

However, certain job standards will have what we call SMART goals—specific, measurable, attainable, results-oriented and time-specific.

For example, let's say you have a person whose job standard is, "Performance is satisfactory when all assigned projects are completed on time and on budget." That job standard will be the same, whether it's 2006, 2007 or 2008. But the SMART goal for 2006 might be, ''Project X will be completed within budget by June 30, 2006." You want to be able to know whether the goal has been achieved or not.

9. Institute written policies and procedures. Most of our employees really want accountability and standards, and I think written procedures are the way to get there.

There are many advantages to written procedures. They provide some consistency in how the job gets done. They are objective and results-oriented. And they provide a mechanism for constructive feedback and corrective action, and for performance reviews.

There are five key elements we embed in all our procedures:

• Define the job in terms of what success in this job looks like.

• Describe the process step by step.

• List the skills and talents required to do the job.

• Name the specific safety standards associated with that job.

• Include productivity standards.

Having written policies and procedures can also help you in other ways, such as being able to share them with other departments. A couple of weeks ago, we did a presentation for 200 of our preneed counselors about our interment process, and we shared our procedures. The more our employees know about what other departments are doing, the better, and having written policies and procedures makes it very easy to share this information.

Also, we have the policies and procedures for our subcontractors and vendors. We want to make sure they know what our safety rules are, and we expect them to follow our park etiquette standards. Our contractors sign off on that, and we expect them to follow through, or they're not coming back.

8. Keep a focus on career development. You want to hire and recruit, train and retain the best quality people you can, so it's not just a human resources department function, it's an operational management and leadership function to focus on career development.

Examine the diagram at the top of this page. Someone with a low skill level and a very high challenge is going to feel anxiety because he or she can't do the job right. Someone with a very high skill level and a low-level challenge could be bored.

We don't want our employees to be in a state of either anxiety or boredom; we want them "in the zone," where their skill level and job challenge are well matched. Managers need to work with employees and understand where their zone is, and create a career path and career opportunities to keep them in it.

It's difficult to orchestrate opportunities, but it's important. In the past, a new person would come to work at Rose Hills, go through training and rotate through jobs, but not really have a career path.

That wasn't working, so we came up with something new. We developed a career path for all employees based on skill acquisitions. As people acquire skills and experience, they are automatically promoted to another level and have an opportunity to increase their compensation. Our employees are so much more valuable to our organization as they grow those skills. We meet with each person on a quarterly basis and analyze their career development plan to make sure they're progressing.

7. Develop a vehicle, equipment and facilities maintenance program. We have formal written maintenance programs in place. With 100+ vehicles in our fleet, we maintain written records of everything done to each vehicle.

We have five working chapels on our property, and 500,000 people visit them each and every year. It's critical that those facilities look as good as they can. People are forming impressions about Rose Hills, and funeral and burial ceremonies, when they enter our property.

We do a weekly inspection of all our public facilities, everything from the speakers to the AV equipment. We check the restrooms to make sure the toilet dispensers and the faucets are working.

Don't forget your employee work areas. You can tell the quality of an organization by looking behind the scenes. It's important that your employees' work areas are safe and neat and well maintained.

6. Conduct internal inspections and quality control and compliance audits. At Rose Hills, our parent company does annual inspections. Someone comes in unannounced and looks at all our procedures and safety compliance and writes a report. We also have somebody on staff who does this. Not every organization is going to have a staff person who can do this, but if you don't, maybe you can subcontract it out.

5. Fully disclose the nature of services before you render them. We all know about the waivers, disclosure forms, at-need and preneed contracts, general price lists. What I've found is that you have to have these things, but most people don't read them. We try to focus on informal methods of communicating the important things.

Avoid industry speak. Nothing drives me crazy more than hearing somebody say, "I'm looking at Mrs. Smith on her ROC”—using terms that clients don't understand.

Brochures, handouts and web sites are obviously great tools to inform people about the business, but nothing replaces good, strong product knowledge and training for your people.

Also, we're beginning to leverage other influencers in the process-clergy, senior associations, leaders and so forth. Get these people involved, and sometimes they can be your best advocate and explain things to families.

4. Have a good system for resolving customer dissatisfaction. Do you have systems in place that resolve customer dissatisfaction? Statistics tell us that every person who has a problem with a company tells 10 other people—the worst type of advertising.

The most important thing is to address the issue immediately. Customer service issues are not like fine wine; they do not age well. We want our staff to address problems with the family immediately, since that's the best bet for restoring the customer's confidence.

Make sure you listen and get the whole picture before acting. Don't start trying to solve a problem before you've got all the facts. And don't blame others. I had a situation not too long ago where one of our supervisors was solving a customer service problem and said, "Well, the preneed person should never have told you that." That didn't give the customer a lot of confidence in our organization.

Separate the objective problems from the subjective. An objective problem, for example, is a cracked marker, a scratched casket or dead flowers. In those cases, you know what you have to do: give a refund or replace the product.

