NZBusiness May 2012 by Adrenalin Publishing Ltd

WOWing the consumer ❖ Actors for hire ❖ DIY website audit ❖ When staff don’t measure up

MAY 2012

And when it does you want QBE on your side Worse things can happen at sea….. When moving goods from place to place – or around the world – you are exposed to risk. The risk of delays, damage or loss.

It might be the difference between your business sinking or staying afloat. Talk to your insurance broker today about QBE Insurance. www.qbe.co.nz

QBE-054 Rapport NZB • Photo courtesy of Mark Alen

At QBE Insurance, we’ve been helping traders manage their risks for 125 years. In addition to trade credit, property, and liability solutions, we can provide worldwide coverage of goods in transit by sea, land and air.

A touching tale

If your goods arrive too late for a specific market they may become worthless, or you may have to discount them heavily. Your customer may no longer accept them, leaving you high and dry. All of which have a drastic effect on your bottom line.

A touching tale

Al Monro: learning my way to success 8.20

May 2012

DIGITISING DOCUMENTS How an EDMS boosts efficiency

DATA SECURITY: Protecting your information assets

A brand is born Tréology’s leap of faith

The book

that backs our export drive “Accredo is seamless to operate and its front end functionality is very savvy.” The smart automation functionality available in Accredo makes life a lot easier for Southland electrical contracting company Nind Electrical Services. // General Manager Steve Winter says without the work in progress reports it generates from Accredo his staff would be faced with the laborious task of tracking down all the information pertaining to each job. // “Accredo does this for us. Each work in progress report shows all the labour and material for work underway. It also allows us to add purchase orders against each job which means we can track costs very accurately. // “This type of automation removes administration bottlenecks and lets me assess which jobs provide the best margin. The information we extract from Accredo improves our quotation accuracy and our client service.”

Go to www.accredo.co.nz to get the full story on Nind Electrical Services. While you’re there, subscribe to our online newsletter and see how Accredo can help you do more. Or if you would prefer, call us toll-free on 0508 ACCREDO.

Newly updaTed for 2012 The New Zealand Export and Trade Handbook continues to be a vital reference guide for Kiwi exporters and importers.

available Now! As the world economy stumbles from one crisis to another, it has never been more important to ensure that you have the best information and help available when trading internationally. The 2012 Edition of the New Zealand Export & Trade Handbook has again

proved to be the best publication available to our exporters and includes a wealth of useful information as well as key contacts that can provide assistance. If you are going to buy one book on the practicalities of exporting, make it this one! Rom Rudzki, Founder New Zealand School of Export.

To order your copy call Hilary Keen (09) 478 4771 or email: Hilary@adrenalin.co.nz Purchase on-line at www.exportandtrade.co.nz

CONTENTS

ACHIEVERS 14 WOWing the consumer Click Suite develops a number-one iPad ‘app’ and becomes an international award winner.

16 Smile please Have your photo taken at a tourist attraction and chances are Magic Memories is part of the picture.

COVER STORY 22 A touching tale Al Monro’s journey with touchscreen company NextWindow started with a mid-life crisis and the end of a safe corporate career. But ultimately the business won through because of lessons learnt from failure. Monro shares his somewhat roller-coaster story with Lesley Springall.

18 Feeling the heat HeatBox is a business that has had to claw its way to success.

20 Actors for hire

FEATURES 28 MUM’S THE WORD For ‘mumpreneurs’ Jo Bond and Jo Keall, strong financial management and the willingness to listen to expert advice has helped fuel an impressive growth in sales.

30 Digitising documents An effective electronic document management system and process can be the key to reducing costs for organisations, large and small. Glenn Baker does a little investigating.

36 A brand is born Launching a new green-luxury brand into the US has taken a big leap of faith for small, familyowned Christchurch business Tréology. Sandy Galland has the story.

38 Protecting your information assets Thanks to cloud computing, storing and managing business data has never been easier or cheaper. So why aren’t all businesses doing it? Bill Bennett offers a guide to data security.

HELP DESK 44 The case for content marketing 46 Business mentoring: a paradox paying dividends 49 The DIY website audit 50 When staff don’t measure up 52 Becoming social media savvy 54 Working together for the cause 55 Shedding light on trademarks

REGULARS 4

Briefcase

65 Franchise File

12 Biz Diary

66 Employment Matters

13 Soapbox

68 On Accounts

42 Speed Interview

69 Export Report

60 Biz Tech

70 Sustainable Business

63 Biz Books

71 Marketing Maestro

64 Customer Excellence

72 Issues with Balls

NZB May 2012 nzbusiness.co.nz

Editor

From the Editor

Glenn Baker. editor@nzbusiness.co.nz Advertising MANAGER Leanne Moss. leanne@nzbusiness.co.nz DESIGN AND PRODUCTION Margaret Murray margaret@adrenalin.co.nz Cover Photograph Julius Margan juliusm@xnet.co.nz Proof reading George Ward JOINT PUBLISHERS Cathy Parker. cathy@adrenalin.co.nz Yvonne Carter. yvonnec@xtra.co.nz Subscriptions Enquiries Hilary Keen. subs@nzbusiness.co.nz circulation manager Kim McIntosh. kim@adrenalin.co.nz Contributors this issue: Steve Alexander, Ashley Balls, Catherine Beard, Matt Bellingham, Bill Bennett, Peter Boyes, Dr Ian Brooks, Rachel Brown, Jacquelyn Collins, Haden de Boer, Sandy Galland, Jacqui Jones, Colin Kennedy, Kevin Kevany, Angeline Long, Simon Lord, Brian Meredith, Patricia Moore, Rachel Reynolds, Angela Searle, Lesley Springall. Adrenalin Publishing Ltd. 14C Vega Place, Mairangi Bay. PO Box 65 092 Mairangi Bay, Auckland 0754. Ph: 09-478 4771• Fax: 09-478 4779 SUBSCRIPTIONS NZBusiness is an 11 issue magazine. Subscription in New Zealand is $75 (incl GST). Please call us for overseas rates. Copyright: NZBusiness is copyright and may not be reproduced in whole or in part without the written permission of the publisher. Neither editorial opinions expressed nor facts stated in advertisements are necessarily agreed to by the editor or publisher of NZBusiness and, whilst all efforts are made to ensure accuracy, no responsibility will be taken by the publishers for inaccurate information, or for any consequences of reliance on this information.

Printing: GEON Distribution: Gordon and Gotch ISSN 0113-4957 (Print) ISSN 2253-2765 (Online)

Vol. 26 No. 4 www.nzbusiness.co.nz Follow us on

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‘Onya, Trev! I bet there’s hardly anyone who hasn’t put themselves in the shoes of Trevor, the $26 million Lotto winner from Te Kauwhata, since news of his win came out. I’m sure we’ve all had a wee daydream about what we would do with all that lovely moolah. If you’re a business owner, the possibilities of putting that sort of money to work for your business and any other enterprise worth backing would seem endless. To put that $26 million into perspective, just look at the sums of money some of the angel investment groups are putting up to back local entrepreneurs – it’s certainly in the same league. I wonder how many jobs and opportunities Trevor could create if he received some good, sound, independent advice on business investment. It’s none of my business I know, but I hope he does put those millions to good use – and not just for his own benefit, but for the benefit of many others. I sincerely hope he gets the right advice. It won’t be easy – there are plenty of previous Lotto winners who’ve ended up back living the ordinary life after making ill-informed decisions. Speaking of things that aren’t easy – running a business would have to be near the top of the list. And guess who suffers the most? That’s right, the families. They often have to make real sacrifices for businesses to survive. According to the most recent MYOB Business Monitor (a regular survey of more than 1000 SMEs in New Zealand), small business owners are routinely having to give up time with their families in order to keep their business running. The study revealed that the four most common sacrifices small business owners

have to make all involve time away from their families: •7 4 percent of respondents said they often had to work longer hours. •5 8 percent said they had to cut back on family holidays. •4 8 percent said they had to cut back on family or household expenses. •3 8 percent said they missed out on important family occasions. Not surprisingly the survey showed that small business owners consistently rate their relationships with their family as more valuable than their business and take more pride in their family than in their business success. Sixty-four percent said they were very proud when their children succeeded, 63 percent said they were very proud when they first had children, and 53 percent said they were very proud of getting married or settling down with their partner. By contrast, only 36 percent were very proud of getting their business to a level where it provided them with a comfortable living, and only 30 percent said they were very proud of their businesses’ first month or year making a profit. So while small business owners say that time with their family matters most to them, they are being forced to give up that time to make sure their business survives. That’s a massive ongoing sacrifice we all need to keep in mind.

Glenn H Baker editor@nzbusiness.co.nz

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Briefcase

Cookie Time named best Kiwi owned company Cookie Time Limited has been voted best New Zealand owned-business at the recent Grocery Retailers’ Association national supplier awards, also taking out gold for best small business for the fourth year running. Off the back of a challenging year with earthquakes affecting production and distribution, the Christchurch company’s entrepreneurial fighting spirit and ambitious growth plans stood it in good stead for the awards which are designed to recognise suppliers who provide quality service and products to the grocery industry. As well as the two golds, CTL also won a silver medal for most efficient distribution. Lincoln Booth, Cookie Time GM, says being voted New Zealand’s best owned business is a huge honour. “Cookie Time is a privately-owned company with highly-motivated owners backing us on a significant growth path both domestically and through international licensing. These latest awards are further recognition

that we have the fundamentals right as we activate the local and global opportunities afforded by robust IP and licensable brands.”

Cookie Time GM Lincoln Booth.

GO UK winner good to go UK Trade & Investment (UKTI) has named New Zealand biofuel company LanzaTech the winner of the GO UK competition. LanzaTech finance manager-operations Beno Samuel says it is a huge honour and very exciting. “Although LanzaTech has its roots in New Zealand, we are very much a global company having offices in the US, China and India. The UK and Europe, however, has been very much on our radar and is a place of tremendous potential for our business.” The GO UK competition invited New Zealand companies to submit business plans for a chance to win a $30,000 prize package including airfares and professional services. British High Commissioner Vicki Treadell says all finalists were of the highest calibre and that it’s very encouraging to see many New Zealand businesses looking to expand into the UK market given the economic uncertainty. “We have every confidence that LanzaTech will quickly establish themselves, make an

4 NZB May 2012 nzbusiness.co.nz

impact in Europe, continue to deliver strong results and put New Zealand on the map.” New Zealand businesses get the same opportunities and benefits in the UK as local companies, thanks to the unique memorandum of understanding between both governments which will help LanzaTech hit the ground running.

(L-R) Chris Lucas, British Airways; Beno Samuel, LanzaTech; Paul Beare of Kevin Beare & Co; and Paul Wilkinson, UKTI.

Briefcase

New owner for Business Support Awards AUT University Business School is the new owner of the prestigious Excellence in Business Support Awards. Created in 2005 and the brainchild of business support specialist Sarah Trotman, the Awards recognises excellence in the field of business support in New Zealand. Now in their seventh year, they are a signature event that Trotman says provides a unique opportunity for business support organisations to benchmark their performance alongside others in their sector, and to give a mark of quality to their organisation. Trotman has been appointed director business relations at AUT Business School and will oversee the AUT Excellence in Business Support Awards in 2012. “AUT is an innovative provider of business education focused on developing highly-capable graduates who are well-

prepared for business practice,” she says. “Supporting business excellence is in essence what AUT Business School is all about and therefore the awards are a natural fit because of their prestige in the business world.” The annual awards ceremony will take place in October. Organisations can enter the awards across a number of categories and the Supreme Award is chosen from the category winners. Evaluation of all awards will be overseen by The New Zealand Business Excellence Foundation, including evaluators from the management department in the Business School. Excellence will assessed using the international Baldrige criteria. Entries close 1 June 2012. For full details on how to enter, visit http://aut.ac/Excellence_in_business_ support_awards.

Dean of AUT Business School Dr Geoff Perry with Sarah Trotman.

Course targets digital marketing skills MYOB and social media expert Linda Coles of Blue Banana are gathering a panel of digital marketing specialists together for an online event that looks at the various tools available to business owners looking to engage more with their clients. ‘20’ will take place entirely online via twice-weekly sessions for ten weeks and will cover everything from online branding to creating a YouTube video. MYOB general manager Julian Smith says one of the biggest advantages for businesses in the current economy is the knowledge and expertise to engage customers online. “We know that businesses that are active online do better – generating more leads, attracting a broader customer base and reporting higher

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revenues. “Upskilling more New Zealand business people in the use of a wide array of Internet business tools and techniques will be transformational for the economy, so MYOB is very pleased to be supporting Blue Banana ‘20’.” Presenters from both New Zealand and the US are taking part in the series, including Mike Gingerich from Tabsite, Richard Conway from Pure SEO, Glenn Edley from Spike Mail, Jane Melville-Allen from Terabyte – and there’ll even be a few words from the Asia Pacific MD of LinkedIn, Cliff Rosenberg. The course begins on May 1 and is priced at $199. Go to www.bluebanana20.com/20 for more information.

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Briefcase

Businesses waste marketing dollars Kiwi SMEs waste substantial marketing budget every day with campaigns that are both poorly aligned to business goals and have little clarity on spend from the outset. This is the view of Nicole Crump, director of marketing plan specialists Tactix, after introducing the company’s new packaged marketing plan strategy. “Traditional marketing can often be a case of a rolling budget, with costs escalating due to unforeseen expenses and the perception that more marketing dollars spent means better return for the business,” says Crump. “This is seldom the best approach for an SME and generally leads to

poorly invested budget with little result other than overspend. New Zealand SMEs overspend or misspend thousands every year due to a lack of understanding when it comes to effective marketing. “SMEs require more clarity on their message, where to spend their marketing budgets and exactly how much that budget will be to allow them to forecast properly.” Tactix is a new player that gives businesses certainty around their marketing spend. The boutique marketing shop provides fixed price plans that take the guess work out of constructing and implementing a marketing campaign – ideal for small to mediumsized businesses, new start-ups or those without a dedicated marketing resource. In her 20 years in the industry, Crump has frequently been approached by organisations requesting a marketing plan that reflects the company’s goals, puts

their brand in the right places and aligns the existing marketing activity at a fixed price. “So many companies we speak to feel that their marketing doesn’t properly reflect who they are or where they want to be and many are not entirely sure how to communicate with their audiences effectively to drive growth,” says Crump. “Often they will see marketing as simply advertising placement or sending out a brochure and may miss out on the opportunities a robust marketing plan can provide. Our clients not only benefit from our experience bringing new ideas and approaches, but also receive focus around their existing marketing efforts,” she says. The generic packages designed by Tactix each include an in-depth organisational analysis and a review of the competitive market – so while the approach offers the price predictability of a cookie cutter service, it is easily catered to all businesses.

New Zealand’s international trade show for the foodservice, bakery and retail industries is back in June – and the biennial event is proving to be vital for the growth and development of the FMCG and hospitality sectors. The show is a great way to leverage the New Zealand industry, says Dona White, CEO of organiser North Port Events. “The inaugural Fine Food New Zealand show in 2010 was a resounding success, exceeding expected visitor numbers by 15 percent and attracting excellent feedback from every quarter – including 240 satisfied domestic and international exhibitors. The 2012 event promises to be even better, despite recent recessionary pressures, not least because the industry sectors that Fine Food New Zealand

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serves are generally defying the trends and showing strong growth.” FMCG is New Zealand’s largest manufacturing industry, accounting for 5 percent of GDP and providing about 63,000 full time jobs. New Zealand supplies 2.4 percent of the world trade in processed foods and exports are growing. The hospitality industry is also a major player, contributing $6.5 billion to the local economy annually. Steady growth has been noted in foodservice sales over the past 24 years (19872010), with average real growth reaching 4.4 percent per annum. Fine Food New Zealand will be held at the ASB Showgrounds from 17-19 June 2012. For more information contact info@finefoodnz.co.nz

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Briefcase

Resort offers conferencing boost Peppers Bluewater Resort has launched a unique Get On With Business package which offers $1000 towards coach transfers from Christchurch, giving conference groups the opportunity to enjoy an inspirational taste of the high country. The package also offers a host of other benefits for conferences booking at least two nights accommodation for a minimum of 40 delegates from $466 per person. Conference groups have the choice of two complimentary activities to help with further team building or to simply unwind after a day of conferencing. Choose from a unique star gazing tour to Mt John Observatory, horse riding trek through the mountains, or a spa and massage pamper pack. Also included in the package is a drinks and canapés and high country BBQ in the resort’s signature Rakinui Restaurant. And for a true Kiwi experience, finish the day with a spot of

gumboot throwing and sheep shearing. Peppers Bluewater Resort is an easy two and a half hour drive from Christchurch. www.peppers.co.nz/bluewater.

New insurance for eftpos terminals Eftpos reseller Viaduct has launched eftpos insurance to provide certainty for eftpos merchants. Director Mark Unwin says latest figures show eftpos transactions account for over 80 percent of retail and hospitality transactions, making eftpos terminals an essential business tool. “Viaduct’s research shows that 40 percent of all terminal faults resulting in swapouts or terminal failure are caused directly by the user or customer. These faults include accidental drops, liquid spills, customer damage or in some cases theft, and are not covered by standard leasing terms

10 NZB May 2012 nzbusiness.co.nz

and conditions.” In response to this, Viaduct’s insurance cover works much like mobile phone insurance. The insurance provides cover in case of customer damage instead of having to be claimed against business insurance which often has a high excess. The new insurance sets the excess providing certainty for the merchants that they are covered for all eventualities. Unwin says with more than 15,000 terminals in the marketplace, his company sees the issues for customers on a daily basis. The insurance is available to all customers on the Paymark network.

Briefcase

Credit reporting reforms in force

Export success for fashion designers New export milestones have been coming thick and fast in recent months for New Zealand’s fashion labels. Twentysevennames, a directional fashion label based in Wellington has recently started selling its collection on the huge international website asos.com – based in the US. Karen Walker, who earlier this year was named ‘Designer of the Year’ in the MYER Supplier of the Year awards across the ditch, also has a new partnership with Anthropologie, the innovative US retail brand, to introduce her diffusion line Hi There exclusively in America. Anthropologie currently has more than 164 stores across the US, Canada and Europe and ships to many more countries. Meanwhile, Kathryn Wilson is now selling her fashion shoes through Hong Kong’s I.T department store. “We had approached their footwear buyers for two seasons prior to securing an appointment,” says Kathryn, “and were delighted to receive a positive response in regards to styling and positioning in the Asian market. We have already received repeat orders for their Hong Kong stores.” Kathryn says she is also targeting the Japanese market, and has begun to explore China stockists through her Hong Kong distributor.

April 1 marked the commencement of new laws in New Zealand affecting what can be reported about an individual’s credit history and repayments. According to Dun & Bradstreet, banks, telcos, utilities and other credit providers will now be able to record whether people are paying their bills and other financial commitments on time. GM of Dun & Bradstreet in New Zealand, John Scott, said that it was now broadly recognised that ‘comprehensive’ credit reporting has the potential to reduce credit costs, improve lending and lower rates of default. “Prior to today, New Zealand was one of the few remaining countries to conduct lending in a ‘negative’ data environment where credit providers only had access to adverse payment information on a consumer like defaults or bankruptcies,” he says. “The new ‘comprehensive’ credit reporting environment now means that information on the timeliness of payments, including whether payments were on time or late, will be available.” A recent quantitative study – the first of its kind for New Zealand – conducted by Dun & Bradstreet with the Policy & Economic Research Council – looked at the impact of ‘comprehensive’ credit reforms in New Zealand. “The report found that the reforms have the potential to significantly improve credit distribution and access in New Zealand,” says Scott. “The use of ‘comprehensive’, rather than just ‘negative’, credit information provides greater visibility of under-served

consumers and small businesses who would otherwise find it difficult to access credit.” In particular, the study highlights a number of specific benefits associated with the changes: • The ability to correctly assess low-risk individuals is more than doubled in a ‘comprehensive’ credit reporting environment. • Under a ‘comprehensive’ credit reporting environment there is a 32 percent improvement in the ability to identify an individual most likely to pay late or default. • The use of non-bank information, like payments on utility bills, provides improved access to credit for previously under-served sectors of the community. Young people are the primary beneficiaries because of their limited banking history and the fact that non-bank credit, such as mobile phone accounts, are the first credit experience of most young people. “By documenting good credit performance, the introduction of ‘comprehensive’ reporting removes the barriers to mainstream credit for those individuals who may have previously had an adverse credit event. This is because the existing New Zealand system documents only bad, or negative, credit performance,” says Scott. “In particular, small business is a big winner from the new reforms because of the additional information that becomes available on business owners – this tends to turn small business owners from credit ‘invisible’ to credit worthy.” Consumers can obtain a copy of their personal credit report at www.dnbcreditreport.co.nz

NZB May 2012 nzbusiness.co.nz

BIZ DIARY

Do you have a business event coming up? Email the details to editor@ nzbusiness.co.nz

“20”

MAY 2012

A 10-week online digital marketing course for business owners looking to engage more with their clients. Covers everything from online branding to creating YouTube videos. For more information go to www.bluebanana.co.nz/20

11-13

15-16

First Wednesday

Coaching Conversations

The Food Show Wellington

Brought to you by The ICEHOUSE and The Auckland City Council, this dynamic presentation and network opportunity is free for entrepreneurs with business ideas. For more go to www.theicehouse.co.nz

Auckland. A one-day course to help you learn how to lift the performance of others. Discover the core principles of a successful coaching approach. For more: www.eeotrust.org.nz

Westpac Stadium. New Zealand’s annual must-attend culinary event. For more information visit www.foodshow.co.nz

ICE Bridge: Achieving Business Growth Seminar

Leadership for Start-up Entrepreneurs Workshop

Getting A Grip Breakfast Club

First Wednesday

The ICEHOUSE, Parnell. For ambitious entrepreneurs who want to take their business to the next level. Fills fast, book early – go to www.theicehouse.co.nz

Write Ltd, 342 Lambton Quay, Wellington. With ‘Time Queen’ Robyn Pearce. Learn how to make those time management strategies permanent. Register at www.gettingagrip. com/breakfastclub or phone 03 351 2140.

