The Business Adviser Embracing Change
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Welcome to our second issue of ‘The Business Adviser’ “Do one thing every day that scares you” Eleanor Roosevelt The only constant in business life is change… Whilst this may be a little scary for many businesses and at times, challenging, the businesses that will thrive in this evolving environment will be the ones that see opportunity in the changing world. Whilst we may have survived the GFC and moved on, there are still mixed messages amongst business as to the speed of growth and stability in the Australian economy. Of late, many businesses have started to see the impacts of recent economic and political changes on their bottom line and a number have noticed that there is a greater focus on technology and its impact. Cloud technology is driving efficiency across the business sphere to do more with less. Great outcomes are being driven by businesses that recognise the opportunity and reinvent their business model accordingly. We have seen the opportunities created when businesses review their current business functions with the intention of looking to create new roles that better meet the needs of their changing market. The increasing cost of Australian labour driven by the demand for skills to drive efficient business – and the corresponding opportunity of a global labour market – suggests that Australian business will need to have a global view of labour input to generate the supply businesses will need. As well as great upside, this issue generates challenges of its own that business will need to respond to. So whilst change can be a little scary it also can be very exciting. We all know that it is human nature to look at the downside of change, but I urge you to see the opportunity for your business. So with this issue of The Business Adviser, I ask: How are you preparing your business to respond to the challenges of change in our business world? What processes do you have in place to ensure that this is done as part of the usual business of your business? Are you ready to capitalise on these opportunities and secure the future growth and prosperity of your business, if so, ask us how we can help you. Matthew Gardiner Partner, Business Advisory
Inside this issue 1
Change: The Key to Success
2
Learning to delegate
3
Office productivity
4
Improving decision making
5
How to hire the right employees
6
Cash flow strategies
Change: The Key to Success As global business shifts towards a cloud-based era, will your business seize these new digital opportunities? Businesses cannot grow without change. As technology continues to evolve, there are consequences of not adapting your business to the current environment in which it operates. Has your business missed opportunities that were only identified in hindsight? Is the overarching mindset ‘if it ain’t broke, don’t fix it’? If you sense that your business is operating with this ‘tunnel vision’ approach, now is the time to assess new opportunities available and devise a futurefocused strategy. The introductions of cloud-based operations and social media platforms have changed the way many businesses operate. In a relatively short period of time, these online applications have changed the landscape in terms of marketing, accounting, IT services and CRM to name a few. The Cloud General Manager of Global Technology Services at IBM, Phillip Guido recently spoke about how cloud computing has opened a multitude of new possibilities for businesses. No longer is cloud technology limited to improving IT functions, but they are emerging for a number of business processes. Research firm IDC has stated that 85% of new software being built today is for the cloud.
What is cloud computing? Cloud computing is when you store and access your data and applications via the internet, so they can be accessed anywhere at any time. Cloud computing is used in a variety of formats. For instance, companies can choose to pay for an online software subscription such as Salesforce.com, Office 365 or Xero. Alternatively, companies can create their own cloud-based platform with custom-made applications tailored to their specific needs. Advantages of the Cloud Accessing data and being able to work from any location at any time provides increased opportunities for companies. These include: Flexibility of workforce
With the incorporation of cloud computing solutions, employees are no longer limited to traditional work hours or even office bound. The implication is that tasks which may have traditionally been limited or out of reach can be exploited. It also allows for a more efficient and versatile use of the workforce.
“When you’re finished changing, you’re finished.” Benjamin Franklin
Improving efficiency through use of live data
Changing the face of outsourcing.
Cloud computing programs often involve automating processes that previously would have been quite manual. For example cloud based accounting solutions offer live bank feeds, which import data directly from the bank straight into the accounting system, eliminating data entry. The result of these automations combined with cloud accessibility is that business leaders have more accurate, timely data. This in turn means smarter decision-making and faster reaction time to potential threats.
There are industries which are facing capacity and skills shortages and looking to outsourcing as a medium to long term solution. Cloud technology is aiding this trend by allowing businesses to remain competitive from an efficiency and cost perspective.
In an article in Forbes Magazine, grocery chain Delhaize Group America explained how it has created its own cloud platform from which it analyses store data and local weather data to study the impact on sales. As a result of this cloud-based analytics programs Delhaize found that warmer weather reduces purchases of certain grilling meats and increases the purchases of magazines. This allows Delhaize to make more informed decision regarding inventory and staffing requirements based on weather forecasts. Increasing international scope
The ability to conduct business through the cloud from any location in the world allows for greater international opportunities and expansion. Multinational companies are able to reduce costs of data access and operate a global shared services network by keeping all of their information on one platform.
Cloud-based outsourcing can function much the same as traditional outsourcing, with the exception of more advanced systems. However one of the revolutionary aspects of the cloud is that it is now possible for companies to implement a hybrid outsourcing solution. This means that instead of wholly delegating a process overseas, the company is able to partially control the process in-office, and coordinate segments of work that will be completed via the cloud by an outsourced workforce.