The bottom line is, do the right thing. I can't tell you how many times we've won the battle but lost the war with customer service. A family has 10 spaces, and we're fighting them over $100 worth of flowers. To try to avoid this, we tell staff, "If you make a decision favoring the customer, you're not going to get into trouble if you err too much on their side."

Of course not everyone who has a problem is going to tell us about it, so we use customer surveys. We ask the family, "Would you recommend us?" We want the answer to be "yes" at least 98 percent of the time.

3. Leverage technology. Walk around the convention this week. It blows you away how much more technology is in our industry than there was five years ago. Make your web site as useful as possible. We do $10,000 a month in flower sales for grave placement, and the family finds the online shop a great tool—they don't have to drive all the way out in L.A. traffic to put flowers on the grave.

We're beginning to use document imaging technology to replace a lot of the old manual recordkeeping. And we're using a park data resource system involving little handheld laptops so our staff can provide information to families in the field.

2. Know thy customer. This needs to be the mindset of all your operational managers. Cemetery master planning, facilities design—everything needs to be built around what you know about your customers.

We know where all our property owners live. We can graph our property owner distribution by zip code. More important than demographic information is psychographic information, which deals with people's attitudes, beliefs, religious preferences and lifestyle. You can do focus groups, survey your families and talk to your employees to get this type of information.

We also need to consider all the people involved in the funeral and cemetery decision process. This includes not only the buyers but also the initiators, who gather information; the deciders; and the influencers, such as clergy and hospice.

All customers have both articulated and unarticulated needs. If customers are telling you what they want and you're meeting their needs, you're not getting any bonus points, because that's what they expect. That's the basic level of service. Pleasant surprises you offer a family—"Wow, I didn't know you did that"—get you bonus points.

1. Put safety first. We've got to have a razor-sharp focus on safety through three different lenses:

• Safeguard the deceased, from the removal to the time the casket is lowered or the deceased is transferred to the crematory. If you have subcontractors, are you inspecting them?

• Safeguard your employees. OSHA requires safety procedures, and we don't view that as a burden. You want your employees to be safe, and they want to see that you care about their safety. We do a lot of safety training.

• Safeguard your visitors. You need to go around you, pack and look for anything that could endanger visitors. Is there a slipping hazard somewhere? Is that construction project properly marked with signs and cordoned off'?
 
Most of the things on this list are not quick and easy. They take hard work, but I can tell you from personal experience that they pay huge dividends. It's a lot easier to grow weeds than it is to grow grass. These things are going to help you grow grass

This article compiled from an address presented by the author at the 2006 ICFA Annual Convention

Good morning, Ladies and Gentlemen: Once again I come before this august body as a pinch-hitter, and knowing that pinch-hitters usually have the habit of striking out, I hope too much will not be expected of me in trying to cover the subject, "Organizing the New Cemetery."

Mr. William Nelson, my associate in Whitemarsh Memorial Park requests me to extend his deepest regrets and apologies for being unable to attend our meeting here this morning, and to deliver his own address. Business and other circumstances made it impossible for him to be present. He wants me to say, however, that he is going to try to run over to attend a few of the sessions, to say "hello" and to renew some of his former acquaintances.

On my own behalf, I am gratified to see such a large attendance and look forward to an ever-increasing association, built on the right ideals, with a broad-mindedness to find a place for all the different groups associating in our business, whether it be monument or non-monument. I personally believe that if each and every man's honest opinion is considered sincerely and respected by the other fellow, we will go far. Should just the opposite occur, I am fearful for it.

Let us pause on this point for just a moment. As you are all aware, this Association was built up out of the meeting we held in Chicago about four years ago, at which time several memorial park owners got together for the purpose of binding ourselves in an association for our mutual protection. Later on the name of the association was changed to the "American Cemetery Owners Association" with the idea in mind of taking into this group, the owners of cemeteries other than memorial parks, until today we have quite a large percentage representing this type of the business.

We believe there is room for all groups and all opinions in this business, providing one or the other group is not dominated or discredited in the eyes of the opposing group. We invited owners of cemeteries other than memorial parks into our group. We gave unsparingly and unselfishly of our knowledge and experiences under the banner that there was room for all and that we should do everything possible for everybody else. Let us not take away that banner standing for this mutual understanding. I do not mean, however, that we should countenance or approve unethical selling methods. I have said before and I now reiterate--crooked promoters and crooked salesmen have no place and are not wanted in this Association. Let us maintain and keep alive that splendid spirit that has carried us this far and let there be no pause in the good fellowship and the sincere desire to help the other fellow. May I say this for the Association: This is our aim; this is our ideal.

Oh yes, I almost forgot, I was pinch-hitting on a talk regarding the "Organizing of a New Cemetery," and not the aims and ideals of an association. Those of you, who know me well, will realize that I am a drifter, drifting from one subject to another; they say this is a form of insanity. But I am not going to worry about that at this time-I'll let you worry about it. Then too, you will also know that on a dry subject such as the one I am supposed to talk about, I am certainly stepping out of character. You know, I don't know where Roy Hatten gets all the subjects that he hands out to the different speakers, I suppose he pulls them out of a hat.