10-13

12-13

14-15

International Council for Small Business World Conference – Wellington

Social Media: Developing Your Strategy

Building a Successful Business Case

Voice of the Customer

With Simon Young. The University of Auckland Business School. P: 0800 800 875 www.shortcourses.ac.nz

With trainer Warren Myer. Wellington. For more information go to www.brightstar.co.nz

Engage with the world’s experts on the latest international developments in small business. Hear how Kiwi firms lead from the edge. Register your interest at www.icsb2012.org

JUNE 2012

Central Auckland. Unlock the potential within your business. For more information visit www.icehouse.co.nz

Brought to you by The ICEHOUSE and The Auckland City Council, this dynamic presentation and network opportunity is free for entrepreneurs with business ideas. For more go to www.theicehouse.co.nz

With Bryan Travers. The University of Auckland Business School. P: 0800 800 875 www.shortcourses.ac.nz

17-19

20-21

25-26

Fine Food New Zealand

New Product Development: Managing the Process

Creative Thinking: Ideas That Ignite Your Business

Leadership for Start-up Entrepreneurs Workshop

With Doug Robertson. The University of Auckland Business School. P: 0800 800 875 www.shortcourses.ac.nz

The ICEHOUSE, Parnell. For ambitious entrepreneurs who want to take their business to the next level. Fills fast, book early – go to www.theicehouse.co.nz

The ICEHOUSE Owner Operator Programme Foundation Day

ASB Showgrounds, Auckland. New Zealand’s biennial international trade show for the foodservice, bakery and retail industries. For more information email info@finefoodnz.co.nz

Rob Verkerk and Saskia van der Geest. The University of Auckland Business School. P: 0800 800 875 www.shortcourses.ac.nz

12 NZB May 2012 nzbusiness.co.nz

A programme for ‘hands-on’ owner operators to unlock the potential of their business. Visit: www.theicehouse.co.nz or r.holmes@theicehouse.co.nz

SOAPBOX

Matthew Bellingham Director Hayes Knight Chartered Accountants

Back to the drawing board? Four years on [from the GFC] and we’re still talking about the poor state of the economy, yet the bad news keeps coming. First our government bailed out finance companies through the guarantee scheme, which at the time seemed like a huge rescue package. Since then the US has been borrowing trillions of dollars to rescue any business, however marginal their situation. Plus, we have to contend with the lingering risk of the European debt crisis. But the questions on my mind are: How did it get so bad? How did it go unnoticed? Why didn’t somebody say stop? These are questions we should be asking ourselves in order to reach our full potential. This leads me to a wonderful quote: “One secret to maintaining a thriving business is recognising when it needs a fundamental change.” – Harvard Business School

This is a big focus for me at the moment as a director of Hayes Knight, and indeed as an adviser and board member to many clients. There is no question that the world has changed, but it will be our ability to adapt which will make or break our respective businesses. Innovative development and thinking isn’t enough. Business models need to be reinvented to keep up with the changing pace of life, new developments, emerging technology and evolving consumer behaviour. In 2003, Apple introduced the iPod with the iTunes store, revolutionising

portable entertainment, creating a new market and transforming the company. In three years, the iPod/ iTunes combination grew to an almost $10 billion product. Apple’s market capitalisation catapulted from around $1 billion in early 2003 to more than $150 billion by late 2007. This success story is well-known;

more businesses doing it? Probably because it’s hard. Perhaps it is easier to break this daunting task up into three clear steps: Realise that the key to success is not thinking about a business model; instead it’s about focusing on the opportunity to satisfy a real

“ Business models need to be reinvented to keep up with the changing pace of life, new developments, emerging technology and evolving consumer behaviour.” what’s less well-known is that Apple was not the first to bring digital music players to market. A company called Diamond Multimedia introduced the Rio in 1998. Another firm, Best Data, introduced the Cabo 64 in 2000. Both products worked well, were portable and stylish. So what did Apple do differently? Perhaps it was because Apple did something far smarter than simply combine good technology with great design – they wrapped it in a great business model. Apple’s true innovation was making it easy to download digital music by creating a groundbreaking business model that combined hardware, software and service. The model defined value in a new way and provided game-changing convenience to the consumer. Everyone is talking about reinvention, surveys report that more than 50 percent of business owners and CEOs believe business model innovation is critical and two thirds say they need to extensively adapt their business models. So why aren’t

customer who needs a job done. Construct a blueprint laying out how your company can fulfil that need at a profit. Compare that blueprint to your existing model to see how much change is required to capture the opportunity. For a business model to work, we need four interlocking elements: • Customer value proposition (CVP). •P rofit formula (revenue model; cost structure; margin model). • Key resources. • Key processes. These four elements form the building blocks of any business. The customer value proposition and the profit formula define value for the customer and the company, respectively; key resources and key processes describe how that value will be delivered to both the customer and the company. As simple as it may seem, this is one way of looking at reinvention in a sustainable manner. Let’s face it; there has never been a better time to start this journey.

NZB May 2012 nzbusiness.co.nz

WOWing the consumer What’s it like to develop a number one ‘app’ for the iPad and become an international awardwinning interactive media company? Patricia Moore asked Click Suite founder Emily Loughnan. When interactive media tool maker Click Suite was established in 1994, few people even knew what the Internet was all about, let alone realised the impact it would have on our lives in a little over a decade. Looking back, founder Emily Loughnan acknowledges it was a pretty brave step. “Even now I still come across people making decisions on how to spend their [marketing] budget that are not up with the technology and can lack the understanding of how big the opportunities are.” The development of Click Suite’s hugely successful Fast, Fresh, and Tasty recipe app is a good example, she says. “I spoke to many potential food partners who asked why on earth people would look up a recipe on their mobile phones. Because they can’t imagine doing it themselves, they can’t see that thousands of Kiwis are doing exactly that. “I think the real issue is not that they don’t use the technology, but that they don’t realise what they don’t know.” For the growing number of people exploring interactive

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BIZ ACHIeVERS

possibilities, it’s a question of exactly what form will work best. “The final answers can be quite diverse,” says Loughnan. “Every job is wildly different and can range from a website to an interactive table to a mobile app, digital wall, or outdoor projection. Recently we even created digital carvings in an historic meeting house in Whakatane.” The big driver always remains the audience, adds Loughnan. “I’m restless until I’ve heard them say ‘WOW’. Making that strong

had a genuine audience of 400 people.” Given that each of those people has an audience, the potential is huge. As the amount of interactive media increases, particularly mobile applications, questions are raised around the access of personal data by other parties. But is it really a problem? “Actually it’s true with some apps,” says Loughnan. “Something like FaceBook quite rightly generates those concerns. While you can protect yourself to an extent, you have to know how to

Hire people that are experts at what they do, then trust them to do it. connection with an audience is what drives me.” Essentially, Click Suite’s job is to create a digital environment that enables action or interactivity, and invokes a response. But clients need to know what they want to achieve, says Loughnan. “Who is their audience, what media do they consume, what are their needs? And then how can we start getting creative about how to reach them?” Social media – used well – can absolutely lift a brand, she says. “Take Twitter, for example. Before we launched our recipe app I spent a few months building a channel on Twitter around food. By the time we launched Fast, Fresh and Tasty, I

do it. However, when you download an app, like a recipe app, it’s more like having a recipe book on your phone. It’s yours and it’s private. As developers we can only see, anonymously, how pages in the app are accessed. We know nothing about you.” Award-winning In 1996 Click Suite made the world’s first interactive television documentary and the company has been successful at award level in New Zealand and internationally. They’re the only New Zealand company to have won three medals, including gold for a Te Papa project, at the New York Festival’s new media competitions. “That probably gave us our biggest thrill because we went to New York and presented in front of a panel of judges from hugely impressive organisations – and got to see the presentations from the other finalists. They were damn good,” says Longhnan. But it hasn’t all been smooth sailing for Click Suite. Recessionary woes saw changes for the company – the biggest of which was to their business model. “We lightened up our team (there are now 10 permanent staff), work a lot more in collaboration with other specialists, and bring contractors in for projects. It lets us offer great specialists to our clients without having to keep them fed 365 days

of the year. “Because our brand is built around innovation and quality, we’ve had to be quite fussy about who we bring into the ‘family’, so the model did take some bedding down initially.” Teamwork Loughnan has an enormous enthusiasm for her work, so how difficult is it to step back and work on, rather than in the business? “I think that’s the small business owner’s conundrum. You can’t let go of the bit that excites you or you might as well just go and get a job. At the same time you own the business so you have to work on it. “Letting other people take over can be quite a challenge; it’s your baby. I once worked for someone who always said the secret of her success was a good hiring policy. Hire people that are experts at what they do, then trust them to do it. I have an absolutely exceptional team.” Global focus Click Suite has worked on projects around the world, but Loughnan describes their international profile as a little sporadic. “It’s an area we’re concentrating on next. The global market is important because a lot of our work is at the front edge of technology, and the size of the market here limits the type of projects we attract – the type that gets us sitting up in our chairs.” Interactive media is all about engaging the consumer, but competition for those eyeballs is fierce. “Whatever tools a business owner chooses, it needs to have a strategy behind it along with design and professional standards,” says Loughnan. The good thing is that more and more businesses are recognising this. “You don’t do your own dentistry so neither should you make your own interactive media. These things take specialists.” Patricia Moore is an Auckland-based freelance writer. Email mch@xtra.co.nz

NZB May 2012 nzbusiness.co.nz

Smile please Have your photo taken at a tourist attraction here or overseas and chances are Kiwi firm Magic Memories is part of the picture. Patricia Moore talks to co-founder John Wikstrom. The story goes they developed a business plan on the back of a table napkin – the reality was a little different, says Magic Memories CEO John Wikstrom. But it all stemmed from one of those ‘what if’? type moments. Wikstrom and Stuart Norris were working in sales and marketing for Queenstown’s Mountain Scene when a visit to the Skyline Gondola had them speculating about the possibility of taking photos of people enjoying the Skyline experience and presenting them with the finished product,

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attractively packaged, when they came back down. “It sounded like fun, so next day I said to Stu, why don’t we put together a proposal and go see those guys,” says Wikstrom. That was 1994, and the rest, as the saying goes, is history. Skyline liked the idea and today Magic Memories – a name decided as they walked the 150-metre path to their meeting – has established partnerships with more than 70 tourism attractions in seven countries, plus New Zealand. But the business is not about

photography; back then they weren’t even sure how to use a camera. Magic Memories is about providing a unique and memorable customer experience and, by doing so, help partner attractions increase their profits. “There were people taking photos, but you had to go to a store in town to look at the photos. You then had to place an order and go back an hour later to collect it.” Not exactly the ideal experience for tour groups or families. And presentation of the finished product was poor. “That was the ‘Ah Ha!’ moment. Let’s

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turn this into a customer service business and deliver the photo into the guests’ hands in a really nice folder.” Deliver they did and there were a lot of legs and feet – and scooters – involved in that initial operation. “But guests didn’t see the heavy manpower involved,” says Wikstrom. “What they saw was just an amazing photo, put in their hand. Soon tour guides started suggesting to other attractions they use Magic Memories and before long we had all the business.” Wikstrom talks about the ‘pretty vanilla service’ in

to successfully growing them. “Setting up an office with a full management team in place – in the UK we’ve got over 80 staff and similar numbers in Australia – gives potential partners the confidence we can deliver,” says Wikstrom. New Zealand Trade and Enterprise support has been important. “Going through the Beachheads process would be good for any business and being accepted into the programme opened up opportunities to sit round the table with people who’d been there, done that. You get the contacts but you need to be prepared to do the work and you need to have key resources in the market.” NZTE funding assistance has also been a plus. “The funds are there to make you bigger

Tell them you take photos and they don’t want to know. Tell them you’re an experiential marketing partner and you do photos and next thing you’re invited to their table for dinner. every market he’s been to: ‘Excuse me, do you want a photo?’ “To us it’s about empathy with the human experience at these attractions and we’ve spent a lot of time, money and energy, researching how we can flesh this out into something that’s really personal; something people can’t create for themselves.” Having successfully partnered with almost all of New Zealand’s attractions, Magic Memories looked ahead. “We had the discussion and decided to do a whole lot more of a whole lot less; focus on what we’re really, really good at. That meant going outside New Zealand.” The challenges this offered were also a way to keep talented people with the company. “We’ve set the vision but they buy into it and they deliver it.” Magic Memories has a set of criteria by which they evaluate potential markets; establishing a local infrastructure has been a key

and better, faster. When you’re managing a business and growing in seven countries, cashflow is something you’ve got to watch very closely.” Business models Magic Memories operates three different business models. The ‘direct’ model involves partnering with the attraction, setting up in business within the premises. They carry all the costs, run the entire operation and pay the partner for the privilege. “One of our promises to these partners is to deliver them more net return year-on-year,” says Wikstrom. (In a challenging retail environment, Magic Memories has increased spend per head, year-onyear, in every market.) The second model is for ‘direct licence partners’. It’s a hybrid, says Wikstrom. “Companies – like AJ Hackett and Shotover Jet in Queenstown – staff the operation

and can create their own bespoke products on top of those we provide.” And in the Middle East, China and South Africa, Magic Memories has ‘channel partners’ – similar to a franchise model, with stringent reporting mechanisms. “We’re very tight partners,” says Wikstrom. Magic Memories is both B2B and B2C. “We sell ourselves to a tourism attraction but then all our focus goes on their guests. And we wrap that all up in the look and feel and brand of the partner attraction. Guests don’t see the Magic Memories brand. Their relationship is with the attraction.” The quality of their governance has been a key strength for Magic Memories and Wikstrom says business owners should never underestimate the impact a strong chairman and board can have. “We’ve been fortunate to attract people who are both forward thinking and dedicated and that’s been crucial to our success.” The company recently rebranded and is working more actively to promote the opportunities they offer and the success they’re having globally. The whole momentum of the business has lifted, says Wikstrom. The focus this year is on growing their presence in Australia and the UK. Next year the US is on the radar, but that’s a harder nut to crack. “Tell them you take photos and they don’t want to know. Tell them you’re an experiential marketing partner and you do photos and next thing you’re invited to their table for dinner.” Business plans on the back of napkins sounds pretty folksy and Wikstrom’s advice to exporters at this year’s International Business Awards was also down-to-earth; “Know what you do and do it well. Know what you don’t do and don’t do it. Surround yourself with great people who can speed the journey. Get great governance, manage your cashflow and use NZTE and its networks.” www.magicmemories.com

NZB May 2012 nzbusiness.co.nz

Feeling the heat HeatBox is a business that has had to claw its way to success. It owes its position in the market today to the tenacity of its founders and backers. By Kevin Kevany. The HeatBox success story is one of the more unlikely you will come across. It has everything: an idea spawned by the apparently mundane workings of a heated mirror; many trips to a foreign land to slave away in research laboratories, hoping and praying personal funds wouldn’t run out; and then the ‘Eureka moment’. Even then, as the two owners worked from the proverbial garage for the next five years to perfect the product and battled to raise finance to bring their patented technology to market – all the while maintaining their passion and belief – they knew national distribution

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could knock them out of the game. Oh, and did I mention the duo consists of an Italian-born, Swisseducated, now-Kiwi, who made his name in the international fashion market and a born-and-bred Kiwi builder? Their firm commitment and main goal is “the continued development of new, exciting and efficient products, while delivering on our promise of ‘warm and healthy homes’ for all New Zealanders.” As Massimo Biscuola puts it, looking around their ultra-efficient HeatBox factory in Albany, “A good idea is just that, a good idea – and most don’t get to market. To

commercialise it takes a lot of time, money and dogged persistence. “We have had to fight for every step – which we expected. Overall, everyone we presented to over the last five years has been positive about the idea and the applications, whether at business incubators like The ICEHOUSE; at local government level; or to the public at trade shows. “But converting that enthusiasm to investment, or orders, has been a massive challenge. You have to take the knock-backs and delays and turn them into positives. As the saying goes “Turn those lemons into lemonade.” A start-up

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A start-up company is not for the faint-hearted and you need strong family support. company is not for the fainthearted and you need strong family support,” he says. They have recently taken a step onto the big stage; a national distribution agreement with Placemakers and a focus on the HeatBox Mini, priced at a ‘compelling’ $1,495. So, while it’s not quite ‘game over’ by a long chalk, I thought it was a good opportunity to ask the battle-hardened duo what they’d learnt. Biscuola believes small players have to shout very loud to be heard. “That’s just the reality. We have been shouting about ‘positive pressure ventilation’ not being able to heat your house forever, and that healthy ventilation is not about pushing filthy air from the roof into the living area. “But well-funded advertising and sales campaigns are hard to counteract,” he says, pointing to 150,000 ventilation systems already installed in New Zealand homes. So HeatBox has turned those installed systems into a market opportunity for the Mini product – providing customers with the option of retrofitting a heater to their ventialtion system using existing outlet vents. “When those companies opted out of selling our technology themselves, we decided to offer the HeatBox Mini direct to retail,”

Investors Rachel Hopkins and Nick Hodson, with Massimo Biscuola and Daryn McDonald.

says Biscuola. How can HeatBox deliver what others have failed to provide – the promised warm, healthy Kiwi homes at a fraction of the standard cost? “Daryn [McDonald, the bornand-bred Kiwi builder] and I initially looked at a heating product used for mirror demisting, and asked ourselves if, at the right heat, it could be used for other applications. Months later we ended up with a heating element that generated about 60 degrees Celsius and we placed it inside a round cardboard box with a hole at each end, and blew some air through. “The air was warm and we immediately thought of how to increase the temperature of the film to get an even better result. It took some time and numerous changes to get the mix and the balance right, but in the end we developed a fibreglass ‘sandwich construction’ of carbon fibres and a proprietary carbon paste, which generated high temperatures at low power consumption. The ThinFilm Carbon Heating Element was born!” says an animated Biscuola. Many ‘trials and tribulations’ later, they had a panel which, with a power consumption of around 100W (a light bulb), can generate temperatures of over 100 degrees Celsius. Next came the challenge of transferring this heat to air in the most efficient way possible. “Jaco Pretorius, our Bostonbased consultant engineer and executive-in-residence at The ICEHOUSE, assisted with airflow modelling, and many designs later the HeatBox, as we know it today, was ready,” says McDonald. The range today includes the 950 Watt Mini, 1.5kW Midi and 2.2kW Multi – all with a 24/7 Siemens controller. HeatBox heaters have been tested by the highly-regarded

Auckland University Engineering School which measured the heating efficiency as between 91 and 98 percent (depending on the humidity levels). Exciting future One of the markets Biscuola and McDonald are most excited about – state housing and council flats – is the subject of a recent trial with Auckland Council. It found the HeatBox system costs less than 50 cents a day to run, while alternative heating options were up to five times more. The trial measured temperature and relative humidity changes (because the system ventilates all rooms, it also eliminates condensation inside windows and house smells). A recent Otago University report, funded by EECA, recommended that these “‘positive pressure’ or ‘roof cavity’ system[s] – should not be promoted or installed based on potential heating or cooling benefits.” HeatBox’s ‘air handling unit’ is a balanced ventilation system which extracts damp, stale air from the home and replaces it with fresh, clean, filtered air which is run through a heat exchanger. The company’s next goal is to convince EECA to provide the same subsidies to the Kiwi-made HeatBox as it does for imported heat pumps. Former corporate lawyer and start-up investor, Nick Hodson and his marketing-whizz wife, Rachel Hopkins, are investors in HeatBox and excited about its potential. “The design and technology is patented in New Zealand, Australia, Europe and the US,” Hodson says. “So once we have consolidated our position in the local market, we can concentrate on global distribution and licensing, along with additional heating and ventilation applications using HeatBox technology.” Kevin Kevany is an Auckland-based freelance writer. Email kevwrite@xtra.co.nz

NZB May 2012 nzbusiness.co.nz

Actors for hire Why not give your business a creative lift by taking on an actor ‘temp’ or hiring a professional speaker? By Kevin Kevany. Once you’ve learnt that nearly 95 percent of actors, dancers, musicians and performers are not working 95 percent of the time, two things become clear. The first is that if you are in that game, you’d better have another string to your bow. The other? Wouldn’t all of those people like to have an outlet for their other skills, and earn money while they wait for work in their preferred profession? We’ve taken two acclaimed national performing icons, Bruce Hopkins and Shane Cortese, to see their different approach to the problems and

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opportunities outlined above. Both have been running their companies, ICMI (‘Your gateway to world class talent’: Cortese) and Action Actors (‘Your brand interactors’: Hopkins) for a short while, so it seemed a good moment to check on progress. “I’d been ‘percolating’ the idea for Action Actors for some time,” says Hopkins. “I frequently have to fund my own career from a wide range of part-time work. My first job after graduating from Otago University PE School was commercial crayfishing with my Dad. I’ve also worked in radio,

MC’d events, been a hammer hand for film and TV set construction, theatre manager, production manager, concrete contractor, house painter, landscape gardener, tour guide and driver, among others! “So I’ve experienced first-hand the benefit to an actor of having a workflow outside of acting roles, to provide both the money and freedom to choose better roles and thereby build an acting career, without having to starve along the way. “Bear in mind that paid acting jobs like I had at the Mercury Theatre, after

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being able to get the same individual the next time for some clients, but, inevitably the next person I place becomes the next ‘must have him/ her’. That’s very rewarding all round,” says the Lord of the Rings actor, who has 30-plus years experience in performing arts and is ranked one of

