M A G A Z I N E
The New Generation of Entrepreneur
The Technology Revolution maxiom
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About Entrepreneur’s Edge: Publisher Maxiom Group Pty Ltd 2/710 Collins Street Docklands Vic 3008 www.maxiom.com.au Editor Jo Poland Digital Magazine Created By Maxiom Digital www.maxiomdigital.com Advertising Enquiries 1300 855 696 (within Australia) + 613 8199 3486 (International) firstname.lastname@example.org Editorial, Media Releases & Article Submission email@example.com
Welcome to the February Edition of the Entrepreneur’s Edge The Entrepreneur’s Edge is the magazine written “by entrepreneurs for entrepreneurs” and in the spirit of paying it forward, every author has kindly donated their time and expertise without thought of return. Boasting exceptionally high quality information, tips and advice, every issue is packed with unparalleled levels of value added content including videos and webinars. Best of all, it’s completely free and open to Everyone!
BTW: some of our authors offer free guidance and advice in the form of white papers, webinars or research papers so if you glean a great idea from one of their articles, be sure and visit their website to see what else they have on offer!
Contributors For This Issue:
A Message From Tom Poland Hi there and welcome to the February 2013 edition of the Entrepreneur’s Edge.
Thomas Kessler Malcolm H.B. McDonald Joey Reiman Dr Gene Landrum
This is our second issue and I’m delighted to present you with contributions from many successful international entrepreneurs including…
Holona Lui Morris Miselowski
Dr Gene Landrum, USA, founder of not one, but two billion dollar businesses
Tony Falkenstein, NZ, serial entrepreneur and founder of a 60 million dollar business
Dorry Kordahi, Australia, found of megasuccessful magazine “Branded”
Joey Reiman, USA, named byFast Company as one of the top 100 thinkers who will change the world
Apoorve Dubey, India, serial author and founder and CEO of Kreyon Systems
There are simply too many great minds here to list them all so please, as you “flip” through our magazine please feel free to “swipe and deploy” every entrepreneurial idea that you can.
Strategically yours, Tom Poland Founder and MD, collegeforentrepreneurship.com
Marty Zwilling Michel Hogan
Mark Matthews Dorry Kordahi Tony Falkenstein Andrew Brown
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M A G A Z I N E
What’s in this month’s Magazine? Regular Features Page 3:
A Quick Word With Tom Poland
Getting To Know You
Bargains4Business Deals of the Month
Profiles Page 52:
Special Features Page 6:
20 Quotes to Inspire the Entrepreneur
What’s Your Business Worth?
What Every Presenter Can Learn From Olympic Athletes
Why Your Accountant Will Become a Futurist
You Need a Vacation
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What’s Your Business Worth? The New Breed of Start-ups…
Special Features Page 24:
Don’t do Email First Thing in the Morning
Targets and Hourly Rates: Can We Do Better?
The Traditional Fast Food Model Has Just Been Killed
Are You an Entrepreneur With All That Entails?
Crucial Questions Boards Are Asking Their Marketing Colleagues and the Answers They Should Be Giving
Positive Employee Relations Starts With a Focus on the Customer
Many Cultures, One Workplace: Overcoming Unconscious Bias
Outsourcing For Best Results
Gangnam Style Your Communications
What is An Entrepreneurial Genius?
Understanding the Target Customer’s Marketing and Sales Mindset
Three Things I’d Wished I’d Known When I Started
Don’t Mistake What You Do With Who You Are
The New Breed of Start-ups Master These 5 Processes
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ENTREPRENEUR | Edge
20 QUOTES TO INSPIRE THE ENTREPRENEUR By Apoorve Dubey
“The strongest foundation for success is laid by the merit of your actions – nothing in the world can shake it” – Apoorve Dubey
1. “The price tag you put on yourself decides your worth. Underestimating yourself will cost you dearly.” 2. “It is the road you take that decides your destiny and not your destiny that decides the road you take.” 3. “Your value in the world is the value you create for
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yourself. Make yourself valuable and the world will treat you that way.” 4. “Mediocrity is always a safe option but never a satisfactory one.” 5. “If you don’t have the courage to walk alone, others will not have the courage to walk with you.”
6. “The microscope with which you can see the opportunities in problems is called vision. Most people do not use it.” 7. “Discomfort, hard work, struggles and setbacks all are indicative of the fact that you are trying. Triumph begins with a try.” 8. “People are driven either by dreams or deadlines.”
9. “It is not your opponent but your weaknesses that hurt you the most.” 10. “Failure is a sign board which says, ‘Try again.’ ” 11. “Life is an opportunity for us to contribute something that outlasts us and makes the world a better place.” 12. “Your time is your most valuable asset; invest it where you get the best returns.” 13. “The more you follow others, the further you will walk from your own destiny. Follow your own star and illumine the world in your own way.” 14. “Original men live forever; it is the fakes who die.” 15. “The only thing that hurts harder than a failure is not trying.” 16. “When you try long & hard for anything, eventually a moment comes when it happens. The important thing is to keep trying until that moment comes.”
17. “Regret is not when you could not finish what you started but regret is when you do not start what you could have finished.” 18. “When you complain about things you don’t excel at them & when you excel at things you don’t complain about them.” 19. “The window of opportunity opens up with a problem. The bigger the problem the bigger is the window it offers.” 20. “Your deepest prayers are your sincerest actions. They are always rewarded.”
Apoorve Dubey is the founder and C.E.O of Kreyon Systems Pvt. Ltd, an IT and mobile application development company. Apoorve is also the co-founder of Master Mentors Advisory Pvt. Ltd, a premier consulting organisation with global footprint and collective management experience of over 300 years. Apoorve is the author of the international best-selling book, “The Flight of Ambition,” published by Macmillan, and coauthor of “Successful organizations in action”. To know more about Apoorve and his work, you can visit www.theflightofambition.com
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Discover How Much Your Business Is Worth (It’s FREE and it takes just 13 minutes) “Whether you want to sell your business or keep it as a cash cow, the smartest thing to do is to make sure is constantly ready to sell” - Michael Gerber, Author, The E-Myth
Attention Business Owners Are you thinking of selling but not really too sure where to start? Do you want to know how to increase the value of your business? Or are you curious about how much your business may be worth?
Introducing the Sellability Score The Sellability Score is a free online questionnaire that gives you an immediate analysis of the sellability of your business The report is confidential and completely free On average the questionnaire takes just 13 minutes
The Science behind it … The Sellability Score uses an algorithm that was developed from the results of a quantitative survey of business owners with annual revenue between $50,000 and $100,000,000 as well as surveys of Merger & Acquisition professionals. We utilized various statistical techniques including a factor, regression and correlation analysis to create the algorithm that predicts the sellability of a company.
To get your FREE report click on the image below…
824| Entrepreneur’s Edge | Modern Franchise Magazine
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LEADERSHIP | Edge
WHAT’S YOUR BUSINESS WORTH? (AND HOW TO MAKE IT MORE VALUABLE) By Tom Poland
You don’t have to franchise or even diversify in order to make your business worth millions. But you do have to get results through other people in a manner which is replicable. Figure out a way to create recurring revenue. Find your sellability score. There are nine key factors to support then the more scalable it consider when trying figuring out is. if your business is sellable and if so, how much it may be worth. In business the term equates to how much of the revenue can be In addition to financial factors driven independently of the such as EBIT (Earning Before owner’s time. For example, the Tax and Interest) and a trend of person who comes and checks growing profit, there are other our swimming pool twice a month factors that a smart buyer will does not own a scalable consider. In this article I discuss business. However, if he created three of the nine factors. marketing, management and service delivery systems he Factor #1: Scalability could then recruit a team of people to do all of the work. The term “scalability” was originally used to describe how Any product or service can be many workstations could hang off scalable with this approach. Just ask Jim Penman, owner and a computer server. The more founder of Jim’s Group which workstations a server can
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includes Jim’s Mowing and an additional 35 other services. What started with Penman moving lawns to put himself through university is now the largest franchise group in the world as measured by number of franchisees. You don’t have to franchise or even diversify in order to make your business worth millions. But you do have to get results through other people in a manner which is replicable.How did he do that? Simple: he created marketing, management and service delivery systems (see above) and put good people in place to run it all.
Factor #2: Recurring Revenue relatively low marketing share in a growing industry. That’s a very How much revenue can you count appealing double whammy. on for the next 12 months? If you don’t have recurring revenue then Conversely, if you have 60% of a the answer is zero. If you currently shrinking market then no matter how good your present-day sell one-off product or services numbers look, there is not a lot of you need to figure out a way to apparent upside. create recurring revenue. Maintenance contracts, When asked by a potential buyer subscription renewals, monthly why you are selling it would be retainers, supply contracts, consumable replacement are just unwise to say that you are simply sick of hitting your head against a some of the things you can consider. And whilst not sources brick wall in trying to get some growth. of reliable recurring revenue, things like annual reviews, forward orders, supply contracts In my experience, a buyer is and the like are more then helpful more motivated if you say something like “I’m getting a little in this regard. tired and don’t think I’ve been giving this business my all. So I If recurring revenue is not figured it was probably time to possible with your product or move on and hand it on to service, create a product or someone more motivated”. service where it is possible. At the very least figure out how If you have an interest in often your clients buy, create discovering what your business systems such as engaging is worth, and how you can make newsletters or similar to keep your brand top of mind, and have increase its value then take our regular offers for them to accept “Sellability Score” quiz. when they are ready. Then track It’s free and on average takes all of your numbers so you can prove to a prospective buyer that only 13 minutes to complete. You’ll immediately receive your you can reasonably predict score. Click the banner below to revenue from existing clients. check it out… Factor #3: Upside
Tom Poland Tom is the founder and owner of www.8020Center.com/sellmybusi ness/ and has been an entrepreneur for over 30 years. In addition to starting his own businesses he’s worked with multi-nationals and business owners to help them get more clients and make more money. Tom has been published internationally and has shared his thoughts on business excellence alongside the likes of Michael Gerber (E-Myth), Richard Koch (The 80/20 Principle) and Brian Tracy (BT International), just to name a few. www.8020center.com/blog/ www.facebook.com/8020center www.twitter.com/tompoland/
What a buyer will be hoping to find here is that you have
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LEADERSHIP | Edge
WHAT EVERY PRESENTER CAN LEARN FROM OLYMPIC ATHLETES By Gabrielle Dolan
Conceptualize Connect Inspire The general commentary has been around the athlete’s mental state as opposed to their physical state. Although the athletes were at their peak, physically, many of the athletes failed to handle the pressure associated with the greatest sporting stage in the world. Throughout the entire 116 years of modern Olympic history, there have been examples of where the greatest athletes have failed and where an unknown has come from nowhere to win gold.