There is not really much you can say about the organizing of a new cemetery. It can be briefly put in a few words and paragraphs, and on the surface this would appear to be all the requirements, but as many of you have sadly found out, there is a great deal more to it than appears. Before you get actively engaged in the business of a cemetery, it appears simple. After you are in it awhile, you will find out that you are in one of the most difficult businesses in the world today. This is what I would call an "opposite" business. You do everything opposite to what you would first think the proper procedure.

The first requisite upon entering the cemetery business is to get "bitten by the itching bug." By that I mean the "Cemetery Bug.” These bugs usually bite you on the palm of the hand and you develop an itching palm. That is your take-off into the realm of cemeteries.

In the original organization, of course, there are several steps to be taken. First, a suitable plot of ground should be secured, preferably without streams, for in many states the health laws prohibit the establishing of a cemetery, through which runs any streams that are tributary to streams from which drinking water is secured. In the highly populated areas this applies to practically all streams. This piece of ground should also be as free of rock as possible, and suitable for burial purposes. In choosing your property, I believe two of the most important features to be taken into consideration are: First, that it be not very distant from the center of the residential population. In larger cities, I would say this should be approximately 10 to 15 miles. In smaller cities or towns, this distance should be considerably less, and most important of all, there should be transportation, and from an advertising standpoint, the property should be located along the main highway. This saves thousands and thousands of dollars in educating the public to go up some side road to find your cemetery.  The ground also should rise somewhat above the roadbed. I found that people do not like to look down upon a cemetery from a highway.

After the acquiring of the ground, it becomes necessary of course to get the cemetery charter, establish an office, the advertising and training of salesmen, proper literature for their sales kits. Some of the grounds should be cleared and at least a few acres at the front and preferably the entrance should be improved. This Improvement Program, to those selling from an investment angle, should not be carried too far back of the entrance. Quite an item in your sales talk is the visualization of future improvements. Your improvements can be planned by any architect and the actual construction can be carried on by yourself if you have the proper superintendent and other lieutenants such as a civil engineer, a landscape gardener, etc., which is the method we pursued in building Whitemarsh Memorial Park. Most of the work in building our park has been done by the company's own departments and their own labor. In doing it in this manner there is a tremendous amount of saving.

May I say here, that one of the last major improvements in Whitemarsh Memorial Park is now being built, and that is the Tower of Chimes.  It will be 172 ft. high, built of steel, granite and limestone. The general contractor on this particular job is the company itself. We believe in doing it this way. On the tower unit alone we will save in the neighborhood of $25,000.00. So you see that doing your own work, if you want to take the trouble to supervise this phase of the business, saves the company considerable money. All you have to do after that, is to sell lots, put the improvements in, keep faith with your customers, and live up to your promises, and behold, you have a beautiful memorial park no matter what part of the country you are situated in.

It seems the only thing I can think of after all this is to recommend to you one of the 100 page sales booklets which has been compiled by my other associate, Mr. Lawrence C. Downey, of Whitemarsh Memorial Park, and which explains in detail how to sell and train men for every phase of this particular business. There have been so many repeated requests for a copy of Larry's book that I understand he is contemplating printing some extra copies and selling them to fill these requests.

All this sounds simple, doesn't it? Well, that is how the building of memorial parks sounds to almost, everyone you sell a lot to.  Their first expression is, “What a swell and profitable business. Gee, I would like to start a cemetery." I remember back in about 1925, when I was a real estate broker on the New Jersey coast. You will well remember that we had quite a boom for a few years, which continued until about 1927. One day I happened to be sitting with another broker. It was he who really put the cemetery bug in my ear. I can hear him saying now, "George, after we have sold off all the coast line of the state of New Jersey, I think the cemetery business would be a good one to go into. You get 100 or more lots to the acre and you don't depend on booms to bring you customers."

That remark started me thinking, and from 1925 until 1930 I was investigating cemeteries at every opportunity, securing all the data and information available. The more I investigated, the more I thought that this was the real thing; that creating a cemetery was nothing but just an easy job. I was never more mistaken in my life. About the latter part of 1929, after the stock market crash, I was joined by my two associates, Mr. Nelson and Mr. Downey, and we did all the things that I mentioned before, and after all the exhaustive searches that I had made, and after we had had our eye teeth cut, and the new organization of the cemetery already set up, then we really began to find out the real way to run a cemetery-after it was organized.

Ladies and Gentlemen, the organization of a new cemetery goes way back to your school days. For a man or woman to be successful in this field must, out of necessity, have certain training along certain lines and certain qualifications which are obtained only through hard years of experience in visualizing the future, feeling the pulse of the public, experience in selling from a development standpoint, and a lot of other qualifications too numerous to mention.

You have gone through the country and you have observed memorial parks started, and a good many of them, alas, too many of them, are at a standstill. You have also run across men in this business that have the ability to build cemeteries, who have started perhaps more than one, and instead of keeping faith with the customer, and really building the cemetery, they put in the least improvements possible. You also have heard one of the real pioneers and a man of ability in this field; say the cycle of success in any particular business was to have a definite, safe profitable plan, with capable and honest management. If you have all these particular qualifications in your business, you will be successful and you will also realize what I mean when I say the organizing of a cemetery starts back in your school days. I would lay more stress on the latter of these requirements, and that is honest and capable management."