As well as creativity, they bring amazing discipline and punctuality (‘you miss a set-call and you’re dead’) I gave up dancing, don’t really exist anymore for today’s actors, who don’t have many options beyond ‘Shortland Street’. “Anthony, my business partner, shared my rationale that not only would Action Actors work for my unemployed fellow thespians, but also for businesses I contract them out to. Many have skills which range from nursing (we have two on the books) through to experienced receptionists, IT experts and creative landscape gardeners. “As well as creativity, they bring amazing discipline and punctuality (‘you miss a set-call and you’re dead’), and while you might think actors are self-focused individuals, the very nature of productions makes them the best team-players around. And they have the all-important passion, drive and desire to succeed. “Actors are in general incredibly versatile and resourceful people and more than capable of contributing in other sectors,” Hopkins says. A number of local companies and organisations already sponsor and support the performing arts. “By hiring an Action Actor for your short-term contract needs, you not only have the opportunity to have a fantastic and talented staff member on your team, you also help support the future of the screen and performing arts industries in New Zealand,” says Hopkins. “These are largely driven folk, determined to prove a point and ‘make it’,” he adds. “The temp work is helping them to succeed in their chosen career, so they put their all into whatever they do. I have had rave reviews from many happy clients across the widest range of placements. “My only ‘failures’ have been not

the country’s top MCs. Go to the Action Actors website (www.actionactors.co.nz) and view Hopkins’s surprise cat food ‘commercial’ to appreciate what actors like him could do for your business. He and Hurst might just knock out a quick and cheerful video that could change your business. Action Actors pay their people more than the normal temp rates – ‘because of their quality and commitment, they add more value than the normal temp’ – and they charge a small commission and admin fee. They know their ‘stable’ well and research, deliberate and discuss options before making a placement. “We are negotiable if a longer-term position comes up and we can find a suitable person,” says Hopkins. “And we can work with clients to adapt to their initial budgets.” More than a booking agency Although Shane Cortese brings a very different set of business skills to the party, he is a man at the pinnacle of a career that has seen him crack London’s West End, and makes him a ‘must have’ for any significant local TV series. While he is hardly ever off our television screens, his versatility keeps him on the billing of top variety shows, or leading his ‘Class of ‘58’ rock band on sold-out national tours. But Cortese also has ten years’ experience in a Palmerston North travel agency as a solid base – and the perfect training and experience for running his recently acquired New Zealand franchise of Australasia’s top professional speakers’ agency. Hopkins might have more than a touch of the evangelist in articulating

the goals of Action Actors, but Cortese is right on top of the business-speak which comes with any top-notch service organisation. His goal is to be the ‘number one go-to speakers’ agency in this country’. ICMI (www.icmi.co.nz) needs to be ‘top-of-mind’ and ‘first call’ when it comes to booking a professional speaker to motivate a corporate conference, MC a product launch, or entertain at a sports-themed event. Being the good actor he is, Cortese puts in a massive amount of his boundless energy and incisive research to understand the client’s task-at-hand and then match personalities, suggest staging and even the venue, to achieve the client’s overall strategic needs for the event. This is more than a booking agency. His time in travel taught him the value of scenario-planning, providing alternate solutions. Not to mention the vital importance of clear and concise communication, listening and making life easier for the client. He welcomes having no overheads too. “My business is more than 300 top speakers across the full range, a smartphone, a tablet, a laptop and me. Being a ‘non-plateau’ type, I have to keep going forward and challenging myself to do better, achieve more and try different things, in addition to what I’m doing at the time. I’m totally committed and have had to remortgage the house to buy the local franchise of the marketleader. “When the opportunity came I researched the market; called my lawyer, flew to Melbourne; did the due diligence; and signed the deal. So now I just have to make it work. “I inherited brilliant speakers, be it a genius business leader like Contiki founder John Anderson; Eric Rush, a hugely successful sportsman; marketing whizz Debbie Mayo Smith; motivator John Shackleton; and, of course, Allie Mooney. These people are recognised leaders, team-builders, entertaining, motivating speakers – whatever you need. Call me.” Kevin Kevany is an Auckland-based freelance writer. Email kevwrite@xtra.co.nz

NZB May 2012 nzbusiness.co.nz

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COVER STORY

Al Monro’s journey with touchscreen company NextWindow started with a mid-life crisis and the end of a safe corporate career. But ultimately it won through because of lessons learnt from failure. By Lesley Springall. When most men talk about a mid-life crisis, buxom blonds, broken marriages and bright red sports cars come to mind. But for Al Monro, his crisis changed the fortunes of a struggling start-up and turned him into a committed entrepreneur. Today Al Monro’s quite well-known within economic development circles: a sought-after speaker, Monro has addressed budding entrepreneurs at the MORGO conference and waxed lyrical about the trials and tribulations of taking touchscreen technology company NextWindow from startup to government poster-child at numerous business gatherings. But there was a time when the thought of being paraded as a successful Kiwi entrepreneur would probably have made Monro’s eyes bulge in disbelief. A Canterbury law graduate, Monro somewhat ironically says he never saw himself as a lawyer or accountant. He’d only completed a law degree because he thought it was a good thing to do. He admits he wasn’t the best student; a dual-honors degree in law and commerce never materialised because Monro was short a few credits in the commerce bit, but was too busy (or, he says, too lazy) doing unrelated subjects in his final year to notice. Not that it mattered, back then

(Monro is 54) it was easy to get a job, he says. He wrote to ten companies he wanted to work for and got interviews with six. He chose a sales role at IBM, not because he was particularly into

Back in Auckland, Monro was rapidly promoted from his pre-Asia role of IBM Auckland regional manager to national sales manager. “It was the end of 1999, so it was the whole Y2K

technology or sales, just because they had a good name and a good training programme. “For your first year you weren’t expected to contribute anything. It was all about training; technology courses, sales courses.” But it wasn’t just about local sales, it was about global sales from day one, he says, Monro spent 18 years with IBM, rising through the ranks to national sales manager. He remembers fondly his year setting up Vietnam’s IBM office, juggling the pressures of a third world country with a young family. Less fondly he recalls his year in Malaysia, a year that coincided with the 1996/97 Asian Financial Crisis, the Indonesian fires which blacked out the sky from dawn ‘til dusk and an outbreak of hand, foot and mouth that killed under-fives. Unsurprisingly Monro’s wife and two young sons spent much of his Malaysian posting alone in Auckland. But his expat years gave Monro a taste of Asia and he loved it.

thing.” It was also a time when New Zealand was doing well, so IBM head office begun to take more of an interest in the country. That irked Monro. He might have been national sales manager, but he didn’t feel like he had any power at all, he recalls. Just into his 40s Monro admits he was going through a classic mid-life crisis. “I could’ve retired at IBM. That would have been easy, comfortable, but not challenging.” Munro says he’d always harboured a desire to do something with a New Zealand business. All his international sales training had to be good for something. Weren’t the powers-that-be always complaining about how good Kiwis were at developing technology and how rubbish they were at commercialising it? One week into the new century, Y2K was a fizzle and so were Munro’s corporate ambitions. “I was sitting on my deck at Lake Rotoiti and I just phoned up the managing director of IBM (New

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Zealand) and said ‘you know that strategic planning meeting you’re having next week, I don’t think I’ll be there’.” Monro says he planned to take a few months off, but he quickly got involved in a new private equity business a friend was setting up, focusing on supply chain management. Monro remortgaged the house – the one he’s still in today – put some money in and took the plunge. But things went wrong pretty quickly. The company was caught in the spectacular business-to-business downfall of 2001 and, he admits, they didn’t really know what they were doing. For example, one of his larger investments, an Australian warehouse management company, had attracted the attentions of a huge multinational retail company that dealt with everything from frozen goods to chilled goods to

the lessons you learn when you lose are huge.”

ambient (sit-on-the-shelf) goods. “From a warehouse management point-of-view it was about as complex as you could get.” At first things looked good; the Australian company had impressed the multinational with its warehouse management systems and there was talk about rolling it out globally. “But we blew it,” says Monro. “We just didn’t do the job justice. It didn’t get the priority it should have. We should have thrown everything at it; the upside would have been massive.” Instead, it all fell apart. At the time it was painful, but Monro says he has no regrets because the lessons learnt were invaluable. “It gave me the small company experience I needed and

company had raised initial capital through friends, and then attracted Tony Hannon’s investment company I-Cap Partners, which had put about $750,000 into the company. “They thought they could just license off the technology and retire,” says Munro. “So they went and saw all the touchscreen companies that existed then and got absolutely zero interest.” It wasn’t difficult to see why, he says. “The technology was very new, very raw, hadn’t been fully developed and they didn’t know anything about it.” Even Newton had seemingly lost interest, returning to a fulltime job with defence technology company Oscmar International. Munro says he spent three months looking at NextWindow, talking to Newton,

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NextWindow opportunity Back in Auckland he was approached by another friend, Auckland businessman Andrew Nugent, who was chair of a startup touchscreen technology company called NextWindow. He asked Monro to have a look at it, to see if the technology had any legs. While Monro was having his corporate career crisis, NextWindow was being set up by electronics engineer John Newton, who’d developed a touchscreen technology that could be used through glass. He’d developed the technology in response to a real estate agent friend’s request to show more than just static pictures of a few houses through his business’ windows. The

looking at the technology, the marketplace, the competition and familiarising himself with the touch industry. In April 2002 he told the board he thought they had something and he was keen to be involved. “They said, ‘great, okay, so we’re going to license the technology.’ I said, ‘No. We’re going to be a manufacturer’.” Trying to license the technology at that stage was like trying to franchise a business you’ve never run, says Munro. “Who’s going to license a technology that’s not working anywhere. So they said, ‘Okay, we’ll just make a few’. But you can’t get half pregnant. If you’re going to be a manufacturer you’ve got to do it right.” The board agreed and Newton returned to the fold, happy the technology wasn’t going to be licensed, though not sure about ‘a salesman’ running the company. To Monro, Newton’s return was essential. “We needed him, he is the technology. He is the vision behind it and always has been.” But those early years were a constant battle with the board. “Accountants try to save their way to success rather than growing their way to success and you can’t do that. We were constantly running out of money and the accountant on the board kept asking how we were going to cut costs and I’m going, ‘I’m not going to cut costs, we have just got to get more capital. If we want to be a global technology company we have got to run hard’.” But Monro did have the support of Nugent, Hannon and, though there were plenty of disagreements about the focus of the technology, Newton, without which, he says, he’d never have made it. But Newton was a technology guy, not a business guy, and Nugent and Hannon didn’t really know the business, so Munro really only had his gut to guide him. “It was a very lonely role.” He was also being paid a fraction of his

COVER STORY

IBM salary and had a huge mortgage, but he says it never crossed his mind to give up. “It was my dream job. It was exactly where I wanted to be; trying to take New Zealand technology to the world. It was hugely exciting.” It was also very, very hard, he admits. There were constant money pressures and the focus of the business constantly changed. Early on NextWindow was a through-glass touchscreen company, but that changed after one of its first clients, Vodafone, ordered 70 touch-activated

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kiosks to promote its new Vodafone Live! service in early 2003, but didn’t want it to be through-glass, but to work directly through the screen. Focus switched from ATM machines, kiosks and ticketing machines to gaming and digital signage, all of which eventually fell by the wayside. One idea that didn’t, however, was the company’s decision to miniaturise the technology. This was born from an early board meeting where Hannon asked, “Can you chip it and ship it?” Or, basically, can you make it in volume? Munro boldly

approached the Foundation for Research, Science and Technology for a $500,000 grant. He got $560,000, which was matched by NextWindow’s investors.

Global player While the minaturisation work got underway, Monro continued to promote NextWindow’s wares to as wide an audience as possible. A big fan of trade fairs, he was a regular participant on New Zealand Trade & Enterprise’s stand at

3/02/12 9:35 AM

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COVER STORY

Get your board right. Accountants should advise on financials within the company, not on the direction of the company – you can’t save your way to success. Get a board that provides the skills and experience you need to grow; sales, business development, supply chain management, marketing etc. The old adage “It will take twice as long as you expect and cost twice as much,” is absolutely true. Even if you budget and allow for it at the beginning it will still take twice as long and cost twice as much. Listen to your customers and be led by them, at least initially until you work out what you’ve got to do. There are a lot of things you can do; there are only a few things you have to do. Sort out the things you have to do and then do them really, really well. Be prepared to travel. You can’t beat face-to-face meetings when building networks. In ten years at the helm of NextWindow, Monro estimates he spent almost three years abroad.

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CeBIT, the world’s largest digital technology and telecommunications trade fair. It was here that he met some key players from global technology company HP, and stayed in touch with them. He met up with the same HP engineers a couple of years later when he was at a gaming trade show in Las Vegas in late 2005. This time he had NextWindow’s brand new prototype, incorporating all its newlyminiaturised gadgetry. At the time HP was working on a secret project to develop an all-in-one PC (the HP Touchsmart) that was to be launched by Bill Gates at the international Consumer Electronics Show in January 2007. The engineers were on the hunt for some touchscreen technology that could be written on, was fast and didn’t include a film over the screen, distorting clarity. “And we had a prototype, that if you put your tongue in the right place and knew where to touch, it worked,” says Munro. Almost unbelievably, NextWindow, this small, unprofitable company in New Zealand, won the manufacturing contract. This led to a frenzied period of activity: finding contract manufacturers in Thailand, finalising the technology, hiring more staff and dealing with HP’s management, some of whom weren’t happy their engineers had engaged an untested, tin-pot company at the bottom of the world. NextWindow had been making about ten to 20 large touchscreens a month – now they needed to produce 60,000 of their new, unmarketed touchscreens, flawlessly. The summer before the launch, Munro spent most of his family holiday sitting in his car outside Harvey Norman in Rotorua, tapping into its wireless broadband and conducting Skype conference calls with nervous HP management. “Once the product was launched, I waited every night for the phone calls to say the product didn’t work, but they never came. They did work. They worked really well.” But Munro doesn’t consider that the turning point for NextWindow. “Winning HP was good, but winning HP for the second time would make the company.” Using the lessons he learnt from his failed private equity firm, Munro’s strategy was now threefold: treasure HP; leverage HP; and get close to Microsoft. NextWindow won the HP business the following year and with that came the endorsement it needed. Quick to follow HP to

NextWindow were Dell, Lenovo, Medion, NEC, Samsung and Sony. NextWindow went from an unprofitable company turning over a few million a year to turning over $30 million in one year and closer to $50 million the next, while employee numbers jumped from 20 to 120. Today NextWindow is owned by listed Canadian whiteboard technology company Smart Technologies, a company Munro says he’d admired for a long time, before it filed a patent suit against NextWindow in 2009. “That’s what happens in the US when you become successful.” Less than a year later, the suit was dropped and Smart decided to buy NextWindow instead, merging the two companies patent portfolios and using NextWindow as a springboard into the broader consumer technology market. At first Monro got behind the merger, recognising the synergies between the two companies, but, he admits, it’s hard to return to being just another corporate cog in the wheel. He left NextWindow at the end of December 2011.

Timing and luck When asked if there was anything he would’ve done differently, Monro says he’s thought about that a lot. “But you don’t really get those choices.” A lot of the time you just have to take your best guess about what’s right at the time, who to hire, when to hire and what direction to focus on. Initially you should follow what your customers want, but there comes a time when you have to focus and sell what you’ve got. There’s also a good deal of luck involved, he says. Looking back, he says NextWindow is definitely the most rewarding and satisfying thing he’s ever done. “And I also recognise that I couldn’t have done this without those lessons I learnt from failing. You can’t succeed every time.” And now? Well Munro’s admits he’s not keen to be a chief executive of another early start-up again, but neither does he want to be a hands-off director. He wants an inbetween role. An interfering director then? Munro nods and laughs. Lesley Springall is an Auckland-based freelance business journalist. www.linkedin.com/pub/lesleyspringall/30/135/4b3

Ready to take your business to the next level? Apply now

For the 2012 nZBusiness magazine ICEHoUSE owner operator programme Scholarship! The Owner Operator Programme, directed by respected business coach Dr Mike Ashby, is designed for owner operators who want to grow their business, but need the tools, knowledge or inspiration to take their business to the next level. This is done through access to expert facilitators, workshops, tools, coaching and the opportunity to work alongside peers facing similar challenges. NZBusiness, together with The ICEHOUSE Business Growth Centre, is giving you a chance to win scholarship funds of $5,370 (50%) towards annual programme costs.

You are eligible to enter if: • You have an established business with turnover less than $3 million p.a. • You are genuinely committed to growth and accept this will involve change. • You like the idea of being stretched without being stressed. • You genuinely want to be challenged and pushed to the next level. • You want to be accountable to your goals and targets. • You are open to the wisdom of other like-minded business owners.

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close 30/09/2012

To find out more about the Owner Operator Programme go to:

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www.nzbusiness.co.nz/scholarship

Mumâ&#x20AC;&#x2122;s

the word

28 NZB May 2012 nzbusiness.co.nz

BUSINESS GROWTH

For ‘mumpreneurs’ Jo Bond and Jo Keall, strong financial management and the willingness to listen to expert advice have helped fuel an impressive growth in sales. Hamilton mothers Jo Bond and Jo

show how big the company could be

should underpin critical management

Keall share a vision – five million

and how all members of the team can

decisions that seal your business’s

mums around the world will have

contribute.

future.”

their lives made easier by using their practical baby care solutions.

“It’s a touch point for all staff to

With this forward-thinking approach

relate to, and use, for better company

Mum 2 Mum has never had to carry

decision making. It’s empowering and

debt thanks to the firm but fair

all started when the two enterprising

encourages staff to take ownership

payment terms Keall established

mums, who, frustrated by the lack

which impacts directly on innovation,

early on with their key debtors –

of local quality baby care products,

productivity, and our company’s

overseas distributors.

launched their company Mum 2 Mum

future and bottom line.”

Sounds impressive? It is, and it

from their spare bedrooms in 2004. In seven short years Keall and

The move to export

“Managing cash flow is critical,” says Keall. “The agreement we have with our distributors is that they match

Bond have achieved much for a

Within a year Mum 2 Mum was

the payments we need to make to

‘mumpreneur’ start-up from the

distributing to major retailers within

our manufacturer which means the

heart of rural Waikato. They are now

the New Zealand market as well as

cash inflows cover the outflows.

supplying more than 900 retail outlets

selling online. It was then that the

Essentially, that’s a 30 percent deposit

around the world with their innovative

decision was made to take their

on order with the 70 percent balance

designs, including the signature

products offshore.

paid on shipment from China.

super-absorbent Wonder Bib™ range and the fitted DreamSwaddle™.

By the end of 2006 they had signed

“It’s really helped to minimise the

their first contract with Baby&More in

amount of borrowings to fund

the United Kingdom, boosting volume

working capital. We established this

last year in winning the Supreme

significantly. But this was a step

right at the start and have carried

Award in the Westpac Waikato

that was not undertaken without the

through.”

Business Excellence Awards 2011,

advice of external expert advisors.

The business’s success culminated

along with taking out the Deloitte Fast

“As a chartered accountant, I have

On the flipside, Mum 2 Mum looks after its distributors ensuring they set

50 – Fastest Growing Manufacturer in

expertise in certain areas,” says Keall.

lower purchase prices and margins

the Central North Island with a year-

“I also know the importance and

so they are motivated to sell and

on-year sales growth of more than 50

value of getting specialised advice

market the brand while covering their

percent.

from other experts including

costs in terms of holding the stock

But it certainly didn’t happen by

chartered accountants to ensure we

for longer.

accident. Along with a shared vision,

can move forward with confidence.

they have the perfect combined skill

As well as hiring a lawyer to

“We also prefer to sell to them in their own currency so that they do

set, with Keall a chartered accountant

prepare distribution contracts, Bond

not carry any risk in terms of currency

and Bond experienced in event and

and Keall hired international tax

fluctuations. It’s all about good

business management.

advisor and chartered accountant

relationships based on strong family

John Adams of KPMG. Adams has

values. We treat them as we would

the financial side of the business,”

helped them to achieve a streamlined

expect to be treated.”

says Bond, who manages branding,

and simple business structure,

marketing and manufacturing. “I leave

allowing Keall and Bond to focus on

system was one of the most important

that to Jo, she’s an asset to the

what they do best.

decisions the company ever made

“I don’t have to think at all about

business. It’s like having a magic wand.” Keall’s nous with numbers and

“Traditionally many small to medium-sized business hire a chartered accountant to prepare

Bond says installing this payment

and illustrates the enormous value of getting specialised advice. “I see so many start-ups fold

strategic thinking has underpinned

financial statements so they can meet

because they’re not in control

every decision in the steady and

their tax and banking needs,” says

financially, especially when it comes

successful growth of the business,

Keall.

to cash flow. They end up overspending and that’s the end,”

founded on a strong company vision

“This information relates to what

and family values. “We have followed

has already happened and the real

says Bond. ”If you have a business

a low-risk business model which to

benefit is the expertise a chartered

idea, you need expert advice right at

us means low debt and controlled

accountant can offer around future

the start to help you make all those

growth,” says Keall.

planning, like cashflow management

critical decisions.”

“In terms of our strategic vision, we have a process that allows us to

and product profitability. It’s information like this that is crucial and

NZB May 2012 nzbusiness.co.nz

Digitising Documents An effective electronic document management system (EDMS) and process can be the key to reducing costs for organisations, large and small. Glenn Baker investigates. 30 NZB May 2012 nzbusiness.co.nz

DOCUMENT MANAGEMENT

n a nutshell, ‘document management’ controls the lifecycle of all documents generated within your company – how they are created, reviewed and published – and, longer term, how they are stored or disposed of. In this new post-GFC business environment in which all businesses are under intense pressure to cut overheads and do more for less, document management processes and systems are understandably coming under increased scrutiny as a means of trimming expenditure and driving efficiency. It’s an area of business where a lack of planning and process can simply no longer be tolerated. Fuji Xerox has long been an industry leader in the DMS field. NZBusiness asked Paul Prouse, GM services and solutions, just how much progress has been made in recent times and what this means to typical SME businesses. “Procuring a document management system used to be an area that required a large capital outlay, took a few months

requirements and size of their business – coupled with a more manageable monthly cost. Prouse says the key to a successful DMS is first thinking about your business documents and why they are essential to running your business – rather than the actual system you are going to use to store and access these documents. “Think about how accessing or sharing critical documents could actually change how you interact with and service your customers. Could you drive more revenue to your business if customer service or sales staff could easily access documents and make decisions faster? Rather than looking for the document in a filing cabinet or realising it’s not in the cabinet but on a colleague’s desk.” If you’re wondering whether better document management would matter to your business, look across your business and identify areas where getting an answer faster or having information more quickly would offer quantifiable benefits to a specific process in your business, adds Prouse – such as a product

Internal costs can be reduced by up to a third, by producing and distributing an e-document rather than a printed version. to install and required ongoing internal maintenance that drained internal IT resources and time. And then there was the headache of whether employees actually used the system. One international study shows ‘knowledge workers’ – that’s staff working with documents – spend half their time trying to find the information they require and are successful only 80 percent of the time. It’s just a waste,” says Prouse. Innovation in technologies and the move towards hosted/cloud based document management has changed this, he says, removing the barriers to entry for smaller businesses who now have access to document management systems and services to match their specific

launch, a specific project, sales campaign, or a sales proposal or enquiry. “This will then help to formulate what type of document management strategy and system you need and how this can improve not only employee productivity but overall productivity and revenue in your business.”

