ISSUE 143 DECEMBER 2016
A good year
2016 results shape strong future P10
PROGRESS IN PAY EQUITY DISPUTES
MAKING SPECIAL REWARDS SPECIAL
DESIGN REFLECTED IN BOTTOM LINE
THE ‘TRUMP EFFECT’ IN LATIN AMERICA
…AND MUCH MORE!
“THE BEST WAY TO DEAL WITH ANY EMPLOYMENT RELATIONS MATTER IS WHEN YOU KNOW THAT YOU ARE ON THE RIGHT TRACK, FOLLOWING THE RIGHT PROCESS. THE EMA SUPPORTS AND COACHES MEMBERS, LIKE US, TO BE PROFESSIONALS LIKE THEM” Marilou Cuison, Human Resources Manager | PAK’nSAVE Papakura
Do you need help with restructures, union negotiations, personal grievances or other staff issues? LET AN EMA CONSULTANT HELP YOU. Visit ema.co.nz or call 0800 300 362 to find an EMA consultant near you.
On the cover: BusinessPlus is published by The Employers and Manufacturers Association (Northern) Inc (EMA) EMA is the major shareholder of national lobby group, BusinessNZ.
Editor: Mary MacKinven T +64-9-367 0939, M +21 636 089 E firstname.lastname@example.org
Some of the more recent additions to the EMA Board include (from left) Margaret Gracie, New Zealand Steel, Sara Lunam, Port of Tauranga Ltd and David Welsh, Iplex Pipelines NZ Ltd. Read more on the AGM and key highlights. Full story pages 10-13
ISSUE 143 DECEMBER 2016
A good year
2016 results shape strong future P10
PROGRESS IN PAY EQUITY DISPUTES
MAKING SPECIAL REWARDS SPECIAL
DESIGN REFLECTED IN BOTTOM LINE
THE ‘TRUMP EFFECT’ IN LATIN AMERICA
…AND MUCH MORE!
Designer: Ripeka Mikaere Printer: MHP Distributor: Rocket Mail Advertising sales: Colin Gestro, Affinity Ads, M + 27 256 8014 E email@example.com
ISSN No. 1176-4953
Commentary EMA Head office – Auckland: 145 Khyber Pass Rd, Grafton, Auckland, NZ Private Bag 92066, Victoria St West, Auckland 1142. P +64 9 367 0900 E firstname.lastname@example.org Hamilton: EMA/ExportNZ Waikato 103 Tristram Street, Hamilton. PO Box 490 Waikato Mail Centre, Hamilton 3240. P +64 7 839 2713 Tauranga: ExportNZ Bay of Plenty Smart Business Centre, 65 Chapel Street, Bay Central, Tauranga, 3110. PO Box 13202, Tauranga Central, Tauranga 3141. P +64 7 571 0600 AdviceLine: NZ 0800 300 362 AUS 1800 300 362 E email@example.com Phone 8am-8pm weekdays for information about employment and more, plus referrals to EMA Legal lawyers and your local EMA consultant in employment relations and/or occupational health and safety. Visit www.ema.co.nz for owner and staff training programmes, confer-ences and other events, employer guides and templates, manufacturer services, media statements and submissions, export development and more EMA contacts Chief executive: Kim Campbell Membership manager: Roger Carson External Relations manager: Val Hayes Advocacy & Industry Relations manager: Mark Champion Learning manager: David Foley Enterprises & Strategy manager: Mauro Barsi Industrial Relations & Safety manager: Paul Jarvie Finance & Technology manager: Paul Yeo Corporate & Building Services manager: Sheree Alcock ExportNZ manager: Catherine Lye
EMA’s CEO Kim Campbell on: Merry Christmas and a prosperous New Year AdviceLine hours during Christmas and New Year
A new era for “retail” politics: what does this mean for NZ?
Major step forward for managing pay equity claims
BusinessNZ CEO Kirk Hope on: Auckland business is optimistic
Building EMA’s future: new board and AGM results
Seen @ EMA’s Annual General Meeting in Auckland
Employment Business outlook is strong for 2017: Employers’ Survey
Ensuring special employee rewards really are special
Case law: Police vet – you bet! Changes employers can expect
Employment Chat – Q and A: Hard hats, parties and policies for business property
Certification helps build youth employability
Recruit well, retain and retrain
In BusIness ICT: Winners, losers and unrequited computer love…a satirical review of 2016
PMI and PSI surveys: A business survey for all seasons
Marketing: Develop leadership skills to keep business thriving
Manufacturing: Stocktake of manufacturing in NZ – what’s really happening
Design: Better office design equates to better bottom line
Buying: Mid-market sales and acquisition growth
News: Asia Pacific’s first Tesla Powerpack supplies electricity in Auckland Ports of Auckland records good year despite unsettled shipping industry
InternatIonal Trade Kiwi exporters report a good year and confidence for 2017
The Trump Effect in Latin America
The road to success is littered with risk
Member ProfIles Kiwis reign in international customer service awards Congratulations to BusinessPlus survey participant
BusinessPlus is free to EMA members BusinessPlus December 2016
10 WAYS WE HAVE HELPED YOUR BUSINESS
Been deeply involved in making practical changes to the Health & Safety at Work Act
Provided economic and employment updates to more than 6000 people via our regular Member Briefings
Introduced the concept of Employment Readiness Certificates for school leavers
Continued to raise the importance of better transport infrastructure and funding for this
Been instrumental in the passing of legislation protecting migrant labour from exploitation
Answered more than 30,000 queries from members via our AdviceLine service in the past year
Delivered a reduction in ACC levies
Promoted the need for a more efficient planning and consent process
Fought to mitigate members having to bear unnecessary costs of earthquake strengthening for buildings in low risk areas
Provided more than 750 training, networking and conference events for our members, which were attended by more than 10,000 people
NZ 0800 300 362 | AU 1800 300 362 www.ema.co.nz
CEO Commentary By Kim Campbell
Merry Christmas and a prosperous New Year The EMA team has had another industrious year working on initiatives to help your business prosper. As we head into the traditional Kiwi holiday break, it’s a good time to reflect on the year that was and think about what lies ahead. At the EMA, we have made good progress in many key areas this year. We have refreshed our brand. We now have a more progressive and contemporary look to better reflect how we as an organisation will work to help your business succeed. You will already have seen a new look for BusinessPlus, our Training Directory, annual report and Member Briefing booklet. We will continue to roll out this new look and feel across our printed and digital collateral over the coming months. Our move into our new head office and training facility in late March was seamless. I know many of you have already enjoyed coming to this new facility and we look forward to seeing you next year at one of the many network or training events we hold. We can also host events here for your business. One of the most significant changes for employers was the introduction of the new health and safety legislation earlier this year. It’s important to acknowledge that change was inevitable. After the early teething problems most businesses have done the training, accepted the new environment and everyone is safer accordingly. Our aim was to inject the voice of business and advocate for practical solutions in every aspect of the new legislation and regulations. Our work in this area has been tireless. From our advocacy efforts through to the specialised training to enable you to be ready for this new era, everyone in the EMA has been involved in bringing this health and safety legislation to life.
Another significant piece of concerns reforming the resource management system. While there is still a long way to go, we have built a solid case with our partners that the status quo is not an option for a successful and sustainable New Zealand. The current resource management system is not working for business, nor the environment, and we must develop something which will better serve the future needs of New Zealand. We continue to provide outstanding service to members through our AdviceLine, EMA Legal and Consultancy offering. We know these services are highly valued by members as most of you rate them excellent or very good. Therefore, in the coming year our focus will be on how we build and maintain this crucial offering. Likewise, our training is also highly rated by those who attend. By now, you should have received the 2017 Training Directory and can start planning for your business’ needs. Our Tailored Solutions training offering is becoming increasingly popular and looks set to expand in the coming year, and we continue to build our digital learning offering too, while still providing the solid base of courses and events we have fine-tuned over many years. As we head into 2017, I am highly aware of what we can control and what we cannot. Currently, New Zealand”s economy continues to perform well with growth looking like it will be around 3 per cent. However, there a number of issues which continue to plague the global economy, including moves towards greater isolationist and protectionist policies. In the coming year we will no doubt have many new challenges resulting from the President Trump administration.
However, as an EMA member, what you can be certain of is that we will be there for you. At the heart of our efforts is you. Whatever service we offer, or where we focus our lobbying efforts through to what we comment on in the media, our focus is on helping our members succeed. I look forward to your continued support and working with you in the coming year. In the meantime, our team will be here for you should anything arise over the break, please refer to AdviceLine opening hours below. Have a safe and happy holiday and we will see you in the New Year.
AdviceLine hours during Christmas and New Year The EMA offices are closed from Friday, December 23 and reopen on Monday, January 9 next year. However, during that holiday season you can phone AdviceLine during the following hours: 2016 Friday 23 Dec. Monday 26 Dec. Tuesday 27 Dec. Wednesday 28 Dec. Thursday 29 Dec. Friday 30 Dec.
8am - 5pm Closed Closed 9am – 5pm 9am – 5pm 9am – 5pm
2017 Monday 2 Jan. Tuesday 3 Jan. Wednesday 4 Jan. Thursday 5 Jan. Friday 6 Jan. Monday 9 Jan. onwards
Closed Closed 9am – 5pm 9am – 5pm 9am – 5pm 8am – 8pm
Contact AdviceLine on 0800 300 362 in New Zealand or 1800 300 362 from Australia or by emailing advice@ ema.co.nz for all your queries about employment relations and other aspects of doing business in New Zealand. Also visit www.ema.co.nz for member-only access to employment guides and templates.
Kim Campbell is the CEO of EMA. Email firstname.lastname@example.org BusinessPlus December 2016
Commentary By MARK CHAMPION
A new era for “retail” politics: what does this mean for NZ? The reality of Donald Trump moving into the US’ White House has once and for all changed the face of retail politics. The ability to run a Presidential campaign with a largely social media focus, whilst simply fending off scrutiny from traditional media channels, will be the lasting lesson from the 2016 US elections. The political dynasties – Clinton and Bush – have been thrown aside, fact checking and scrutiny proved ineffective, the media’s sneering dismissiveness of Trump, the power of the party machines and attack advertising campaigns all came to nothing in Trump’s ride to the White House.