Honesty, of course, comes first, and capability second in the organizing of a new cemetery, for this business can only be a real success in capable hands. That might apply also in other businesses, but it seems that you can hire capable employees to handle your affairs in other businesses, but where on earth are you going to hire that which this business needs most; a capable sales manager who has had years of experience along certain necessary lines in this land of ours.  I know this is next to impossible, for I have heard many, many cemetery owners asking this same question.

A banker friend of mine once said to a man in his office, who was getting bitten pretty severely by the cemetery bug, and the great idea of a memorial park. His remarks to this man summed up, I believe, most emphatically the requirements in organizing a new cemetery.  “It is true that the memorial park idea is wonderful and everything you think it is.  That, Mr. Blank, is 5%.  The other 95% in accomplishing this great idea is sales ability in that particular field."

This banker’s words, Ladies and Gentlemen, express more than the things that I have been saying to you here this morning about what it takes to organize a new cemetery.  I believe that to be really successful in this business, active constant application in governing the affairs of a cemetery company should be confined to a few people who can closely watch through personal management every detail of this business.  I believe that your improvements should be strictly in accord with your brochure and never make a promise to the public or to the salesmen that you cannot and will not keep. Double all the promises to the salesmen and triple all the promises to the public and have the money in your hand before you let a contract for improvements.

A man’s personality is reflected in many ways: his handwriting, his personal appearance, the way he walks, how he accomplishes his work - are all a personal reflection of the character of the man.  So too, is the way you run your business and the way you build your cemetery, a personal reflection of your character. Those of you who have come here lacking some of the fundamental knowledge, experience and ability to carry your park any further than probably the initial start, where it may be getting stagnated, may I respectfully suggest this to them: First, try to get the proper sales manager. This I know is almost impossible, but failing in that, I would suggest that you sit down and talk with those of us here belonging to the Association, who know sales in this particular field. You will find quite a few of them here among you, and you will also find that they are ever ready to give you any ideas that they may possess to help you further along the road to success.

In closing, may I invite you to visit Whitemarsh Memorial Park.  It is less than two hours by automobile or train, and for most of you who are going west, your ticket will provide stop-over privileges in Philadelphia. You will see what we believe to be an execution of the principles that I have mentioned, and you will also see that we have strived to build a very beautiful memorial park. One that we hope is a credit to us and to the Association. It is needless to say, that you will be welcome. I sincerely trust you will pay us a visit.

From the publication:
“ACOA 1938 Cemetery Handbook and Buyers’ Guide"
8th Annual Meeting and Convention held at
Hotel New Yorker, NY

Last Thursday during the Convention of the Memorial Craftsmen in Cleveland, Mr. Carter asked me to make a few remarks at this Convention, at our Convention. I asked him what I was to talk about and he said, "Oh, say something about the women, or women's place on the program." Now, from the various stories that Mr. Carter told at that Convention I am very frank to tell you that he would have been the logical person to tell about women, (Laughter) for he seemed to know all about our one piece dresses, our lost waist lines and how to smooth things over with candy and flowers and kisses (Laughter) and I am sure that he would have given us a wonderful talk on "The Women's place on the Program."

However, the word "program" reminds me of a story I heard a few weeks ago about Rastus and Mandy who met at a dance. Rastus said to Mandy, "is your program full", whereupon Mandy answered, "Now Rastus, I 'jes tell you it takes more'n olive and lettuce sandwiches to fill my program." You will all agree a woman could do a heap or talking to tell or a woman’s place on program. I did not have time to prepare a paper as I left Cleveland shortly after having talked with Mr. Carter, so I shall be very brief.

There is a town in the United States run entirely by woman, with the exception of a City Marshall who really doesn't count. It all started as a joke, a little josh on the women, but the women took the joke seriously and so did the townspeople, with the result that a perfectly good man-Mayor and several other masculine city officials are out of jobs. It seems the boys, prior to election, placed a ticket in the field just as they had done ever since the town had been organized. Some one just as a joke suggested a women's ticket in opposition. The idea spread. People voted who had not voted for forty years. The women were elected and are most efficient on the job. This city is Columbus, Iowa and the women in public offices like their jobs so well that very likely there will be some good electioneering to keep them in office.

Another town run by women is Jackson, Wyoming.  Jackson is a small town but small town problems are big town problems on a small scale. There is nothing wrong with the men at Jackson but they seemed to be easy going land their lax methods resulted in defeat. There was no cemetery excepting one high up on the hillside where a space had been set aside as a resting place for the dead. There was no road to it. In the summer the climb was made in a hot, unrelenting sun, in the winter the pall-bearers had to carry the caskets a mile up a rugged slope in four foot of snow. Two years ago they elected women to their public offices. The women went to work, they made a budget; bids were asked on improvements; they passed health laws and etc. and instituted clean up week, the people turning it into a real town holiday. Then the council faced the cemetery problem. They selected a site, built a fence around it and set up stones to mark the graves of the dead. They constructed culverts and built gravel roads which made it possible for automobiles to enter the cemetery.