Tangibles and intangibles Tangible efficiencies are there for the taking when a well-planned DMS is implemented. Neal Ross, CIO for Konica Minolta New Zealand was quick to point the following out: • Simplifies document filing and retrieval; reduces costs and space of storage; reduces the risk of losing physical

documents; reduces wastage and cost; encourages collaboration; removes silos from within the organisation; facilitates process automation. • Paper, printing and copy charges are greatly reduced. For example, research indicates that a staff member in an accountancy firm can spend up to 15 hours per week photocopying/printing documents. An EDMS can reduce this by upwards of 75 percent, resulting in huge cost savings in terms of time, paper and click charges. • Paper files in filing cabinets or boxes take up a lot of space. The result of reducing or even eliminating paper storage can result in substantial cost savings from recovered floor space in either the office where squaremetre costs are at a premium, or storage facilities where costs associated with document storage and retrieval can become prohibitive. Then there are the intangible efficiencies, says Ross. “Instead of one person working on a document at a time and then passing it onto the next, causing bottlenecks and delays, multiple people can view, comment and edit a document simultaneously – thereby streamlining the process. “A well-ordered EDMS will also enforce standardisation and best practice in an organisation’s document process. And, of course, with metadata and content search functionality it is all but impossible to lose a document, regardless of how poorly it may have been indexed or filed.” The impact on internal costs a well-managed DMS delivers cannot be overemphasised. Paul Prouse estimates that internal costs can be reduced by up to a third, by producing and distributing an e-document rather than a printed version. “Think about the benefits of having files available and shared real time in a DMS for key people to access. What benefits could

NZB May 2012 nzbusiness.co.nz

Law firm streamlines DM processes Wanganui law firm Armstrong Barton uses InfinityLaw practice management software to project manage all the matters they deal with. However, document scanning was a two-step process – documents had to be scanned to email, then renamed and coded for output to InfinityLaw. This process was timeconsuming and came with the risk of documents ending up in the wrong place. The firm was also dedicating a large amount of office space for storing hard copies. Clearly a more efficient process for scanning and archiving documents was needed. The solution involved the implementation of Scanz – a new interface between Armstrong Barton’s pre-existing ‘bizhub’ Konica Minolta multifunctional devices (MFDs) and their practice management software. Three templates were provided as

this bring to your business and the way you interact with your customers? Our experience tells us that digitising this process and automating workflow can take a current process from 15 days to two days, to two hours,” he says. “An internal study by AIIM Market Intelligence tells us that ‘significant numbers of organisations are only scanning for post-process archive. Whilst they may be making savings in records storage space and improving subsequent searchability, they are not improving the efficiency of the process, nor raising the transparency of in-process documentation’. “A wealth management client of ours witnessed this first hand after streamlining its process for opening new accounts,” says Prouse. “A laborious five-day cycle was reduced to about two hours, enabling clients to invest on the day they signed the contract. What was the impact to the business by automating the process? About $1 million per year.”

32 NZB May 2012 nzbusiness.co.nz

part of the interface to optimise the handling of the main documents types; Client Matters, Proof of Identities and other more general documents. A new validation process was created using powerful look-ups in InfinityLaw to ensure that all of the required data is entered in a correct format at the time of scanning, using the screen and keyboard on the MFD. The outcome of the new process is less time and effort associated with scanning paper documents. The validations required ensure that the information entered alongside scanned documents is complete and therefore the documents are filed more reliably. Armstrong Barton has also reduced its period for holding paper originals from seven to three years – more than halving the amount of physical paper files that they hold and freeing up vital office space.

New technologies Of course new technologies are having an ongoing impact in the DMS market space – and that includes cloud-based services. “Cloud-based and hosted services have become more prevalent,” says Ross. “However, uptake is not high.” The ROI on EDMS remains difficult to quantify and is a barrier to adoption, he says. “But natural disasters such as the Christchurch and Japanese earthquakes caused a call to action by those businesses that recognise the benefits of data storage over paper.” Technology innovation is rapidly changing the landscape for DMS, suggests Fuji Xerox’s Paul Prouse. “You can now use your traditional photocopier/printer as an efficient and effective on-ramp into your business processes. Fuji Xerox multifunctional devices (MFDs) coupled with our ‘SolutionBuilder’ software tool lets you index, OCR and file documents that you can

locate in the future.” This has helped cross the bridge between digital information and physical information, he says.

Myths and misconceptions Of course, when it comes to electronic document management systems, many SMEs fail to utilise them properly or have overly high expectations of what they can deliver. Konica Minolta’s Neal Ross says many businesses believe open source systems are easy to use and configure. “But in reality, they’re rather like a kit-set kitchen. Unless you have the necessary skill, you would still need a kitchen installer to be able to assemble and use the kitchen”. Ross also points out that an EDMS does not solve business issues. “If process is poor, adding an EDMS will not correct this position.” Eighty percent of the features on an EDMS are rarely used, he adds. “And organisations believe they can install a DMS

DOCUMENT MANAGEMENT

Scans through ApeosPort MFD

Converts documents into a searchable format

Interfaces directly with applications

Original paper document

Reads barcodes

system with little planning of their taxonomy and metadata. The ones that succeed apply phased, approached implementations involving careful planning and refining.” One of the biggest myths and misconceptions is that you need to spend tens of thousands of dollars to get a robust DMS, and this is not the case, says Fuji Xerox’s Paul Prouse. “Document management hosting and outsourcing has changed the landscape and now SMEs have multiple DMS options to choose from to suit their business, size and budget requirements. The most important investment is a little time

to consider what documents are critically important in your business. Start with your critical documents and the processes they drive and this will ensure you find the right service and solution for your business.” Prouse agrees that some companies don’t get the most from their DMS. “We recently worked with a local business that came to us to replace a scanner. After reviewing their document and scanning requirements as well as understanding the actual process in the business we also uncovered that their current DMS wasn’t being used to its full potential. “The business had outgrown the

• Document Management • L egal Practice Management • C ustomer Relationship Management • A ccounting Practice Management • F inancial Advisor Practice Management • Enterprise Solutions

system and didn’t have the in-house expertise to develop and scale it further. We proposed that our business analyst team review the scanning process, the document involved and what was required from the DMS in order to meet their requirements. “After consultation and review, the client decided it was actually more cost-effective and productive to outsource the scanning and hosting of the document management to Fuji Xerox. We had the internal expertise and resources to provide a more scalable DMS to meet their requirements and we had the outsourced scanning and workflow expertise to manage their

NZB May 2012 nzbusiness.co.nz

DOCUMENT MANAGEMENT

Six questions to ask when considering a DMS Before purchasing a DMS, work through the six questions below and think about the documents essential to your business. Think how sharing, accessing and managing these documents in a more automated, faster manner could change how you operate your business and engage with customers. 1. Which critical documents need to be 100 percent accurate and on time for your business to meet its goals? 2. Do your documents include rich content that requires rapid and/or shared access, use, review, etc? (eg, client files, contracts, sales documents.) 3. Do you work with multiple third parties or external contributors who create, review, revise and/or collaborate on documents? 4. What are the risks of mismanaging or delaying your documents? (e.g. fines, penalties, lawsuits, lost revenue.) 5. Could there be a real benefit to your business and your customers by streamlining a manual process and making it digital? 6. Could a hosted/cloud-based solution work better for your business? Your answers can help clarify the true purpose of your documents and even suggest processes that might have a need for speed. Then you can speak to vendors with an end result in mind and they can help you to ensure that the system or document management service you go ahead with will actually make a difference to your business. By building on these starting points, you can employ accelerated, accurate document management to minimise your slowdowns and increase your momentum in a world that never stands still. Source: Fuji Xerox

34 NZB May 2012 nzbusiness.co.nz

Mobile devices (Smartphone, ipad)

Hosted DMS

MFD (Fax/Print/Scan) (Apeos IV)

PC (Web browser, DocuWorks)

scanning process, which is now done in real time, rather than post process. “We have changed the way this customer interacts with their customers in real time.”

The future Documents are still viewed by many as static pieces of A4 paper even though the world is flooded with email messages, electronic bank statements, e-tickets, tweets, digital photos, electronic medical records, online applications, YouTube videos, podcasts, PDF product instructions, Google listings, Apple iPad forms and countless other variations on the theme. So, says Prouse, the DMS of the future must capture all of the above as well as information from social media, video clips and voice conversations. “The ability to search, access and extract this information will be vital to the future of how businesses operate and interact with their customers either online, via mobile devices or through traditional mediums such as physical mail, email and fax. Mobile and cloud-based technologies in all forms – Software as a Service (SaaS), Infrastructure as a Service (IaaS) and Platform as a Service (PaaS) – will make documents more accessible than ever. “So what does the cloud have to do with documents and document management? Plenty, says Prouse – with cloud computing and dynamic content, individuals anywhere can create documents, make changes, reconfigure content chunks, repurpose

content, embed new content forms, aggregate real-time information, develop mosaic documents from multiple sources and so on – without worrying about having the ‘right’ operating system or application. “In short,” he says, “users will be able to easily access, manipulate and share documents and content from any computing platform that has a web browser. It means easier access, greater collaboration and at a lower cost.” Konica Minolta’s Neal Ross sees an all-digital future for documents. “There’ll be a much tighter integration into business processes and workflows – for example, accounts payable processes,” he says. “Document life-cycles are rapidly changing from being digital-physical-digital to being purely digital. This will remove the ‘printed’ phase from the document life-cycle which will have far reaching implications on efficiency and cost. “As a result DMS will be mandatory since the majority of documents will only exist in digital format.” Contextual language search engines such as Pingar are likely to become mainstream, he adds, allowing rapid meaningful searching of unstructured data. “SaaS in the DMS space is also likely to increase, and with a reduction in wholesale prices the uptake should be strong. Smart MFDs will provide more interfaces too, enabling printing from, and scanning to, cloud-based document management systems.” Glenn Baker is editor of NZBusiness.

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A brand is born Launching a new green-luxury brand into the US has taken a big leap of faith for small, family-owned Christchurch business Tréology. Sandy Galland has their story. ‘Massive’ is a word used often by Tréology’s founder Andrew Davies as he shares the journey of taking a concept and crafting it, systemising it and preparing it for its launch into the marketplace. “There have been times when I have freaked out thinking of the tasks that lie ahead, but with the right team, the right mindset and a commitment to our dream, we will make this a huge success,” he declares. Andrew and wife Melany-Jayne are the fifth generation of the Davies family to be involved in timber craftsmanship and are the owners of Davies Furniture,

36 NZB May 2012 nzbusiness.co.nz

a prestigious and respected New Zealand maker of timber furniture. But they saw a bigger picture. They had a vision to take a slice of New Zealand’s natural beauty and present it as genuinely sustainable, bespoke, luxury furniture. This month they travel to New York, Los Angeles and San Francisco to unveil Tréology to their target market – interior designers to design conscious, apartment dwelling families. “We knew there was a powerful story to present to the world through our products. We wanted to provide an opportunity for these concrete-jungle dwellers to have a slice of natural, untouched New Zealand; a slice of history in their homes. Timber is a material that helps to ground us with nature, connect us with something bigger than

EMERGING EXPORTER

ourselves. It brings a weight, texture, warmth, colour and lustre that cannot be replicated.” Tréology’s philosophy is about accentuating the beauty of timber by showcasing its natural beauty. “We don’t design our pieces, nature does that for us. We simply appreciate the natural form of timber and craft each into a contemporary piece of enduring furniture,” explains Andrew. The business only uses genuinely sustainable timber. While prototypes have been made from non-New Zealand timbers, all of which are from totally sustainable sources, the subsequent pieces will be crafted from native timbers. These are either naturally felled, through landslips and earthquakes and rescued from our lakes, the sounds of Fiordland, swamps and rivers – or native timber rescued from earthquakeravaged buildings in Christchurch.

The first step the hardest Early in 2011, after ten years of toying with the idea, Andrew made the commitment to bring the brand to life. Step one was engaging business mentor Colin Clapp. “The task was massive. We started with the visioning – where did I want this business to be in 20 years, 15, 10? Then we worked solidly to create a two-page strategic business plan. It was about prioritising everything that had to be done and then breaking it down into three-month chunks,” recalls Andrew.. “To make this happen, we had to get started, that was the hardest part – just getting started. It has to be about progress not perfection. We continually prioritise between the urgent and important and always with our long-term goals in mind.” The business strategy is anchored in the strong values Andrew holds for himself, and for his business. “This sounds easy, but when you try to put the things you value strongly into simple words on paper, it becomes difficult.” The values woven through every part of Tréology are around respect for nature, excellence in craftsmanship

and design, family, adventure and giving back – to the earth, the team and the community. “Adventure is so important to us. We are lucky enough to live in one of the world’s greatest adventure playgrounds. A lot of the motivation for creating Tréology was to move away from making ‘vanillaflavoured’ furniture. I wanted to create a product that would polarise people. You will absolutely love what we do – or you won’t. Getting to that point was a massive journey.” Step two was engaging an advisory board. “This has been so powerful, not only does it hold me accountable, but we all know it’s lonely in business by yourself. It’s a place to bounce around ideas. I have over 120 years of solid business experience sitting around the board table – that is empowering,” says Andrew. “You don’t know what you don’t know. To accept this and bring in other people – people with a diverse skill set, is the only way we saw to make this happen.”

Getting creative Step three, was engaging a creative team. This consisted of a marketing professional, a graphic designer and a writer, who with Andrew and MelanyJayne, conceptualised and brought to life Tréology. “We started by sharing our values and dream for the company – at this stage it was an unnamed entity. We then did a huge amount of market research, and brainstorming about who our ideal client was, where they lived, what they did, what made them tick and what their family looked like. By getting a picture in our head of exactly who would buy our products, we were then able to begin to build a brand that would appeal to these people on an emotional level.” Tréology [tree-ol-uh-jee] is a made-up word, invented by the creative team. It’s a combination of the words tree and genealogy, the latter referring to the heritage of the century-old trees used in the furniture and the generational designs. Andrew describes the next step as all hingeing on discipline. “Up until the time of actually having a living breathing brand, a brand story and visual concepts, we could have backed out. But this made it real and made us even

more determined to drive this forward.” The time, resources and investments that have gone into Tréology have been immense. On top of Andrew’s commitment to bringing Tréology to market, he is still MD of Davies Furniture, ensuring this continues to thrive. “I am so motivated and discipline has been essential. That’s been an empowering thing for my entire team. It has allowed those that want to shine and progress up the business, to do so. We have encouraged everyone to take ownership of their roles. It’s not easy stepping back when you have closely managed a team. But it has to happen.” Once the creative team had woven their magic, and the Tréology brand concept was ready to be unveiled, Andrew and Melany-Jayne took the entire team away from the factory to share their plan and vision. “It was essential they all bought into it. As a company we have exceptionally strong values and it’s important the entire team are on the same bus heading for the same destination.” During a planning session just before Christmas 2011, Andrew encouraged the team to be open and honest about their aspirations within the business, how they would like to contribute to the culture and what support they needed to get there. “This was powerful,” he says. “Ninety percent of what they said aligned with my vision and strategic plan. So now the plan we have really is theirs – they feel like they own it. There is a clear path of empowerment, accountability, expectations and communication. We have put in place a regular performance matrix and the first four things we measure are centred around our values. Of course productivity and performance feature, but it is firstly about their attitude and commitment to Tréology.” The lessons, challenges and wins will continue to come thick and fast, but as Andrew and Melany-Jayne head to the US to launch Tréology, they have every confidence the authenticity of their brand story, the quality and integrity of the furniture and designs, combined with their passion and hard work, will pay off. Sandy Galland is a Christchurch-based communications specialist. Email sandy@yourstory.co.nz

NZB May 2012 nzbusiness.co.nz

Thanks to cloud computing, storing and managing business data has never been easier or cheaper. So why arenâ&#x20AC;&#x2122;t all businesses doing it? Bill Bennett offers a guide to data security.

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minimise the risk of human error or an external attack. Once you have that under control, you need to think about getting things back on an even keel as quickly as possible should disaster strike. A good data security plan will take both into account. The good news is that storing data safely and managing risks have never been easier or cheaper. Backup software is inexpensive, robust and straightforward to use. Hard drives cost next to nothing. You can, and should, consider making local and remote backups. Cost and difficulty is no longer an excuse for not making multiple copies of key files at various locations so your business can be back on its feet as quickly as possible. It’s an area where cloud computing and managed services have already proved their mettle: companies using cloud-based tools were back online faster following the Christchurch earthquakes. It’s no accident security service providers reported a rush of enquiries about cloud services immediately following the earthquakes.

ata is central to modern business. It’s so important for knowledge-based companies that some never fully recover from serious data loss. If your business stores other people’s data, you are also vulnerable: New Zealanders are unforgiving about information leaks. Even when information isn’t your company’s core business, losing data is disruptive and expensive to fix. Imagine where you’d be if all your bank details, invoices and customer records suddenly disappeared into a black hole. Securing data is a two-part process. First, you need to

Christopher Russell, Australia New Zealand corporate sales manager for security software specialist Symantec.cloud told NZBusiness; “Even a very small business needs to have some kind of security plan in place.” Yet, amazingly, many New Zealand businesses don’t. In its 2011 SMB Disaster Preparedness survey, Symantec found small businesses the world over are not taking the risks to their data as seriously as they should. The survey, which included responses from 100 New Zealand companies, found the lack of planning is worse in smaller companies than in medium-sized ones. Overall half had a plan in place. Around one in six companies neither had a plan nor any intention to plan for data disasters. Symantec said most small businesses don’t take action to prepare for disasters until after they

have experienced loss from downtime. It went on to report this lack of preparedness “has significant impact on their customers and their business”. Many small businesses fail to make regular data backups or protect their data from malicious attacks. Interestingly, Symantec said most of the small businesses with a plan in place have already been through a data loss.

Losing data is a problem for companies everywhere. However, according to John Kendall, Unisys’s security programme director for Australia and New Zealand, local customers are especially unforgiving when companies suffer consumer data breaches. Kendall’s company asked consumers around the world how they would react if a company they did business with leaked data. He said New Zealanders had one of the strongest reactions with 80 percent saying they would stop dealing with the company online. A quarter of New Zealanders say they would go as far as halting their offline business as well. Almost half said they would go public telling others about the breach. Kendall says Australia isn’t far behind, but there’s a particularly strong sense of personal security in New Zealand. The key point here is, if word gets out about poor data security, customers will walk.

As recently as a few years ago, data security was all about protecting local networks. Companies would put metaphorical locks on the doors where data and security risks entered the network and take measures to keep malware and snoops at bay on the inside. This mainly involved anti-virus and other anti-malware software, along with physical or software firewalls. Companies would also find safe and easy ways of backing up data from machines on the network. Now, thanks to the boom in digital devices such as

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smartphones and tablet computers, as well as the increased mobility which sees workers log-on from home or other remote locations, an ever larger share of critical data isn’t necessarily on the local network. Suddenly it’s much harder to build a moat around the digital fortress and pull up the drawbridge. Today’s comprehensive data security strategies have to account for a range of mobile devices and multiple entry points. It would almost be too hard to manage all this if it wasn’t for cloud-based security services. Instead of securing the physical point where data enters and leaves a network, cloud services located on a remote server sit between local networks or devices and the rest of the Internet. A properly configured and operated cloud security service will monitor all the traffic to all of your devices – a similar approach can handle remote backups. It’s not just about writing cheques. Dealing with devices and security risks is as much about putting policies in place as buying tools or services. At the very least, workers need to know their responsibilities, what’s expected and what the

Clearly it makes sense not to wait until it is too late before putting a data security plan in place. Here are five easy steps you can take to minimise the risk to your data. Part of this list is based on customer advice from security software specialist Symantec. Choose security software tools or managed services designed specifically for small companies rather than something designed for a corporation. Not only will it be significantly cheaper, you won’t need specialist skills to get results.

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implications of their actions could be. You may need to consider encrypting data on devices and using products that allow you to wipe data remotely if a gadget is stolen or lost. Experts also recommend something known as “two-factor authentication”. This is when you need to input both a password and a code that is generated to be typed in at the moment you are logging in. The second code is delivered via a separate device, it could be a text message on a smartphone or you may get it in an audio form as a voice call on a phone. It is extra safe because it means someone would need your computer, your password and your phone to steal data.

In the past companies would make on-site data backups, some would store additional copies of key files at a remote location in case of a site-wide disaster. Symantec. cloud’s Russell says this is exactly what happened last year when most of Brisbane was flooded. He says half of the city’s mail servers were underwater. This meant many

Keep up-to-date. Your software or service provider should take responsibility for making sure your protection deals with new threats. Your job is to stay informed about the changing nature of the data security risks you face. Educate employees. They need to know what the risks are and why you ask them to take precautions. Make sure they know their responsibilities. Take a big picture approach. No single data security product or service is foolproof, so it makes

companies were out of action for days – some lost all their historic data. However, he said workers for companies signed to Symantec’s email continuity.cloud service were able to log-on to Symantec’s remote servers via a web page and carry on using email as normal. He said they could connect from home or from iPhones, iPads and other mobile devices. While it’s worth pointing out that companies using web-based email services such as Gmail have the same continuity in a disaster, the important point is that decentralisation reduces the chance of catastrophic loss.

Cloud computing may be relatively new, but it has already changed the face of data security. There are

sense to take a ‘belts and braces’ approach. Any comprehensive data security plan should include as a minimum some form of local or on-site backup and at least one remote backup. Ideally you’d have data stored in two or three different places. Test your systems at least twice a year. Visit your backup files and attempt to restore some of the data – possibly to a spare computer. If you run into trouble, you know to get it fixed before disaster strikes.

DATA SECURITY

cloud services to protect your systems against risks and cloud storage services to manage backups and restoring systems. Christopher Russell says cloud services mean even the smallest company can adopt what he calls an “enterprise grade security posture”. “By signing with a cloud service on a per-user basis you can leverage off a partner with high levels of security and skilled staff on hand to manage it.” He says partners can now provide all the components of a data security system, and recommends small business operators find a trusted partner with an offering that supports mobile workers and teleworking as well as company networks. Russell says two other positives of cloud services are that the costs are predictable and are on a per-user basis – this means you know in advance how much it will cost. Symantec is a major security brand with a global reach. Andrew Johnson, managing director of Manage Direct in Sydney operates a business that wholesales cloud security services to small-scale valueadded resellers and computer support companies across Australia and New Zealand. He says his partners generally sell cloud security services to small businesses as part of a broader mix of managed services. In effect these arrangements see companies hire virtual CIOs (chief information officers) who then take responsibility to make sure systems work smoothly. Johnson says one overlooked point about a good data security service is that the end-users don’t see anything. “They won’t see junk mails or viruses if they’re using our mail filtering.” He says his company’s MPaware service sits in the background until you need to check or find something.

Unisyss Kendall says managed services are especially appropriate for smaller businesses. “If you’re running on a lean staff, you don’t have the resources to search through security logs.” He says security requires a number of specialist skills and it is unlikely small outfits will have the kind of expertise a managed service can offer.