In fact, so buoyed by that international mood, Mr Peters repeated his prediction that his party would poll second in the 2017 election – ahead of Labour we presume.
Mr Peters reminded us that he had picked a Trump victory more than a week before, that earlier in the year he joined the Brexit campaign and had seen similar discontent bubble up and over, and then he went on to foretell (as you would expect) a similar wave of discontent about to express itself in New Zealand – with Mr Peters positioning himself as the political beneficiary of that ‘movement’.
BusinessPlus December 2016
NZ election signals So what are the international signals we have been sent and can recognise a year out from New Zealand’s general election? Those signals are: •
Nothing better summed up the two candidates’ readings of how that campaign should be waged than their respective slogans. Clinton, under the banner of ‘Stronger Together’ tried to engender the inclusiveness she believed America needed – which ironically failed to tap into white, lower and middle class discontent. Trump dialled directly into that discontent with the call for a return to simpler, better times – ‘Make America Great Again’. The same day as the vote count was held in the US and the world watched Trump pull ahead in the swing states, the EMA was holding its Annual General Meeting. Our guest speaker was the Rt Hon Winston Peters – himself a politician who time and time again has shown himself able to tap into the same kind of discontent that has fuelled Trump to the Oval Office.
Joyce stumped up with $183 million for work-based training, a shiny new target of 50,000 apprentices and two new job hubs in Auckland.
A prospective fourth term National Government will need to present a new and revitalised face and offer an agenda of real change. Homelessness, housing affordability, social equity, a more liveable Auckland, jobs and training for young people, and real regional development are all issues with considerable political play in the new landscape. Old and tired solutions will not cut it. A continuation of the incremental and cautious riskadverse approach to issues like the resource management system reform, tertiary education, housing and infrastructure development will not present the fresh face that is required. A fourth term National Government will need to present itself as a party of change – a party in touch with that politically subterranean ‘movement’ that has engulfed the UK and US and is poised to move through the democracies of Europe. Labour, despite flagging it for nearly two years, has stolen a march on National with its Future of Work Commission and the findings and recommendations of that project. Labour is working its natural territory with the Commission, and despite a couple of expected shots across employers’ bows, the recommendations are fresh, optimistic and focussed on the task of providing skilled labour in a rapidly changing jobs market. It must have been good work because the day after it was release Minister Steven
The Peters Agenda. It is now almost inconceivable that a government will be formed post our 2017 election without Winston Peters and New Zealand First. His party is on a roll, the regional agenda plays well for him, not only in Northland, and he is sensing fertile ground in scrutiny of our financial systems and controls and those who are involved in those systems.
According to Politik blog editor, Richard Harman, the Peters’ Agenda, which potential coalition partners of NZ First must understand and largely accept, may look like this: 1.
A wide ranging review of the Reserve Bank Act. Now 27 years on from the Act’s introduction, this would seem achievable, but the Agenda clearly points towards a potential broadening of the Bank’s mandate – more towards the Australian model.
An inquiry into foreign-owned trading bank operations;
Limitations on foreign investment;
Limitations on immigration; and
An increase in health expenditure.
There is much in this speculative wish list that plays to themes we recognise from the Trump and Brexit campaigns. They are also themes that are likely to cause considerably less irritation to Labour than National.
EMA’s focus So, as an organisation committed to helping our members succeed, what will be the priorities EMA will focus on in 2017 and onwards? The focus of our lobbying efforts in recent times, based on feedback and views from members, has seen us drive hard to achieve outcomes for members in the following areas:
Coping with economic growth: Reform of the resource management system, infrastructure development and transport.
Skills and training: Our work stream ranges from numeracy and literacy courses, employability of young people and preparation of a tool kit for members as they confront our ageing population and the role older workers will play in the future.
EMA advocacy results
Employment law and health and safety: Having achieved what we believe was a good result on the pay equity working group, the Government now needs to act to imbed the recommendations. It also needs to tidy up a shambolic Holidays Act.
Export growth: The Government has set an ambitious 40 per cent target for exports as a percentage of GDP. Given Brexit and the Trump victory, this ambition just got a lot tougher.
We are committed through our lobbying efforts and our leadership of ExportNZ that we will be there, alongside Government, selling the story of exports driving prosperity and doing everything we can to promote expanded trade access.
In recent times, we have seen considerable progress across the areas listed above. Some gains we can own as straight out lobbying wins, while others have shifted the landscape and prepared the ground. These include:
The defeat of the Minimum Wage (Contractor Remuneration) Amendment Bill, a Private Members Bill promoted by Labour’s David Parker. Unintended consequences were of concern to our members. A co-ordinated campaign from our sister organisations around the country saw this Bill rejected. Considerable reductions in ACC levies over the past two years and a more transparent process for the setting of those levies.
A pitched battle on behalf of members to prevent the electricity regulator from changing the way the cost of transmission of electricity is passed onto consumers. Under its proposals, our region north of Taupo faces annual power price increases of around $180 million. That fight continues.
A partnership with other business organisations and the Environmental Defence Society (EDS) to campaign for a complete rethink of the resource management system. The research is in; the lobbying has begun.
The creation of the Auckland Transport Alignment Project (ATAP). This is Government talking to Auckland Council about the future transport needs of the city. We pushed hard for this mechanism and government bodies listened. Now we are pressing hard for the agreed programme to be rolled out sooner rather than later.
Mark Champion is EMA’s general manager of advocacy and industry relations. Email email@example.com BusinessPlus December 2016
Major step forward for managing pay equity claims Significant progress has been made on managing issues around pay equity between men and women in different occupations, with the Government confirming it agrees with the recommendations made by the Joint Working Group on Pay Equity. EMA was part of the Joint Working Group (JWG) comprising employer, union and government representatives. The JWG provided recommendations to Government on how to manage this complex issue. “The working group was determined to offer an agreed way forward on this matter. We ensured the principles outlined the criteria for determining a pay equity claim, how the bargaining approach would be conducted and how settlement would be managed,” says Mark Champion, general manager advocacy and industry relations at EMA. The Minister for Women, Louise Upston, says it’s important gender does not affect what people are paid. She says, “Occupations shouldn’t be lower paid just because women make up most of the employees.
“The Government’s response means that employees and employers can resolve concerns about unequal pay in good faith. “In addition, there will be a pathway for resolving issues, as happens with other employment matters, including mediation and ultimately the Employment Relations Authority.” The agreed principles outline how a pay equity claim can be made and in what circumstances. Broadly speaking, the recommendations include: · Principles to provide guidance to employers and employees in identifying, assessing and resolving pay equity claims; · A process for employers and employees to follow to address pay equity, including a bargaining process based on the Employment Relations Act framework. The recommendations work through criteria determining the merit of a claim, the pay equity bargaining principles, what are appropriate comparators in this process, how to settle a claim, dispute resolution and applying good faith bargaining.
What does this mean? For employers, this is a good outcome in that a bargaining approach was the preferred option to address a pay equity claim, should it arise. This will give certainty to the process, and is an approach employers are familiar with, under current employment law. It was a major step to have the members of the JWG agree on an approach in the first instance, and then also to have these accepted by Government.
What’s next? The next key step in this process will be integrating this into law. Changes to the Equal Pay Act 1972 and the Employment Relations Act 2000 will need to be made. The Government expects to introduce a Bill to this effect next year. EMA will be deeply involved in this process going forward, and will keep members updated in this regard. A lot of detail will need to be worked through as this progresses. You can read the Summary of Response to Joint Working Group on Pay Equity Principles at www.ema.co.nz in the Reports and Documents section.
For more information contact Val Hayes, EMA’s external relations manager. Email Val.Hayes@ema.co.nz
Get your 2017 training sorted! Order your free business training directory now www.ema.co.nz
BusinessPlus December 2016
Commentary By Kirk Hope
Auckland business is optimistic Auckland businesses are reporting an optimistic frame of mind. Businesses that are members of the Employers and Manufacturers Association (EMA) reveal useful insights into business confidence by taking part in surveys run by EMA and BusinessNZ.
“Cashflow, acquisitions, exports”
This year, however, the answers were more positive than negative, including:
“Get back under control after unprecedented growth, take advantage of opportunities offered by the growth in NZ, increase profitability”
“Improve productivity, grow export markets, product innovation”
“Commercialise new IP, enter new geographic markets, access growth capital”
“Upskill staff, improve performance in newly introduced product ranges, improve working capital”
“New market for export – Indonesia, new machinery, implement project management system”
“CRM, export, social marketing”
“Expand business into new markets, capital raise to fund expansion, transition to “a services led organisation”
“New product launch”
“Gaining some different clients”
“Health and safety”
“Increased margin with increased profit”
“Topline and bottom line growth”
“Acquire more good employees”
“Significant profitable growth”
“Maintaining revenue at budgeted level despite increased competition”
Monthly surveys of manufacturers and services businesses in the top half of the North Island (for the PMI and PSI surveys) deliver valuable data for analysis and decision-making.
“Record financial result”
“Best ever financial results”
“Kaizen achievements and R&D innovations”
Our most recent annual survey, Mood of the Boardroom, has given a good insight into confidence by the many small and medium companies in the greater Auckland area.
“Surviving the dairy downturn”
“New product launch”
“Two new facilities commissioned and progress offshore”
This survey, run annually in partnership with the NZ Herald, surveys businesses of all sizes and types throughout New Zealand.
“Developing a USP”
“Merger with Australian company, opened new outlets”
“Getting rid of a bad apple, finding new clients”
“Successful acquisition of another manufacturing business”
Interestingly, this confidence was also reflected in the responses by medium and small businesses in the top half of the North Island.
“Revamping web presence”
“Record number of sales”
“Opened new export market”
Most reported that they expected to increase capital spending and spend more on IT this year, and their highest reported priority was related to growth.
“10 per cent growth in sales”
“Business transformation program resulting in a significant turnaround”
The “comments” part of the survey revealed the most positive results, especially the question which asked: “What was your best achievement in the last 12 months?”
This year’s survey showed large Auckland-based businesses to be in a positive frame of mind. Business leaders surveyed reported feeling more upbeat about their prospects than a year ago – “serious optimism breaking out,” the Herald reported.
This is a question that is included in the Mood of the Boardroom survey every year, and most years elicits a range of replies including a fair balance of negative and positive answers.