Anxiety, nerves and negative thoughts can all cripple an athlete before their event. It has been reported however that for the first time in 20 years the Australia swimmers are competing without their own professional sport After years of training the inability psychologists. to master their mind can result in performances below Watching the effect of nerves and expectations. It’s why many stage fright has had on our highly Olympic athletes enlist the fancied Olympians, I was services of sports psychologists. constantly drawing parallels Sport psychology exists because between an Olympic athlete’s the human mind can do strange mindset and the mindset of things under stress. successful presenters.
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Most people, who present, no doubt experience nerves, negative thoughts and stage fright, with a detrimental impact on their performance. Given that the most common phobia is fear of public speaking; these states of mind are normal. Being able to master your mind before your next presentation will set you up for success and make presenting a lot more enjoyable experience, for you and your audience.
Granted, the audience at your next presentation may not be on the global scale of the Olympics, the consequences of losing or benefits of wining not so dramatic and the sacrifices perhaps not as significant.
Slowing down your breathing reduces your heart rate and signals to your mind that all is calm here. The key is to identify the early onsets of nervous tension and start this technique immediately.
Yet for anyone who has to deliver presentations there are three key techniques we can learn from Olympic athletes that work particularly well for presenters. And all of them relate to your mindset.
After swimmer James Magnussen failed to meet expectation in the men’s 4x100 freestyle, he said "the morning of my race my hands were shaking and my heart was beating out of my chest". Perhaps an attempt to slow his breathing may have helped.
Slow Your Breathing The first is slowing your breathing. You may have experienced some of these sensations before a presentation, feeling nervous as hell, you can’t remember your opening line and you are fighting your greatest natural human instinct to flee. When this occurs you will be well served to find some space and a few minutes and actively focus on slowing your breathing.
Atlanta. “We’d run through the warm-up, and the paddle to the start and then I would talk them through the race”. They went through this process of visualisation hundreds of times and “the actual race went exactly, exactly as they planned it”. Presenters can use the same technique. In the week leading up to your presentation, picture yourself walking on stage, your opening, your key messages, your ending, the laughs, the applause as you leave the stage, the congratulations and hand shakes afterwards.
Visualise success The second is visualise success. In the lead up to the 1996 Atlanta Olympics, the once much feared Australian men’s rowing team, the “Oarsome Foursome”, were not rated highly. They only just scraped into the final and against all odds won the gold medal. Sport psychologist Jeff Bond had worked with the Oarsome Foursome on positive visualisation in the lead up to
The power of visualising success works because the brain cannot distinguish between reality and imagination. The more you visualise success the brain will be tricked into thinking it is real. As you are about to walk on stage your brain will be think “Ok been here, done this before, all good”.
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LEADERSHIP | Edge
Know Your Routine
Similarly every successful presenter has a routine that sets their mind and heart in motion.
Many Olympic athletes have a routine they religiously perform They have a ‘getting ready’ before each event. Sport process. This might be just one psychologists call this mindfulness or process focusing. thing like some speakers brush their teeth before they present. It’s helpful because it distracts Others do a final practice or prep the brain from racing ahead by focusing the mind on the present themselves with some upbeat music that signals to them this is moment. In ‘All Psyched Up’ Australian swim coach Shannon show time. Rollason instructed the swimmer Jodie Henry to have a routine for Having a pre performance the 20 minutes preceding each routine helps you shift your state. race. On leaving the change You shift into high gear ready to room she was to speak to someone in the marshaling area, go. then she was to find the So before your next presentation, Australian team and wave to take some learnings from our them. Next she had to seek out her parents in the audience and Olympic athletes to help you give them a wave and so right up master your mindset. Slow your breathing, visualise success and until her being introduced and only then taking off her tracksuit know your routine. Doing all three will help achieve your own PB and putting her cap on. (Presenter’s Best). Henry won three Olympic gold medals in 2004 after following her pre-match routine.
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Gabrielle Dolan is an expert in communication and thought leader in storytelling. She is co-author of ‘Eliminate Death By PowerPoint’ and codirector of One Thousand & One, which run public and inhouse workshops on Making Good Presenters, Inspiring! To contact Gabrielle or for more information and workshop details, go to: Web Site: www.onethousandandone.com. au
Twitter: http://twitter.com/onethousan dand1
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CUTTING | Edge
WHY YOUR ACCOUNTANT WILL BECOME A FUTURIST By Morris Miselowski
Move from a reactionary role to a proactive role. More evolution than revolution. A rate of unprecedented business.
With business undergoing rapid structural change and new technology having an increasing impact on the way we work, live and do business, the accounting profession is also undergoing a fundamental change from a reactive role to a more proactive one. We talk with Morris Miselowski about what changes he sees in the world of accounting over the coming years and how this will affect our businesses. What changes you forecast for the accounting profession? The world of accounting will be revolutionised over the next 15 years with a fundamental move by most accountants away from the backline, with its focus on historic figures and tax compliance, to become a
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forward-looking well-informed holistic business adviser on the frontline.
Accountants will have real-time access to all of their clients’ relevant business details at their fingertips.
Is this going to be reflected in Much of the mundane the way we do business as donkeywork needed for tax well? compliance will be outsourced and accountants will become Most aspects of how we work specialist financial advisors who and do business are already become an integral part of their changing. Employees are working remotely and carry their clients’ thinking process. offices with them in their mobile Accountants will move from a device which can be accessed reactionary role to a proactive anywhere in the world at any role. In the past much of the work time. accountants have done is clientHow will these changes affect driven, reactionary and done after the fact. They will be part of our relationship with our a process that works in tandem accountant? in real-time with business operators. There will be an increasing reliance on accountants, with By 2020 relationships between their detailed knowledge of their organizations, people and clients’ business, for information service providers will be far more about how best to manage the intimate, accountants will be part business’s financial affairs. of an individual’s advisory group
and statutory requirements will be outsourced to some other country or person - that’s a fundamental shift. Does this mean that we will view our relationship with our accountant is a far different way? Accountants’ relationship with their clients will be significantly different. Accountants who will prosper are moving beyond traditional taxation advice, playing a broader role in their clients’ businesses and offering more holistic advice. What impact will this have on our businesses? In tomorrow’s business model clients will think ‘you are my financial advisor, you are part of my trusted tribe, you work in relationship with me and the others who advise me, you are constantly aware and switchedon. I expect your advice when I ask for it but also at times when I don’t.’
Accountants will know that information because they will monitor their clients, with permission, in real time.
economic powerhouses of China and India. Bigger firms in the US already send up to 70 per cent of their tax compliance work offshore and Australian firms are starting to catch on too.
This approach will apply to accountants working within a firm and those working externally Already book-keepers in India within an accounting firm. have good knowledge of tax laws in various countries around the Is Outsourcing likely to world. become a key function of our The world will become a much accountants business? smaller place and work will be Much of the number work will be routinely sent around the globe. sent to workers in the future
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CUTTING | Edge
So for accountants it’s more evolution than revolution?
What about the so-called “Revolution of Business”?
Some accountants - particularly in big accounting firms or boutique accounting businesses - already have close relationships with their clients, though by 2020 closer client relations would become the norm rather than the exception.
There will be a revolution of business across all levels, and its effects will be felt by accountants who work within a corporation or accounting firm, and in Australia and across the globe.