What’s Next? June issue:

CRM Systems & Guide Some businesses can’t afford to stop even after a major disaster. For them there’s the data security ‘Full Monty’: comprehensive business continuity. Auckland-based Plan-b promises its customers they can be back up and running with little interruption and minimal loss after a crisis. When the Christchurch earthquake damaged the city centre in September 2010, Ryman Healthcare’s offices were inaccessible. A serious aftershock saw the company phone Plan-b and have its complete head office function replicated. “We didn’t miss one payroll to staff, we didn’t miss one payment to suppliers and we kept up-todate with everything,” recalls Ryman Healthcare CFO Gordon MacLeod. “We even managed to get our normal set of board papers out the door on time”. Lastly, as Symantec’s Russell points out, data security is like taking out an insurance policy. You hope you never need it and you may even have second thoughts when paying the bills, but a small annual fee is nothing compared with the cost of putting a business back together again. Bill Bennett is an Auckland-based freelance IT writer. Email bill@billbennett.co.nz

Behind every successful customer interaction there should be a highly supportive CRM system.

Franchising for Beginners Our annual look at business franchising, from both franchisee and franchisor perspectives.

The Bank and your Business A look at the evolving role of business bankers.

July issue:

Debt Factoring/ Invoice Financing Our annual look at the factoring – how it can both finance growth and smooth cashflow fluctuations.

The Mobile Office A look at the technologies that support today’s virtual offices and almost make ‘bricks and mortar’ obsolete.

Let’s talk Call Leanne Moss

09 477 0368

leanne@nzbusiness.co.nz

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SPEEDINTERVIEW

Cilla Hegarty is the CEO and founder of Christchurch-based NZ Tax Refunds. She fields 10 questions in 10 minutes and her time starts… now: SQ1: When did you first realise that you wanted a career in accountancy? CH: When I was at school I was fascinated by numbers. They always made sense. I didn’t get the chance to make more of this until my first child arrived when I in my late twenties. I have loved it ever since. Q2: Briefly how did NZ Tax Refunds come about? CH: The Inland Revenue Department removed the requirement to file a tax return for most people in the late 1990s. The idea was that it worked on swings and roundabouts and tax payments would, on average, even out. The reality was that in many cases things became a little out of kilter and there were a huge number of people missing out on having their overpaid tax paid back. The idea of providing a simple online service to help people find out if a tax refund was due grew from this. Q3: Do you think New Zealanders are more aware of their tax refund entitlements than they were when you first started the company? CH: More people are aware but still people are missing out on their overpaid tax. There is a time bar on applying for a New Zealand tax refund with Inland Revenue. Many people still miss this date and therefore forfeit their right to the money being refunded. Q4: What gives you the greatest satisfaction when it comes to running NZ Tax Refunds? CH: We make a difference to peoples’ lives. There are some amazing stories of how the tax refunds people have received have really helped them and their family.

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Q5: In terms of growing the company – have you gone as far as you can? What’s next on Cilla Hegarty’s business radar? CH: In New Zealand there is still a lot of potential for growing the company. Last year we achieved over 1400 percent growth and we expect our high growth to continue. So it’s really a matter of making sure we keep doing what we do well while looking at ways to improve. There are some very exciting times ahead for us. Q6: Why do you think your company has been so successful? CH: First and foremost our success has been down to passion and people. I am passionate about what we do and I have wonderful staff that are also very passionate about their work here. They are what make our company so amazing and are a privilege to work alongside.

We had purchased a new commercial building with settlement due in February 2011 which was partially damaged. After lengthy negotiations with insurers and the Christchurch City Council we expect to move from our very cramped offices into our wonderful new spacious offices in late June. This will be great not only for our staff but for Christchurch and in particular for Sydenham.

Q7: It seems that you keep yourself extremely busy between your personal and business lives – what’s the key to successfully balancing the two? CH: Balance – that is asked so often. I am not sure I get it right but I love the life I live. The people in it that I have met through work or my private life make it great. My family are also very supportive and this makes everything flow really well.

Q9: Who’s your go-to person for business advice and inspiration? CH: I’m very fortunate to have a fantastic group of top advisors and business people close at hand. Dr Helen Cross is our independent director and brings a wealth of knowledge and experience. We also have wonderful advisors in various fields including Andy Lark and Roger Hatrick-Smith. I have also been really fortunate to have had advice from Annah Stretton, Mai Chen, and Sir Gil Simpson, to name just a few.

Q8: How did the Christchurch earthquakes impact on you and the company? CH: We are fortunate that no staff or their families were hurt and all of their homes will be repaired. Our business continued through these trying times due to the resilience of our systems and our staff.

Q10: What is on top of your business wish-list right now? CH: As we continue to grow, I need to recruit new staff members who can replicate the wonderful work of our existing team. We’d also like to be able to move into our new offices on the corner of Brougham and Durham Street tomorrow!

Give your great little business the recognition it deserves!

Enter

The David Awards 2012 New Zealand’s small, micro and home businesses more than hold their own against the Goliaths in our Kiwi business landscape. Size for size, they punch well above their weight. It’s time they got recognized for it.

2011 David Awards Supreme Winner: Rob Howard and Joe Hesmondhalgh, Groutpro Entering the awards allowed us to look at our business from a different angle, celebrate our success and identify areas for improvement. We’ve come a long way from a suburban garage in Palmerston North... We still both work from home, enjoying the flexible lifestyle rewards; but also the challenges of running what is now a multi-million dollar business with pre-school aged kids sitting underneath the desks and playing in the offices. The Supreme award was a delightful addition to the Lifestyle and Transitional awards and we’re sure that we will receive incalculable benefits from receiving the award.

All entries are in to win $3000 worth of advertising on bizbuzz.co.nz and finalists receive a free 6-month subscription to NZBusiness magazine.

EntriEs

closE 27 July

2012

For details, to enter, or to nominate someone else, visit www.thedavidawards.co.nz

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The case for content marketing Colin Kennedy reports on the strategic shift to content marketing and how businesses are already benefiting from it. Red Bull may give you wings, but it’s the international corporate giant’s innovative use of content marketing, or brand journalism, that has launched the brand into the stratosphere of marketing success. Red Bull Media House prints one of the most widely-read magazines in the world with a distribution of 4.8 million; offers Red Bull Mobile services; operates a TV station and produces documentaries, movies, music, apps and even games for all devices. The strategy is called content marketing and their objective is simple: “To excite customers with outstanding quality content.” When Red Bull launched Media House in Europe in 2007, the content marketing wave was just beginning to build on the back of a global shift in the way buyers interact with companies – whether B2B or B2C.

Buyers in control The invention of the Internet, the introduction of Google and more recently the surge in social media apps, handed regular people the power to research their decisions, source good quality information instantly and control the terms of engagement. For example, Facebook gives

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people the ability to engage with multiple ‘friends’ on a regular basis, at their own convenience, for time periods of their own choosing. And now we’re applying the same rules to how we shop. The result is that most consumers now research their buying decisions beforehand. According to the 2011 New Zealand World Internet Project, 69 percent of respondents rated the Internet as an important source of information ahead of television, newspapers, radio and other people. The rise in buyer power has been facilitated and influenced by a number of trends in the last decade, but there are three that stand out. • Infobesity. Simply put, people are overwhelmed with the flow of information . Already by 2005, J. Walker Smith – president of consumer and marketing watcher Yankelovich – was telling USA Today that consumers were encountering from 3,500 to 5,000 marketing messages per day, vs. 500 to 2,000 in the 1970s. • Our faster pace of life. A recent study undertaken in 32 countries by a team led by British psychologist Professor Richard Wiseman, found that walking speeds have increased

by an average of ten percent in the past ten years. “This simple measurement provides a significant insight into the physical and social health of a city.” • Technology is changing the way we think. Calling it the ‘Age of the iBrain’, Scientific American reports “The current explosion of digital technology is not only changing the way we live and communicate but is also rapidly and profoundly altering our brains.” Ask most people when they last bothered to memorise a telephone number, and they won’t be able to tell you, because the need to memorise information is being made redundant by mobile technology. The result of this information overload, time poverty and the evolution of digital technology is that buyers don’t want to be hassled with interruptive marketing. They want speed and convenience and now they have the power to get what they want. The B2B Content Marketing: 2012 Benchmarks, Budgets & Trends report (published by the Content Marketing Institute and MarketingProfs) found that 41 percent of people engage with a sales rep only after initial research, and 24 percent only after they’ve have shortlisted their preferred vendors.

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The shift to content marketing The objective of content marketing is to apply what the media has always known, that people are open and receptive to stories that inform, educate and entertain. The rules of content marketing are to deliver information in a format that is helpful, rather than promotional; objective and interesting, rather than a one-sided sales pitch – via the buyer’s preferred media (print, video or games). While owning your own TV station may be a stretch, the opportunity in content marketing is that it can be carried out at

turns 50 this year and, amazingly, was largely an unknown to most Baptist churchgoers until recently. Business development manager Andrew L’Almont says Baptist Savings has increased its deposits by about ten percent in the last year through showing church attendees how they could better manage their finances. “We’re a charitable organisation, so huge budgets are not an option. What we did was revise our website and add a blog. We put some clever, very cool, low-cost apps on the site that help people calculate mortgage rates, repayment periods and interest on savings. “We also arranged for a regular common sense advice column in

The rules of content marketing are to deliver information in a format that is helpful, rather than promotional... low cost, and achieve far better penetration than most traditional marketing channels. The socialisation of media, even the growth in user-generated content, means that the quality of the content is more important than the production. People now think nothing of viewing video filmed on an iPhone, for example, so long as the information is engaging. Tools such as YouTube (video), MailChimp (electronic newsletters), blogs, Facebook, LinkedIn, Twitter, content directories, traditional print newsletters and press release distribution wires mean that anybody can become their own publisher. While it’s debateable whether social media is itself a brand strategy, there’s no doubt that social media portals are valuable tactical channels for the syndication of good content – done with discretion, of course. In New Zealand, the not-for-profit organisation Baptist Savings has successfully embraced the content marketing philosophy. Essentially an organisation that takes deposits from investors – to fund the building of Baptist churches and facilities like church day-care centres – the organisation

the Baptist magazine and I have a weekly slot on Christian radio station Rhema. “While acting as our own mini media house and speaking directly to our audience, I think it is important not to underestimate the power of traditional media to spread your message, so long as it is not self-serving. Traditional media is a valuable part of your content distribution strategy, but they won’t tolerate self-serving content, but neither will our customers. Look first to serve people, and the reward comes later,” he says. As part of their content strategy, Baptist Savings also produced its own video based on a biblical story called “The Talents”, puts out a regular printed newsletter and organises financial seminars. L’Almont’s point about content that adds value rather than being self serving is valid, even when an organisation is speaking directly to its audience rather than via a third party such as the media. Theodore Doucas of Zone Law and a consultant for Zone IP – an intellectual property management consultancy in Wellington – says the company has grown its profile and improved its positioning as an expert by producing educational, newsworthy content.

“We look for trends like the growth of Facebook and the issues that creates for things like protecting your IP. It’s the kind of article that is interesting and informative and it is well-received because we’re not trying to actively plug our services.” Another good example of SME content marketing is a company called The Caterers in Albany, Auckland, which recently wanted to create a video for its new website. MD Danny Wrigley says the first take was of him talking to camera. “I felt uncomfortable. It was just a bit boring, so I hired a journalist to do a proper interview with me on camera while we were preparing the food. The video tackles the unique challenges of catering an event, which everybody should be mindful of. It’s a bit like our own food channel,” says Wrigley, who is far happier with the result.

Content still king In all instances it’s clear that while a successful content marketing strategy relies on effective distribution (via social media, videos, blogs, newsletters and press releases), the content itself remains king. The media has long maintained that information should inform, educate or entertain. Now even the buying public is demanding that business do the same, if they want to be heard. For more information:

1. I nfobesity: http://www.usatoday. com/money/advertising/ adtrack/2005-06-19-cannes-box_x. htm 2. Pace of life:http://www.dailymail. co.uk/sciencetech/article-452046/ Pace-life-speeds-study-revealswalking-faster-ever.html 3. http://www.scientificamerican.com/ article.cfm?id=your-ibrain http://www.scientificamerican.com/ article.cfm?id=are-social-networksmessing

Colin Kennedy is a marketing consultant who specialises in content marketing. Email: colin.kennedy@ironroad.co.nz or visit www.ironroad.co.nz

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Business mentoring: a paradox paying dividends Business mentoring is alive and well in New Zealand. Peter Boyes has the evidence and a reminder that the service should never be taken for granted. Voluntary business mentoring is one of those paradoxical things that in some ways shouldn’t work. Why should successful New Zealand businesses donate their hard-earned cash and resources to an organisation dedicated to helping new up-and-coming companies find their feet? Why should talented, experienced business people give freely of their time and knowledge to nurture the next generation of entrepreneurs? Given our inclination to turn our noses up at a free offer, why should a proud SME owner log on and ask someone they’ve never met for help? Yet since 1991 Business Mentors New Zealand (BMNZ), operating as a not-for-profit charitable trust, has been providing volunteer SME mentoring, and it has seen an explosion of demand for its services. “Although we introduced a

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charge of $100 for registration to help defray our local administration costs, the number of companies seeking help has continued to climb,” reports BMNZ chief executive Ray Schofield. “BMNZ is a voluntary private sector initiative run by New Zealand businesspeople for New Zealand businesspeople. It works because we provide pragmatic assistance to the SME sector and although we do get some government aid we could not do what we do without support from the private sector.” Companies like Lock Finance, which has just signed on as a National Patron of Business Mentors, see support for mentoring as an integral part of their vision for the economic development of New Zealand. Lock Finance CEO Simon Thompson, who is a part time consultant to the World Bank,

explains, “The country’s common future after this recession lies with nurturing our small and medium business sector. It’s never been more important to provide small and medium enterprises (SMEs) with support so that they can weather this period of uncertainty and be fit to take advantage of the upturn. “Lock Finance is a 100 percent New Zealand-owned finance company, providing financial services to small and mediumsized businesses throughout New Zealand. Our aim is to help them optimise their business growth by providing a range of fully-integrated funding options including working capital, trade finance, debtor finance and factoring. It’s a great fit with Business Mentors New Zealand and at Lock Finance we do believe that by

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supporting the principles of business mentoring, we are investing in our own business opportunities as well as being good corporate citizens. After all, healthy businesses generate business.”

Variety the key Business mentors come from every corner of commercial life and it’s that very variety that makes their contribution of advice, recommendation and know-how so valuable for small business owners. Stephanie Hunt specialises in providing expertise on information technology and it is an area that she has spent a business lifetime accumulating. Born in Christchurch but brought up in Invercargill, after her education she went into banking and left the South Island for Wellington where she worked for the National Bank for 11 years. “I was part of that first generation who had done computing at school where we had one of the first ever programming courses and I’d learned BASIC,” she explains. “I was a very early adopter and very excited about it but nothing much came of that professionally until I had been at the bank for about five or six years. A new computer system was introduced and for me it just clicked. Because I loved computers I was seconded by the HR department to go around all

and her husband decided to return to Invercargill. Slowly the business, now called Market Elements, grew through word of mouth. Stephanie focused on small businesses, which meant that she ended up as a Jillof-all-trades. “I ended up doing everything from organising emails to showing how to set up and use an iPhone because they saw me as a go-to person for a wide range of ‘tech’ things. They like having someone local who they can trust and meet with and a lot of specialist technical support is a long way from here.” Market Elements offers the full service spectrum for small business on a pay-as-you-use basis. There is a panel of part-time contractors for website development, a partner handles traditional marketing support and Stephanie concentrates on the technology, investing heavily on keeping up with what is happening online. Five years ago Stephanie got in touch with Venture Southland, the Business Mentors New Zealand regional agent and offered to organise some seminars on the web and they suggested she became a mentor. “I agreed but I only mentor in the area of online marketing,” she says. “I have worked with half a dozen clients so far; often after they have seen other mentors for help with

There are great benefits in seeing how other businesses do things and within the mentoring community there are huge reservoirs of experience to draw on. the branches and handle all the training. It was a great opportunity for training and up-skilling. After six months I was offered a permanent position and that was how I got into accelerated learning training in computers.” At this time Stephanie began to specialise in instructional design, writing the help protocols for online instruction as well as training in a wide variety of settings including one job with the Department of Corrections, which was installing a new system. Then after 15 years away Stephanie

other areas such as accounts or new product development or whatever and then come to me for the tech solutions. Often I end up looking at a system or a process and working out how it might be done better. I’ve got three active clients at present. “It is a fantastic experience,” says Stephanie. “I like helping people. I like meeting people but you learn as much as you teach. There are great benefits in seeing how other businesses do things and within the mentoring community there are huge reservoirs of

experience to draw on. And, yes, every time I take on a new client I do get a bit worried whether I am experienced enough – until I get into it and remember just how much I do know and have to offer.”

Mentor a priority One of the first things Ailsa McGavin and Beccy Lane did when they went into business was get themselves a business mentor. Winning awards is now something of an entrenched habit for Key Skills, the specialist recruitment consultancy for Wellington’s industrial sector. The year Key Skills was founded by Ailsa and Beccy in 2007 it was a finalist in the Hutt Valley Chamber of Commerce Business Awards for Best Small Business. In 2010 it was among the finalists in the Her Business Wellington Businesswoman of the Year awards for Best Micro Business. Last year it was named New Zealand’s 12th fastest growing company by Deloittes Fast 50. In 2010 they were joined by Josh Galuszka and Ati Aaifou-Olive and the business has gone from strength to strength. All the Key Skills consultants have extensive experience in the recruitment business both within New Zealand and overseas and the team are known for their passion, expertise, customer service and humour. “We’ve always been top performers wherever we went,” says Ailsa. “I have worked in recruitment for 12 years specialising in construction, engineering and manufacturing and migrated from Scotland a few years ago. We set up the business in 2007 because we wanted to work in a more caring way. There is not a lot of care about customer service in our industry. I didn’t like that and wanted to work in a way where we could treat people well. “We had no experience of running a business,” Ailsa explains. “I thought very quickly that we would need a mentor. The big plus for us setting up was that the mentoring is free, thanks to the support of private businesses and NZTE.

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“We had the usual issues such as managing cashflow and organising premises. But it is help in changing the mindset of employees to employers, and that pat on the back from someone whose opinion matters, which is so important. We got Chris Elphick as our mentor and hit it off straight away. It was great because he was used to dealing with strong women. He’d worked in Scotland and the UK and understood our background. “Beccy and I are very close but very different and don’t always agree. Chris has been very good at helping us learn how to compromise. He gives us challenging questions and sets big heavy audacious goals, which we put down on paper. He helped make us accountable and kept an eye on our backs. “We met on neutral ground every couple of months and we were really grateful for the flexibility. That quiet time away from the office is so

valuable. In some ways it’s like having a teacher and a dad. Chris worked with us for quite a long time and although we’re still in touch our mentoring meetings have now stopped. Chris brought such a wealth of experience and he has seen people go through what we were going through. He was also great for reminding us how well we were doing. He gave us perspective about what we had achieved. We’ve come a long way for two wee girls.”

Your support needed BMNZ focuses on the development of capability, profitability and employment generation through its 1700 volunteer mentors who provide their experience, skill and knowledge free of charge. Much of the funding is provided by private sector sponsors, such as Lock Finance, who believe in contributing to the greater community through the improved generation of wealth and employment.

Since 1991 BMNZ has assisted well over 57,000 businesses. According to Ray Schofield the surge in demand for mentoring and the Charities Commission decision to remove charitable status from Business Mentors’ operating arm means greater pressure on the organisation’s resources. “This is why we are looking to our colleagues in the business community to further support our work. For those who cannot stretch to full patronage, a modest $1,000 donation helps five more New Zealand SMEs have access to advice and counselling to enable them to work through those difficult early times.”

Peter Boyes is a volunteer business mentor with Business Mentors New Zealand and a PR and marketing communications specialist. For more information go to www.businessmentor.org.nz

knowledge

experience

community

Make Business Mentors experience your success People in small businesses often feel very isolated. The Business Mentoring programme provides an empathetic person to listen to the challenges and difficulties small businesses can face. Sometimes this alone is all that is needed to identify strategies and opportunities for growth.

Visit www.businessmentors.org.nz or call 0800 209 209 A fully funded service of Business In The Community

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The DIY website audit Rachel Reynolds offers eight steps for keeping your website performing. We’ve all seen those tired storefronts with peeling paint, faded signs and frayed, sagging awnings. Don’t be guilty of this online – even though a website’s paint can’t peel and the awning can’t sag, you should still engage in a regular DIY website audit to ensure your store-front is kept at its best for window shoppers. There are, of course, many things you could cover in a website audit – from search engine performance to content to navigation and branding. But if you have limited experience in this area, you can conduct a basic audit to ensure its kept fresh and relevant without employing an external consultant. Here are eight things to check: 1. Keep content fresh and relevant. It’s not for nothing that marketers say ‘content is king’. Give your readers something useful or they’ll go elsewhere. Ensure it’s updated on a regular basis. Nothing’s more off-putting than a site that says it was last updated in 2006. What’s more, search engines love sites that are updated regularly and reward them with higher search results. 2. Make sure your site looks attractive. Choose a complementary colour scheme, and keep it simple. Don’t underestimate the power of white space. Remember, people are reading this online, not on a piece of paper. A glaring computer screen isn’t conducive to in-depth reading, with lots of ‘stuff’ competing for attention. If anything, it puts people off. It’s a perception that poor design indicates a less reputable company. 3. Proof-read! Make sure your site is free from all grammatical and spelling errors. And don’t just rely on Microsoft Word spellchecker or similar – they’re not always accurate. Either ask for a favour from a word-savvy friend, or pay a copywriter or proof-reader to check it for you.

4. Test the online enquiry form. I’ve lost count of the number of enquiries I’ve sent to companies through their websites that never get back to me. If they can’t be bothered to reply, I’m not going to be bothered to chase them up. Never underestimate the power of being timely and responsive in your communication with customers. 5. Check the navigation. Is it easy to navigate through the pages? Is there a logical flow to the site’s structure and can you easily find your back to where you came from? Breadcrumbs (the line of page names you’ve visited, displayed at the top left of a page) are a great way of doing this, and help with search engine optimisation. If it’s hard to see the wood from the trees, ask someone with little knowledge of your website to complete certain tasks. Watch them as they do it – you’d be surprised where people look for information or where they navigate while online. What’s intuitive to you may not be for others. 6. Check the links. Ensure there are no broken links by clicking on

all of them. Often, if you’ve linked to an external site, things may have changed and it’s a bad look, not to mention plain annoying, when they don’t work. And make sure they open in a new window – so the user can easily find their way back to you should they want to. 7. Watch your load times. Don’t have dense graphics or animations that slow down page load times, and perhaps cause users to exit before they get to your content. Think carefully about using Flash animations, as these don’t work on Apple products. 8. Is there a clear call to action? A good website should make it very clear what it wants users to do, and make it easy for them to do it. Know what the point of your website is – is it generating sales, building your database through newsletter signups, creating an online profile or generating leads? Be clear on what you want your user to do: “If you do this, we’ll do that.” Can you offer a free consultation by phone? A free DVD? A slideshow? Make sure that there is only one choice. It’s easier to list every choice, but keep it simple – you can’t be everything to everybody. Remember, a website is one of the public faces of your company. Review your website regularly because even though you might not notice the awning beginning to sag, that shop front is making a first impression on potential customers every day.