When asked about future prospects with the question: “What are your top business priorities for the next 12 months?” the responses were similarly positive, including: •
“Find more good people, find more good clients, stay sane”
“Increase business through website, improve website and upgrade business software”
The intentions expressed by these businesses appeared to be based on a degree of confidence about their prospects and the business environment in which they are operating. They suggest an upbeat, positive business sector this year and in 2017.
Kirk Hope is Chief Executive at BusinessNZ. Visit www.businessnz.org.nz BusinessPlus December 2016
Building EMAâ€™s future At EMAâ€™s recent Annual General Meeting (AGM) Sara Lunam, from Port of Tauranga Ltd, was confirmed as the newest board member and Andrew Hunt, from Kinetics Group Ltd, as the new President.
The 2016-17 board members are: Andrew Hunt (President) Kinetics Group Ltd
Both Kim Campbell, chief executive of EMA, and Laurie Margrain, outgoing President, were pleased to report to members that the EMA was in good heart financially. For the 2016 financial year a net surplus of $743,510 was confirmed from a gross income of $17.509 million, with expenditure of $16.765m.
University of Auckland
Rinnai NZ Ltd
The net surplus was an increase of 18.8 per cent on the year prior, on a like for like basis. Total revenue increased by just more than $1m, mainly due to increased use of member services such as employment relations and improved revenue from training and conferences along with income from providing services to Business Central.
Permark Industries Ltd
Iplex Pipelines NZ Ltd
Rankin Treasury Advisory
Operating costs were held steady with no significant changes compared with the year prior.
ASB Bank Ltd
Open Country Dairy Ltd
Other key highlights for the year included conducting a brand refresh, successful completion of the new headquarters in Auckland on time and on budget and subsequent smooth transition to the new office and training premises, plus the ongoing performance of each of the divisions within EMA.
COGITA Holdings Ltd
New Zealand Steel
Port of Tauranga Ltd
We gratefully acknowledge Former President Laurie Margrain, who stood down from the role after four years. The 2016 Annual Report can be found at www.ema.co.nz for further information.
It was a year of milestones for the EMA. The official opening of the new premises, and the subsequent transition to a modern working and training environment, was a significant event for the organisation and marked the beginning of a new era in how member services will be delivered.
Here are some of the ways we helped our 4200 member organisations over the past year.
145 Khyber Pass Road officially opened on 5 May
BusinessPlus December 2016
organised by Learning for members
people attended a training course, conference or networking event organised by learning
on specialist topic forums organised by the Advocacy team
31,943 calls answered
Kept 4200 members informed via our published and electronic communications
submissions were made to ensure membersâ€™ voices were injected into the development of public policy
3 mayoral debates were organised to inject the concerns of business into local body elections
140 students were supported through the Youth Employability Programme, enabling then to be work ready
people attended the 23 Member Briefings held three times a year, throughout the region.
2274 members used the EMA Consultancy or Legal services
2 outstanding ExportNZ award events held to celebrate exporters from around the region
of members who used EMA Legal services rated it as very good or excellent
members proactively contacted by the ExportNZ to find out how best to help them succeed
people chose the webinar option as their preferred way to attend Member Briefings BusinessPlus December 2016
Kim Campbell and Laurie Margrain conduct the order of business
Rt. Hon Winston Peters, guest speaker at AGM
Seen @ EMA’s annual general meeting in Auckland Janice Taylor and Bruce Jackson (Nicoll Jackson Chartered Accountants)
Laurie Margrain (centre) with newly endowed Life Members Geoff Wicher (left) and Terry Arnold (right)
Hamish Chaddington and Melissa Chan (Bellingham Wallace), Don Aue and Pippa Baker (RSM)
Helen Wicher, Geoff Wicher and Margaret Brown (Board Member)
Jeff Douglas (Douglas Pharmaceuticals), Kim Campbell and Angela Campbell
Craig Fisher (RSM) and Laurie Margrain (Board Member)
Graham Mountfort (Board Member), Kevin Brailey (Solutions Financials Services Ltd), Jeff Williamson (Mainprice King Chartered Brokers Ltd), Chris Davis (Board Member)
EMPLOYMENT By MIKE BURGESS
Business outlook is strong for 2017: Employers’ Survey Businesses are heading into 2017 with a confident outlook, according to the EMA’s End of Year Employers’ Survey. Most respondents expected business conditions to improve over the next six months (49 per cent), while slightly fewer (47 per cent) expected conditions to stay the same, says Mike Burgess, EMA’s senior policy analyst. Significantly, 68 per cent of respondents expected their own businesses to grow in the next six months. This is a major increase on the same time a year ago, when in November 2015 the response to the same question was 57 per cent. The majority of respondents said they had increased their number of employees in 2016, which would correlate with the positive outlook respondents had of their own businesses.
However, on the downside, employers were still struggling to recruit, with 53 per cent saying it was difficult or very difficult to attract suitable candidates for positions in general. Specifically, professionals, technicians and managers were the roles employers had the most difficulty recruiting. Machinery operators and labourers also featured strongly as growing areas of skills shortage. This was backed up by the majority of respondents (65 per cent) saying there was currently, or there soon would be, a skills shortage in their sector.
looking to use immigrants to fill their skills shortage along with other mechanisms such as apprenticeships, Mike says. The online survey was conducted in mid-November amongst EMA members. Respondents represented a crosssection of business types and sizes across the EMA region, located from Taupo to Kaitaia. The full results of the Survey will be reported in the February 2017 issue of BusinessPlus. The half-yearly survey will next be conducted in mid-2017.
Not surprisingly, one of the key themes that came out of the survey was looking for ways to resolve this skills shortage. In particular, employers were looking at how they upskilled current staff, but were also
Mike Burgess is EMA’s senior policy analyst, with responsibility for the Employers’ Survey. Email Michael.firstname.lastname@example.org
BusinessPlus December 2016
employment By David Shannon
Ensuring special employee rewards really are special Employers sometimes wonder why employees can seem singularly unimpressed when presented with a “special performance reward”. Very likely, this was due to the way the reward was “packaged.” Presentation can make all the difference, as with many other aspects of employment. Let’s look at just how these special rewards should be presented in a way that excites and motivates employees to continue the performance that attracted the reward in the first place. Note that by “special rewards” we are focusing mainly on those “extras” that sit outside the basic total remuneration package, eg, high performance rewards.
Packaging special rewards These factors need to be considered before presenting the special reward: · Competitive base pay First of all, the employer must ensure the total remuneration package is competitive in the market in general. And, that total remuneration package must not only BE competitive in the market, it must also BE SEEN by employees to be competitive in the market. Employees know what others who are doing comparable work are earning, and if you are not competitive….. well – read no further! Only a fair and just reward is meaningful to an employee. This generally requires you to have ccess to market survey data in order to align your overall total remuneration practice with the appropriate market. If your “special rewards” are seen as merely making up the difference between a low remuneration practice and the market, they will be viewed as little more than a joke.
· Clear communication It is essential that all components of the remuneration and benefit package on offer are clearly described and appreciated by employees and not hidden among a lot of other information about the organisation and its work. This is particularly true for non-financial rewards, such as offering the employee time off for personal reasons, health and medical provisions, counselling, parking, and other benefits that may be “hidden” in the work process – particularly the opportunities for paid time off. This even applies to those aspects of the working environment you may take for granted such as Friday social hour, birthdays off, providing lunches or other food, travel opportunities, and making cell phones and lap tops available for personal use. · Meaningful value To state the obvious, the value of any special reward to the individual is in direct proportion to its size. A financial bonus should be large enough to “make a difference” to the recipient. A “performance bonus” of $50 would likely generate more laughter than gratitude. · Ceremony increases value In line with value, the public presentation of “extra” rewards for performance increases their impact. Make some fuss about extra rewards. A special reward presented in front of fellow workers with some ceremony will be valued more than a personal notice enclosed in a pay envelope. Casual praise in passing, or in a closed office, will not have the same impact as praise given with some ceremony in a general staff meeting.
David Shannon is EMA’s remuneration consultant. Email email@example.com 14
BusinessPlus December 2016
“A financial bonus should be large enough to “make a difference” to the recipient. A “performance bonus” of $50 would likely generate more laughter than gratitude.” Also, take care not to bury praise or compliments on performance in lengthy work announcements. Make them stand out so they can be appreciated and valued. · Source carries impact Make sure the rewards come from the proper source – and that generally means from the BOSS. A public presentation from the boss in front of peers will have much more impact than a letter handed down by an immediate supervisor or, worse yet, the human resource manager. · Exclusivity counts Keep the extra reward at least somewhat exclusive. If the same “bonus” is given to every employee at the same time, it will have little personal meaning and little impact on subsequent work. It will simply be seen as just another part of everyone’s compensation. “Worker of the week” at Friday drinks will wear pretty thin after everyone has received it two or three times – unless the “joke” value has some benefit for team spirit! · Timing matters The reward must relate to the event which led to its giving. While there is no need for unseemly haste, a bonus given for a good job should follow the job. A bonus given for some dimly remembered effort last year is unlikely to have much impact. The effectiveness of variable rewards is directly related to how they are presented and handled by management. The impact can be completely lost if poorly communicated or the above principles are ignored.
employment By Hana Schofield
“The demand for the Police Vetting Services has grown significantly since the passing of the Vulnerable Children Act 2014 and associated regulations.”
Police vet – you bet! Changes employers can expect Media have recently reported about issues experienced by some employers such as child care centres in obtaining police vetting checks and the problems that delays associated with these checks have had on their ability to hire staff. The demand for the Police Vetting Services has grown significantly since the passing of the Vulnerable Children Act 2014 and associated regulations. Currently the police are asked to process about 500,000 applications per year, a significant increase from about 200,000 10 years ago. Recently, the Office of the Privacy Commissioner and the Independent Police Conduct Authority carried out an independent review of police vetting policies and made recommendations to ensure they were robust and legally compliant.