What women lack in weight and muscular power, they make up in conscientious and keen endeavor. We do not know whether it is merely as social accident or a fact or nature but as things are at present, there is little doubt that women are less inclined to be idle than men. Women have no. desire to displace men but to act as their complement.

Many insist that women’s place is in the home. We probably all agree but the word home is a comprehensive one whose boundaries extend beyond the place where one dwells and includes the city, state and nation in which we live. It is in such a sense that I contend that home-making applies to city as much as it does to the home. Therefore, it is woman's place on the program.

From the publication:
AACS - Proceedings of the 39th Annual Convention
Chicago, Illinois
August 24, 25, 26 and 27, 1925

Coverage on property consisting of building and contents:

Basic coverage reimburses for loss by fire, lightning and the hazards of extended coverages.  Extended coverages protects against loss by windstorm, cyclone, tornado, hail, riot, strike, civil commotion, damage by falling aircraft and parts thereof, sudden and accidental smoke damage from any stationary heating unit, explosion other than boiler explosion.
 
To these coverages can be added additional protection against loss by vandalism and malicious mischief.

On buildings only the insurance can be extended to provide all risks of physical loss coverage. This all risks protection excludes damage by:

1.    Earth movement which would include earthquakes, landslides, mud flow, earth sinking, earth rising, or earth shifting.
2.    Flood, surface water, waves, tidal water, overflow of streams or other bodies of waters, backup of water through sewers and drains, water below the surface of the ground.
3.    Wear, tear, deterioration, rust or corrosion, mold, wet or dry rot defects, smog, smoke, vapor or gas from agricultural or industrial operation.
4.    Animals, birds, vermin, termites, or other insects.
5.    Explosion of steam boilers.

As respects buildings only coverage can be provided for replacement cost.  This means that in the event of an insured loss repairs or replacement will be made without depreciation being taken. To properly insure for replacement cost, amount of insurance must be equal to the present day replacement cost of building - no depreciation being taken for age of property.

CONTENTS - of building includes office furniture, mixtures, machinery, equipment, supplies, records, etc.

Coverage on contents is normally fire, lightning and extended coverages, vandalism and malicious mischief. This can be extended to include Optional Perils protection which covers against loss by:

1.    Falling objects when damage is first sustained to the building.
2.    Weight of ice, snow, or sleet damage to the contents of the building which causes damage to the contents of the building.
3.    Accidental discharge or leakage of water or steam within a heating, plumbing, or air-conditioning system.
4.    Collapse of building.

Outdoor signs must be specifically insured, as they are not considered contents.
 
As respects the aforementioned coverages, protection afforded for windstorm, hurricane and earthquake varies in each state.

Each building and contents thereof must be specifically insured with an amount of insurance applying to each building and the contents of each building, unless the fire rate published by the Inspection and Rating Bureau is average rated. Average rated risks cover all building and contents thereof on the cemetery property. When equipment or contents values are moved from one building to another during the course of a year, it is best that an average rate be secured, as this provides for movement of machinery and equipment or fixtures regardless of which building they are in at time of insured loss.

Co-insurance clauses of either, 80%, 90% or 100% apply on all of these coverages.  To secure the proper amount of insurance the value is not arrived at by using your book figures. For insurance purposes the value is arrived at by taking present day replacement cost on buildings and depreciating (this can not be done on replacement cost coverage) at the rate of 1% for each year since built, but no more than 50% depreciation. On contents, whether of value or not to the owner, on an insurance claim everything on the premises has value.  Contents valuation is arrived at by securing present day replacement cost of like, kind, quality and age.  To ascertain proper values it is best to have an appraisal made by a certified appraisal firm. These appraisals can be secured at a reduced cost through your insurance broker or agent if he belongs to his local Board of Underwriters.

VALUABLE PAPERS AND RECORDS INSURANCE

This covers written, printed or otherwise inscribed documents and records, including books, maps, films, drawings, abstracts, deeds, mortgages and manuscripts.

The coverage of this contract is against all risks of physical loss with the following claims being excluded from policy coverage:

Wear, tear, gradual deterioration, vermin or inherent vice; war risks and atomic fission: loss due to any dishonest fraudulent or criminal act by any insured whether acting alone or in collusion with others; loss to unscheduled property if such property cannot be replaced with other of like, kind and quality; loss to property held as samples or for sale or for delivery after sale.

This contract agrees to pay in the event of loss the actual cost of reproducing or replacing the damaged documents. Such property may be owned by the assured or held by him in any capacity provided the insurance applies only to the interest of the assured including his liability to others.

Under Contents Coverage, Valuable Papers and Records are insured but only to the extent that it would reimburse for cost of the paper on which these records would be reproduced. Under the specific policy providing coverage on valuable papers and records there would be included the expense of additional payroll necessary to reconstruct the damaged or lost records, or the services of an outside firm if this would be necessary to contact and secure from others such as customer's, their portion of the contract with the cemetery for reconstruction of cemetery records.