Over the next 10 years we will see business change more The growth in the industry will see significantly than we have in accountants offer more than just many hundreds of years. The numbers advice. They will offer financial/accounting world will business growth advice and evolve to meet new demands. bring in specialists to assist their client with other elements of their There will be new jobs, a whole business. lot of new areas we create, and new industries. Large firms already act as a trusted advisor and offer So how fast is this “revolution specialists in various areas of of business” likely to occur? business. The pace of change in the past We are already seeing the Big 20 years had been exponential, Four employing non-traditional with it not being unusual these employees - such as experts in days for businesses to amass online shopping and retailing and millions of customers within a online digital advertising year – a rate of unprecedented because this is a space about business. which many of their clients are seeking advice. In the next 10 years we will move forward more than 100 years of technology and within 100 years
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we will move forward 1000 years of technology. We are living a digital wild west, with few rules to guide us. We have moved into the digital world and we now have an online world where every physical activity we do has an online equivalent. Does this mean we need to adopt “lifetime education” as the norm in order to stay competitive? Generation Y and Z, the next generation to take over business boardrooms, would have been raised in a digital world. They have grown up with computers and mobile devices and are incessantly on them. They see the world as simultaneously physical and virtual. Human behaviour though is unlikely to change much. We are programmed a certain way. It’s how we use the new technologies and apply them in our lives and business that makes the difference. We have
Accountants will have to become good at interpreting information; work successfully with clients to inform them – sometimes in advance of their actions; and become adept at communication. We are already seeing the move to mobile access to information. So what will our accountant of the future look like?
to keep learning to keep up. Our whole approach to education, including business education, will change. Our accountants will also play a role and have the knowledge and expertise to guide us. Are we heading towards information overload? Technological advance has brought with it information (“we’re drowning in it from Google”); knowledge (“I can go to a blog and get someone else’s interpretation”) but to get wisdom
We are moving away from a fixed computer and moving into a mobile world. Smart phones recognise where we are, who we an accountant would need to be are with, what we are doing and consulted. do all kinds of things at our behest. Bank accounts, share What clients in the future will be portfolios and other financial wanting is the wisdom of information will be connected in someone with specialist one space and will be able to knowledge at a time and place give you advice, such as which that is meaningful to them. credit card is best to use at this Advances in technology will allow time. accountants to mine and capture the number work. Within 10 years this will be absolutely normal. Accountants Accountants’ main role in the will be mining that information future will be in selling the routinely and they’ll know all interpretive wisdom. The wisdom about their clients, their spending sought will deliver different skills, habits and what they have different mindsets and offer bought. different opportunities.
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CUTTING | Edge
What other revolutions are ahead?
The business world will adopt a project and task model, whether accountants work internally or Looking further into the future, by externally. 2020 stem cells will start to be used to grow organs and bones, While the need for traditional travelling into space for tourism number crunching accounting will be more common place, an work will remain, today’s accounting practice business increasing number of today’s cancers would have been tamed, model will be turned on its head we will have an understanding of by 2025. how the brain works and children born then will live for at least 120 It’s already undergoing years and manufacturing will be significant change. done to order using 3D printers. In the accounting world of the So what does this all mean for future number crunchers will be a small enclave rather than the our accountants? totality. The accounting industry will also be involved in a revolution in the The current business model – which sees most accounting way people work. practices with a majority of At least a third of the workers in number crunchers and the minority (partners) outreaching the western world will work and outsourcing business – virtually and remotely by 2025. simply doesn’t make sense financially. Accountants will no longer necessarily be physically housed in a building, and won’t work 9-5 My advice to today’s accountants in accounting firms is to find a weekdays. specialist niche that can be sold The notion of squeezing work in or provided through an accounting or financial firm which between the hours of 9am and is a growth area for the world in 5pm is a nonsense. which they work.
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Internal advisors will take on a generalist advisor role because that will also be needed. While there was limited room for businesses to continue to exist in their current narrow model, there was still a need for them. Future accounting practices will have extremely communicative consultants with a far closer and more intimate relationship with their clients and accountancy would become a much more advice-based people profession. Where once accountants saw their clients once or twice a year and interacted more with texts, books and notes, in the future they will be consulted much more often and interact much more with people. Accounting will become a complete customer interaction industry because there will no longer be any need for clients to use them ‘to get their books done’.
CUTTING | Edge
How will our accountants achieve all this?
There are and will continue to be enormous local opportunities.
Accountants will continue their education by constant up-skilling because they will be custodian of their own career. Global accounting qualifications will begin around 2030.
By 2025 China will be a dominant spending power on the planet and will have a large middle class. India’s growth in consumer demand will be about a decade or so later.
Australia and New Zealand, in Is the current mood of individual entrepreneurialism the Asia corridor, are placed perfectly to have a great good for accountants? influence on those economies. The working world had changed Geographically, they are close to most Asian countries and has vastly even in our lifetime. better time zones than the US Generations X and Y have learnt, and UK. through watching their parents, Australia also knows, from a that employment is short-term and loyalty is no longer required. financial/accounting perspective, how businesses will evolve. There are a growing number of employees defined by the notion These countries are inviting of six careers and 14 jobs in one Australia to share the business wisdom they have and that they lifetime.” are yet to gain. Will the “globalisation” of business have an impact? The huge opportunities open to Australians keen to capitalise on the growth of the economic powerhouses of China and India.
Our accountants will be at the forefront.
Morris Miselowski Business Futurist | Keynote Presenter | Strategic Advisor The highly-regarded principal and founder of Success through Focus since 1981, each day, he consults with business leaders around the globe, helping to shape their businesses so they can be first to take profitable advantage of tomorrow’s business opportunities. Morris foresees an unlimited future for those companies which take the time to prepare and strategize for the future NOW. Blog: BusinessFuturist.me Website: BusinessFuturist.com FaceBook:
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PERFORMANCE | Edge
YOU NEED A VACATION By Bill Hennessey
I made the mistake of taking a grand total of zero vacations during my first five years in business. Four reasons to fit vacations into your schedule
My family didn’t go on extravagant vacations when I was growing up. We took a ski trip once a year, and we went Walt Disney World when I was in Grade 8. When I graduated from the Richard Ivey School of Business in London, Ontario, Canada, my parents offered me a trip to Europe. Instead, I asked for cash to start my first company. Then I made the mistake of taking a grand total of zero vacations during my first five years in business. So my New Year’s resolution for 2012 was to go on a five-day vacation every two months. Minimum. (And yes, I’ve managed to pull it off.) Here are four reasons to fit vacations into your schedule: 1. They make you better appreciate all the hard work you put in.
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1. They force you to take a break from day-to-day operations, allowing you to think more broadly about how to grow your business. When I’m on vacation, I spend an hour in the morning and another hour in the evening jotting down notes on how to take things to the next level. I don’t deal with anything else until I return. 2. They train your staff to work independently, giving them more autonomy. If you plan to sell your business at some point, you want to make sure you can demonstrate its ability to chug along without you. 3. They give you a fresh perspective; stepping back to look at how the competition operates can help you improve your business.
Bill Hennessey Bill loves to build businesses and entrepreneurship. He is always on the hunt for the next opportunity. Although still under the age of 30, he was already recognized in Profit Magazine's Fuel Award as winner in one of Canada's top 20 entrepreneurs. He also received nominations on Toronto Event Producer of the Year.
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MANAGEMENT | Edge
DON’T DO EMAIL FIRST THING N THE DAY By Robyn Pearce
Dealing with emails can ‘suck dry’ your productive time. We’re much too easily side-tracked into following hyper-links on interesting items, reviewing blog posts .… and more. And then, before we know it, the end of the day shows up. Your email inbox won’t die from neglect! At all my face-to-face events I 1. When you’re responding hand out a little card to to/reacting to others’ emails, participants. It has my contact are you working on your information on one side but the priorities or are others true value is the list of ‘Eight Top directing your day? Of course Time Tips’ on the reverse side. some are highly important and/or urgent, but is that all you No. 8 on the list is ‘Don’t make work on first thing? email the first thing in the day’. 2. For many of us, the medium is This almost always gets addictive. You intend to take a questions from the audience as quick look but it’s so easy to to why I suggest this. And for ‘just check these ones’. Before some, it’s a very challenging you know it, an hour or two of suggestion. I’ll give more your precious day has research as to why in a future disappeared. article, but for now, let’s look at the surface issues. 3. If you don’t have an appointment first thing, the day Several reasons: seems to stretch ahead invitingly and a ‘few minutes’ checking the email seems like 1. The potential distraction factor a nice easy momentum(unless you’re very disciplined, creating activity. However, or on tight time-lines.) many of us find we’re much too
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easily side-tracked in following hyper-links on interesting items, reviewing blog posts .… and more. And then, before we know it, the end of the day shows up and we find ourselves saying ‘I’ll get to that big job tomorrow’. Example: Here’s what Peter, a very experienced accountant, said at a ‘Getting A Grip on the Paper War’ session in regard to email: ‘I don’t look at my email until after 4pm. My PA keeps an eye on it through the day. She clears the rubbish and anything urgently needing my attention will have been brought to my attention. By the time I get to them there are rarely more than 8 emails left for me. I don’t leave work until I’ve dealt with them -
but they haven’t sucked dry my productive time.’
neglect. You might have a bit of catch-up the next day, but you've One of my clients checks his mail given your brain a chance to detox. Very good for the health! An I can hear some of you saying ‘all on his Smart Phone while he’s waiting to give his teenage son a increasing number of companies very well for him. He’s lucky to are instituting ‘Email-Free’ Days. have a PA.’ No, it’s not luck. It’s a ride to school. Others check I’ve also heard of ‘Email-Free whilst riding public transport to choice - and that’s a different Friday’. work. topic. Peter isn’t reacting to email. Instead he keeps control, staying focused on the work that brings in his income. He doesn’t allow email to drive his priorities. He manages it instead of being managed by it.