Article by Rachel Reynolds, marketing and communications specialist. Follow her on Twitter at @RachelReynoldsW or email rachel@crainstorm.com

NZB May 2012 nzbusiness.co.nz

When staff don’t

measure up

Non-performance issues with employees often end up on the back burner. HR support specialist Angeline Long offers some guidelines on how to deal with them. Non-performance is a minefield for most employers. Generally speaking, managers are there to oversee the day-to-day running of the business and ensure ongoing profitability. Everything goes well until people stop performing. There are varying ways that individuals can be classed as not

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performing – such as absenteeism, attitude problems, inappropriate use of the Internet, and many more. Often these issues are allowed to continue far too long and, for a variety of reasons, go from bad to worse. The two main reasons are: management are too close to their staff to be tough enough to deal with the situation when it

arises, or, they don’t have strict guidelines for managing staff performance. If these guidelines are not in place then the employee doesn’t know what is expected of them and management do not have a yardstick by which to measure their staff. In one recent case I know of, the management team met

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with an employee over a series of months, scheduling regular meetings to talk through his/her performance or lack thereof. Both parties left the meeting with the best of intentions for change and

have been completed so that the individual’s performance can be assessed appropriately. The KPIs can also be used in catch-up meetings between management and staff, so staff

Performance-related problems can be avoided provided companies ensure that staff are fully aware when they join an organisation what their role involves. yet nothing happened. At this point the company sought professional assistance as they were nervous at the prospect of having to deal with the disciplinary process and a possible personal grievance. It was clear from the outset that management had been too soft in their approach – they didn’t have measurable key performance indicators (KPIs) to measure performance and they had allowed the situation to go on for too long.

Key performance indicators Performance-related problems can be avoided provided companies ensure that staff are fully aware when they join an organisation what their role involves – having been provided with an employment agreement and detailed job description. Once this has been agreed by both parties, management then develops measurable KPIs detailing goals, objectives and timelines. The KPIs should ideally be developed in consultation with staff to ensure they are also meeting their personal goals and objectives. These KPIs are designed so employees know what the company’s expectations are and assist employees in monitoring their personal development goals to ensure they increase their ability to contribute to the success of the organisation. Key performance indicators should be limited to five or six specific tasks that the employee is expected to achieve for each quarter. They can be reviewed quarterly and changed dependent on the company requirement. Any training that has been identified needs to

can address any shortfall prior to their annual appraisal. This will also prevent issues from escalating to a disciplinary stage. One question that must be asked is: is it merely a lack of skills that is preventing the employee from completing his or her tasks or is it a case of disengagement with the organisation? The ideal outcome when dealing with a disciplinary issue is identifying what can be done to improve the person’s performance. It may mean additional training, support or counselling, dependent on the issue. When management leave these issues to escalate they can experience feelings of anger, resentment, pressure and guilt and then just want the person to leave. Sure, there is the option to pay the employee out, but what impression does this leave on the company and the employees left behind? There is a legal process that needs to be followed when addressing a staff member’s performance and it needs to be completed in a procedurally fair manner. Yes, there is the threemonth trial period in which to determine an employee’s suitability for a role – but legally even over this period the person’s performance should be reviewed and managed appropriately and any shortfall documented and discussed. We worked with an organisation where the general manager had been trying to manage a staff member’s performance over a period of months. They were very busy and travelled extensively and therefore the issues were continually placed on the back burner. The general manager was skilled in some areas of this role

and quite often would complete or redraft information just so the work was completed by the required timeframe. This eventually became untenable. The disciplinary process had to be considered. The initial couple of meetings were held with the employee and his lawyer as a support person. We advised the employer that we had developed an Individual Performance Management Plan for this employee. We would meet with the employer and the employee each week to assess how they were going in achieving the required objectives and determine what assistance they required. After six weeks the employee conceded that he was not cut out for the role and lacked the skills required to meet the organisational objectives. This could have been addressed earlier with a more structured approach to the performance process.

Minimising nonperformance So how do employers minimise non-performance? The employers we work with that have a high staff retention rate generally have a stringent, robust recruitment and selection process. They screen new employees very carefully to ensure they have mutual agreement of the company values and have the skills and competencies to perform in their respective roles. They are also provided with a well thought-out induction programme. If employers take the time at the beginning of the recruitment process to ensure they attract, screen and induct their employees appropriately then they will reap the rewards long term.

Angeline Long is Managing Director of HR Executive Solutions. Ph 09 215 9590 or visit www.hrexec.co.nz

NZB May 2012 nzbusiness.co.nz

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Becoming social media savvy Eva-Maria explains the business case for utilising Facebook and Twitter. Time and time again, business courses, workshops, the media and people everywhere are going on about using social media for business. People are pretty much sold on the benefits of the sites but are still unsure on a number of facets – such as: What is my ROI? What will I get out of it? How do I know this is beneficial for my business? Put simply, social media is merely another platform for your brand to be seen by the public. Just like newspaper and TV advertising, social media is a place for promoting what you do, and letting people know of the benefits you can bring to them. Social media also doubles as a networking tool. Think about how much time you currently spend talking on the phone, answering emails, networking at events, and any other methods you use to socialise and network for your personal and business advantage. To really make social media work for you, invest the same amount of time you currently spend networking, but do it through social networks. Social media provides the opportunity to combine marketing strategies with networking. The nature of social networking helps you network, and when coupled with basic marketing principles, it succeeds in taking your company message to your demographics. And there’s the opportunity of your message, brand, product or service going viral through your target market, creating a buzz around YOU. The way to market on social media is to spend time there. Unlike setting up a billboard and have it bring value to each person who sees it, you need to deliver that value with individual comments, joining in with discussions, being forward enough to introduce yourself to potential clients, and

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sharing links to articles, products and services you recommend. Here are the benefits of using social networking sites like Twitter and Facebook:

current events or news within your industry. This can also be a great opportunity to tie in popular current events with the relevance of your work.

1. Engages with your target market in a more personal way.

5. Raises brand awareness.

With the power of social media, it’s all about the amount and quality of content you produce and share with your target audience. The relevance of your material to your audience and the value you produce can position you as an expert in your field. The amount of content you produce also ensures your audience never forgets you. As we all know, we all have our own lives and people aren’t sitting at their computer waiting for your next update. So make sure you catch them when they do log onto their social networks. Repetition and the amount of time you keep putting yourself out there is the key to having a valuable engagement with your target market.

2. Gets straight feedback. Sure, it may sometimes be from the general public, but it’s valuable information about how others perceive your services and benefits of doing business with you.

Through your involvement in social media you not only connect and engage your target audience, but by doing so, you also raise the awareness of your brand. Of course, we can’t all be McDonald’s with the golden arches, but, as I said earlier, you can certainly try to become a recognised ‘industry expert’ through the value of your content you share with your online audience. Make sure you include your website link, business logo, and anything else that will associate your brand with your name online. You can also take it one step further and make a ‘welcome page’ on Facebook to encourage people to sign up to your database in order to communicate with them outside Facebook. Or how about creating a Facebook contest or game app that your target market can join in with or play? They’ll tell other friends about it – in turn, advertising YOUR business to THEIR friends. Now that’s viral marketing at its best.

3. Instantly reaches out to potential clients. The beauty of the Internet is that news, advice and events can be uploaded and circulated instantly. As soon as you have any new press releases or content to share, upload it! The Internet has the power to update the world about events as they happen.

4. Gets the inside scoop about your industry. Social media is public, and that can be a good thing. This means you can learn valuable information about your competitors, and any

Eva-Maria is a 21 year old family coach, international speaker, social media consultant and author of the bestselling parenting book ‘You Shut Up!’. You’ll find her at www.socialemedia.co.nz

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Time to be convincing Cameron Gordon has an important message on USPs for food and beverage exporters targeting Southeast Asia and Taiwan. With the current economic volatility of the European economies and

relationship. One question I am often asked by

suppliers educate their trade partners about what makes their product

ongoing consumer confidence and

Asian importers is, “Why is everything

unique, because without this buyers

spending in the US still below average,

from New Zealand ‘premium’?” To me,

will be comparing an award-winning

it should not come as a surprise that

the fact that buyers think everything

Marlborough sauvignon blanc to an

companies with export ambitions have

marked ‘Made in NZ’ is premium isn’t

entry-level white from Chile, a Bluff

their targets firmly set on Asia.

the concern, the real worry is why

oyster to a South Korean oyster and

these buyers are not aware of what

UMF honey to less expensive Thai

Asia are, of course, aware of the state

makes our products among the best in

honey-blend products (what does UMF

of the global financial landscape

the world.

mean to an Indonesian importer?).

Importers and exporters throughout

outside of the region. However,

Movies like The Lord of the Rings

We cannot assume that Asian

in meetings I have with food and

and visually stunning Tourism New

buyers understand why our products

beverage importers in Southeast Asia

Zealand campaigns have done

command an ultra-premium price.

and Taiwan, the effects are nothing

wonders for our reputation as a

but positive and I often hear stories

pristinely beautiful country. This

go back to when they do not fully

of how the low US dollar and Euro is

powerful imagery has translated nicely

understand a product’s USP is price

supporting year-on-year growth.

in the positive images that consumers

and as New Zealand products are

and potential importers of New

often more expensive than those of our

in the international supplier-buyer

Zealand products have of food and

international competitors, this gauge

relationship and this is how it will be for

beverage products from our country.

may not work in our favour. From the

For now, Asian buyers hold the cards

the foreseeable future.

The challenge is that, unlike in New

The automatic gauge that buyers

outset, New Zealand exporters need to

Zealand where consumers like to buy

convince buyers that our higher prices

up to get in front of major buyers

boutique food and beverage brands,

are justified.

throughout Asia to pitch their products

generally the opposite is true in Asia –

because they realise that it’s in these

where the safest option is one that has

specific credibility indicators should

markets that consumer demand for

been seen on TV or is recommended

not be overlooked. For example, in

premium international products is

by a local celebrity.

the Taiwanese wine market, one of

International suppliers are lining

quickly growing. Further, many of

While New Zealand food and

Finally, the power of country-

the most helpful credibility indicators

these markets are not yet mature

beverage suppliers need to be

is a Robert Parker rating. Taiwanese

or saturated, but open to those

cognisant of the major drivers that

consumers look for Robert Parker

that invest the time and energy in

Asian buyers often look for, including

ratings in the same way that we look

firstly understanding, and secondly

internationally competitive pricing,

for Cuisine recommendations at home

committing to growing their brand.

shelf/chilled/freezer stability and

and Taiwanese importers often apply

support (in some cases financial) in

big gold stickers to their wines to make

they would welcome the opportunity

growing the brand, there are buyers on

it easier for the consumer to pick a

to do more business with New Zealand

the lookout for products with a USP.

winning drop. Credibility indicators

Buyers I talk to often comment that

like this may seem unnecessary to our

exporters, but they are not getting the

For example, in the wine industry

face time with them – which is crucial

currently the Chileans, Argentinians

modest sentiment, but they can make it

to developing the relationships from

and Italians are investing heavily in

much easier to penetrate a new market.

which business grows. Although we

growing their brands in Asian markets,

live in a global village, the reality is

to the point where importers that

your export business and your

that buyers do not want to have an

partner with suppliers from these

product has won acclaim, cast aside

‘e-relationship’ with suppliers. Rather,

countries receive regular, all expenses

the tall poppy syndrome and be proud

they want to meet with company

paid trips to acquaint themselves

to tell potential partners about your

representatives in their offices on a

with these wine industries. While we

successes.

regular basis, especially if it’s a new

may not be able to compete with the

If you are serious about growing

macro-level cash injections that some of our competitors are taking advantage of, what Kiwis have always been good at doing is storytelling at the micro level. It’s crucial that New Zealand

Cameron Gordon is Asia Market Manager at Incite, an international trade services firm that connects New Zealand food and beverage suppliers with partners in South East Asia and Taiwan. www.exportincite.com

NZB May 2012 nzbusiness.co.nz

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Working together for the cause A series on social responsibility. This month Jacquelyn Collins shows how to work with a not-for-profit partner. You’ve chosen your charity partner; now it’s time to support them. Start with fundraising. Get your staff involved and brainstorm interesting ideas for events and challenges. One-off events are great, but ongoing fundraising activities may be equally effective – set targets to stay motivated. Ask your charity partner for banners, branding and information to use in your workplace, to publicise your fundraising. To make an even bigger impact, announce a financial contribution from the business. This both demonstrates your commitment and incentivises staff and customers to donate. Craft shop Crafty Knitwits, in Milford on Auckland’s North Shore, was only three months old when it held its first 48-hour knitathon for the Child Cancer Foundation. More than 200 people took part; knitting with wool donated by a supplier that supports the same charity. Other Milford businesses and the local business association also helped with the event. At the end of the weekend 13 knitted blankets were auctioned for the charity, raising $3,500. Co-owners Linda Geor and Kerry Bowles know that the knitathon raised their profile and established Crafty Knitwits as a crafting base on the North Shore – they now see many customers

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travelling from outside Milford to visit their shop. Consider your core business: can your expertise help the charity? If you work with business clients, you’ll almost certainly have skills that a charity could also use. When you provide help, take a minute to jot down the details of what you did, and roughly how much your time was worth – information that you can use to publicise the relationship. Pro bono work gives people a chance to use their skills in a different way, keeping them sharp and helping them to learn. You don’t have to do this every week – you can respond to your charity partner’s ad-hoc needs. Wellington-based web design company Insight donates its time to several charities, helping them to maximise their online presence and connect with their stakeholders. Strategic development director Steven Giannoulis says that their pro bono clients allow them to be truly creative and try options that might be too innovative for commercial clients. The 23-person Insight team love the way that pro bono clients give them autonomy and aren’t scared of new ideas. Insight may occasionally pass on some basic project costs to its charity partners, but staff time is always given free of charge. What general skills can your staff contribute? For example, three hours of your unflappable office manager’s time each month could help your charity partner to work more effectively. Few charities can afford more than one or two employees, so your staff’s business skills are invaluable. By encouraging your office manager to volunteer you’ll show them that you value their skills – and people who feel valued tend to work harder and do a better job. Your charity partner might have

its own volunteering programme: can you give your team a couple of hours off work occasionally, to take part? Doing this will connect your employees with their community. Keep track of staff volunteering hours for evaluation and publicity purposes. Could your charity partner make occasional use of your equipment or premises? If it can hold its AGM in your meeting room or use your photocopier to produce newsletters you’ll help it to run smoothly. Charities that lack basic office equipment may also appreciate your hand-me-downs if you’re upgrading. Publicise your activities by finding an interesting ‘hook’ for local media. Milestones like raising a certain amount of money or logging a significant number of volunteering hours can provide this – or the initiative itself can be unusual or unexpected. Work with your charity partner to tell the full story: how and why you contributed (the ‘input’), what happened (the ‘output’), and what this means for the charity (the ‘outcome’). Take opportunities to describe how your business made a difference. Share news of your charity achievements with employees and customers by displaying it in the workplace, and include it in your company newsletter and on your website. Don’t exaggerate your business’s contribution, but don’t be embarrassed to promote your charitable activities. Next month we’ll talk specifically about working with local schools: the benefits and success strategies.

Jacquelyn Collins is setting up a charity and writing about sustainability issues. Learn more at http://jacqcollins.wordpress.com.

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Shedding light on trademarks Angela Searle dispels some of the urban myths surrounding trademarks. Your trademark is potentially one of your most valuable business assets. The ability to use it, unimpeded, is something many of us take for granted. Yet, if you have not registered your trademark – your brand name – then you leave yourself wide open for someone else to swipe it from underneath you. For close on 20 years, trademark attorney, Angela Searle of North Canterbury-based Trademark Intelligence has been working with both SMEs and large global corporations, helping them to protect their integrity, pride, reputation and character by protecting their good name. Here she addresses some of the myths and misconceptions existing around trademarks. Q1: I’ve heard that you get rights to a trademark through use – so why should I go to the effort of registering a trademark? “Yes, you do get rights to a trademark through use, if you can demonstrate that you have built a reputation under that name or mark. The question is – what is a reputation? How far does it extend? And how can you prove it? It’s a subjective argument and one that will cost you a huge amount of money to fight if someone else comes in and uses or registers a mark that’s the same or similar. For example, you could be a long-established Christchurch company servicing the local community. A Dunedin company could start to use or register the same trademark, as your reputation probably is not strong in other parts of the South Island. But if you have registered your name then you have a certificate proving your nationwide

exclusivity to that mark.” Q2: Does a trademark registration allow me to stop someone using a similar trademark – or just the identical mark? “The answer is based around whether a consumer would be deceived or confused by the same/ similar mark. Similarity comes in two guises. In simple terms, the first is around the marks’ visual, phonetic and conceptual similarity; the other, around the goods or services to which the marks are applied. If another trader used a phonetically similar mark, then you’d probably be able to stop them. If you had registered a mark for tennis rackets, you would be able to stop someone using the same name on tennis balls. On the other hand, if a coffee shop tried to register that same name – they possibly could, as there is no way the consumer will think that they are related. This is when the advice and assistance of a professional trademark attorney can save you thousands of dollars and lots of stress.” Q3: I own a successful bakery in a small community. I’m the only one in town and I trade under the name ‘The Bakery’. Can I trademark that name? Every trademark must distinguish a service or product from those provided by other traders. The word ‘bakery’ is a descriptive and generic term, so you cannot register it and prevent others using it. You also cannot register as a trademark a geographical location, common surnames or superlatives (such as beautiful, best or greatest). For example, you could not register Whangarei Bakery, Smiths’ Bakery or The Freshest Bakery. To uniquely distinguish your product or service from others, invented words can be used or standard words that have no relationship to the goods/services.

So in the example of the bakery, by adding an invented word into the title – let’s say Breagal Bakery, or ordinary words such as Blue Skies Bakery – you would then have a distinctive mark to register. Alternatively, you could include a distinctive graphic logo to accompany the mark. Q4: I can register a trademark myself – why would I use a lawyer? Do you file your own tax returns? Would you write your own will? Registering a mark is the same. Yes you can do it, but it’s a case of you don’t know what you don’t know. If you get it wrong, you might not know until someone challenges you or tries to steal your mark out from under you… they might even succeed! Many self-filers also go wrong by defining their goods/ services too narrowly, therefore not allowing them scope to expand the breadth of their goods or services provided under their existing mark – or by filing an application to register a logo, whereas they would obtain much stronger protection if just the word mark was registered. An attorney will also have more success at overturning any objections raised during the registration process – objections are commonplace. It can cost less than $1000 to use an attorney. If things go wrong then you will spend well over $1000 just thinking about what to do next. Registering your mark is like insurance – it protects your good name. The name you have worked hard to establish. A professional puts you in the strongest possible position, now and into the future.

To contact Angela Searle at Trade Mark Intelligence. email: angela@tmintelligence.co.nz phone: 03 312 0934

NZB May 2012 nzbusiness.co.nz

BIZTECH

A plain English guide to online marketing What every business owner should know about marketing online. By Haden de Boer. Forget the jargon. What can the Internet really do for your business? Most entrepreneurs simply don’t have enough hours in the day to become experts in online marketing on top of everything else they need to do to run their business. The situation is made worse by the sea of information available (some good, some bad, some downright dangerous). To help, I’ve created the following short, plain English guide. A guide I hope will give you a clear, nononsense, basic understanding of the options available and the pitfalls to avoid.

What is search engine marketing? If someone says they’re into SEM, what they really mean is that they are using search engines to get customers. And by search engines, I really mean Google, which controls 66 percent of all searches performed online (the only other

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significant player is the Bing/Yahoo combination). SEM includes two different approaches: Search engine optimisation (SEO) and paid advertising. But first:

Why should you be interested in search marketing? When someone searches online, they are actively involved in looking for something. That something might be information for a school project, or they might be searching for news. But a number of people who turn to search engines are looking to buy. In fact, search has largely replaced the role of the Yellow Pages, especially for people under 30 years old. With estimated total searches per year of 1.679 trillion, you do the maths. The beauty of search engine marketing is that it lets you reach potential customers at the exact

moment they are looking for what you have to offer. This eliminates the ‘waste circulation’ which you get with newspapers or TV.

What are keywords? Keywords are the phrases people type when searching. For example: ‘Lawnmowers’ is a keyword. But the phrase ‘Best lawnmowers in Wellington’ is also counted as one keyword. Keywords are the most important part of any search marketing effort. Finding the right ones (the ones that identify those people most likely to buy from you) is essential.

What is pay-per-click marketing? Pay-per-click (PPC) is much like the name suggests. Instead of paying a lump sum to run an ad, you pay anywhere from 15 cents to $5 or more (depending on the competition) for every person who clicks. In search engines it is run with

an auction-type system where you bid on the keywords that you want your ads to appear with. If successful, your ad appears beside (and sometimes above) the search results when someone searches using that keyword. Pay-per-click is the fastest and best way to test out keywords – to find the ones most valuable to your business. The problem with PPC is that many people have been conditioned to ignore them. That, and most people don’t trust ‘sponsored’ results as much as organic results. So to really get the lion’s share of the traffic you must get your site listed at the top of those ‘natural’ results. This is where SEO comes in.

What is search engine optimisation? Search results are divided into two types. The top few (and those down the right hand side of the screen) are ‘sponsored’. The rest are the organic or ‘natural’ results. The goal

Plus, if you don’t already know the value of a keyword, you risk wasting valuable time, effort, and resources by chasing terms that aren’t worth it. This brings up an important point. SEO traffic is not ‘free’. Although you don’t pay for clicks as per PPC, there are costs involved. First, you have to spend time or money creating content for your site. You also have to spend time, effort, and sometimes money, to build links. Most business owners simply don’t have the time to do proper SEO personally – which means training someone to do it for you, or hiring a consultant. There’re two important things to consider if you choose to hire. First, no one can guarantee you will get number one rankings for a particular keyword phrase. If they do, it’s an immediate red flag. Second, because of potential wasted time and money if you choose the wrong keywords, any good SEO consultant should recommend testing with PPC ads first

At the end of the day, if what you are doing online isn’t adding to the bottom line, you’re burning money. of good SEO is to get more targeted prospects to your website by getting your site to feature as high in the organic results as possible for your keywords.