What exactly is a police vet? A police vet is different from the Ministry of Justice criminal record check, which only covers criminal convictions. Its main aim is to protect the most vulnerable members of our society (children, elder people and those with special needs) from any risks posed by people who may have displayed behaviour that could be detrimental to others’ safety and wellbeing. As such, a police vet is a significantly wider check and includes a review of all information held by the police relating to an individual. For example, in addition to any conviction history, this can include family violence information, non-conviction information including warranties for arrest or restraining orders in effect or investigations where no charges were laid, if that information is relevant to the role for which a person is being vetted.
Only “approved” agencies, not individuals, can use the Police Vetting Services. To become approved, agencies must meet one of the following criteria: •
the agency is a government agency;
the agency has functions which involve community safety and security, eg, public hospitals, early childhood services, school bus services and family support services;
the agency has a specific legislative or other obligation to obtain a police vet; and/or
the agency seeks a police vet for immigration or foreign consular/visa purposes.
Checks can only be carried out with the consent of the individual being vetted. However, where consent has not been obtained, the disclosing of information may be justified if one of the exceptions to Principle 11 of the Privacy Act 1993 applies. Following a police vet, a police report is provided to the agency, which includes information about the applicant that the police consider relevant to their suitability for the role, eg, relevant to the assessment of whether they pose a risk to vulnerable people. However, the police do not provide a recommendation about the appointment of the person; this judgement continues to be the responsibility of the agency.
Problematic areas The vast majority of applications are non-contentious and are processed within 20 working days. However, more than 10,000 applications involve information of a nature that requires police to consider whether or not they should disclose non-conviction details to the agency. Complex applications (about 1,000 per year) are escalated to a File Review Officer and around 200 of those are referred for review to a vetting Review Panel. Most complaints received by the Independent Police Conduct Authority and the Privacy Commissioner about police vetting have involved these types of complex applications. The review suggested this could include information that had not been verified as correct by the courts or any other independent agency that could be “very prejudicial” to individuals and leave them with very little ability to counter the prejudical effect of a negative police vet. At the moment, there is no statutory framework for the vetting service. The police carry it out as an administrative function under section 9 (general functions) of the Policing Act 2008 and it has developed ad hoc, largely driven by user demand. As a result, there is some uncertainty about what information can be considered as part of the vetting service. Similarly, the police have no single, over-arching policy or procedural document that provides a consolidated overview of the entire vetting process for staff, which can lead to inefficiencies and inconsistent practices. Continue on pg31
Hana Schofield is a solicitor at EMA Legal. Email firstname.lastname@example.org BusinessPlus December 2016
Hard hats, parties and policies for business property “The stark truth of the matter is that you could be fined up to $25,000 for charging an employee for protective equipment in relation to doing their job…”
“Consider your needs: it may or may not be a good time for employees to take holidays, depending on your business. ”
BEST E H T EST YOU WE T R O F ...
Q. Can I make my staff pay for the increased costs of health and safety, like charge them for hard hats and vests that they constantly damage or lose due to carelessness? - Kev
Q. It’s Christmas and holiday time, and our slow time of the year. Cash flow is tight. Do I have to put on a party for staff? Do I have to allow endless leave to be taken….? – Bryce
No you can’t, I’m afraid.
No you don’t have to do anything in particular when it comes to parties or activities that are outside actual productive work. There are no regulations that say you have to reward staff in any way other than with pay (money). And that is heavily regulated!
The stark truth of the matter is that you could be fined up to $25,000 for charging an employee for protective equipment in relation to doing their job or if you require them to as a pre-condition of employment or through a term in the employment agreement. But employees should be expected to look after and use the appropriate personal protective equipment provided. On a similar vein, it’s unlawful for you to have insurance (to pay) to protect you or your liability if there’s an accident at your workplace or in connection with your workers and the accident is due to breaches of the Health and Safety at Work Act.
But it can be a biggie for staff morale – for at least a portion of your staff probably, though worth checking and involving them in the planning. If nobody wants to go to a staff function, don’t bother. Otherwise find ways to spice it up and have fun - casual can be just fine - in a way that suits everyone, though this is harder to do than meets the eye! Of course you have to limit access to alcohol and provide refreshments with it, keeping in mind people’s safety while
OUR VERY POPULAR EMPLOYER GUIDE SERIES OUR POPULAR ISVERY NOW EVEN BETTER. EMPLOYER GUIDE SERIES IS NOW EVEN BETTER.
A VALUABLE EMPLOYMENT RESOURCE KIT FOR PAYROLL, HUMAN RESOURCE NEW TO STAFF MANA
A VALUABLE EMPLOYMENT RESOURCE KIT FOR PAYROLL, HUMAN RESOURCES, EMPLOYMENT RELATIONS PRACTITIONERS, AND THOSE EMPLOYMENT RELATIONS PRACTITIONERS, AND THOSE NEW TO STAFF MANAGEMENT. OUR SUBJECT GUIDES ARE UPDATEDGUIDES AND AVAILABLE NOW! OUR RELATED SUBJECT RELATED ARE UPDATED
Call 09 966 74 74 www.horizonrecruitment.co.nz
BusinessPlus December 2016
Discipline and Termination Diversity Discipline and Health and Safety Diversity Employees and Technology
Leave Entitlements Termination
Drug Testing Harassment and Bullying
Health and Safety Employees and Technology
AND AVAILABLE NOW!
UnionsEssentials Payroll Recruitment Leave Entitlements Privacy Drug Testing Harassment and Bullying
ORDER ONLINE WWW.EMASHOP.CO.NZ
ORDER ONLINE WWW.EMASHOP.CO.NZ
at a work function and their driving afterwards. Maybe provide taxis or assist in some way with safe transport. Regarding holidays, you have to give at least 14 days’ notice of a closedown. This leaves you in the position of managing everyone’s individual holiday requests. Consider your needs: it may or may not be a good time for employees to take holidays, depending on your business. Take time to consider the impact of the public holidays transfer rules with Christmas Day and New Year’s Day falling on a Sunday, in particular if you operate over seven days. If staff change their minds or ask for extensions during this time it is up to you to agree or not. You will need to consider and where possible agree unless it would genuinely disrupt business and you can explain how.
Q. I realise our employment agreements don’t have half of our company policies in them, like using cars and cellphones on holidays! How do I add them in? – Syd Dear Syd Very important matter to get sorted out! It is vital your staff are aware of the rules that apply to both business and personal use of cars and cellphones. Most employment agreements will cover the requirement for staff to follow company policies, however, the actual policies are often contained in an employee handbook or house rules document. If you already have policies you should check to ensure they are upto-date and that staff have a copy. An Employment Agreement should of course be signed and if you are providing a company car it is recommended you have a separate “vehicle policy”, which you would require the staff member to sign.
By the EMA communications team in consultation with EMA Advice, and loosely based on real calls to EMA’s AdviceLine. All names are fictional. The information in this article is a guide only and not to be used as business advice without further consultation. EMA members can start with our free AdviceLine team at phone 09-367 0909 or 0800 300 362 (within New Zealand), and 1800 300 362 (from Australia), 8am8pm weekdays NZ time; or email email@example.com You can also find information at www.ema.co.nz such as the A-Z of Employing – a manager’s guide on more than 100 specific employment topics, or the detailed Employer Guides on 12 popular topics.
0800 223 729 www.acepay.co.nz 0800 223 729 www.acepay.co.nz
0800 www.acepay.co.nz 0800 223223 729729 www.acepay.co.nz
www.acepay.co.nz e PayrollAce Payroll 0800 223 729 Ace Ace Payroll forPayroll New Zealand Try it for free New for Zealand Try it for free New Zealand for New Zealand T r y iTt rfyo ri tf rfeoer f r e e employers. Ace Payroll ployers. employers. employers. for New Zealand Try it for free Take control on pay day with easy low employers. Take on and pay day with easy lowsupport. ake control oncontrol pay day withgreat easy low cost software help desk Take control on pay day with easy low
costand software great helpsupport. desk support. t software greatand help cost software and desk great help desk support. Take control on pay day with easy low cost software and great help desk support.
BusinessPlus December 2016
EMPLOYMENT By MIKE BURGESS
Certification helps build youth employability Mele Talakai (right) from Southern Cross Campus receives her certificate from MP Louisa Wall who talked about her effort in the sports world and the work that inspires her. PHOTO BY: Julia Moore
Employers often tell us they struggle to find employees with the right transferable skills.
YEP has been trialled during 2015 and 2016, and will be expanding further in 2017.
Often schools and training programmes focus only on job-specific skills. While these are important, it is the transferable skills that make the biggest difference in the long-term.
At the 2016 graduation in October, 125 young people were proud to receive their certificate of completion from EMA’s staff member Mike Burgess and from MP for Manurewa in Auckland, Louisa Wall. After the ceremony they also received their Licence to Work, which will provide valuable evidence of their skills, for future employers.
EMA is proud to partner with COMET Auckland and others to address this problem through the Youth Employability Programme (YEP). YEP consists of a series of workshops plus 20 hours of community service and 80 hours of work experience, all designed to build the specific employability skills that employers say they most need. The programme builds on individual behaviours and the personal qualities that motivate individuals to learn, adapt, set and achieve goals. There is work on both sides to prepare work experiences, which are set in reality. Facilitators work hard to place students in an area that they are interested in.
Manu Inukihaanga from Sir Edmund Hillary Collegiate at the certification evening. PHOTO BY: Julia Moore
Julian Palu received his certificate from his placement advisor at J.A. Russell Ltd where he now works. PHOTO BY: Wendy Sturt
BusinessPlus December 2016
One of the recent graduates is Julian Palu from the Southern Cross Campus. The school placement advisor helped place Julian in an electrical store one day a week, as he was interested in electronics. Julian says he has learnt to ask many questions and enjoys learning about every bit of equipment. It is the ‘hands on’ aspect of learning that he is really excited about at work. He is now fulltime at J.A. Russell Ltd, an EMA member company, and all his workmates are helping him learn more about the trade. He will start an apprenticeship next year to further develop his skills.