Doesn’t the very sound of it seem Most of us won’t be tempted to get into a long response session like wonderful freedom! on those small screens and keyboards. Mind at rest, we can then ignore email until later in the day. Guidelines:
Some possible exceptions: Set yourself regular checking 1. If you work across time zones times, but not in your prime and need to review last night’s creative time. mail before you can start work. If you've got a big task that needs 2. If you’re in a customer-focused concentration, don't go near your emails until you've had a solid role that requires rapid burst of time on the big job. response. Robyn Pearce Treat checking the mail as a treat 3. Or you’re the front-line administrator/support person and a light break. for rapid response colleagues. Set a time limit and then turn the 4. And of course, when you’ll be mail programme off when time’s up. away from your computer for the rest of the day. A quick morning check gives peace-of- You Might Like To Try This: mind. Every now and then, have a nonemail day. It won't die from
Robyn Pearce (known as the Time Queen) runs an international time management and productivity business, based in New Zealand. Get your free report 'How to Master Time in Only 90 Seconds' and ongoing time tips at: www.gettingagrip.com
Entrepreneur’s Edge | 25
LEADERSHIP | Edge
TARGETS AND HOURLY RATES: CAN WE DO BETTER? By Margaret Heffernan
Thinking, in and of itself, isn’t confined to schedules, meetings and clocks. Targets don’t encourage you to spend time building up the relationship. Without targets no one has anything to fear from getting other people involved. Most companies set targets for and for our clients to have an y their employees and then monitor agreed fee for the job; that goes productivity. a long way back. So we do hourly rates, but only when the client Professional services firms do insists. Culturally we would rather so, normally in the form of billable bill by a fee for the job.” hours. I’ve always been skeptical that this was a smart way to It isn’t just tradition that informs motivate great people so I was Slaughter & May’s approach. It’s intrigued to encounter a highly also derived from an observation successful international law firm of the way that good legal that does neither. thinking happens.
sleep. Well, how do you bill for that?” According to White, this approach has all kinds of benefits: not just sleep-induced solutions but a better attitude to collaborative work.
“It means that partners are less likely to hoard work and over work. No one has anything to fear from getting other people “We’ve never had targets,” Thinking, in and of itself, isn’t involved - it won’t impact how partner Graham White told me. confined to schedules, meetings much they take home. There’s no and clocks. It takes place incentive to work ridiculous “They’ve never really been part of anywhere and everywhere. hours.” the firm. And historically we were always reluctant to move to hourly “You often have your best thought The biggest case against billable rates, for the simple reason that in your sleep. We know that lots hours and targets is that they we thought it was better for us of problems are resolved in direct energy and attention away
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LEADERSHIP STRATEGIES FROM THE LEADERS OF SUCCESSFUL MULTI-MILLION DOLLAR BUSINESSES
MODERN LEADERSHIP MAGAZINE
from what matters most: the relationship between lawyer and client. “Targets militate against investing the extra time or attention which is what it takes to become a trusted advisor. At its best, that’s what you want to achieve; it’s at the heart of what we do - and targets just won’t get you there. They don’t encourage you to spend time building up the relationship and they don’t inspire the kind of creative thinking that makes the relationship both central and special.”
Margaret Heffernan is an entrepreneur, Chief Executive and author. She was born in Texas, raised in Holland and educated at Cambridge University. She worked in BBC Radio for five years where she wrote, directed, produced and commissioned dozens of documentaries and dramas. For more information please visit our website: www.8020center/contributors/mh
CLICK HERE TO GET YOUR FREE COPY DELIVERED DIRECT TO YOUR INBOX EVERY MONTH Entrepreneur’s Edge | 27
TECHNOLOGY | Edge
THE TRADITIONAL FAST FOOD MODEL HAS JUST BEEN KILLED! The traditional fast food business model just never had a chance, now did it? Well it’s had a good run. It is well over 50 years since McDonald’s rolled out its’ first franchises. But all good things must to come to an end. Yes, we’ve heard it all before - that people’s tastes and habits are changing. Many of us are eating healthier, or trying to anyway. But still the traditional fast food model reigns supreme. Until now! Marcelo Coelho and Amit Zoran, a pair of whiz kids from MIT, have developed what very well may be the next major revolution in food preparation. It may also be the only machine that keeps you alive when the Robot Apocalypse goes down, but we'll try to push that to the rear of our minds for now.
The Cornucopia is set to change the way we think about food
before, but apparently now that’s countries? It seems mind blowing totally possible. right now but the technology has already been developed and will Able to deliver "elaborate become mainstream in the near combinations of food," the future. machine also has a rapid heating and cooling chamber that Will this be the future of food Essentially, the Cornucopia is a purportedly allows for "the preparation? Will this be the end creation of flavours and textures of the fast food model as we 3D printer that precisely mixes foods and flavours from a number that would be completely know it? What impact will this of canisters in order to produce unimaginable through other have on café’s and restaurants? cooking techniques." something that's edible (and guess just have to wait for it to supposedly close to what you become mainstream to find out. Imagine printing your dinner ordered). every evening? What about being Food for thought! able to print food to save the lives I’ve never ordered duck a of starving people in the poorest l’orange from a street vendor
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Entrepreneurâ&#x20AC;&#x2122;s Edge | 29
ENTREPRENEUR | Edge
ARE YOU AN ENTREPRENEUR WITH ALL THAT ENTAILS? By Dr Gene Landrum
Be Charismatic - communicate Be Ego-Manic - high selfesteem Be very Gestalt - Big Picture Person Be Innovative - Creatively Destructive “The Motivated Entrepreneur is the most important person in US today. We need to support a new Entrepreneurial Economy for the younger generation.” - Malcolm Gladwell (2010).
Be Big Risk-Taker- Bet it all to get it all Be Iconic Renegade - Go where pack fears Be Passionate - Drive is Intrinsic to success
you’re doing, you’ll keep on getting what you’re getting. If good, fine. If not, change!’
Michael Malone, in The Future arrived Yesterday (2011) said, ‘Those resisting change will be Most people feed their strengths obsolete as a 32RPM, thus by and starve their weaknesses. Not 2013 two-thirds of all adult true of strong entrepreneurs, who Americans will be classified as have a propensity to attack entrepreneurs.’ weakness, and go with their strengths in the face of The Wall Street Journal, on the traditionalists or family and passing of Steve Jobs, called friends. Savvy entrepreneurs are him, “A fearless entrepreneur considered renegades by due to a Beginner’s Mind due to bureaucrats and of course, most his Buddhist nature.” He was entrepreneurs do not have ostracized by many, fired from bureaucratic-oriented friends. Apple, the firm he founded, and then came back when the firm hit The old adage is important for hard times. Here are some those wanting to be their own beginner’s insights for those boss, ‘If you keep doing what launching into a new business,
30 | Entrepreneur’s Edge
with the entrepreneur as a renegade visionary who: ● Introduces New Products ● Into New Markets ● With New Innovative Uses ● Via New Production or Distribution Strategies ● Using New Organizational Methods or Ideas If you do not follow the above regimen you are not a true entrepreneur. An example is the Frisbee, a product developed by an ex-P-51 fighter pilot who was throwing cake pans in Santa Monica when, in his prophetic words, “I was offered twenty-five cents (.25c) for them. A business was born.” His idea
was hatched during an era of Flying Saucers, and this man developed a fun way to fly a saucer on a beach or park. There are many times when ignorance is bliss in a new idea launch.
One of my axioms for students is to never start out to build one of anything. If you open a retail store, figure out how to build a chain or franchise/license the rights to others, as that is the true path to fame and fortune.
The propensity of Henry Ford was not educated entrepreneurship is tied up in enough to know he was not personality. To be good at being supposed to sell his Model T car your own boss one must have: below what it cost to build and he became rich and famous. ● Charisma: - effective communication skills. If Howard Head was not smart you can’t communicate, enough to know that his you cannot motivate ineptness at hitting a tennis ball others to follow you, give was not important, so he you money or to put your developed a racket with twice the product on their shelves. ‘sweet spot’ so he was better and he revolutionized the sport ● Have you ever been he was not good at. In four years labelled an Ego-Centric? he made $75 million. Why didn’t It is one of the factors key Dunlop, Wilson or McGregor do to taking unique paths as it? Simple! They knew too much you must believe to mess with current revenues or inextricably in your dream sales of traditional rackets. The in what psychologists head engineer at Prince Rackets label Internal Locus of told the press, “If any other Control. engineer had come in here with such an idiotic idea I would have ● One must have a Gestalt thrown him out, but he owned the View - a big picture vision company.” of life’s possibilities. It is a gut sense of what works
and what may not work. Be intuitive and you can be effectively selfemployed. ● Next one must score well on Innovation tests - be creatively destructive of what is, in order to be able to create something that is not. ● This trait is tied to RiskTaking Propensity - the ability to bet what you have, to get what you want. Many people say they want to do their own thing but will only use what is known as OPM - Other People’s Money. Other people will not give you money if you haven’t shown that you are willing to bet yours. ● When you have passed this temerity test then it is about your Drive/Passion - inner emotions that let you sleep less, earn less at first and to work endless hours when other people are not working.
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ENTREPRENEUR | Edge
● The last quality of crucial importance to entrepreneurs is a Renegade Nature – since traditionalists and the established types never, ever make it to the top in their own endeavors. To validate the above just look at the lives of Walt Disney or a Steve Jobs or Richard Branson. They all fit the above like a glove.
One study that showed just 1% of the general population is inclined to hypomania, compared to 33% of entrepreneurs. Without adequate capital no one can rise to the very top of any discipline so get money enough so you spend your time chasing business.
The founder of venture capital, George Doriot, told us the importance of an entrepreneurial You do not have to score high on personality when he said,” each of these traits, but know that Always consider investing in a you must be above average on grade A man with a grade B each and way up there on at idea. Never invest in a grade B least three of these traits: man with a grade A idea.” To sum up the consummate entrepreneur: They are a bit manic finishing their meals first and can be found double-parked when necessary to cut a new deal. They learn to multi-task as they must be able to get orders, ship products, handle press conferences and financially analyze new market opportunities.