ACCOUNTS RECEIVABLE INSURANCE

Coverage of this contract is identical to that of the valuable papers. This policy reimburses for any necessary expense incurred for the reconstruction of accounts receivable, interest charges to offset impaired collections pending repayment of such sums made uncollectable by such loss; collection expense in excess of normal collection cost; other expenses when reasonably incurred for re-establishing records.

FINE ARTS:

All risks of physical loss protection can be written to cover Fine Arts of a cemetery. Property that would consist of Fine Arts and could be insured under this contract would be paintings, etchings, pictures, tapestries, art glass windows and other bona fide works of art, such as valuable rugs, statuary, marbles, bronzes, antique furniture, rare books, antique silver, manuscripts, porcelains, rare glass and bric-a-brac. On this contract each item insured must have a specific amount of insurance. The all risks of physical loss claims would not include damage by:
1.    Wear and tear, gradual deterioration, moths, vermin, inherent vice, damage sustained due to and resulting from any repairing, restoration, or retouching process.
2.    The acts of war.
3.    Damage caused by atomic fission or radioactive force.

To provide coverage against breakage from any cause whatsoever, these contracts must have an additional endorsement attached providing this coverage.

BOILER EXPLOSION

Under this coverage this insurance applies to any steam boiler, electric steam generator, hot water boiler, fired water heater or fired pressure vessel, including as part thereof (1) any steel economizer used solely with such vessel, (2) any indirect water heater used for hot water supply services which is directly in the water circulating system of such vessel and which does not form a part of the water storage tank and (3) any piping on the premises of the insured or between parts of said premises with valves, fittings, traps, and separators thereon, which contains steam or condensate thereof generated in whole or in part in such vessel and any feed water piping between such vessel and its feed pump or injector. Under boiler explosion the coverage applies to an accident which means a sudden and accidental breakdown of the object insured, or a part thereof, which manifests itself at the time of its occurrence by physical damage to the object that necessitates repair or replacement of the object or parts thereof. In payment of claim under this coverage, the payment is made as follows:

1.    Repairs or replacement to the damaged object.
2.    Reimbursement for repairs or replacement to the insured's building and contents thereof.
3.    Damage to property of others.
4.    Personal injury or death claims sustained by members of the public.

On # 3 and # 4 claims, if the limit of liability under the boiler explosion has been used, this protection would then automatically come under the general public liability and property damage insurance carried on the operation of the cemetery business.
 
BUSINESS INTERRUPTION OR EXTRA EXPENSE

Insurance can be purchased to provide reimbursement for loss of income or necessary extra expense incurred for the operations of the business which is caused because of damage or loss to property under an insured peril of the original contract applying to buildings. This also reimburses for cost in excess of the normal cost of repairs to the damages property for expediting repairs or replacement. Under the cemetery operation extra expense incurred in obtaining property for temporary use during the period of restoration necessarily required for the conduct of the business.

“Extra Expense” means the excess of the total cost during the period of restoration for the operation of the business at the location or on other premises over and above the total cost of such operation that would normally have been incurred during the same period had no loss occurred. The cost in each case to include expense of using other property or facilities of other concerns or other necessary expenses.

As respects another business conducted in the premises of the cemetery,
such as a floral shop, the company shall be liable for the actual loss sustained resulting directly from such interruption of business including reimbursement for continuation of normal charges and expenses, including payroll expenses to the extent necessary to resume operations with the same quality of service which existed immediately preceding the loss and such expenses as are necessarily incurred for the expediting, which would inc1ude overtime pay, to repair the damaged property. This coverage also reimburses for loss of income or profits during the reconstruction period.

DISAPPEARANCE, DESTRUCTION AND DISHONESTY

This form of contract provides coverage for loss of money or securities due to a dishonest act of an employee. Claims involving the dishonest acts of an employee or employees must be proved by the insured as to the actual persons involved in this type of loss. This could include losses such as monies being taken on deposit, or monies taken for payment of bills which an employee would divert to his personal use; or it could involve payment of nonexisting bills the monies of which would be diverted to the personal use of an employee.

This type of contract can also include holdup of the premises when they are open for business, holdup of a messenger carrying securities or monies of the insured while away from the premises; burglary of a safe or burglary of the premises when they are closed for business.

Under the protection of burglary, reimbursement would be made for loss of stolen securities or monies, or any type of stock of merchandise and would also include payment for any damage to property caused by thieves.

This contract can also include check forgery covering outgoing as well as incoming checks.  Also included under this contract could be securities of the corporation in any safety deposit box of either a bank or a recognized safety deposit company.
 
PUBLIC LIABILITY AND PROPERTY DAMAGE

This covers the legal liability of the cemetery for injury or death to members of the public which accidents occur on the insured premises, or result because of an action of an employee either on the premises or away from the premises when acting as a representative of the cemetery.

Damage to property of others is covered when the property damaged is not in the care, custody or control of the insured.