YEP also helps students trial work they may never have thought about before, which sometimes leads to an ongoing employment relationship. This benefits both student and employer. YEP has also influenced a greater national focus on employability. Last month a new national employability skills framework was accepted by the government-lead Pathways Advisory Group. This means educators and employers now have an approved set of skills that are recognised as important in helping young people gain entry-level jobs. YEP has succeeded by working collaboratively and combining all relevant sectors - education, industry training and business - to lead the work alongside EMA, Careers New Zealand, COMET Auckland, Ministry of Education and Business New Zealand. It promises to be a formula for success. Employers who are interested in using this scheme or want to find out more can contact Mike Burgess, senior policy analyst, at email Michael.Burgess@ema. co.nz
EMPLOYMENT By KEVIN CHAMBERS
Recruit well, retain and retrain In the middle of last century, workforces were largely homogenous in that a sizeable portion of an organisation’s employees shared the same cultural and social norms.
you know, not what you know. As such, Heathfield encourages us to “gather the attention of a pre-qualified candidate pool of potential staff before we even need to fill a position.”
The modern workforce, however, is more diverse than any before it with respect to age, gender, ethnicity, culture, experience and education.
Technology has made it easier than ever to build up social and professional networks, so tap into your network and those of your past and existing employees to aid your search for talent with the right job-based, team- and organisation-based competencies.
A recent report by global management consulting firm McKinsey and Company examined data from 366 organisations across a range of industries and continents, confirming the inexorable financial gains to be made by organisations that have embraced diversity. However, heterogeneity in the workplace poses very real challenges for employers as they go about trying to secure the best and brightest talent. The way forward, then, is to recruit well, retain and retrain your staff. US human recourses expert Susan Heathfield suggested in her recent online column, The Balance, a variety of ways to improve your recruitment success and reminded us of author Harvey Mackay’s main premise that what counts is who
However, the cost of recruiting, onboarding and orientating staff can add up especially if the labour market is tight. A Center for American Progress research paper published in 2012 found that while the actual cost varied by wage and role, the average replacement costs were 21.4 per cent of annual salary. So the cost of replacing someone who has gross annual earnings (including benefits) of $75,000 would be $16,050. According to Bersin by Deloitte, the “total” cost of losing an employee could in fact be 1.5-2 times the annual salary when you add into the mix lower productivity, lost engagement, deteriorating customer service, increased errors, and cultural impact.
The first thing to walk out the door when an employee leaves is the knowledge that they have gained while in your employment. If remaining staff have not been cross-trained or this knowledge has not been documented then productivity in your organisation will fall. In addition, the new recruit may take months to get to the levels of productivity of the employee who is gone – again, more lost productivity. Our focus, then, should be on retaining staff wherever possible, and retraining them when needed. One way of improving staff retention is by providing your talent with benefits such as better paternal or maternity leave for new parents, more flexible hours of work, student loan assistance, or training. But even your best and brightest talent will need upskilling as social, cultural, and technological advances change the face of the workplace. Training – or retraining – may be one of your biggest competitive advantages. I invite you to contact us at learn@ema. co.nz to find out how.
Kevin Chambers is EMA’s Portfolio Manager - Tertiary/Leadership and Management /Training Development. Email firstname.lastname@example.org
Management & Leadership
Based on real employers issues, gain knowledge of the key functions of management and the super leadership skills necessary to develop highly efficient teams. Explore your options: Free call NZ 0800 300 362, AU 1800 300 362 or visit our website, www.ema.co.nz
BusinessPlus December 2016
Find the middle ground. Keep your precious staff.
North or South, East or West. Health Professionals to Construction Workers. We’ve got the true picture from Kiwi employers just like you to help you make informed decisions that deal with questions such as, ‘In order to retain my precious staff, what should I pay and what benefits should I include’?
wage salary survey
IN BUSINESS By DAVID SPRATT
Winners, losers and unrequited computer love…a satirical review of 2016 After a busy year trying to make sense of the changing ICT landscape I’m winding down for Christmas by attending as many customer and supplier events as possible. The prospect of free wine and food, stimulating conversations and standard speeches by sales managers delivers a mix of pleasure and pain. I’ve also delighted in compiling my 2016 awards list of companies and individuals that have taken on the IT challenge and made a difference, one way or another. The IT challenge awards go to: • The 1980’s Post Office in Disguise Award: Chorus. Given the task of delivering fibre to the country’s wealthiest city, Chorus, you sure have made an art form of missing targets, breaking promises and then complaining to the government about not getting paid enough. Fellas – I live two minutes off the Southern Motorway, on the Great South Rd, well within the greater Auckland Council area. Two years ago, you promised me UFB in 2016 – now you have “no plans” to deliver on that promise. In the meantime, I have download speeds slower than my aging prostate in the middle of the night. But then - when you made all the cable guys redundant and turned them into “self-employed” Vision Stream contractors, what the heck did you expect to happen to quality, delivery and on-time performance? • The Best Solution Nobody Wants Award: Amazon Web Services. We all knew you were the best at the technical stuff nobody understands. We all knew you were cheaper than chips.
At the end of the day guys, we didn’t want your fancy pants “cloud availability zones”. What we really wanted, was something simple and easy to use. Not the mysterious dross the high priests of IT have been serving us up for the past 20 years. In the end, we spurned you and chose Microsoft, despite your rugged good looks and romantic promises of freedom and joy! • The “We keep trusting you but it feels so very dirty when we do” Award: Microsoft Four years ago, you told us the world would end if we used cloud servers at the risk of our sovereignty, privacy, security and data ownership. Now that you have a half-decent product, you tell us that these aren’t problems at all and that Microsoft Azure and Skype for Business will make us all so very happy. Even though Bill and Melinda Gates are saving the world from disease and war using our money I still only half believe you. I do love you though, I do. Just keep telling me that you love me too and you won’t betray me and that it will all be okay in the end. • The “Three years to retirement and then I am SO out of here” Award: All you technocrats in IT departments all over New Zealand
Now you are clinging to your “boxes that go ping” and telling us that “the cloud” will work for some companies but have limited use in ours. In fact, you don’t even agree that “the cloud” is a real thing and keep demanding we define it. Then you strive to dazzle us with the same technical gobbledegook that lost you your place at the executive table and left you reporting to Finance. In your heart of hearts, you know it’s all a lie and that you just can’t deliver on the promises you make any more. Better to go to your grave clinging onto that shiny box you love so much than to admit you have become the same dinosaur as the one you replaced back in the days of mainframes, whirring tapes and green screens. • The “You don’t even need to know much to be world class” Award: The cloud. Whether it’s Office 365, Amazon Web Services, Salesforce, Facebook or just plain old internet banking the reality is that you are all world class and we love you for it. We can have you at home, at work, in fact anywhere for cents in the dollar and with a click of a credit card. Mr/Ms Cloud you are just so secure, so easy to like, so powerful and so very, very cheap I can’t help but want to marry you. If only Siri would answer my calls…. Merry Christmas readers - see you in the New Year.
You know who you are. I worked with most of you during the 1990s and early 2000s. Back then we were so proud of our local innovation and No 8 wire ways that saved us from dealing with those multinational IT companies who thought New Zealand was part of Asia Pacific.
David Spratt is a director of Total Utilities. Visit www.tumg.co.nz BusinessPlus December 2016
IN BUSINESS By steve summers
A business survey for all seasons “This means the December or January results can be compared directly to, say, the result for June, as any Christmas influence has been taken out.”
50 45 40
On the surface, applying seasonal adjustment to a time series of data might seem like making something complicated and even harder to understand. However, once you know the reasoning behind it, doing so actually makes a lot of sense, helping users get a better idea of what’s really going on. So what does seasonal adjustment do? Simply put, it takes into account standard seasonal patterns of behaviour that occur every year, and makes sure people can compare any one month of results with all the others. This is important for businesses, market analysts, economists and the Government when trying to determine how the manufacturing and service sectors are performing. To illustrate how this works, probably the biggest seasonal factor for the business community is the Christmas period. For some, this period represents
BusinessPlus December 2016
a boom in sales or other activity while for others it can be a quiet time as the business shuts down over the summer holiday period. By seasonally adjusting results, a time series trend can be analysed independently of the seasonal component that would otherwise affect it. This means the December or January results can be compared directly to, say, the result for June, as any Christmas influence has been taken out. Figures 1 and 2 (above) show the seasonally adjusted results from 2010, as against the unadjusted results, for both the PMI and the PSI. As the pale blue bars show, seasonally adjusting the data gets rid of those more extreme highs and lows so a more understandable picture can be pieced together. But there are also times where the seasonally adjusted result is very similar to the original, or unadjusted, value. For such months, the seasonal influence seems to have had little effect on the result.
Taking account of seasons So how are the seasonally adjusted values compiled? Early on, BusinessNZ made the conscious effort to use the exact same software programme as StatisticsNZ, ensuring our results could be compared as accurately as possible to official New Zealand data.
Steve Summers is an economist at BusinessNZ. Visit www.businessnz.org.nz 22
Both our monthly member surveys, the BNZ-BusinessNZ Performance of Manufacturing Index (PMI) and Performance of Services Index (PSI), have a seasonal adjustment applied to their data at the national level, that is, to the key values reported on each month.
There are two words that often befuddle and bewilder people when they look at statistics and try to understand what’s going on: “seasonal adjustment”.
But it’s important to point out that while seasonal adjustment is a useful tool that adds in-depth knowledge to the series, it can’t be everything to everyone. First off, it can’t be done when a survey first begins. A general rule of thumb is that around four-to-five years’ worth of data is needed before seasonal adjustment can be applied and patterns and so on can be determined. Generally speaking, the further back the data, the less it changes, although often within a few years of the most recent result, minor revisions will have occurred. Last, not all data can be seasonally adjusted, mainly because it has been broken down into groups. The PMI and PSI series seasonally adjust only at the national level when all data is included. When broken down by region, the data is left unadjusted in order to get a better handle on patterns and trends; so alternative measures, such as threemonth rolling averages, are looked at instead. All up, when wanting to know how the various business sectors are performing, it’s best to stick with the seasonally adjusted series to get an accurate read on results.
IN BUSINESS By Rosina Webb
Develop leadership skills to keep business thriving You started with a great idea, and a vision for where you could take it. You’ve turned your great idea into a burgeoning small business that is by all accounts doing pretty well. A key issue that often faces small business owners after that point, is leadership. Often a new business owner is excellent in their chosen field, but not necessarily strong in management and leadership skills. As the business grows these skills become more important if the business is to thrive. It’s not just about having a great product or service; it’s about having the ability to lead and manage staff as your business grows. Here are some tips to improve your leadership management skills:
Communication is key Communication works both ways. Share with your staff your vision for the company. Communicate to them how their roles fit into the overall picture and how they can therefore actively contribute to the success of the company. Likewise set up channels where they can feedback to you - whether this is an open-door policy to come and discuss things personally, or an avenue where they can contribute suggestions for improvement. Listening and understanding employees needs and observations and then acting on them, if appropriate, will make them feel valued and enhance the culture of your business.