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Dr. Gene Landrum Dr. Gene Landrum is an author, lecturer, consultant. He is a Professor Emeritus from Hodges University where he still teaches MBA’s on the art of being their own boss. In 2011 he was inducted into the Entrepreneurial Hall of Fame in Dallas, TX. He launched five new companies and took three to $100 million in revenues within three years. The most famous was Chuck E. Cheese. To read more you can visit his Website: www.genelandrum.com
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Entrepreneur’s Edge | 33
LEADERSHIP | Edge
10 CRUCIAL QUESTIONS BOARDS ARE ASKING THEIR MARKETING COLLEAGUES AND THE ANSWERS THEY SHOULD BE GIVING By Professor Malcolm H.B. McDonald
The reputation of marketing is at an all- time low. CEOs and CFOs are sick and tired of the lack of accountability for the substantial budgets of marketing. There are ten questions Directors are now asking their senior marketing colleagues. The answers, set out here, will ensure that marketers gain the respect in the boardroom that they deserve. As was made clear by the Deloitte report in 2007, Directors will no longer tolerate sloppy, unprofessional marketing departments who fail to justify the often substantial sums of money they spend. The following are ten crucial questions they are increasingly demanding answers to.
products we sell. Remember IBM Answer: (“we are in the mainframe market “)? and Gestetner (“ we’re in the ● We do proper needs duplicator market “)? based segmentation, not that a priori nonsense We map our markets, showing such as socioeconomics product/service flows, (not all As behave the volumes/values in total, our same), demographics (not shares and draw critical all 18-24 year old women conclusions for our company. behave the same, geodemographics (not Question 1 We know what the key decision everyone in the same points are. In particular, we street behaves the same) understand the 20/80 rule, as this etc. Do we know and understand our is where segmentation is done. key markets? We also understand the needs of Question 2 members of each segment. Answer: We define our markets in terms of needs satisfied, not the
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Do we address real segments in our markets?
● opportunities and to ameliorate the threats.
Do we know what our sources of differentiation are in each of the Question 4 principal market segments in our key target markets? Do we all agree where we should target our limited resources? Answer: Answer: ● We regularly check on the buying motives of We prioritise the segments in segments and compare each market, having classified how well our company them all, according to relative performs compared with potential for growth in our profits, main competitors. in each, over the next three years and according to our company’s ● We act on the resulting relative competitive position in strengths and each. weaknesses. We check that our strengths create Question 5 value for us and the customer and that they are Are our objectives for revenue difficult to copy. We work growth and market share hard at tackling those realistic? weaknesses that are meaningful to the Answer: customer. For attractive markets (attractive ● We regularly monitor the means there is potential growth opportunities and threats in sales and profits in the next by segment and work hard three years), our objectives are to to take advantage of the improve Net Present Value
● (NPV), whilst investing in growing/retaining our competitive position. ● For attractive markets in which we have few strengths, having chosen the better ones, our objectives are to improve our competitive position by investing in them . For those markets not selected for investment, our objectives are to maximise net free cash flows. ● For unattractive markets in which we have few strengths, our objectives are to maximise net free cash flows. ● For unattractive markets where we have strengths, our objectives are to minimise costs consistent with retaining our competitive position and to maximise net free cash flows.
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LEADERSHIP | Edge
Question 6 Are our strategies for product development, pricing, customer service, channel management and promotion consistent with our objectives? Answer: ● Our strategies match the objectives referred to above. For example, the majority of the available budget goes into attractive markets where we have strengths followed by unattractive markets where we have strengths, followed by attractive markets where we have few strengths - in that order. Question 7 Have we dispassionately assessed the risks associated with our strategic marketing plan?
36 | Entrepreneur’s Edge
Answer: ● We assess the risks associated with our MARKET forecasts by using the long established tools of marketing, such as product life cycle analysis. We assess the risks associated with our plans for new products and markets by using tools such as the Ansoff matrix. ● We assess the risks associated with our declared STRATEGIES by testing whether we are addressing proper needsbased segments with specific offers and whether we are leveraging our strengths, minimising our weaknesses, taking advantage of opportunities and ameliorating threats.
● margins and by checking that we are not setting unrealistic objectives such as rapid growth in static or declining markets. Question 8 Have we calculated whether our strategic marketing plan creates or destroys shareholder value? Answer: ● We work with our senior accountants having taken account of the risk adjusted net free cash flows from all of the products for markets. We then calculate whether these cash flows are greater than the cost of capital. If they are, we are creating shareholder value and can quantify this.
Question 9 ● We assess the risks associated with our declared BUDGETS by Have we agreed the metrics for checking our forecast measuring market effectiveness? margins against historical
● We know the levels of Our plans demonstrate: promotional expenditure 1. A deep understanding of necessary to maintain our our markets current level of sales (maintenance). 2. A clear understanding of needs based segments ● We subject any promotional expenditure 3. A clear prioritisation of our over and above objectives and strategies maintenance expenditure (investment/growth 4. Quantified proof that they expenditure) to net create shareholder value present value calculations. ● We know the difference between lead indicators (actions that cause sales etc.) and lag indicators (outputs, such as sales growth.)
5. They are clear, creative and interesting
● As a result of this, we know what needs reporting, why, when, how often and to whom it should be reported.
In conclusion, let me say that, whilst all these questions are not relevant to all markets, unless marketers can answer the relevant ones, they should either get their marketing education up to par, or question whether they are in the right job.
Question 10 Are we happy with our marketing planning processes?
6. They enable us to allocate our scarce resources differentially
Prof Malcolm H.B. McDonald Malcolm, author of 44 books, is a Professor of Marketing at six of the world’s top Business Schools. His extensive industrial experience includes a number of years as Marketing Director of Canada Dry. He spends much of his time working globally with the operating boards of the world’s biggest multinational companies. He is Chairman of six SMEs. In 2006, he was listed by the Times as one of the country’s top ten consultants. firstname.lastname@example.org www.malcolm-mcdonald.com
Entrepreneur’s Edge | 37
STAFFING | Edge
POSITIVE EMPLOYEE RELATIONS STARTS WITH A FOCUS ON THE CUSTOMER by Kristin McNicol
Poorly motivated and disengaged staff reflects badly on your company and your brand. Internal marketing (IM) is the process of engaging the support and commitment of employees. Focus on the customer and everybody wins! Marketing doesn’t just mean superior customer experience promoting your company’s (in other words a market leading products or services to potential brand) begin. customers. Goals might include broad In order to create a great brand, strategic initiatives, as well as be the employer of choice in your specific tactical marketing industry and regularly and programs and campaigns. routinely exceed customer expectations, your marketing In every case, the establishment efforts need to begin internally. of an IM program incorporates three main elements of the Internal marketing (IM) is the marketing concept: process of engaging the support and commitment of employees 1. It is customer focused - the and other organizational customer is the hero of the members for the mission, organization. objectives and values of the company. 2. It is integrated throughout the organisation: everyone is in Ensuring your employees fully marketing. understand your customer’s needs and the goals of the 3. It is accountable: various business is the first place that customer and employee great employee relations and a metrics are established to
38 | Entrepreneur’s Edge
monitor progress towards goals. Internal marketing projects usually encompass one of six phases: 1. An assessment phase that uncovers management and employee attitudes and beliefs towards each other, the company, customers, and marketing mix components. This frequently consists of employee focus groups or formal written employee and management surveys. 2. The segmentation and profiling of the internal market by demographic, workrelated, and attitudinal characteristics.
3. A review of communications activities and their effectiveness, including a "mapping" of communications channels. Instrumental are the links among customers, employees, and marketing/management. 4. An assessment of employee performance and appraisal systems, including goalsetting, measurement, appraisals, and rewards. 5. The identification with management and employees of realistic internal marketing goals and objectives. 6. The development of a workable internal marketing plan to achieve internal marketing goals. These plans usually include communications and behavioural-related programs across all organizational levels.
appraisal systems, and focusing on day-to-day employee communications to ensure a professional, consistent internal marketing perspective. Many organisations battle with training, motivating and inspiring front line staff. Hiring processes can often be shortcut due to immediate staffing needs. We all know that poorly motivated Kristin McNicol and disengaged staff reflects badly on your company and your Kristin is a consultant to enterprise brand. IM programs enable businesses to inspire their employees to inspire their customers. This is where great customer service begins. It is also where great employee relations begin. Focus on the customer and everybody wins! Motivated and inspired employees are the clearest reflection of your brand.
Organizations implement their IM programs using a combination of Motivated and inspired internal and external resources. employees equate to a better customer experience. Happy That might include employee customers results in more sales. meetings, developing orientation More sales usually mean and other employee increased profitability. communications materials, creating communications Keep your promises to your staff programs for annual employee as well as to your customers. meetings, creating IM integrated
on HR & recruitment best practices, having worked for over 20 years in North America and Europe. Kristin has worked with some of the biggest household names, franchises and government organisations helping senior management improve communication with all stakeholders in order to achieve better business outcomes
For more information please visit: http://www.smartcompany.co.nz/kri stinmcnicol
Entrepreneurâ&#x20AC;&#x2122;s Edge | 39
LEADERSHIP | Edge
MANY CULTURES, ONE WORKPLACE OVERCOMING UNCONSCIOUS BIAS By Holona Lui
In the Western world, the baby boomers are ageing and with them a demographic challenge is looming. Migration as a potential source of skilled labour will become increasingly important. The source of skilled migrants will swing towards countries where English is a second language. The workplace is a microcosm of wider society many cultures, one community.
Migration as a potential source of skilled labour will become increasingly important and the source of skilled migrants will swing towards countries where English is a second language.
closer to home because of gender? Choosing the best talent available
In the Western world, the baby boomers are ageing and with them a demographic challenge is Ethnic diversity in NZ will continue to rise. looming.