What does this mean for you? In a recent global survey of almost 800 technology industry leaders, the cloud was ranked as the technology that will have the greatest impact in driving business transformation for enterprises. This is just the beginning for the potential that the cloud offers to businesses across industries. What once started as a platform to reduce costs and increase efficiency has now expanded to allow firms to re-think their entire business model. With a mobile workforce, live data feeds global shared service opportunities, how will business embrace these changes to accept opportunities and go on to expand, grow succeed?
and your new and
To learn how you can enact positive change in your business, contact Matt Gardiner today on 02 9020 4137.
QUOTE NEEDED
6
Learning to delegate Learning to delegate tasks and responsibilities can be a challenging adjustment for many leaders and business owners. While it is tempting to try to maintain control over all aspects of your business there comes a time when there are simply not enough hours in the day. Effective and well executed delegation can add considerable value to your business.
The most significant advantage is that once you have delegated some of your responsibilities to others you will be able to truly apply yourself to the more pressing or complex tasks that require your attention. Additionally, you will be increasing the skill set of your staff members. This is not only beneficial for the business, but also gives your employees a sense of pride and career progression.
Delegating a task to someone is also a fantastic opportunity to assess their potential for leadership or promotion. One of the most important aspects of learning to delegate is choosing the right person. You should consider their capacity to work independently, their interests and ambitions within the company, and whether or not the new responsibility will put a strain upon their current workload.
It is important to explain to the person the reasons why you have chosen them, as well as the value in the delegated task.
This will demonstrate your appreciation for their efforts. You need to make sure that you have set aside adequate time to train them to do the new task. It is also important to avoid the temptation to watch over their shoulder and micromanage. Instead, set them a time frame and when the task is completed give them your full and honest feedback. Once they have completed the task several times, if you are satisfied with their performance, you should sit down with them and discuss how the task can be incorporated into their regular responsibilities. It may be necessary for you reduce their current workload.
You should also ensure that they feel sufficiently rewarded. While increased remuneration in the form of a salary increase or bonus may be unfeasible, taking them to lunch or sending an office wide acknowledgment of thanks can go a long way. If you would like to speak with a business performance improvement specialist, please contact Kate Blecich on 02 9020 4034.
“When you have that window of opportunity called a crisis, move as quickly as you can, get as much done as you can. There's a momentum for change that's very compelling.�
Anne M. Mulcahy
8
Office productivity Productivity in the workplace is affected by a number of different things. Being aware of common barriers to productivity in the workplace, as well as engaging with advice on how to boost your productivity to above average levels, can be extremely beneficial to your business outcomes. Here are five things that all businesses should be thinking about:
Assigning one staff member as a trainer or mentor to others who will be learning skills from them is a great way to demonstrate your confidence in someone, while simultaneously giving you an opportunity to evaluate their leadership skills before a promotion.
1. Motivating Staff
3. Digital Organisation
More motivated staff equate to a more productive company. Adequate remuneration is an important factor in job satisfaction (and staff retention).
With so many workplaces having become paperless it is now easy to feel that your office is an organised environment. However, digital clutter can be an issue when servers and hard drives become a disorganised mess.
However, there are a lot of other important contributors to job satisfaction, including an appropriate system of reward and recognition. Ensuring that workplace complaints are heard and seriously considered is another significant factor in staff motivation. Additionally, increasing individual accountability for tasks will improve work ethic and increase people’s sense of achievement.
If staff have difficulty locating documents or programs this can be a significant barrier to productivity. Additionally, it creates a sense of disorder that can impact their perception of management. Organising the company’s digital work place, and encouraging individual staff members to be similarly organised, can go a long way in improving your productivity.
2. Expanding Skill Sets
4. Productivity Software
There are a lot of advantages to rotating employee tasks wherever possible. Your staff will develop a more diverse skill set, people will feel that they are making career progression and it will increase employee engagement.
There are a lot of new productivity software products and apps that are designed specifically for the workplace. Some of these are even created for specific industries and/or roles.
Examples of helpful software products or apps include digital time trackers, to do lists, productivity monitors and project management software. Remaining aware of new workplace productivity software, especially if it is an industry specific development, will ensure that you maintain your competitive edge.
If you do go ahead with purchasing productivity software, ensure that you provide staff with adequate training in using it. 5. Scheduling Communication Returning phone calls and responding to emails is not just time consuming, it can also be extremely bad for employee productivity. Constant interruptions break people’s concentration and can be very distracting. By encouraging your staff to have specific times each day that they return phone calls and emails you can improve the productivity and concentration of your staff. If you are looking for ways to increase productivity in your workplace, contact Tony Kabrovski on 02 9020 4109.