Claims that could come up on this type of insurance would be injuries incurred under the “attractive nuisance theory” which could be a pond in the cemetery property which would attract a child and because of the attraction say a youngster would drown in the pond. These claims arise regardless of the fact of whether the member of the public is legally on the property when the premises are open or illegally on the property when the premises are closed and access to the premises is made either through forcible entry or say, over a fence. This type of claim could also apply to any machinery or equipment on the insured premises that would prove to be an "attractive nuisance".

In Illinois, the term “attractive nuisance” is no longer used and the new legal term for this type of injury would be “Forseeability of Injury”. This law varies from state to state as well as the age factor on which these claims can be brought to court. In the state of Illinois these claims have been held up in court to age sixteen.

This policy provides legal fees, court fees, bond release attachment and all necessary expense incurred regardless of whether there is liability on the part of the assured or not. The insuring company provides these services as well as any inspection or investigation of righteous or fraudulent claims.

If there is an elevator or elevators in the cemetery buildings, coverage can be provided for public liability and property damage claims incurred through the operation or ownership of these elevators, as well as elevator collision protection.

This contract can also be endorsed to provide cemetery malpractice coverage which would protect on claims made by members of the public for mental anguish. A mental anguish claim could be presented in the event of some untold or unlooked for occurrence involving the casket which could possible fall or become upset and cause members of the deceased family to claim damages for the shock they received, which could probably go into a breakdown of health. This protection also provides coverage for error or mistake in the embalming, handling, disposition, burial, disinterment or removal of any deceased human body or any conduct of any memorial service by the insured even though no deceased human body actually be present or because of any injury to, destruction of, or interference with the right of burial of a deceased human body.  Coverage also pays on behalf of the insured all sums which the insured shall become legally obligated to pay as damages because of injury to or destruction of urns, caskets, linings, or fittings, casket cases, crypts mausoleums, or other facilities for the care or burial of a deceased human body belonging to others and in the care, custody or control of the insured for the purpose of burying or caring for a deceased human body.
Cemetery Malpractice Protection protects an insured cemetery against claims for injury arising out of malpractice, error or mistake on the part of cemetery personnel.

To the basic policy, can also be attached endorsement providing for personal injury coverage and will pay and defend for the named insured, any suits which are brought against the insured cemetery under the following definitions.

Personal injuries are divided into the following groups:

1.    False arrest, malice, prosecution, willful detention or imprisonment.
2.    Liable, slander, defamation of character.
3.    Invasion of privacy, wrongful eviction, wrongful entry.

Additional insurance coverages that are written for cemeteries and other businesses that are not listed or explained in the foregoing pages are as follows:

1.    Workmen's compensation and occupational diseases.
2.    Automobile insurance.

The theoretical system for the management of cemetery employees is a very important feature towards success of a cemetery.

Employees should be cautioned, and be compelled to show great respect and affection to bereaved families, who through loss of their dear ones are compelled to visit the cemetery.

Where employees are rude and harsh, it places great sensitiveness to such families and their friends, and naturally creates public comment and complaint to the management of such cemeteries, and therefore cemeteries are very liable to lose patronage, through advice of their own lot owners to their friends, to seek other burial spots in adjacent cemeteries.

It therefore seems important in taking the first step towards good management to train the employees, especially such men as are in change of interments to be courteous and spare no pains in pleasing the families at such times.

Cemeteries of large acreage, where interments are numerous and improvements are necessary to supply the required demand, a large force of men is required. The superintendent at Woodlawn, has the entire control of selecting and engaging his men, and will therefore speak of his own experience.

Theory may be well applied on a general basis; but it seems to me, that the same applied to large and small cemeteries, may not prove entirely sufficient, and therefore I deem it necessary to apply a certain amount of practical basis, as experience or conditions may require.

At Woodlawn the improving and maintaining the grounds is entirely in the hands of the superintendent, and he thinks a very important factor in managing employees successfully, is to detail a proper system of branches for the various departments required, which should be in charge of a competent foreman. Each foreman in charge of his gang of men is held accountable for the expected and required work of his men. Each foreman is provided with a time-book to mark the time of his force, and on leaving work each day, he must deliver his time-book to the superintendent, from which the superintendent enters the time on his general book, and there from the payrolls are made. The entire employees have to answer roll call at 6:45 a.m. in the presence of the superintendent, who then directs each foreman to his respective work. As the superintendent is present at roll call and constantly on the grounds, no misuse or favoritism of any form can be shown on the part of the foreman in timing his men.

The following department forces are required: Gravediggers, Maintenance, Improvement, Mowing, Gardening, Repair, Stable and Police Forces.

The Gravedigger force, under a foreman and assistant, with horse carts, are required to open graves, attend funerals, excavate foundations and remove all surplus earth immediately. Such force is uniformed by the cemetery with black cheviot suits and hats to be worn at funerals, also with water proof coats and leggings and protected during stormy weather when at work with small grave tents. The above force are selected men, among the oldest employees, and are strictly cautioned to perform their work, in the most quiet and respectful way.