One way businesses can maximise the opportunity to get the best talent is by developing greater cultural awareness. As We are seeing this happening part of this process businesses In New Zealand, as with some of already as reinforced in a recent can learn to recognise some of our traditional trading partners, article in the NZ Herald, the unconscious assumptions our labour force growth is that might be influencing their slowing and our workforce is ‘Embracing ethnic diversity: decisions and adapting their ageing. Melting-pot reality okay with New recruitment processes accordingly. There are now more 60-64 year Zealanders.’ The challenge for olds than 15-19 year olds in the many NZ businesses is how to In our experience and workforce. attract, hire and retain the best observation of businesses new talent available? How do Nearly one in three workers are they ensure that their recruitment looking for new staff, there can be an unspoken and at times, an over 50 and by 2029 it is processes are open and unrealised inclination by those projected that one in four workers responsive to potentially great will be aged over 64. staff members and how do they recruiting new staff to hire people like themselves i.e. people from ensure that they are not similar backgrounds and on the Globally there is increasing unwittingly filtering out potential face of it with similar values. competition for skilled labour. talent from other cultures or
40 | Entrepreneur’s Edge
While getting the right ‘fit’ in recruitment is a key element in staff selection, it should not preclude people from different backgrounds or gender from being seriously considered as prospective candidates or as future colleagues.
They have the qualifications and industry experience but are given the impression or are told that they lack relevant ‘Kiwi’ experience.
In frustration and disillusionment some return back ‘home’ overseas, move to Australia or International research by take jobs where their talent and institutions such as the University skills are under-utilised. of Arizona, supports the view that businesses benefit from having a When this happens, NZ is the well-managed diversity of poorer for it and much time, personnel, cultures and energy, money, hopes and perspectives and that it dreams have been wasted. enhances staff engagement, innovation, customer There may be many reasons for engagement and productivity. this such as unconscious assumptions of a person’s ability NZ for many years has been based on such obvious things as considered as the ‘land of Milk their name, accent, cultural and Honey’, a land of opportunity, background, appearance, but through our work Catalyst gender or age. Pacific is aware that for many migrants settling into NZ and For businesses these being accepted is not that easy. assumptions need to be addressed particularly as new Enticed by excellent immigration candidates entering the NZ campaigns, as part of our work labour force with higher we have met a number of education levels are more likely migrants from different parts of to be new migrants and women the globe, who find that Kiwi businesses are reluctant to hire them.
Recognising unconscious bias Many decisions business owners make about their businesses are deliberate, well considered and they are fully cognisant of the many factors that are influencing them. But equally at times business owners may not be aware that those same influences might be unconsciously affecting their decision making processes such as when considering someone for promotion or a ‘stretch’ project. Their gender or communication style may not fit a preconceived view of what makes an effective leader at the ‘next level.’ This is a form of unconscious bias and it can happen to even the most broad-minded and forward thinking business owners. Great candidates may not even make it to the interview stage for promotion or recruitment because of unconscious assumptions and expectations about their background and
Entrepreneur’s Edge | 41
LEADERSHIP | Edge
qualifications, that may undervalue the candidatesâ&#x20AC;&#x2122; potential and ability.
The good news is that we can make progress and leverage off this insight.
Internationally there is a growing emphasis on diversity and inclusion where the focus is on creating a more inclusive workplace culture with the business benefits this can bring.
By learning more about the different cultural backgrounds and values of the people we might employ and the clients we work with, business owners can improve their competitive advantage.
Part of this process is recognising and understanding unconscious bias. But what is unconscious bias? Unconscious bias can be described as an unconscious expression of the cultural lens through which we all view the world. Through their personal lens business owners, assess judge and make the myriad of large and small decisions about their businesses and the people they hire. All of this is natural and understandable but it can mean that businesses might be missing out on the best people available and consequently the competitive benefits these people may bring to the business.
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It is when we begin to realise the extent to which our cultural lens and our unconscious biases might be influencing our decisions that we will be more open to seeing the potential of a wider talent pool.
Holona and Trish Lui
Holona has considerable experience and expertise in his specialist areas of team development especially high performance teams, project management for learning and If we can begin to recognise and development programmes and communications, particularly for understand our unconscious Pacific communities.
bias, collectively and individually, we might be able to better leverage the talent and potential of the many cultures in the NZ workplace.
He regularly provides advice on communicating with Pacific Peoples and co-conducted Pacific Analysis Framework policy training for a wide range of public sector and non-government organisations. T: +64 4 938 8183 M: +64 274 439 345 E: email@example.com. nz W: www.catalystpacific.co.nz
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Entrepreneur’s Edge | 43
OUTSOURCING | Edge
OUTSOURCING FOR BEST RESULTS
By Mark Matthews
Know what to outsource and the results you want to achieve. Outsourcing can assist SMEâ&#x20AC;&#x2122;s compete on more favourable terms with larger organisations if it is used effectively. An outsourcing specialist can assist you develop an outsourcing strategy. Entrepreneurs and Business Managers are outsourcing more services than ever. Yet many business outsource without any defined purpose nor are they measuring the effectiveness of their contracts. In fact, many businesses experience inconsistent results from companies they engage to outsource a wide spectrum of services.
Know what to outsource and the results you want to achieve.
Being clear on what services you do not wish to undertake in Ideally a successful outsource house and the scope of services relationship enables you to you want to outsource along with outsource administrative or the results expected from your operational activities that are not outsourced contractor is critical part of your normal day-to-day to the success of the relationship. business, or for which you require additional resources. Organizations that outsource should be seeking to realize This provides you with the peace benefits or address the following of mind that comes with being issues: certain that the required services will be professionally executed in 1. Cost savings - The a timely manner, without lowering of the overall additional in-house hiring. cost of the service to the
44 | Entrepreneurâ&#x20AC;&#x2122;s Edge
business. This will involve reducing the scope, defining quality levels, repricing, re-negotiation, and cost re-structuring. It may include contracting production or services offshore, to lower cost economies. 2. Focus on Core Business Resources (for example investment, people, infrastructure) are focused on developing the core business. For example often organizations outsource their IT support to specialised IT services companies.
3. Cost restructuring Operating leverage is a measure that compares fixed costs to variable costs. Outsourcing changes the balance of this ratio by offering a move from fixed tovariable cost and also by making variable costs more predictable. 4. Improve quality - Achieve a steep change in quality through contracting out the service with a new service level agreement. 5. Knowledge - Access to intellectual property and wider experience and knowledge. 6. Contract - Services will be provided to a legally binding contract with financial penalties and legal redress. This is not the case with internal services. 7. Operational expertise Access to operational best practice that would be too difficult or time consuming to develop inhouse. 8. Access to talent - Access to a larger talent pool and
a sustainable source of skills, in particular professional services, consulting, science and engineering. 9. Capacity management An improved method of capacity management of services and technology where the risk in providing the excess capacity is borne by the supplier. 10. Catalyst for change - An organization can use an outsourcing agreement as a catalyst for major step change that can not be achieved alone. The outsourcer becomes a Change Agent in the process. 11. Enhance capacity for innovation - Companies increasingly use external knowledge service providers to supplement limited in-house capacity for product innovation. 12. Reduce time to market The acceleration of the development or production of a product through the additional capability brought by the supplier.
13. Commodification - The trend of standardizing business processes, IT Services, and application services which enable you to buy at the right price, allows businesses access to services which were only available to large corporations. 14. Risk management - An approach to risk management for some types of risks is to partner with an outsourcer who is better able to provide the mitigation. 15. Venture Capital - Some countries match government funds venture capital with private venture capital for start-ups that start businesses in their country. 16. Tax Benefit - Countries offer tax incentives to move manufacturing operations to counter high corporate taxes within another country. 17. Scalability - The outsourced company will usually be prepared to manage a temporary or permanent increase or decrease in production.
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OUTSOURCING | Edge
Some businesses outsource just because it seems easier, but if the contracted service scope isn’t clear and the delivery expectations not documented then the end result may not be what the business owners had in mind.
18. Creating leisure time Individuals may wish to outsource their work in order to optimise their work-life balance.
It makes sense to partner with an outsourcing specialist who can assist you develop an outsourcing strategy that will enable you to achieve your business aims.
No matter what you are looking to outsource the first thing you should check is if the person or company you are considering is Outsourcing can assist SME’s capable of managing a key area compete on more favourable of your business better than you can do yourself, so you don’t terms with larger organisations if have to worry about it. If you don’t it is used effectively. think they can or are unsure…then move on to one With the plethora of outsourcing who can. options available to most businesses cutting through the sales hype and delivery promises can sometimes be a difficult proposition in itself. Knowing where to start, what to outsource, why and to whom can be daunting for many SME’s but it doesn’t have to be.
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Mark Matthews Mark is CEO of Maxiom Group. Maxiom delivers the Business information and advice you need - straight to your inbox. Best of all, it is completely FREE and open to everyone. Mark is also a regular contributor to several business publications including Modern Business Magazine and Smart Company lo Learn more about Maxiom visit the Website at: www.maxiom.com.au
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SALES | Edge
GANGNAM STYLE YOUR COMMUNICATION! By Yamini Naidu
Have your seen Gangnam Style on youtube? Gangnam style, a pop video by a South Korean rapper Psy has taken the world by a storm and entered the Guinness book of world records as the most liked YouTube video! Gangnam style has been parodied and has also featured heavily in mainstream media. Opinions vary widely with The Sydney Morning Herald writing ”It makes you wonder if you have accidentally taken someone else’s medication”, while Robert Myers of The Village Voice called it “an inspired piece of silliness”. The Gangnam style video is cheesy, has humorous dance moves, a catchy beat and is a larger than life successful piece of global communication. Now, not for a moment am I suggesting your next communication should feature a YouTube video with your CEO presenting the strategy Gangnam style, unless your CEO is an ex rapper.