How SEO works Whole books could be written (and have been) on SEO practice, so I won’t bog you down with technical details here. Put simply, SEO is about having relevant, useful content on your site. It’s about making sure that content is displayed the right way so search engines know what it is. And it’s about getting as many other websites to link to your content as you can. The big problem is that SEO takes time – depending on how much competition there is for a keyword, it can take anywhere from several months to a year or more to see results.

before committing to a keyword with a full-scale campaign. Keep in mind that your goal is not to get number one rankings for every keyword. It is to get more qualified visitors to your site. A good SEO consultant should be able to help you find the keywords that help you do this.

What about Facebook? Almost every business seems to have a Facebook page. Should you have one too? There are a couple of very good reasons why you should. First, Facebook gives you a stable, ready-built forum to interact with customers and answer their questions. Lots of people check Facebook from their phones, and often find it a convenient way to get in touch. Second, and perhaps the best

thing about Facebook, there is the advertising opportunity. Unlike search engines where you bid on keywords, with Facebook advertising, you select your audience based on demographic information and their likes, dislikes, groups they’re interested in, and so on. Depending on your business, this might be more effective than advertising based on search terms.

What about email? Email remains the most widely used Internet application. According to a study from 2002 to 2011, 92 percent of all Internet users send and receive emails. Social networking sites, on the other hand, are still only used by around 65 percent of Internet users. The key with email is not letting all the hard work you’ve done getting a visitor go to waste. Once they’re there, give them a reason to leave their email address. Then follow up with them. Let them get to know you. When they are ready there’s a good chance you will be the one that gets their business.

Don’t believe the hype It’s true that the Internet has created new opportunities for business. But it hasn’t changed the core of what business is all about – selling what you have to as many people as possible. At the end of the day, if what you are doing online isn’t adding to the bottom line, you’re burning money. Subject your online efforts to the same standards as any other form of advertising. If it is not bringing you more business than it is costing you, then it’s not something you should be doing.

Haden de Boer is with Doubledot Media – a Christchurch-based Internet technology developer with several tools for aspiring Internet business people, including the widely acclaimed Traffic Travis, available free at www.traffictravis.com

NZB May 2012 nzbusiness.co.nz

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Consumer IT drives ‘bottom up’ change Employee devices are raising a whole new crop of considerations for employers – but they need not be scary. Phill Patton explains why. With the growing trend of employees bringing their own devices to work and accessing cloud services to get their jobs done more conveniently, it is no longer feasible to dismiss or say ‘no’ to consumer technology in the workplace. With these devices and cloud services come applications, demands for greater access to information and requests to incorporate devices and outside services into personal workflows. As inexorable as this development is, it is not necessarily threatening: embracing consumer technology in the workplace doesn’t have to be difficult or risky. Furthermore, it is a practical necessity which, when managed appropriately, can boost employee productivity and job satisfaction. It should also become an integral aspect of IT transformation, helping shape your IT landscape for relevance in the future.

Think beyond the device To fully exploit the consumerisation of technology, it is necessary to think beyond the device, while applying the skills and experience relevant to running enterprise IT. Reaping the benefits of consumer technology – whether devices or web-accessed services – depends on business and technical experience to effectively converge, connect and control all the elements that exist in traditional and emerging environments. It is about transforming the IT function within your business in a controlled fashion, taking cognisance and advantage of new ways of using technology, while managing risks and downsides. While the devices and services may be varied and somewhat different to those with which enterprise technology administrators have worked in the past, there is a major – and significant – similarity: data. Whether in the data centre or accessed on the handset, data is data; the principles of its management, control and analysis remain consistent irrespective of access device.

Managing the explosive growth in data EMC’s 2011 Digital Universe survey shows that ‘information taming’ technologies are driving down the cost of creating, capturing, managing and storing information – it is now one-sixth the cost it was in 2005. ‘Information taming’ technologies include tools such as de-duplication (removing copies), compression and analysis (to make sense of volumes of data). Be that as it may, the growth of data remains staggering. Devices are ubiquitous and millions of people are using them to create and share information. The accelerated use of consumer-style technology is part of this development; in the absence of IT policies and processes this data is frequently managed ineffectively or not even at all. What this means for the average company is two things: Sheer volume, necessitating potentially unnecessary spend on hardware to store it. The possibility of failing to take advantage of the inherent value of the information the data represents. It is important to note that data on its own is of little use. The release of value depends on analysis which enables trend identification, cross-referencing and correlation of disparate sets of structured (contained in databases), semi-structured (spreadsheets and other documents) and unstructured data (such as photographs).

Secure the device or service However, the influx of consumer devices also introduces into the workplace a new set of risks. Personal devices used at work and left in taxis, bars and hotel rooms could create points of compromise. The consequences of losing company information in this way can be disastrous; hence the necessity for some control of how users and their devices access the network.

This potential problem may sound daunting – but it isn’t. For example, intelligent security management technologies are emerging that make ‘situational’ assessments, controlling access to data dependent on location or time of day. Other simple security measures, such as password protection, can be very effective should an employee lose a device. Such measures are often a mere matter of appropriate policies rather than the implementation of costly or complex software solutions. What is clear is that the consumerisation of IT cannot be resisted. People are bringing their devices to the workplace and they want to use them to improve productivity, performance and convenience. Embracing this development will reduce risk and drive up employee satisfaction. Resisting it may be futile – and risky.

Phill Patton is New Zealand country manager for EMC Corporation. He has more than 20 years’ of experience in the IT industry.

NZB May 2012 nzbusiness.co.nz

BIZTECH

Projectors continue interactive revolution Offering simultaneous dual pen interactivity, access to all the resources on your laptop, network and the Internet, and instant capture of added content and notations (all without an interactive whiteboard), the Epson EB-475Wi and EB-485Wi ultra short throw interactive projectors are continuing the revolution in interactive teaching and training. Installation is easy and fast with no driver software to install on networked computers and no need to calibrate: these projectors auto calibrate. Epson’s interactive projectors have the fastest response to pen movements (as you move the pen notations are displayed virtually immediately) and the most accurate pen detection, so writing on the image and clicking through programs is easy and intuitive. Both models can be wall mounted (vertical projection) for larger group interaction or table mounted (horizontal projection) creating a more intimate workspace. The Easy Interactive Tools 2 software and Epson’s Instant Annotation mean there’s no need to wait for a PC to come online to handwrite notes and diagrams or annotate an image from a document camera or CD/DVD player. You simply turn on the projector and get to work.

The Epson EB-485Wi. The EB-475Wi (2600 lumen) and EB-485Wi (3100 lumen) are brighter than previous models, are smaller and more compact and also have a shorter minimum throw distance, further reducing the possibility of shadowing and glare. Also new in the ultra short throw range are the EB-470, EB-475W, EB-480, EB-485W. These projectors have the same high performance specifications as the EB-475Wi and EB-485Wi (the EB-470

and EB-480 are XGA resolution) but are not interactive. Advanced connectivity and networking capability includes an HDMI port and optional wireless card which provides the capability of presenting wirelessly from Apple iOS devices. RRPs for the EB-400 Series projectors range from $2,599 for the EB-470 to $3,699 for the EB-485Wi. Visit www.epson.co.nz

Interactive panels ‘the next big thing’ If size and interactivity have anything to do with making a memorable presentation – in the boardroom or classroom – Sharp’s recently-released 60inch and 70-inch Interactive Presentation Panels (IPPs), appears to be just what the presenter ordered.

60 NZB May 2012 nzbusiness.co.nz

With a Sharp IPP as the focal point, strategy meetings, sales presentations, training sessions and lectures can now be conducted with far more versatility and impact than ever before. No longer do you need a whiteboard, separate projector, LCD monitor or touchscreen overlay. The Sharp IPP is an all-in-one presentation tool – transforming from an interactive, whiteboard-format touchscreen into a large-screen monitor to display a remote source such as external hard drive, laptop or tablet. Today’s intuitive touchscreen technology, providing the ability to swipe, drag, pinch and expand, is the platform

for a Sharp IPP’s imposing performance. In whiteboard mode, the user can write directly onto the screen (using a Sharp Pen or just a finger). All those ideas can then be shifted around the screen individually to create, for example, prioritised lists and, if necessary, scanned and printed. Used as a monitor, Sharp says the IPP takes pre-prepared, multimedia slide/video presentations to a new level of sight and sound quality. But it’s the sheer size and the full highdefinition LED images that amaze most users. Both models can display multiple HD images and text and still be readable (and hold a meeting’s attention) right at the back of the room.

A new level of video communication Leading video conferencing experts say Apple’s latest iPad takes video communication to a whole new level for New Zealand businesses. The recent unveiling of Apple’s latest product coincided with the launch of Smartpresence – a Kiwi company which provides hardware, accessories, and cloud-hosted video and audio conferencing services alongside design, consultancy and management. Smartpresence was founded by Corey McCarthy and John Kandiliotis, who together have designed and deployed the majority of New Zealand’s managed service video environments in the past decade. The pair say the new iPad enables more businesses to embrace the benefits of high-quality video conferencing and mobility. “By using Polycom’s M500 iPad application with our Smartpresence infrastructure, staff can connect with their company’s video conferencing network and take part in meetings no matter where they are,” says McCarthy. “Smartpresence will show New

Zealand’s business community how they can integrate and securely manage the very latest video and audio conferencing technology.” McCarthy says today’s business environment demands greater flexibility, higher productivity and a smaller carbon footprint than ever before. High definition video conferencing has become a key way of achieving all of these goals. “Video conferencing is really becoming available to everyone now. The technology is far superior and more secure; it’s more integrated; there is more network availability; Internet speeds are faster and the hardware is cheaper than ever before.” Smartpresence has formed key partnerships with leading telecommunications suppliers and also offers New Zealand’s most innovative cloud video service. “Our Smartcloud intelligent core is unique in that we support H.264 high profile in multipoint calls, providing high definition at lower bandwidths,” McCarthy says. “Smartcloud is the only service in New Zealand that

Smartpresence founders Corey McCarthy (left) and John Kandiliotis.

allows federation for Microsoft Lync users, bringing the Microsoft and traditional video conferencing environments together.” The nationwide roll-out of ultra-fast broadband combined with the latest video conferencing technology will make a big difference to a company’s bottom line, Kandiliotis predicts. “It will improve communication, reduce travel time and result in faster, better-informed decision making.”

Sony’s slimmestever voice recorder Sony’s new ICD-TX50 digital voice recorder is designed to capture your important reminders, thoughts or ideas on the move without compromising on style. The lightweight and ultra slim voice recorder easily fits into a pocket, making it easy to grab in an instant. At only 6.4mm thick and weighing just 50 grams, the ICD-TX50 is Sony’s slimmest voice recorder yet and is ideal for business meetings, conferences and capturing ideas on the go. The built-in lithium-ion battery

allows up to 24-hours worth of recording and a mere threeminute quick recharge will give you a recording time of one hour. Sony’s ICD-TX50 also features high-quality digital microphones allowing crisp and clear voice recording in either linear PCM or MP3 format. The highly functional 4GB voice recorder has a microSD card slot and sports an Organic EL (OLED) display screen. It has an RRP of $249.95.

NZB May 2012 nzbusiness.co.nz

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Biz Books

Bridging the gap to commercialisation A new book from entrepreneurial Wellington publisher and author Jenny Douché is aimed at helping bridge the sometimes huge gap between innovation and successful commercialisation. Foolproof: How to Find and Test Great Business Opportunities was written after Douché noticed how few business people take the time to properly test ideas for new products or services before launching to market. Market validation helps ensure that businesses deliver market-orientated offerings. She recently surveyed 53 business people who validated the market before launching a new

product and, as a result, 86 percent changed the features of their product or service, and 70 percent changed their promotional plan. These changes likely resulted in increased sales and significant cost savings. With its 13 true stories of failure and success, Foolproof is a practical book for those looking to grow their revenues through new or existing product and service offerings. RRP $29.95 Published by Hugs Press. Also available as an eBook. To order go to foolproofbook.com ISBN: 978-04732-05058

Sales success tips from America’s best

Is your brand crisisready?

Stephen Schiffman has trained more than half a million sales professionals – so if anyone understands the sales mindset, he does. In The Power of Positive Selling, Schiffman gives instruction, tips, anecdotes and inspiration that are guaranteed to help you overcome negative thoughts, feel confident in any sales situation, and remain positive no matter what happens. This book offers 30 sure-fire tactics to make sure your mind doesn’t devolve into that self-destructive pessimism we’ve all experienced. Learn how to: believe in what you’re selling; help your client solve a problem; do your research; set the tone for the conversation and establish the pace; listen before you talk; ask the right questions for the right reasons; and never say ‘I absolutely guarantee that’. A book to dramatically improve your attitude, your behaviour and your sales record. RRP $27.00 Published by McGraw-Hill. ISBN: 978-00717-88700

A number of high-profile brands have in recent times faced widely publicised meltdowns that threatened to put them out of business, or seriously damage their reputation – yet each one is still going strong today. This is due to the fact that they took charge with conviction, creativity and smarts. In Brand Turnaround, author Karen Post, a leading branding expert known as ‘The Branding D iva’, provides practical insight and methods you can use to transform your brand when it seems the world is crashing down around it. Brand Turnaround gives you the tools to develop a game plan within hours of the incident to prevent the problem from spreading; to create a company culture designed to handle situations quickly and effectively; and to manage emotions during the toughest days. RRP $44.00 Published by McGraw-Hill. ISBN: 978-00717-75281

End that entitlement culture Imagine how your business would perform if all its employees thought and acted like owners? How can you replace that sense of entitlement with a sense of ownership, and create a culture of accountability, purpose and profit within the business? Brad Hams, the author of Ownership Thinking, shows you how. ‘Ownership Thinking’ provides a three-step program for transforming employees from average people just doing their job to top-performing people who operate with the understanding that they have a very real stake in the company’s success. Hams shows how to: educate your employees on the fundamentals of business and finance – how the company makes money and how they, the employees, add or take away value; identify the business’s KPIs; and create incentive plans aligning employees’ behaviour with business objectives. RRP $46.00 Published by McGraw-Hill. ISBN: 978-00717-72457

NZB May 2012 nzbusiness.co.nz

Customer Experience

Ask, listen and learn Your staff may be good at answering customer questions, but if they don’t ask questions, they’re just order-takers. Dr Ian Brooks has more.

have been doing some mystery shopping lately and have been struck by two observations. The first is how bad it is out there. You will remember last month’s column about being ignored at Bond and Bond and Farmers. Since then, I have been to look at boats with a friend who is thinking of spending about $100,000. It was a Saturday morning. Three marine brokers were closed. One marine broker who was open should have been closed. When we walked in, the salesman was sitting in a chair behind a desk. He greeted us but did not get up to shake hands or introduce himself. When he found out I was originally from Canada, he was more interested in talking about a plane crash near Winnipeg than answering questions about the boats he had advertised on the wall. When we asked to see three boats, there was a great deal of shuffling through papers and discussions with a colleague about where the boats were. It turned out all of them were at other marinas in the Auckland area. One brokerage had a sales dock. My friend and I walked up and down the dock looking at the boats, reading the information about the boats nicely displayed by each boat. We even walked onto the boats in the hope of being noticed but nobody came out from the office to talk to us. I walked back up the ramp to the office and found the salesman sitting at a desk. I stood behind him and, looking out the window said, “So, you can see the sales dock from here.” “Yep,” he replied. I told him my friend and I would like to look at one of the boats. He said that would be fine but he needed to “turn the phones over” – whatever that means. He did not introduce himself nor did he ask any questions about why we might want to look

64 NZB May 2012 nzbusiness.co.nz

at that particular boat. You have to give people a reason to buy from you and those kinds of experiences are not going to do it. By contrast, I was speaking recently at a sales conference in Australia. During the discussion, one fellow said he always gave new customers his mobile phone number and told them that if they had any questions or problems, they should call him directly and not ring the call centre. I could see from the expression on his colleagues’ faces they did not think that was a very good idea because he was opening himself up to being constantly ‘interrupted’ by his customers. At the awards dinner that night, he won six awards including Sales Executive of The Year.

Ask questions My second observation is that even the good salespeople are capable of answering questions but do not seem very interested in asking any. This problem is not confined to the marine industry. I have mystery shopped car yards, retailers and other types of businesses lately and found the same thing. In the ‘good’ companies, staff are generally knowledgeable enough to answer the customer’s questions but rarely ask any of their own. This tendency to be reactive creates several problems for the customer. First, it is hard work asking all those questions, trying to anticipate issues that might crop up in the future and generally thinking of what you need to ask about. Secondly, we make dangerous assumptions if we do not ask questions. When I mystery shopped a car dealer I told the salesman I wanted to buy a car for my teenage son. “The cheap cars are over there,” he told me, pointing to an area of the lot.

“Where do you keep the BMWs?” I asked. The third problem with not asking questions is that customers are always right but often wrong. Customers buy because they have a problem or want to avoid having a problem. They are always right about their problem. They know they have one and they know what it is. Admittedly, they may, or could have, other problems they do not know about – but they do have at least one problem they know about or they would not be in the marketplace in the first place. What customers are often wrong about is the solution to their problem. They do not understand your business as well as you do and so customers may, and often do, ask for the wrong solution. They do not know what other solutions are available and the pros and cons of each. Your job is to look past the customer’s request for a particular solution and ask questions to understand the problem they are trying to solve. That way you can affirm their request or suggest a better alternative. If you do not ask questions, you are just an order-taker and there is no shortage of those. But perhaps the biggest problem with not asking questions is that if you do not understand the customer’s needs, you cannot compete on value. If you do not compete on value, you will have to compete on price. And we all know where that road leads! So that I practice what I preach, let me ask you some questions. What reasons do you give your customers to shop with you? Do your staff ask questions or fill orders? Do they understand the need to ask questions? Do they know which questions to ask? Could these be good questions to discuss at your next staff meeting? Dr Ian Brooks is a leading expert in customer care. Follow Ian’s blog at www.drianbrooks.blogspot.com

Franchise File

Is dissatisfaction built-in to a franchise? Simon Lord discusses some suggested ways to increase franchisee satisfaction and improve recruitment.

recent seminar on franchisee recruitment raised some interesting issues about the importance of keeping existing franchisees satisfied. The Auckland seminar, run by Jason Gehrke of the Australian-based Franchise Advisory Centre, pointed out that one of the keys to franchisee satisfaction is the way that the ongoing fees, or royalties, are collected. The need to pay ongoing fees may not always be popular with franchisees but it is vital for the health of any franchise as ongoing fees pay for essential development and support services, as well as providing an element of profit for franchisors. There are many ways of calculating ongoing fees, not all of which require direct payments from the franchisee to the franchisor, but in his presentation Jason chose to focus on three particular options. The first was fixed percentage of gross sales. This is the model used by many franchises in all sorts of different industries. It requires franchisees to declare their gross sales turnover and remit a certain percentage of that figure as a fee to the franchisor. However, it is not necessarily workable in franchises where there may be a significant percentage of cash jobs or where sophisticated point-of-sale systems are not employed – eg, many mobile franchises. A fixed percentage system can also cause friction if price-based promotions are not carefully managed. The second option covered was that of the fixed fee, where a certain number of dollars are paid weekly – a common option in home services and other smallerinvestment franchises. This obviates the need for gross sales reporting and allows the franchisee to grow their business without having to pay additional fees. However, fixed fees mean income growth

for the franchisor is dependent upon increasing the overall number of franchisees rather than increasing the profitability of existing franchisees. Although some mechanism for increasing fees (such as adjusting for CPI) is often built into the franchise agreement, over time the results may not reflect the actual sales, profitability or investment needs of the franchise. A third option Jason described was a fixed transaction model as practised by the Just Cuts hairdressing franchise. Under this model, each franchisee pays for support via a fixed weekly fee that equals 12 haircuts (based on the core price of a haircut). The contribution to the national marketing fund is similarly set at five haircuts per week. Both fees remain the same regardless of the number of haircuts the franchisee does each week. This approach is easy to calculate, requires no policing and automatically updates as prices change. What has all this got to do with recruitment? Well, the best recruitment medium is wordof-mouth, and the best word-of-mouth comes from satisfied franchisees who talk to their friends and give good reports to those attracted via other sources. So why, Jason questioned, do so many franchise systems have a built-in source of franchisee dissatisfaction that kicks in after a couple of years? That source of dissatisfaction is franchise support, and he explains the issue thus: •F ranchisees are told their fees pay for ongoing support. •T hey get an expectation of the level of support to expect in the first few months when their need for operational backup is at its highest. •T wo years later, their business is established, they need little operational support, yet they are probably paying

higher fees. In order for franchisors to maintain franchisee satisfaction levels and encourage further recruitment, Jason suggests they have to address this issue. One obvious way is through moving the focus away from operational support to something more appropriate for established franchisees, such as business development training aimed at improving the bottom line. But there is another way to address the satisfaction issue and that is to consider reducing the fee level at that stage. Two such examples are: 1. The level of fees paid actually steps down over time – for example, after three years, the royalty drops from five percent to 4.5 percent. This might reflect the lower cost of supporting an established franchisee; however, on resale of the franchise, the fee would revert to the initial level. he level of fees drops beyond a certain 2. T performance threshold – for example, the first $400,000 of sales attracts a royalty of five percent, sales above that level are charged at only four percent. This encourages franchisees to grow on the basis that they keep more of what they earn above the threshold. There is a school of thought that says that the initial high levels of support are not the norm, and that the ongoing franchise fee is set at an appropriate level for an established franchisee – but do franchisees really understand that? And once they are established, do they believe that? Changing existing structures (particularly when it relates to fees levels) within an existing franchise is a massive undertaking and should not be undertaken lightly – or without specialist assistance. Given its impact upon franchisee satisfaction, recruitment and retention, however, it’s something many franchises might find worth considering. Simon Lord is publisher of Franchise New Zealand magazine: www.franchise.co.nz

NZB May 2012 nzbusiness.co.nz

Employment Matters

A breach of duty Cases of employers being awarded damages for dishonest employees are rare. Brandon Brown reports on two that provide some valuable lessons.