Lead by example Behave in a way that you would like your staff to behave. Turn up promptly for work. Put in the hours until your job is done. Go the extra mile. Respect your customers, listen to their issues and work through them to ensure they are satisfied.
Your employees will pick up on your work ethic and are more likely to follow suit. You can’t be everywhere, doing everything, but if you get your staff on board with your work ethic, by default you will be more likely to have a team of people acting as you would act, and delivering the service level you yourself would deliver.
Exude positivity Starting a new business or growing an existing one is hard work. It’s important to exude a sense of positivity, optimism and confidence about where you are going and what you intend to achieve. This will encourage your staff to also get on board with your vision, and to believe in the quality and delivery of your products or services. There will be set-backs and challenges, but again it’s important to approach these with a can-do attitude, with a view to working through the issues and moving towards your goal.
Develop staff Your staff is an important asset to your business. As with any asset it’s important to invest in them. Make sure your staff members are well qualified for the roles they undertake, and if additional training or qualifications are required, as your business or their roles grow and change, make sure you invest in that staff education process. Your staff will feel valued and will more likely to remain on board with your business goals and vision. It takes more time and money to recruit new staff than it does to develop and grow those you already have.
Reward staff Another key point with staff is to share in your success. If a staff member is doing well or going above and beyond in their role, acknowledge them for it. Show you notice, and reward their hard work and loyalty. This may be as simple as a verbal acknowledgement or even a financial or holiday leave acknowledgement if business success allows.
Community focus Likewise with the community as a whole: be involved in your local community and get them on board with your brand. Whether this is sponsoring a local event or even running a community sausage sizzle, it gets your brand out there in the community in a favourable light and potential customers will likely remember you for it.
Invest in technology It’s important to stay up-to-date with technology that is relevant to your business. This doesn’t necessarily mean a huge investment in technology. It’s more about being savvy across the various social media opportunities and understanding relevant computer technology. If it’s not an area that you are confident in, then invest in a consultant or part-time employee to get you up to speed with the most effective technology to offer the cost, promotional and production efficiencies within your business. Strong leadership, and staff who are on board with your vision, will lead to a positive company culture and ultimately improved business growth and performance. It’s worth the time and investment.
Rosina Webb is founder and managing director of Energise & Associates. Visit www.energise.net.nz BusinessPlus December 2016
In business By catherine beard
Stocktake of manufacturing in NZ – what’s really happening I’ve long believed that manufacturing is the unsung hero of the economy, and this has been proven in the latest economic survey of manufacturing in New Zealand. Manufacturing for the construction sector grew 9.5 per cent, and meat and dairy product manufacturing grew by 8.6 per cent over the latest quarter. But one sector which is set to transform New Zealand – and overtake the dairy sector in terms of exports – is the tech sector. The12th annual TIN100 Report, produced by the Technology Investment Network (TIN), was launched in October, showing growth of more than $1 billion. In the context of New Zealand’s GDP, this is massive - and it’s up from around $600 million last year. High-tech manufacturing, biotechnology and information and communications technology (ICT) – the three major sectors covered by the TIN100 Report – are all on the rise across every region of the country, with total revenue up 12 per cent to $9.42bn. Manufacturing in general has been growing strongly in recent years, and New Zealand manufacturing is performing better than its peers in the Performance of Manufacturing Index (PMI). We started off the year reporting that the BNZ-BusinessNZ PMI for January 2016 showed its highest level of expansion since October 2014. Over two-thirds of manufacturers reported increased sales both domestically and internationally. The rest of the year showed healthy growth for manufacturing in New Zealand, with the PMI remaining in a state of expansion each month. The headline result for the first 10 months of 2016 shows expansion only varying by 2.8 points, with most months seesawing between the 55 and 57 point range (above 50 points shows growth). At this stage, 2016 is shaping up as better than 2015 did for the sector.
While we have strong building and construction activity, the prospects for manufacturing remain very positive.
Wait, there’s more The NZIER Quarterly Survey of Business Opinion results for Quarter 3 (to September) showed expectations for domestic sales were now matching the ongoing robust pace in export sales. This would appear to fit with the latest upshift coming through the construction sector. It was also encouraging to see a bounceback in the jobs index of the PMI. I recall that it slumped to a seasonally adjusted reading of 47.7 in August, from 54.4 in July. While we flagged this we also said we needed to see September (even October) results before drawing any conclusions. In September the PMI jobs index snuck back up to 50.3. This wasn’t a surprise to us as there hadn’t been any indication of sagging in manufacturing jobs from other economic surveys. Then in October, as BNZ senior economist Craig Ebert points out, it was the employment index that seemed to provide the most encouragement. It made it up to a seasonally adjusted level of 53.8, from 50.8 in September.
He says, “To be sure, its long-term average is only 50.3. But this makes October’s result look all the more assured. This represents a bonus for the labour market, in that manufacturing has not been party to the surge in nationwide employment over the past year or so.” There is no denying the fact that manufacturing is having a huge impact on how well the New Zealand economy fares. It employs quarter of a million New Zealanders, accounts for $22.6bn (11 per cent) of the economy, contributes $12bn in wages and earns billions in export revenue every year; non-food manufacturing contributing $12bn of exports. Yet, despite all of these facts, there remain a lot of misconceptions and unfounded beliefs about manufacturing. The truth is that New Zealand manufacturing is strategic, broadbased and well integrated in the global economy. It is based on the ingenuity New Zealand is famous for, and it is bringing economic growth.
Catherine Beard is executive director of ManufacturingNZ which is a division of BusinessNZ. Email email@example.com 24
BusinessPlus December 2016
The recent redesign of Sistema premises
IN BUSINESS By VICTORIA WILKES
Better office design equates to better bottom line As your business grows and changes, you may be contemplating whether your existing premises still suit the needs of your company. You may be struggling to fit staff in, or the space could just feel a bit tired. This can be a terrific opportunity to take a fresh look at what kind of working environment is going to help the business meet its immediate needs, as well as its future plans. For many, engaging the services of a professional interior designer will be viewed as an integral part of the evolution of your business. Others, however, may be asking themselves, “Is it worth the investment?” Interior design as a service to the commercial sector is growing year-onyear. Companies that use a professional design approach to their workspaces enjoy benefits that reach across an organization and provide a measurable return on investment.
What an interior designer can do • Save you money. By following proven process and tapping into expertise, working with a designer will mean better control of the budget and ensuring investment in a fit-out that is not only fit for purpose, but that any product – everything from desks to carpet – will still be available longer term should you want to expand.
Interior designers can source quality options to meet your budget. They have solid history with contractors and suppliers of the likes of furniture, fittings and flooring. • Improve efficiency and productivity. A professional designer will take time to understand how different individuals carry out their work and how an organisation’s departments interact. They will research how your team can best collaborate to achieve optimal performance as well as what style of environment would best inspire your staff. Designing and planning space to meet these needs will positively affect your staff’s productivity and profitability. • Entice and retain staff and clients. A well-designed, inspired office interior appeals to job candidates who place importance on their work environment and surroundings. A functional, professionally designed space will also impress clients and can help to set your business apart from less progressive competitors.
A designer will ensure that an office interior has sufficient light, planting and separate zones for concentration and socialising; things that have all been proven to support positive mental health in the workforce. • Express your company culture. Company culture can be defined as the collective values of an organisation. A good designer will work closely with their client to understand “what makes them tick” and provide recommendations on how to bring the culture to life. This can range from providing communal spaces for collaboration to using colour and wall decals to visually express the brand. Collectively, the benefits of a professionally designed office translate into significant and tangible value to a company. Beyond being a place for employees to travel to and from each day, a workplace is a primary business tool and – if designed well – will provide business leaders with a clear competitive advantage over others.
• Support staff health and wellbeing. Recent research supports what our natural instincts tell us – that employees who feel good at work are more productive and are less likely to leave the company.
Victoria Wilkes is founder and managing director of Outline Design and was the appointed interior designer for EMA”s new offices. Visit www.outlinedesign.co.nz BusinessPlus December 2016
IN BUSINESS By Mike Fokkens
Mid-market sales and acquisition growth “Just by being bigger from acquiring another business can attract better employees, or retain your best ones longer, because these people can see better career paths ahead.” In the last issue, I covered Strategically Exiting a Business. In the next two issues, I will discuss Growing by Acquisition and the advantages and challenges this brings.
Companies that expand through acquisition realise all sorts of benefits, many of which may apply to your situation and are outlined below.
Being bigger Just by being bigger from acquiring another business can attract better employees, or retain your best ones longer, because these people can see better career paths ahead. Larger customers that once thought you were too small to service them are now willing to deal with you. Your position with suppliers is stronger, because your volumes have increased. New economies of scale can be realised in overheads, purchasing, distribution and marketing. Size can help you better absorb economic shocks and cover peaks in demand.
More customers, more business Taking on more customers through acquisition means more business and deeper market penetration. Taking on more products or services means more
Proven strategies Acquisitions avoid the risks associated with organic growth, such as new products that fail, new customers that are expensive to win over and new staff that are costly to find.
Knowing where to start The best approach to acquisition is to start with a plan and a clear idea of your goals. This will give you a set of criteria to assess target companies and make your search for the perfect acquisition faster and simpler. It will also help us give you an honest appraisal of the chances of success.
You’ve probably thought about how to expand your business many times, and considered the costs and benefits of growing fast, or the risks of growing too slowly. Well, there is a sure and fast way to growth: through acquisition.
New product combinations may be irresistible to your customers.
The six phases of acquiring another business
opportunities to cross-sell within your newly expanded customer base. More staff means better coverage and smoother handling of leave and other issues and can open up opportunities to specialise. Being spread across more locations may mean better access to new markets.