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But there are lessons to learn from the success of Gangnam style, success that every communicator would kill for. The music video for the Gangnam Style song has gone viral and is a meme, which is a concept, an idea, behaviour or style that spreads rapidly, virally from person to person. Our culture is replete with memes, from catchy advertising jingles, nursery rhymes, popular proverbs like ‘A stitch in time saves nine’. You possible use memes everyday without even being aware that you are. One of my husband’s favourite lines is ‘You just can’t handle the truth’ from the film A Few Good Men and is an example of a meme, a popular catch phrase
that people repeat from TV or a film. Imagine your next piece of communication whether it’s a pitch, an idea, newsletter, an email, a presentation becoming a meme! WHOA. So how can you ‘Gangnam Style’ your communication? You don’t need the Internet to do that, but you do need the power of good idea or at least the right turn of words (Tony Blair describing Princess Diana as the ‘People’s Princess’) to create an instant meme. The example that immediately comes to mind is President John F Kennedy, who famously said ‘We want to put a man on the moon and bring him safely back to earth, by the end of this decade’.
An instant meme, the idea spread through America and the world and inspired a generation of diverse Americans from NASA engineers to cleaners to strive to make it happen. A more recent example, ‘wardrobe malfunction’, a meme created to explain Janet Jackson’s Super Bowl controversy. In 2008 John Stewart the then CEO of NAB described NAB as an offshore racing yacht that had spent four years getting ready for the winds to change. This yachting meme spread internally within the bank like wild fire and was embraced by the media as a sound bite. Stories are classic memes as they are easy to understand, remember and repeat. Other examples have created memes like ‘Brussel Sprouts’ ‘Copper head snakes’ within their organisations using stories.
To Gangnam style your next communication, steer clear of corporate jargon and cliches and start by asking yourself ‘What is a fresh way of thinking and talking about this?”. Hint ‘Optimising synergies’ will not become a meme. Cast your net wide, take risks and don’t afraid to be cheesy, funny, lateral… use a story, and be rewarded with Gangnam style results.
Yamini Naidu Yamini Naidu is a communication and business expert and a global thought leader in storytelling. She is a highly sought after keynote speaker and author. The is a regular contributor to Modern Business Magazine and is coauthor of the highly regarded eBook ‘Eliminate Death By PowerPoint’. For more information and workshop details, go to: Web Site: www.onethousandandone.com. au Twitter: http://twitter.com/onethousanda nd1
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50 | Entrepreneurâ&#x20AC;&#x2122;s Edge
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ENTREPRENEUR | Edge
GETTING TO KNOW YOU: MICHEL HOGAN BRANDOLOGY Michel Hogan is an Independent Brand Advocate dedicated to helping organisations make promises they can keep and keep the promises they make – with a strong, resilient organisation as the result. 1. What inspired you to start
organisations and a desire to Brandology? What are your help give those organisations tools and confidence to own goals and values? their own brands and to stop When I moved back to Australia outsourcing who they were to others. As a note I trained and from living in US for 15 years, worked as a designer in a Brandology became the variety of mediums for many continuation of my brand years and so this perspective practice and so even though it emerged both from my own was new to people here in experiences and observing the Australia, it really wasn’t. industry around me from the inside. My goal is to encourage and inspire people to be deliberate about the promises they make. 3. What types of customers do you help? What experience do you have My values are: Build strong relationships; Always ask helping small business questions and; Work with customers? purpose. You can find more explanation around them in the My customers are almost meet Michel section on exclusively small and medium michelhogan.com. businesses. I also work for nonprofits, start-ups and individuals. 2. What was the driving force behind your decision to I have made a deliberate specialise in brand decision not to seek out large corporates as customers, advocacy? although don’t rule out working with them on the right kind of Frustration with what I saw as project. too many agencies projecting their own agendas on
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4. What are the main reasons that someone would choose Brandology to help grow their business? Because they are interested in and committed to understanding what promises they are making and how to keep them. I firmly believe that this is the most important work an organisation can do to build their brand. As I like to say - your brand is the result of the promises you keep! 5. What process, services and support do your clients receive? Probably easiest to use the following description from my profile: “Unlike traditional “branding” programs that produce campaign driven results disconnected from the way you do business, my unique process involves Socratic-style
discovery in which the true persona of your organisation is revealed, not invented.
Thankfully there were many kind people happy to meet with me and help me understand the lay of the land.
That analysis is followed by an exploration of your desired future 7. Tell us about some of the state and the critical gaps and expectations that you had. misalignments between the two. Have they been met? Business practices are then added, subtracted, adjusted, and tested to ensure that promises can be kept.”Because I work as an advocate, I am always “for the customer”, which means sometimes telling them they don’t need me or should seek out a different approach than I provide.
Mostly I expected to find greater resistance to my ideas and philosophy, given it is a long way from the most people see and think about Brand.
nationally? Yes. I work with clients from all over the country. 10. Do you have any plans for
overseas expansion? I still work in the US - you could say Australia was my overseas expansion. 11. What would you say to
someone looking for a So the fact that customers and business or marketing people in the business consultant and what advice community have been so open to would you give them? my message and approach has been great and a welcome I would say make sure that the surprise. people you work with share you
In addition to that my goal is for our work together is to provide a foundation of knowledge and 8. What types of services do perspective that means they you offer? won’t need me in the future. The specific project services I 6. What challenges did you provide all stem from the face in setting up your approach that is talked about business? above, in general they fall into three categories: Strategy and The biggest challenge was alignment; Experience and learning the different nuances of culture; and Communications. doing business here in Australia. After so many years in US, I needed to learn a new “language”.
9. Do you provide services
values (as much as possible). That’s not to say they need to think the same way, but that your beliefs line up. On the advice front it’s quite simple, know what promises your business is making (even the implicit ones) and make sure you can keep them. If you can’t change what you need to so you can or make different promises.
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ENTREPRENEUR | Edge
WHAT IS AN ENTREPRENEURIAL GENIUS? By Dr Gene Landrum
An entrepreneur is an enlightened renegade. The entrepreneurial will never be caught saying something like, “You can’t do it as it is not in the budget.” Crisis is the mother of creativity. What is an entrepreneur? An entrepreneur is an enlightened renegade who refuses to kow-tow to conventional wisdom and is always willing to bet what they have to get what they want. Very simply, an entrepreneur tends to be a tempestuous radical on a mission to sate a deep-seated passion; an obsessive Promethean (Intuitive-Thinker) willing to sacrifice all for the redemption of a dream.
medals. That doesn’t mean the entrepreneur makes radical decisions or isn’t rational. It just means there isn’t much they won’t do to see their dream commercialized. As any worldclass athlete will tell you, those who are uncertain when in the heat of battle end up as casualties. The entrepreneur, like the athlete, should come prepared with a mindset that is to win, and not one that is not to lose.
a market void. It is why Mark Zuckerberg, of Facebook fame, turned down $50 billion for his firm at the age of 23. The entrepreneurial do not do it for money, would never, ever be caught saying something like, “You can’t do it as it is not in the budget.” They are not into policy manuals or any other ritualized system that says you must do this in any given way.
Sam Walton violated every manual at Wal-Mart and even What is the magic behind the broke his own rules. Do you think Strange as it may seem an drive? Thomas Edison ever made one entrepreneur tends to leap decision based on the money he before they look. The one absolute about the could make? Never! When impassioned entrepreneur is that Edison was told no one would That is scary to the security take chance on producing his driven, traditionalists who tend to they can’t wait to get to work in the morning and often refuse to incandescent light bulb he see the entrepreneur as some vowed, “It is factories or death.” kind of sociopath on a mission. leave at night. For them it isn’t work but an exercise in fulfillment. Then he put up the money to But the leap is often a leap of Money, for them, is not nearly as build the first GE plants. faith for a dream, where being prudent isn’t likely to win any gold important as the opportunity to fill
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In building their firms, did billionaires Michael Dell, Jeff Bezos, Richard Branson or Donald Trump do something based on the almighty buck?
Bucky Fuller and Martha Stewart began their businesses after having been fired.
Your family may be the first to tell you to get a job and do what is Never! For them money was but safe. a way to keep score. Richard Branson wrote in Losing My Wrong! Chase your dreams and Virginity (1999), “I can honestly it will never be work, but a say, I have never gone into passion for life. business to make money. I rely more on gut instinct than researching huge amounts of statistics. I make up my mind about a business proposal, or new people I meet, within 30 seconds.” Bucky Fuller proclaimed in Critical Path, “You can make money or make sense because the two are mutually exclusive. The drive to make money is inherently entropic, for it seeks to monopolize order (Fuller p. 276).” It has been found that most great breakthroughs have occurred during periods of breakdown. As I have preached, Crisis is the mother of creativity.
Dr. Gene Landrum Dr. Gene is an author, lecturer, consultant and Professor Emeritus of Hodges University. In 2011 he was inducted into the Entrepreneurial Hall of Fame in Dallas, TX. D. Gene tells friends who face problems on their trek to the top, “No one ever makes it to the very top without a visit to the bottom.” To read more you can visit his Website: www.genelandrum.com
Soichiro Honda only started building Honda Motorcycles after his parts factory was bombed in Tokyo. Henry Ford, Walt Disney,
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SALES & MARKETING | Edge
UNDERSTAND THE TARGET’S CUSTOMER MARKETING AND SALES MIND-SET By Thomas H Kessler
Overview of the M&A lifecycle. Downloadable detailed guide of what to do during the M&A lifecycle. Strategic selection criteria for an acquisition target, from the sales and marketing perspective. Guide for conducting a Board of Directors briefing. As Fred was returning from his briefing with Michael O´Keen, CEO and the founder of the company, his mind was spinning. His task was to prepare a short and precise presentation about the six most important steps in integrating the sales and marketing department for a board workshop. The six steps are: 1. Understand the target’s customer marketing and sales mind-set. 2. Analyze the new market situation and key changes required. 3. Define the marketing strategies to be implemented post merger.