The Maintenance force, under a foreman, is required to keep roads and paths in proper order.

The Improvement force is under a competent foreman with teams in grading new sections.

The Mowing force under a foreman consists of lawn mowers, sickles and shears who mow the grass uniformly over the entire grounds during the season.

The Gardening force, under a competent gardener, is in charge of the bequest lots and the planting of flowers, trees and shrubs.

The Repair force consists of a blacksmith, carpenter and engineer, who build carts, sharpen tools and general repairing, also the shoeing of horses and oxen and the running of steam boilers.

The Stable force consists of stableman and assistants, who are in charge of the stock and must meet funerals that come by train with hearse and removals within the cemetery.

Since we have our own stock for teams and carts, we do not hire much, only in case of necessity. Certain men are selected who have charge of their teams and carts.

A Police force is organized and uniformed, who protect the grounds and give general information to lot owners and visitors. These men are selected from the general force, taking the most intelligent and as they are well acquainted with the grounds can render good assistance. You will observe that by having various departments and each in charge of a foreman with time-book, accurate account can be made and given for charging up payrolls to the various accounts.

The secret of managing a large force of men successfully is to treat them right, pay fair wages, and always show them your strict authority. Experience shows by such treatment, labor troubles have been avoided and any number of men can be obtained when wanted.

From the publication:
AACS - Proceedings of the 8th Annual Convention
Philadelphia, PA
September 11, 12 and 13, 1894

“What are you going to do when the rent comes 'round?” expresses in realistic terms the question that all of us who study finances are asking ourselves today.

In the not too far distant future it is probable that we shall again face a "buyer's market." For seven years most of us have had a seller's market wherein we prospered-or at least we were fooled into thinking so. Very soon people are going to be very loath to let go of their money for anything. The threat of continued war and the actuality of taxes are upon us. If is a sad fact that the people of the great middle class (wherein has lain the great purchasing power of the United States) are rapidly running out of money.

The Three Great Lags-It would appear to the student of economics that the cemetery industry is soon to be hit with the greatest impact in our history¬ the three great economic "lags." These "three musketeers" of evil fame I call the "gross sales lag," the "profit lag," and the "cash lag.” If I do nothing else in this talk but to arouse you thoroughly and place you on guard" against the great danger of these three sly, insidious, treacherous, undermining termites I feel I shall have performed in part my duty to you.

The Gross Sales Lag-In terms of today's devalued dollar, your gross dollar sales should be twice your 1940 gross dollar sales and 60% more than your 1945 sales, if present day dollar sales are to be really equal to the old days. There are only a few, if any, who could accomplish that miracle-unless you possess a new property, in which case doubling a small amount of gross sales can be done very easily.

The sales resistance attitude of the public will grow stronger and stronger because of many things, such as growing taxes that will take from your cus¬tomers cash they might have spent with you, threat of an unknown war, govern¬ment propaganda against increased prices, the uncertainty generally prevalent because of a confused Washington. And yet, your prices must rise to keep step with your rising costs, which creates even more sales resistance. Money is changing hands, and it may be that in some degree we can overcome this "sales resistance lag," by giving particular attention to the so-called laboring classes. If we want money, we must go where the money is.

The Profit Lag- The "profit lag" has two phases. Economic history teaches that during an inflationary period, labor and material costs rise much faster than the public's willingness to accept higher prices, which means greatly reduced profits. The second phase of this "profit lag" is the higher cost of replacement of inventory. Most of us today are making a fictitious profit because we are selling inventory that was manufactured at a much lower cost than that of today. Men we begin to replace this inventory, be it crypts, niches, graves, vaults or what not, we shall find that the difference between what this new inventory costs, and the price at which we can sell it, is much less than before.

The Cash Lag- The last and perhaps most dangerous lag is the "cash lag." Contrary to public and government opinion, profits are not all in cash. The fact is if our bookkeeping was such that we could isolate this year's cash receipts from the payments on last year's business, we would find that the cash content in the total profit is much lower than we think. In fact, it is entirely possible that none of this year's profit is in cash but is in accounts receivable-trucks, maintenance equipment, inventories of salable products, operating supplies, new buildings or additions to the old, etc., etc.

We, however, are compelled to pay all cash or partially cash on many things¬ such as payrolls, city, county, state and federal taxes, operating supplies, sales¬men's commissions, contractual payments on buildings, etc. I do not need to emphasize to you where and how your cash slips away from you. Again your cash income will continue to dwindle because, in order to offset the "gross sales lag," you will endeavor to make it easier and easier for your purchasers by asking less and less cash for their monthly payments.

As expenses go up this cash lag becomes greater and greater until you may well find yourself borrowing money to pay your taxes and other items that have in themselves no hope of compensating return. As the outgo of cash exceeds the accumulation of cash year after year, you will soon find your cash supply always inadequate to take care of your cash necessities, and borrowings therefore steadily increase.

From the publication:
“1950-1951 Cemetery Yearbook”
NCA 21st Annual Meeting
Hotel Schroeder, Milwaukee, Wisconsin
October 18, 19, 20 and 21, 1950