Competing better You may remove one competitor immediately by buying them, and you instantly become a bigger threat to the others. You may achieve dominance in your own specialised market niche. Enjoying synergies suddenly gives you a broader product range, a wider customer base and less competition. New people bring new skills to your overall mix. Product or service duplications can be eliminated for greater efficiency. Better products can take the place of weaker ones. Vertical integration may secure your lines of supply, and eliminate process delays and mark-ups.
It is important to be proactive and to retain the initiative at all times – others in your industry are also hunting for a sound acquisition.
An acquisition is not an event but a process We have evolved a structured, six-phase approach to acquisition. Following this process, most mid-range businesses achieve a successful acquisition within four to six months. Experience has shown that following a disciplined approach leads to clear answers to the important questions: •
“How will buying this asset make my existing business more valuable?”
“How will I bring value to the asset I am buying?”
We guide our clients through the phases of the process, towards clear strategic objectives, detailed implementation plans and a focus on creating and capturing value – invaluable to any company, regardless of whether an acquisition is completed. In the next issue we will explore these six phases in more depth, providing a detailed checklist and plan of action.
Mike Fokkens is a business broker at LINK Business Broking (Licenced REAA08). Email firstname.lastname@example.org 26
BusinessPlus December 2016
Asia Pacific’s first Tesla Powerpack supplies electricity in Auckland “This is transforming the way the energy sector is managed and will have a powerful influence on consumer behaviour.” The Minister of Energy and Resources, Simon Bridges, has officially opened Vector’s renovated Glen Innes electricity substation, home to the first grid scale Tesla Powerpack battery storage system to be integrated into a public electricity network in the Asia Pacific. With a storage capacity of 1MW/2.3MWh - the equivalent to powering 450 average homes for 2.3 hours - Tesla Powerpack allows Vector to continue to provide a secure, reliable power supply and defer a conventional upgrade to the substation. This move represents a radical transformation in how Vector manages its electricity network and responds to the need for innovative infrastructure development to support growing
communities, says Vector’s chief executive Simon Mackenzie. He says the Tesla Powerpack battery storage system could help to reduce peak demand and extend the life of the substation, deferring capital expenditure and providing supplementary power to the Glen Innes area – all without compromising reliability. “Tesla Powerpack introduces an agility and flexibility into how Vector manages and invests in its network. “By gauging trends such as household energy consumption, the effect of infill housing and the uptake of new energy systems, we can target growth areas and defer or avoid the significant investment required in a new substation.
From left: Vector CEO Simon Mackenzie and Senior Project Manager Paul Cannin, and Minister of Energy and Resources Simon Bridges
“And when connection or consumption growth requires a conventional network upgrade, we can mobilise the batteries to other parts of the network where power demand is rising. “This is transforming the way the energy sector is managed and will have a powerful influence on consumer behaviour.” Mr Mackenzie says new technologies such as Tesla Powerpack allow Vector to better manage the risks associated with the NZ$2 billion that needs to be invested in its Auckland networks over the next 10 years. Vector’s network is evolving to deliver the benefits of smart meters, efficient and cost-effective solar panels, batteries and an expanding electric vehicle charging infrastructure and energy management services to customers.
Ports of Auckland records good year despite unsettled shipping industry Profit and dividend increased at Ports of Auckland Ltd (POAL) in the past financial year, despite container volumes and revenue being lower.
Mr Gibson says, “This financial performance should be seen in the context of a container shipping industry that is undergoing significant change.
This is a great result and shows that the company is in good health, says chief executive Tony Gibson.
“Put simply, the industry has built too many container ships and there isn’t enough freight to fill them. Shipping line profits are down, one line has gone bankrupt and others are merging as they seek to reduce overcapacity and improve their financial position.
The port paid its shareholder, Auckland Council Investments Limited, a dividend of $54.3 million for the 2015-16 financial year. This compares with last year’s dividend of $41.7 million and equates to $103 per Auckland household, or 4.4 per cent of the average residential rates bill of $2320.
“The impact has been felt in New Zealand in the shape of changing shipping routes and alliances. As a result container volume was down 6.7 per cent on last
year to 907,099 TEU. The container sector is expected to remain volatile with low growth.” In contrast to containers there was good growth in trade with the Pacific Islands and the number of cars and other vehicles, and car numbers this year have continued to grow strongly. POAL has achieved international recognition for its customer service, having been voted Best Port in Oceania earlier this year, beating out ports in New Zealand, Australia and Hawaii. It is also the most efficient port in Australasia, with record high crane rates. BusinessPlus December 2016
Kiwi exporters report a good year and confidence for 2017 Kiwi exporters are confident and expecting orders to increase in the next 12 months, despite the uncertainties in the UK and US, according to the 2016 ExportNZ DHL Export Barometer. The research shows that overall 2016 has been a good year, with just over half (52 per cent) of exporters achieving an increase in international orders. When asked about their expectations for the coming year, optimism is very high with 63 per cent of New Zealand exporters expecting international orders to increase, and 32 per cent saying they expect orders to remain at the same level. Commenting on the results, ExportNZ executive director Catherine Beard, says, “This is a positive signal in an increasingly uncertain global market. While the survey was conducted before the US election result was known, the chance of TPP getting across the line was looking weak whichever candidate won.” Export destinations have remained consistent, although China, ASEAN and Hong Kong have slipped back a bit since last year. Now the top five export destinations are Australia, North America, Europe, Pacific Islands and the UK.
Online commerce holds steady The 2016 Export Barometer shows that while some exporters have embraced online commerce, there is still room for growth. One-fifth of exporters now generate more than half of their international orders online, including 6 per cent who generate all export orders this way. DHL Express NZ country manager Mark Foy says, “Online commerce is a massive growth area for Kiwi companies. While we haven’t seen a particular increase in online sales over the past year, exporters did signal the value of an enhanced presence online as a marketing tool.
BusinessPlus December 2016
Key findings •
Most businesses expect international orders to increase over the next 12 months.
Online commerce holds steady, with room to grow also in social media use.
One-third of exporters highlight negative impacts, if the GST threshold for imported goods is lowered.
“Correspondingly, while four in 10 exporters say they currently use social media to increase international orders, this poses an additional opportunity to market to international consumers looking for innovative and unique goods.”
Overcoming export challenges While exporting poses many benefits in tapping into much larger offshore markets, Kiwi businesses need to navigate a number of barriers to do so. The biggest barrier is the level of the New Zealand dollar, with exactly one-third of exporters highlighting the exchange rate as a challenge. Coming second is the strength of competition in overseas markets, a concern for 30 per cent. Finding partners or agents in a new destination comes in third (for 28 per cent) – with the ever-present set-up costs/funding being a challenge for 23 per cent. However, encouragingly, one in six (17 per cent) of exporters say their business faces no major challenges regarding international trade – the fifth most popular answer.
Neutral or negative on calls to lower import duties threshold While there have been calls from some parties regarding lowering the GST-free threshold for imported goods entering New Zealand, exporters overall signal neutral or negative impacts.
The majority (56 per cent) of Kiwi exporters said there would be no impact to their business if there is a change to the current regime, whereby goods valued at $400 and under are not subject to Government duties and taxes. However, one-third (32 per cent) cited negative impacts around an increased cost of importing raw materials, delays or other administration costs.
Calls for more free trade agreements A quarter of exporters support more free trade agreements (FTAs). Says Catherine, “Interestingly, Australia is the only country out of our most popular export destinations that has a trade deal with New Zealand. So progress needs to be made on the rest, including the UK, as a result of Brexit. “ExportNZ is hopeful that if the TPP can’t come to fruition, the wider Asian region can show the way with the high quality FTA [under negotiation], “RCEP” - a 16-country, Asia-wide FTA including India and Japan. This would help New Zealand exporters remain competitive in these markets.” The Export Barometer is a joint initiative between ExportNZ and DHL that surveyed 536 New Zealand exporters. This research aims to provide Kiwi businesses and Government officials with detailed feedback on exporter sentiment plus barriers to exporting and how to help reduce them where possible.
INternational trade By Thomas Manning
The Trump Effect in Latin America After an extended period of left-wing populism Latin America has recently moved to the political centre and the pro-business leaders now in charge of the region’s biggest economies have had a rude shock with the election of Donald Trump as US president. After Trump’s inauguration on January 20 the US economic relationship with Latin America will be characterised by protectionism, retrenchment and reduced international activity, all of which have been overarching themes in Trump’s foreign-policy pronouncements. Chile, Mexico and Peru are members of the Trans Pacific Partnership (TPP) which would have boosted trade but the election of Trump has most likely extinguished TPP in its present form - an eventuality which will be a lost opportunity for New Zeaalnd’s international trade as well. Trump’s unorthodox mixture of rightwing protectionism and bilateral trade deals is not dissimilar to the economic policies of the new governments in Argentina, Brazil and Peru, but this will not earn them any special favours from Trump. Despite previously having expressed a preference for a Clinton presidency Argentine President Mauricio Macri congratulated Trump on his victory but his comments papered over the comments by his foreign minister Susana Malcorra before Trump’s election that Trump’s “more closed, isolationist and xenophobic” policies would threaten a new phase of cooperation and trade with Washington. Notwithstanding the apparent common ground Brazil has been singled out by Trump as a country which benefits from trade arrangements which are unfavourable to the US and the arrangements’ renegotiation will hit Brazilian exporters hard as the US is their second largest market. “Congratulations on your election, @ realDonaldTrump. Pedro Pablo Kuczynski, President of Peru” was PPK’s tweet, the
terseness of which is understandable as he joked last June that if Trump won he would cut Peru’s ties with the US. Peru cutting ties with the US is an unlikely scenario but increasing trade from present levels will be a hard ask in light of Trump’s protectionist policies.
Insecurity in Mexico In Mexico’s case Trump’s savage rhetoric about immigration and dismantling NAFTA has caused major concern. Increased border enforcement and the deportation of millions of undocumented Mexicans from the US will create logistical strains on Mexican authorities and make the insecurity already rife in Mexico much worse. Mexico’s export-based economy will suffer substantially if free trade with the US markets under NAFTA is curtailed or abolished as Trump has promised.
Need to look beyond the US Trump’s position on Cuba is that unless the island nation makes very unlikely concessions on political expression and prisoners he will end the normalisation of relations with Cuba and to maintain the economic blockade even though a majority of Americans want it removed. Colombia is relying on hundreds of millions of US aid dollars to rebuild infrastructure damaged in the protracted civil war with FARC and if this aid does not eventuate there are wide concerns security and the economy will suffer and criminality increase.