ncidences of employers defending personal grievance claims are not uncommon, and some employers feel that the odds are stacked against them in employment disputes generally. However, cases arise from time to time in which it is the employer who seeks remedies against an employee through the Employment Relations Authority (ERA). For an employer to seek remedies from an employee, the employer must establish that there has been a serious breach of a term in an employment agreement. To receive damages for a loss, the employer must also prove that the loss was reasonably foreseeable as a result of the breach, and must clearly quantify such loss. Often cases of such a breach have involved an employee breaching their duty of fidelity to the employer. The duty of fidelity is implied with all employment relationships and requires both parties to behave in ways that maintain mutual trust and confidence; to act honestly towards one another. The recent case of Restaurant Brands Ltd v Bond involved the employer recovering remedies against the employee for stealing money. In that case Restaurant Brands conducted an investigation and found evidence of a general manager (a Mr Bond) having taken $80 from the store. The employer then followed a disciplinary process and dismissed him. Following Bond’s dismissal, Restaurant Brands brought ERA proceedings to recover special damages from him. These damages were based on the costs of investigating the stolen funds, and also to recover general damages for him having stolen funds as a senior staff member. In assessing the damages sought, the ERA considered that it was reasonable to

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The Authority was satisfied that Bond’s actions were an extreme breach of his duty to act honestly and it was reasonable to recover the cost of some of the executive staff time. engage private investigators given the scale of the discrepancies which were discovered by Restaurant Brand’s audit. Restaurant Brands had taken executive staff away from their usual duties in order to take part in the investigation and disciplinary process. The Authority was satisfied that Bond’s actions were an extreme breach of his duty to act honestly and it was reasonable to recover the cost of some of the executive staff time. Restaurant Brands also sought to recover the cost of legal advice regarding the possibility of recovering sums from Bond. The ERA considered such legal advice to have a direct link to his behaviour and accordingly that it could be recovered. Restaurant Brands sought to recover $3,000 in general damages from Bond saying that the thefts could have been as high as $100,000 taken by Bond and other employees over time. The ERA declined to award such damages on the basis that they could not be quantified accurately enough. The ERA stated that Bond’s actions constituted a breach of the implied duty of fidelity to his employer and ordered him to pay damages of $8,929.41, which consisted of: • $ 5,000 as an apportionment of the private investigator costs; plus • $ 2,381.41 in respect of the staff time; plus

1,545 for the cost of the legal advice •$ prior to bringing the ERA proceedings. In the case of Bradford Trust Ltd v Roebeck and Pakieto the employer also sought to recover damages for a breach of the duty of fidelity. The employees in this case (the sales manager and operations manager) set up a competing business while they were still employed by Bradford Trust. They used their unrestricted access to confidential client and pricing details to undercut their employer to secure contracts. The employees had secured certain contracts through their roles as employees, but ran them through their own competing business which received the revenue for such contracts. The ERA said that the two men had committed a blatant and deliberate breach of their duty of fidelity, good faith and honesty. The ERA considered that had the employees carried out their duties honestly, the contracts in question would have been secured for the employer. The ERA ordered the employees to jointly pay $223,500 in damages in respect of the lost contracts, and ordered them to pay penalties of $5,000 for breaching their duty of good faith. These cases highlight the potential of an employer to seek remedies from an employee for a serious breach of the employment agreement. They also point out the requirement for an employer to have clearly quantified loss which results directly from the breach, in order to obtain an award of damages. Cases in which employers manage to obtain remedies against employees are few and far between, and tend to be for more serious breaches. Before considering taking such actions employers should obtain professional advice. Brandon Brown is a solicitor at EMA Legal, Employers’ & Manufacturers’ Association (Northern) Inc. Visit www.ema.co.nz

IN INDIA, THERE ARE MORE THAN 315 LANGUAGES SPOKEN. BUT SHE’LL BE RIGHT; EVERYONE SPEAKS ENGLISH ANYWAY. TRUE

FALSE

If you’re thinking about exporting to India, there’s no room for guesswork. New Zealand Trade and Enterprise can give you the tips and tools you need to move your business into this market; from country overviews and language and culture, to sales and marketing suggestions. That way, you’ll know that English is widely used in business, which means you won’t have to learn 314 different languages.

Get the answers here. Succeed over there.

TE0028A

Visit www.nzte.govt.nz/answershere or call us on 0800 555 888.

On Accounts

Business KPIs: secret weapon of choice Steve Alexander outlines the importance of setting and monitoring key performance indicators.

itting performance targets isn’t easy. But if you knew there was a secret weapon you could deploy with minimal effort to achieve this, would you use it? Of course you would! The secret weapon of choice for businesses that have grown, or maintained profitability over the course of the recession, is the use of KPI (Key Performance Indicator) targets. KPIs are quantifiable measurements which benchmark key facets of a business on a regular basis. They help by monitoring the trends in your business which leads to faster and more decisive decision making. Because KPIs can span the entire business, the whole team can be involved. This helps ensure everyone understands what is important and how their role fits into the overall business goals. Engaging staff in these can lead to improved productivity. Setting the right KPIs, and having a robust system in place to ensure they are regularly monitored and met is paramount from the outset. It is important to know what drives your business. You need to know what your KPIs are, and how they compare to industry averages. This is known as benchmarking. For commercial businesses, KPIs might revolve around activities that lead to sales (for example, visiting a certain number of

clients each week; the number of units sold each week), gross profit percentage, and so on. KPI Dos: • DO limit your KPIs to factors that are essential for the business to reach its goals. • DO limit the number of KPIs to four to five per person/team or firm. • DO have a mixture of daily, weekly and monthly KPIs. • DO benchmark your KPIs against industry standards. KPI Don’ts: • DON’T make your KPIs too complicated and difficult to track/monitor. If it’s too much of a chore, the team could lose interest in them. • DON’T base your KPIs on those of another business. Yours will differ depending on your unique critical success factors. • DON’T get lazy and let the monitoring of your KPIs lapse. The five step KPI set up process: 1: Identify what the key success factors or drivers of your business are (gross profit, sales per staff or productivity), and how they affect your bottom line. Translate these into KPIs. 2: U nderstand how to measure those KPIs

and set up a system to easily monitor them. Set targets or benchmarks for your business, staff or team. They should be easy to measure and understandable. Involve your team in the KPI setting process. Not only do they feel empowered and valued for their opinion, but it also ensures better buy-in. PI results should be reported back to 3: K the team on a timely basis. From the results, decisions can be made with the appropriate action taken. To get the best value from having KPIs, it is important the business has a culture of accepting change and supporting continuous improvement. 4: Celebrate the successes. As targets are hit, make a point of praising the team and rewarding them appropriately. 5: Evaluate KPIs on a regular basis to ensure they are still relevant. Business never stands still, nor do your markets, so be mindful that a KPI may be relevant one year and obsolete the next. Remember the golden KPI rule is to keep them simple. Your accountant can take the guesswork out of selecting the right KPIs for your business and benchmarking those KPIs against your industry standards. This will enable you to understand how your business compares to others in your industry, enabling you to make the right decisions to improve. Steve Alexander is a principal and business adviser for WHK Hawke’s Bay.

Call us to find out how WHK can help you navigate the changes to the gifting regime. Free phone 0800 4 945 69 www.whk.co.nz WHK_NZB_GiftingAd_180x40_.indd 1

68 NZB May 2012 nzbusiness.co.nz

6/09/11 2:50 PM

Export Report

Tips from the top

Catherine Beard shares some gems from the recent Go Global international business conference in Auckland.

he Go Global export conference brought an invaluable line up of speakers together in Auckland recently. Exporting champions from a range of international markets shared their stories and insights, and a wealth of networking was carried out. I wish I could condense it all for you here, and advise anyone exporting or thinking about it to book in for next year’s event. What I can do, is pass on just a few gems. Here’s a sample of some of the speakers’ top tips that I gleaned when we were lucky enough to have some one-on-one interviews. Dr Simon McDonald, CEO, Triodent “Get the product right. The product specification is the really important thing – deciding what is a totally and utterly fantastic product, and then working out how to make it. “Multiple experiments, fail fast and use the 80-20-20 rule, which is to get 80 percent of the features in the product done in 20 percent of the time, at 20 percent of the cost, and then go to market. “Get on and do it. Execute. I think a lot of people spend far too much time planning and not doing, and that often is an excuse for not really getting on with it.” Neil Cowie, CEO, Pumpkin Patch

“Firstly, determine the channel by which you’re going to take your service, your product or your brand to market. In today’s day and age there are many different channels, and in some cases your product may be a multiple channel opportunity. “If you’re going to a particular market, don’t just rely on your partner, you need to have an understanding of that market. I can’t emphasise enough the knowledge you need to build on in that market, so take the time, visit and understand the market, because the time it’s really going to become beneficial to you is when your partner hits a bit of a speed bump, and they will need your support and help. Be in a position where you can communicate and engage with them to come up with a solution. In other words, don’t do a deal and walk away.” Peter Chrisp, CEO, NZTE “What is your point of difference? Why are people going to choose you rather than choose someone else? Strategy and knowing your point of difference is essential. “If you go in, you can’t be too tentative, you have to go in and go in hard. You have to commit and put in the resources you need to be successful. In most markets you have to go in for some considerable amount of time.”

Ben Anderson, chair, North America Beachheads “You need to be very clear about what you’re doing. That doesn’t mean you have to come out of the gate with that clear strategy, you may want to go up to market and really spend some time networking and leveraging the relationships that you have. “Work with NZTE to tap into their programmes in North America – a wonderful network of mentors, coaches and advisors.” Paul Adams, CEO and founder, Everedge IP “Assess your intellectual property right from the very start to understand what it is you actually have, and what the potential of that IP could be – because ultimately all businesses are founded on ideas and intellectual property. “Commercialisation essentially breaks into three key available options – they are: to licence your IP, to sell your IP outright, or to turn it into a product. You have to figure out which of those three options are available to you. It might be one or another or a blend of them.” Dr Helen Darling, CEO, Oritain Global “Back yourself. It’s easy to be intimidated by the fact that we’re a small company in a small country, but what we offer is world leading.” To watch a video of Go Global go to www.exportnz.org.nz Catherine Beard is executive director of Export NZ.

NZB May 2012 nzbusiness.co.nz

Sustainable Business

Incentivising sustainable innovation Rachel Brown looks at how to motivate people to innovate and come up with new, more sustainable ways of doing business.

he SBN team has been talking about what motivates sustainable innovation. Does it need to be incentivised and, if so, what’s the best way of doing that? The topic came up after discussion with some of our members about how incentives, bonuses etc are being used here in New Zealand and around the world. We started thinking whether there was merit in the idea of financial reward being used to stimulate sustainable growth and innovation. When we look at innovation, we’re not convinced that cash is king and that perhaps societal or personal values are the main thrust behind great innovation. So what approach works best in motivating people to innovate and come up with new, more sustainable ways of doing business? I don’t believe that financial compensation is the ultimate reason why creativity thrives. Many of our members are innovators; whether that’s part of their core offering or whether it’s simply the way they do business. I think most are personally motivated to solve societal issues and in doing that, they’re responding to their employees’, customers’, and communities’ needs. The people working in these organisations, the ones coming up with the innovative strategies, are not spurred on solely by money. Clearly people have to be fairly compensated but beyond that, the inspiration to create a brave new world comes from more altruistic places. I’m not the only one thinking this way either. According to MIT research covered in an RSA talk entitled “Drive” and given by Dan Pink, rewarding performance doesn’t work unless you’re talking about mechanical tasks. People are motivated by different things, and once you get past basic cognitive skill, financial rewards don’t work that well. Pink says, “Money is a motivator – if you don’t pay enough, people won’t be motivated. If you pay enough to take the issue of money

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off the table, you pay people enough so that they’re thinking about the work and not the money.” This makes sense. Especially if you consider that some of the biggest innovations seen in recent times have been made by clever people in their own time. Look no further than Google or Facebook for proof. Pink also says there are three factors that lead to better performance and personal satisfaction. They’re autonomy (the desire to be self-directed); mastery (the urge to get better at stuff); and purpose (those people and companies that flourish are animated by their purpose). In his words, “we’re purpose maximisers, not only profit maximisers”. In looking at all of this stuff around financial incentives, it was a natural progression for me to think about what happens when inequity becomes too extreme in society. When you think about the highest and the lowest paid, there can be a huge ratio difference particularly if the organisation is large. If we have this big divide between the rich and the poor, what happens to society and, in turn, what happens to business? There’s a strong link between good business and a thriving society and evidence to suggest that where the social system is more equal, business does better. I asked Mark Bentley, CEO of Auckland Communities Foundation, what his thoughts were around creating a more equal society in his city. He had this to say. “Bill Gates said that his one big regret was that he left Harvard with no real awareness of the awful inequities in the world and the appalling disparities that condemn millions of people to lives of despair. I think this is a very powerful message from someone we should all respect. Informed and accessible philanthropy can make a

difference to disparity. My aim with the Auckland Communities Foundation is to encourage generosity from all tiers of society – we need to build the desire to act and the awareness that everyone can make a difference. “The result should be a shared commitment to ensuring every Aucklander can achieve their potential. Only then will we live in a city of which we can be truly proud.” This stuff is on the agenda at the UN’s ‘Rio+20’ Conference on Sustainable Development in June. According to secretary-general Ban Ki-moon, social justice requires worldwide action. At the first Global Human Development Forum held recently in Istanbul, he said, “We need everyone – government ministers and policymakers, business and civil society leaders, and young people – to work together to transform our economies, to place our societies on a more just and equitable footing, and to protect the resources and ecosystems on which our shared future depends.” So here’s what we concluded around the matter of sustainable innovation. Firstly, make sure pay is fair so money isn’t the focus, rather the work is. A good way to start is creating a pay equity policy. We suggest transparency and opening your business up to scrutiny by publishing any policies to the wider public. Secondly, when pay isn’t an issue, you can truly focus on innovation with the much more altruistic rewards – what we at SBN call ‘psychic-income’. There is nothing better than knowing that YOU have made the world a better place. Rachel Brown is CEO of the Sustainable Business Network. If you want to connect with other organisations and people motivated to innovate and grow sustainably, go to www.sustainable.org.nz.

Marketing Maestro

Do sweat the small stuff Brian H Meredith makes a heartfelt plea to businesses to understand the power of behaviour management in forming customer relationships.

hould we, or should we not, sweat the small stuff? It seems to depend entirely on whom you ask or whose opinion you seek online, in books, journals or whatever. It also depends on what aspect of our lives we are applying the question to. I have a heartfelt plea that goes out to every business and organisation in our wonderful country that, if heard and heeded will, I promise you, achieve untold good for us all. My plea is simply this – do sweat the small stuff – sweat it big time. Specifically, please do sweat the small stuff surrounding the way in which your business behaves – behaves in every tiny way, every moment of every day. Please do sweat the stuff that engages in the most visible set of behaviours – the people in your business (and that includes yourself, dear reader!) Please don’t completely ignore two emails and two texts from a potential customer who saw the name of your business on one of your liveried vehicles, was impressed with its professional look and so noted the phone number and email address and subsequently tried to contact you. Please don’t run open homes for newly built houses on subdivisions where your other sections currently being (or still to be) built on are in a disgusting, third world state of presentation, with excessive amounts of rubbish, discarded building materials, overgrown grass and weeds etc. Please don’t get stroppy and argumentative with a customer who asks you what the marketing lesson is when you have just told him that a particular garment that has dominated your store window for weeks and which your store had promised would be in stock by now and they would call you when it arrived is not, in fact, ever going to arrive, “’cos it got lost in Australia,”

and, “anyway, just ‘cos we have a picture of it doesn’t mean we have it – it’s just there to reflect the Ralph Lauren lifestyle,” (oops, there I go again, naming names). And please, if the customer then seeks out the manager to express his concern at being abused, do not trounce belligerently up to the counter and challenge the customer about why he is talking to the manager and demand to know what he is saying. Please try to avoid telling a customer who has waited 15 minutes for two flat whites that if he understood anything about espresso-based coffee he would know how long it takes – because the risk is that the customer will have himself owned cafes where accolades were stacked high for their espresso-making skills. Please don’t launch your wonderfully sexy little slimline latest version of PlayStation with a whole bunch of promotional material showing the exquisitely stylish box sitting snugly and elegantly in its custom-designed stand and then have a bunch of spotty faced youths in several retail stockists tell the customer, with no apparent concern (or even signs of intelligent life) that the stands aren’t available in New Zealand yet and won’t be for some time. This is particularly irksome when the customer then continues to be exposed to promotional material for weeks and weeks afterwards showing a stand that he still can’t have. “Behaviours stem from attitudes, which are, in turn, formed by many things, including friends, family, society, experience and learning. Attitudes can also be affected by what the company communicates to position itself favourably in the minds of its audiences. “Attitudes drive the behaviours that lead to purchase and the opportunity to work

together to develop yet more value for one another.Thisisarelationshipandrelationships are ‘the most valuable of all intangibles’,” according to Ian Gordon‘s ‘Relationship Marketing’ (Gordon, Ian. Relationship Marketing: New Strategies, Techniques and Technologies to Win the Customers You Want and Keep Them Forever. Wiley, 1998. Print.) The managers of the businesses above have clearly failed to understand the core principles inherent in Gordon’s description of ‘relationships’. They and/or their people are falling at the very first hurdle of faceto-face selling and they all did so in a period of just a few days. A pretty shabby demonstration of New Zealand business excellence. As I am guilty of saying at every opportunity, this is not rocket science. Rather, the behaviours engaged in by your business and its people are the raw materials of relationships and without relationships you are, ultimately, nothing. A business may survive for a while for a whole bunch of reasons but, ultimately, if your behaviours fail to encourage customers and prospects to want to enter into a relationship with you (and even a single transaction or purchase is, in itself, the beginning of a relationship) then you will, ultimately, fail. There are many variables that we have to face as business owners and managers and many of them are beyond our control. However, the power of behaviour management is that it is completely within our control. And when it comes to staff, it must begin with the right attitude as the non-negotiable base on which to build the rest. So my final plea is this: When hiring staff, always, always remember, Hire attitude. Train skills. Brian Meredith is CEO of The Marketing Bureau (www.themarketingbureau.co.nz). Email brian@themartketingbureau.co.nz

NZB May 2012 nzbusiness.co.nz

Issues with Balls

Postcard from South America Ashley Balls has spent some time in Chile and Peru. Are they lands of opportunity for New Zealand exporters? He is not so sure.

his month’s piece is being written in Chile where I have spent nearly three weeks and travelled quite extensively – including to Peru. As an SME owner and keen observer on business opportunities for Kiwi companies I started by looking for evidence of New Zealand businesses and the evidence is not only hard to find, it is virtually impossible. My first observation was the journey from Santiago airport into the city. The most noticeable thing was that this is not the third world, as some would have us believe, but a modern city with exceptional infrastructure (though like Auckland some clot ‘forgot’ to put a rail link to the city). However, the motorways are a revelation and go straight to the airport and throughout the city (population seven-plus million) and are supported by an extensive underground network. The latter was put in over the last 15 years and (Auckland/ Wellington transport take note) uses a single price regardless of journey length – though the price varies during the day to reflect the loading. There is some similarity between New Zealand and Chile – both economies rely on commodities (fish, forestry and agriculture) and in the case of Chile, copper – loads of it. BUT prices are lower to reflect wage differentials. This presents a major challenge to many New Zealand exporters. The likelihood of any vintner selling large quantities of wine here are nil, given that it is similar with virtually all other agribusiness – which leaves only services, high tech, or some other niche products. Selling here on price alone will be a challenge for any Kiwi business. However, Chile is an opportunity, not a threat, a fact clearly evidenced by the increase in air traffic – there are now 14 direct return flights a week and Qantas has

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just announced three new direct flights a week. A trip to the supermarket and a large mall was similarly revealing – there was no evidence of New Zealand (or Australia) anywhere. There are no Australasian white goods anywhere – the Koreans have that market sewn up. The banking market is, like everywhere, international but again no evidence of anything from the Southwest Pacific – but plenty from North America and Canada. What of tourism – a staple industry the world over? Prices in Chile are lower than New Zealand and service somewhat indifferent, despite the rather nasty habit of tipping being endemic and expected by everyone from bellhops to taxi drivers and even bar staff. It is not that service is indifferent or unfriendly – quite the reverse – it is just slow. The only reason I can find for this is low wages and poor labour relations – New Zealand take note. Treat your staff badly and there is a price to pay. Before moving on to Peru, perhaps it is worth noting that Chile is a first world country with nearly 20 million literate, eager people with a thirst for quality products and services – something that is very evident on the motorway where the cars are younger and smarter than in New Zealand. Language is a barrier, but not overly so – there are growing numbers of foreign language schools (English and German being prevalent) taking children from five through to university, where all subjects are taught in whatever the parent has opted for. Given New Zealand’s experience in this sector surely this is an opportunity. Peru is another matter entirely – it is clearly impoverished but the tourism sector is a revelation if my own experience is any guide. We used some Chilean friends to

book a trip for us using LAN Tours, the subsidiary of the largest airline in this region (and one the largest in the world), as the prices for domestic purchases are lower than those available offshore. For $1150 dollars we had a three night/four day trip to Cuzco to visit Machu Picchu. This entailed a three-hour flight to Lima, followed by a one-and-a-half hour flight to Cuzco. It was quite simply amazing and all details were covered from collection at the hotel, transfers, breakfasts – everything worked like clockwork. Cuzco is a city of 500,000 and apart from the brewery and university is reliant on tourism, and it shows. Tourists are very well treated whether you want a hostel or five-star luxury. Tourism NZ could learn a lot from the Peruvians. They seem to have found the right balance between coddling and independence. The restaurants are to die for – one meal was among the five best I have ever eaten (anywhere) and the price for four was NZ$175. In a competitive market for the tourism dollar Peru has much to offer and it shows. Scenery is clearly not enough when competing with the Andes, rainforest and some of the finest ancient monuments in the world. Whether New Zealand could sell Peru anything is moot but there are opportunities – we only have to look. One final note – bureaucracy! In both countries it is a nightmare, but again not insurmountable. The volume of paper used to complete simple transactions like changing money, paying a hotel bill, booking a taxi to the airport is astonishing and probably reflects a national work creation effort – but it is effective. As for New Zealand? Could try harder – being the friendliest hosts is not quite enough. Ashley Balls is senior partner of LegalBestPractice. Visit www.legalbestpractice.com

The book

Newly updaTed for 2012 The New Zealand Export and Trade Handbook continues to be a vital reference guide for Kiwi exporters and importers.

To order your copy call Hilary Keen (09) 478 4771 or email: Hilary@adrenalin.co.nz Purchase on-line at www.exportandtrade.co.nz

WOWing the consumer ❖ Actors for hire ❖ DIY website audit ❖ When staff don’t measure up

MAY 2012

It might be the difference between your business sinking or staying afloat. Talk to your insurance broker today about QBE Insurance. www.qbe.co.nz

QBE-054 Rapport NZB • Photo courtesy of Mark Alen

A touching tale

Al Monro: learning my way to success 8.20

May 2012

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