“Technology is nothing. What's important is that you have a faith in people, that they're basically good and smart, and if you give them tools, they'll do wonderful things with them.” Steve Jobs
11
Improving decision making The ability to make the right decisions is central to good leadership. What many leaders fail to realise is that decision making is a skill that can be improved and refined just like any other. While some people are more naturally predisposed to make confident decisions in a timely fashion, this does not necessarily signify a good decision maker. Here is a step by step guide to improving your decision making skills:
Always ask yourself if you are making the best decision or the most readily available decision
Reflect upon whether you have all of the relevant information upon which to base your decision
If the stakes are high, allocate a proportionate chunk of your time to considering all possibilities. If necessary map out all of the potential outcomes and speculate on how your competitors may react
Acknowledge what you currently don’t know and what information you can’t find out. This will strengthen your final decision
Analyse times in the past that your decision making has been poor. Aim to identify any flaws in your decision making process
Be aware of your gut instinct – sometimes it can be your saviour – but learn to differentiate it from your logical thought processes.
For advice on strategic leadership and improving the ways that decisions are made in your business, contact Stephen Preen on 02 9020 4090.
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13
How to hire the right employee Hiring a new employee to join the business is an important task that shouldn’t be taken lightly. Employers should scout out talent in the same way that a good sales person hunts for new clients. Many employers enter the selection process unprepared and end up settling for a candidate who is not right. Employers should take their time to find out whether their candidate really has the character and credentials to fit the position available. Hiring the wrong employee can end up costing an employer a lot of time and money through reduced sales, poor morale, lost productivity and interview costs. Here are a few ideas to help employers land the right employee:
1. Screen for organisational fit Successful companies believe that having a candidate fit into the organisational culture is more important than the candidate’s skills. This is because employers can teach job skills; however, they cannot teach character. Although ‘organisational fit’ is more subjective than job skills, it is still able to be determined. First, an employer needs to understand their own company’s culture and decide on the characteristics and personality required by a new employee to fit in. Questions should be asked in the interview to reveal the candidates character and how they like to work.
For example, ‘talk about the most difficult culture you have worked in and how you dealt with it.’
2. Screen for the right job skills It is also important to screen candidates to determine if they have the necessary job skills. Companies should avoid screening candidates on outdated or generic job descriptions as candidates will be prepared for the standard interview questions, such as their strengths and weaknesses. The best predictor of success is a candidate’s past behaviour and results, not their interview expertise. Ask about the candidate’s successes at past jobs and what they achieved after six months, one year and three years.
3. Verify credentials A key step in hiring a new employee is to verify their credentials and ensure that they have achieved what they are claiming. It is important to spend the time and money performing background checks and assessments as it will only cost more in the long term if the candidate is not the right fit. For more information on ensuring that you hire the right person for the right role, contact John Raffaele on 02 9020. 4111
“The world is changing very fast. Big will not beat small anymore. It will be the fast beating the slow.� Rupert Murdoch
15
Cash flow strategies Without profits and positive cash flow, a business is going to struggle to survive. This is why cash flow strategies should be taken seriously. Aim for long term financial stability When setting finance and cash flow goals for the business it is important to aim for long term stability. Businesses should realistically assess how and when they want to reach their long term goals. Don’t forget to consider customers who are permitted to make purchases on credit as it will help in forecasting how much cash is coming into the business and whether it will be enough to cover expenses.
Profit first and growth later Businesses should aim to increase profits in the present and use them to grow the business in the future. Approaching it the other way around isn’t always a good idea, especially for start-up companies.
Be aware of timing Businesses need to be aware of exactly when money is coming in and when it is going out. Although owners may not be directly responsible for the accounting side of the business, they should at least be aware. It is also important to have a plan in place to ensure that clients pay promptly so that the business can know when to expect a payment.
Should you require advice on innovative cash flow strategies, please contact Kate Blecich on 02 9020 4034.
Sydney Business Advisory Contacts Matt Gardiner, Partner Business Advisory E: mgardiner@hlbnsw.com.au P: (02) 9020 4137
I am a widely experienced professional with strong, specific expertise in working closely with small to medium sized businesses and in particular, family owned and operated businesses.
Tony Kabrovski, Partner Business Advisory E: tkabrovski@hlbnsw.com.au P: (02) 9020 4109 I have built an outstanding reputation for developing a proper understanding of my clients’ most exacting requirements and developing practical and easily implementable solutions. This has been achieved by working alongside and sharing the journey with my clients. Where will your journey take us?
Stephen Preen, Partner Business Advisory E: spreen@hlbnsw.com.au P: (02) 9020 4090 I am highly regarded for my client focus, consultative approach and highly personalised service, attributes that have been integral to much of my work with family owned and operated businesses. These attributes have been best demonstrated in my appointments as administrator to the estate of a number of family businesses, a process that involved the sale of numerous assets, including several properties, and the distribution of the proceeds to various beneficiaries. John Raffaele, Partner Business Advisory E: jraffaele@hlbnsw.com.au P: (02) 9020 4111 A key focus of my work has been assisting privately owned businesses to implement realistic, workable and sustainable growth plans, particularly in relation to managing growth from a financial and strategic perspective. In particular, I have worked closely with clients seeking to optimise the value of their business, often as part of a business restructure, divestment or sale. Kate Blecich, Director Business Advisory E: kblecich@hlbnsw.com.au P: (02) 9020 4034 I have over 10 years experience specifically relating to business performance improvement through assisting businesses to develop with respect to business growth, profit maximisation, enhancing cashflow, asset protection and succession planning.