“After Trump’s inauguration on January 20 next year the US economic relationship with Latin America will be characterised by protectionism, retrenchment and reduced international activity.”
will be disastrous for the basket-case Venezuelan economy. Bolivian President Evo Morales whose relationship with the US has always been fraught to the extent of expelling USAID in 2013 tweeted: “Here’s to @ realDonaldTrump’s win. We hope to work against racism, machismo, and antiimmigration for the sovereignty of our peoples.” And as there is little bilateral trade Trump’s election will not affect the Bolivian robustly growing economy to any marked extent. In Chile, Hillary Clinton’s good friend President Michelle Bachelet has barely mentioned Trump’s victory, only saying she hoped the US and Chile could continue to collaborate, which, considering the enormous US investment in Chilean mining is likely to continue but not increase.
Venezuela’s President Nicolás Maduro publically supported Bernie Sanders and has grudgingly congratulated Trump and not surprisingly called for a respect for state sovereignty and selfdetermination.
Trump’s scepticism of climate change and focus on upping US industrial activity could have considerable effects in Central America as the region is vulnerable to flooding and tropical-storm activity and relies on a stable climate for food production, which with global warming can no longer be relied upon.
Trump is not likely to have been moved by Maduro’s aspirations as he has inveighed against Venezuela’s government and promised that “I will stand with the oppressed people of Venezuela yearning to be free.” And there is a threat the US could stop buying Venezuelan oil which
With recessions in Argentina, Brazil and Venezuela already dragging regional GDP down the “Trump Effect” means any resurgence in Latin American economic growth in the medium-term will depend on new or strengthened trading relationships which do not rely on the US.
Thomas Manning is governing director of Latin American business consultancy Manning Group Ltd and Transpacific Business Tours, and publisher of the Transpacific Business Digest. Visit www.manningrouplimited.com BusinessPlus December 2016
international trade By brendon wilson
The road to success is littered with risk Risk is on every business person’s mind right now, with considerations from Brexit to the US election results, the house market boom (or bust) and climate change…Then there’s the tragedy and consequences of a major earthquake, and extreme weather complicating some areas’ recovery. Building and infrastructure risk are topical.
Pressures to compete or deliver at times when the market is under stress and scrambling are the very time to stiffen your protective processes and demonstrate your integrity and quality performance to the world; show you’re in it for the long haul.
There are many integrity or corruption risks, regarding practices in procurement supply chain and sales for example, that are unethical or illegal and would endanger your business reputation. Watch out for collusion and price-fixing – keep aware of the Commerce Act!
A Commerce Commission investigation in New Zealand found competitors in the wood preservatives market were taking part in price fixing and market sharing agreements. This included sharing pricing information and agreeing not to compete on price, and not to compete for each other’s customers. As a result, farmers were paying higher prices for fence posts and homeowners were paying more for their house framing and decking timber.
But let’s remember that risk itself is a good thing – for business it is a way of measuring possibilities and focussing analysis and decision-making. Importantly, risk offers opportunity – without some risk there is no reward. Taking the right risks and reducing their downside has been the basis of all business since time began, and it is still, even in the most conservatively-run businesses. Some do this by formal processes, others less formally, but it is a brave and very foolish organisation which just waits for change or occurrence to happen before addressing the problem. Businesses with this approach find it hard to attract capital, and regularly fail at an early stage.
Addressing risk is easy There are endless professional risk consideration and management frameworks available to lead a company through a proven process. Businesses need to adopt and use a good process, and this usage should be at the centre of board and management planning. When considering risks, face the reality that risks will be identified in every part of the business and in all its activity. Often the people to recognise and warn about risks will be staff on the front line or at lower operational levels, so encourage their speaking up - it may save your bacon.
But if you ignore risk…
Following proceedings in the High Court, fines totally $7.5 million were imposed for breaches of the Commerce Act on Koppers Arch Wood Protection (NZ) Limited, its Australian parent company, three Nufarm companies and two Osmose companies including individual executives. The Commerce Commission has good advice for a range of situations, and excellent guidelines and fact sheets on its website comcom.govt.nz If the grapevine carries the hint that a business’ integrity is low, or it could be legally pursued for transgressions or that its low reputation makes its future success a wobbly prospect, then everything from customer loyalty to markets, to supply chain, to capital support, to staff commitment and effort are all likely casualties – serious risk indeed!
“Often the people to recognise and warn about risks will be staff on the front line or at lower operational levels, so encourage their speaking up - it may save your bacon.“
A robust integrity compliance programme will include: •
Adopting a policy covering bribery and corruption, fraud, gift-giving, entertainment and conflict of interest;
Board commitment and responsibility for the integrity programme and its measures;
Communicating this commitment to all staff and business partners;
Training of key functions (eg, sales, procurement staff);
Clarifying who is responsible for ensuring compliance at all levels;
Active ongoing understanding of relevant legislative and regulatory requirements, and regular checking to ensure compliance;
Undertaking due diligence of agents, distributors, contractors and business partners, and their inclusion in your mutual monitoring and reporting;
Thoroughly assessing risk of your own company’s operations – including agents, distributors, contractors and business partners;
Regular measuring and reporting in all areas of possible risk; and
Encouraging internal risk reporting and whistle-blowing; setting up a mechanism so staff or business partners can report concerns without fear of derision or retribution.
A strong integrity code and culture, and implementation of a good integrity compliance programme, are invaluable to prevent risks of these and other lapses – and bring big upsides!
Brendon Wilson is a director of Transparency International New Zealand. Visit www.tinz.co.nz 30
BusinessPlus December 2016
Kiwis reign in international customer service awards
ISSUE 143 DECEMBER 2016
2016 resu P10 2016 results shape strong future lts shape
PROGRESS IN PAY EQUITY DISPUTES
MAKING SPECIAL REWARDS SPECIAL
DESIGN REFLECTED IN BOTTOM LINE
THE ‘TRUMP EFFECT’ IN LATIN AMERICA
New Zealand real estate agents took home all the individual accolades and one of the business awards out of 9,000 agents and 1,000 offices internationally - at the international conference of Ray White real estate company this year.
…AND MUCH MORE!
John Quiambao of Ray White Remuera,
Rebecca Toone of Ray White Metro,
Diane Quinn of Ray White Paiha,
Rodney Fong of Ray White Tauranga, and
Anita Martelli and Tim O”Sullivan of Ray White Rotorua.
In addition, Ray White Tauranga was named as one of the top five businesses. Ray White New Zealand chief executive Carey Smith says, “These awards are arguably the most distinguished within our group, and they are becoming some of the most competitive. As a Group we’ve made a commitment to take our clients’ feedback, listen to it and improve from it. “We’re proud of our 2016 winners, who all provide a world-class customer experience.”
PROGRESS IN PAY EQUITY DISPUT P08 ES MAKING SPECIAL REWARDS P14 SPECIAL DESIGN REFLEC TED IN BOTTO P25 M LINE THE ‘TRUMP EFFECT IN LATIN AMERICA ’ P29
…AND MUCH MORE!
strong futu re
P08 P14 P25 P29
Congratulations to BusinessPlus survey participant Congratulations to David Greer of Mouats Engineering, in Mt Maunganui, for winning the prize draw for participants in our survey of BusinessPlus magazine readership.
The Ray White “choice” awards recognise the top five agents and businesses that are rated most highly by their customers. The New Zealand winners were: •
ISSUE 143 DE CEMBER 2016
A good A good year year
David has won the Prezzy Card valued at $50. Thank you to all who took part and told us what you like and what you want changed about the magazine.
We have taken note of suggestions regarding additional desired content, and your preferred way to receive the magazine.
The foundation of the awards is Ray White’s customer satisfaction programme that is based upon the internationally recognised customer loyalty metric, Net Promoter Score (NPS) - the same metric used by companies such as Apple, Telstra and Uber. Using a third party, Customer Monitor, to run the programme, every Ray White client is surveyed asking the question: “How likely are you to recommend your Ray White agent to family and friends?”, and give a rating from 1 to 10.
Our reason for the survey was to ensure the magazine was providing a genuine member benefit. Overall the magazine is considered excellent or very good value as a member service (for 87.5 per cent).
Continued from pg15
Vetting review recommendations The review recommended a clear statutory framework for vetting and is in support of a proposal (currently with the police) that a programme be undertaken to develop recommendations to Government for the enactment of legislation. In addition, it also identified the need to develop a more comprehensive set of guidelines and procedures to support consistent decision-making about what information to release. Finally, it called on police to talk first to people being vetted if their checks threw up information about them that they were unlikely to think existed or which they would not expect to be released
through the vetting procedure, and then give them a “reasonable opportunity to comment”. In addition to the above recommendations, Police Minister Judith Collins recently confirmed that regulations will be made to charge a small fee of $8.50 per vetting request (to date the service has been free), to cover the actual and reasonable costs of the Vetting Services.
What to do •
Always make your employment/ offer subject to obtaining a satisfactory vetting result. This should be clearly spelt out in both your offer letter and the employment agreement.
If necessary, consider fast-tracking applications for vetting. There is no fast tracking system as such, however you can email police to ask for your application to be expedited. There’s no cost at the moment.
Remember under the Vulnerable Children Act, employers are required to carry out employee checks, including police vetting, every three years.
If results of a police vet are negative, as an employer you are required to act in accordance with substantive and procedural fairness considerations.
BusinessPlus December 2016
AA Business Care Take advantage of this exclusive EMA member only offer – giving you access to all the great benefits of AA Business Care: •
List with your company vehicle(s) with The AA and they will be covered for AA Roadservice regardless of who is driving.
A nominated driver for each vehicle will be entitled to the below: Discounted insurance*
Discounted movie tickets*
Free eye exam valued at $60*
maps and guides
Access to AA Smartfuel*
Save up to 40% with our all inclusive rates*
AA Directions magazine
Accommodation discounts* * Terms and conditions apply
SIMPLY CONTACT: The AA Business Care team on 0800 734 543 to discuss your fleet (whether you have one or one hundred vehicles) and find out how much you can save just by being an EMA member or visit aa.co.nz/businesscare