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4. Understand and consolidate growth significantly. Steps four the marketing function. and six were important as they
were critical in order to retain
5. Co-ordinate and confirm the those people who would combined promotional generate growth, and thus value. effort.
6. Develop an integrated sales department for the new business.
How not to buy and integrate a company
Boyden Chemicals, his former How to extract the value in the employer, a large Australian diversified chemicals company, deal had acquired Becket, the Step one and two were important company at which he had started his career. Boyden felt Becket steps, as he had learned from would be a good extension to past experience. They, in his their existing product lines, so mind, determined whether the purchase of the business would they pitched for the business. be a good fit and would generate value if integrated well. A careful This was Fred’s first time, being involved in an M&A transaction. exploration prior to the He learned that acquiring a acquisition could increase the business was not only chance of generating solid
a. Selecting a business that was up for sale and seemingly a good fit strategically.
understanding from the conversation with Michael showed that the board needed more clarification on what b. Doing some due diligence needed to be done in order to to check if the financials, tax extract the value from the deal. positions and the legal situation were solid.
c. Buying it, then implementing just a couple of integration initiatives, focused primarily on cost reductions.
People were expected to accept new superiors and do business the Boyden style or leave the company. Frustration mounted, and Fred remembered how he had tried to start one integration initiative after the other to stop He was clearly going to make the the bleeding in the sales and point that he did not want to be marketing department, but after a part of what he called the year and a half of endless “Boyden” style of M&A. Identify! discussions and many frustrating Buy! Throw it over the wall to the meetings he had just given up “operation guys” to deal with it!All trying and started looking for a to often he had heart the COO at new position himself. Obviously Boyden say “Look it was our job with the attrition in sales people,
Not really! To the contrary! There were several steps that were paramount to ensure value generation before and after the deal.
to buy the business - it is your job the number of customer to make money off of it”. relationships defecting to the competition had mounted, and Key sales people from Becket, Becket was far from even coming most of them long standing close to its prior revenue levels. friends of his, had jumped ship Quality had deteriorated and Fred felt that the best way to start right after the deal was overall moral was at the lowest the board presentation was a completed and Boyden levels in years. short overview of the major steps announced that a major goal of in the M&A life cycle, followed by the transaction was to eliminate The M&A lifecycle a precise description of each duplicative cost and that they step. “I should highlight what would expect a significant To avoid this scenario Fred was needs to be done before the revenue increase through going structure the presentation board signs off on the deal and reorganizing the sales force as a workshop. The first item on what we need to do afterwards, under their leadership. However, the agenda was to give a short particularly afterwards.” His there was no plan behind it. overview of the M&A lifecycle,
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SALES & MARKETING | Edge
demonstrating that there were three key steps of the deal, post signing, that needed significant board commitment for the transaction to be successful. For a full detailed chart with explanations of what needs to be done from an integration point of view during each step of the M&A lifecycle please see the chart below:
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Step 1: Strategic Selection The M&A life cycle was going to introduce the board to the main phases from an integration perspective. The first phase, the “Strategic Selection” phase was to focus the attention towards creating one common vision about the deal. Thus Fred would highlight the four most important steps with his key objective, to align
potentially differing positions among the management towards one vision about the value in the deal. The four steps are: ● Growth objectives. ● Strategic fit. ● M&A Mission-Vision. ● High level integration focus.
Growth objectives Michael O’Keen’s briefing was very valuable, as it had given Fred a sense of why the board was looking at the deal. With Fred’s knowledge about Southwest Tubing, he knew immediately that, beyond adding new product lines, the acquisition would also enable his company to open alternative distribution channels and to service additional locations. Strategic Fit Beyond the growth objective, Fred needed to pursue a discussion around strategic fit, largely from a marketing and sales perspective. His main objective was to reach a consensus on the various components that would indicate the company was a strategic fit. Alternatively it would provide them with a list of the key questions to investigate further. 1. What focus was Southwest Tubing’s marketing department pursuing? ● Was it more focused around promoting the brand or specifically
pushing product sales through campaigns? ● What was the mix of both activities? ● How cohesive was the marketing department internally? How strong is the public perception of Southwest Tubing’s advertising and marketing communications? 1. How was the sales force organized? ● Where they structured by region, products and distribution channels? ● How solidly where they involved in new product development? ● How strong was their ability to build and retain customer relationships? ● What strategies did they use to fuel their growth? ● How well was their marketing and sales planning perceived?
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● What training needs would be there for his firm? 1. How in tune with customer needs was the new product development? ● How frequently did the new product team dialogue with sales and customers? ● Did they gain insights from the marketing information systems for new products? 2. How effectively was Southwest Tubing’s distribution organized? ● Was there any issue with delivery time?
● Had they invested significantly in their brand? ● What was the market perception of Southwest Tubing? ● How strongly was the effectiveness of the marketing and sales department measured?
Had anyone on the board thought about revenue enhancement opportunities that could be generated from the deal? Synthesis: the merger vision Fred was planning to synthesize the answers during the discussions, to develop a clear merger vision that was measurable and value oriented.
1. Did they benchmark themselves regularly against the competition?
Focusing on what is necessary for the integration during the strategic selection
● What information where they looking at in those benchmarks?
In addition he was going to focus on singling out obvious integration challenges and important information that needed to be used for the internal and external communication strategy.
● How will Southwest Tubing use such results for continuous improvement?
● How capable were they in pushing new products into 2. Which marketing KPI’s was the market? the company using? 3. What was the culture in the company? ● Was it highly marketing driven? ● How strongly was market share ingrained in peoples mind?
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Furthermore, he planned to emphasis the need for training the sales and marketing staff, as he felt this was a major stepping● How were they integrated stone towards fusing both groups with the compensation together. schemes of the sales and marketing staff? However, probably most important to all involved was a ● Were they used at all to good discussion on how to join drive the company’s both sales and marketing direction? departments from an organizational point of view.
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With this agenda Fred felt he had built a solid foundation for keeping the initial discussion on those topics that were important for the board to consider. He had decided to take the board step by step through the M&A life cycle, to keep the focus on what was most relevant at the time, knowing full well that he had not touched on a lot of the requirements for the remaining phases because he wanted the board’s undivided attention on those critical initial points. To be continued next month with … “Analyze the new market situation and key changes required.”
Thomas H Kessler Thomas H Kessler, is founder and head of M&A integration at Kessler Praxis Consult, a consulting firm that specializes in M&A integration and member of Global PMI Partners. He previously worked with clients in the US, Europe and Asia. His industry experience covers telecom services and equipment, basic chemicals, capital goods, automotive suppliers, financial services and a broad variety of technology subsectors. Tom frequently speaks on the topic internationally. www.integrationsuccess.com www.gpmip.com
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LEADERSHIP | Edge
THREE THINGS I’S WISHED I’D KNOWN WHEN I STARTED MY BUSINESS By Naomi Simson
It’s important to step back and ask ourselves why we do what we do. Red Balloon was not the first business idea I had - but as I look back now I realize that of all the ideas I had, it was the one that inspired me, that I was passionate about, that I could see myself making a difference with. Are you building a better mousetrap or are you changing the game of rodent management? I think back more than a decade to the moment when I thought it was a good idea to start an online business. There are some things I really wish I had known as I set out. Although one mentor said to me years ago, “The greater the loss, the bigger the lesson,” there comes a point if the business lessons get too expensive - and, well, then it’s all over!
All you need now is that idea which will make the business simply slip into place and you are on your road to Nirvana. Ah, what a lovely dream. Sorry to bring you down to earth: businesses are 1 per cent idea and 99 per cent execution. You do still have that bright, shining idea though. Without it you only have hard work.
Working out "why" you want to start a business (let alone keep running it for a good proportion of your adult life) is essential to sustaining you, and ultimately, the success of the enterprise. 3. It’s not about the money
If you are driven solely by financial success in business, think again. Great businesses 2. Don’t ask, “Will it work?” solve a problem; they make life 1. It’s never just the good idea Ask, “Do I want it to?” ‘easier’ - they do things that have not been done before. They This is the very first moment I’m approached regularly by make a difference to other when you think it is ‘a good idea people wanting to share a new human beings. You could argue to run your own show’; you have business idea with me. They ask that great businesses make the read of these entrepreneurial earnestly, “Will it work?” My world a better place. heroes who create amazing response to all these queries is ‘overnight’ success stories - and always the same: “Why do you I have only just come across the you think, “I could do that”. want to do it?” work of John Mackey - Concious Capitalism: Creating a New
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Paradign for business and Raj Sisodia Firms of Endearment. I have been putting into practice what they talk about for years and it works. All of the great start-ups that you can think of solve a problem. Facebook was about keeping college students connected. Google was about making the world’s information accessible. And think of the number of problems Apple has solved. So the first step on creating a viable business is to work out what problem you are solving, simply asking, ‘What is your purpose?’
RedBalloon was not the first business idea I had - but as I look back now I realize that of all the ideas I had, it was the one that inspired me, that I was passionate about, that I could see myself making a difference with. As I learned later when I did a Harvard Business course, the idea was a ‘disruptive’ innovation. It brought a new product to an existing market, delivering it cheaply and quickly and the incumbent dominant gift retailers would not have noticed us on the horizon coming to Naomi Simson market.
If I was to pose a question for you to think about: why do you do what you do - and who will give a damn? Are you building a better It is far easier to create an mousetrap or are you changing enterprise when you are really the game of rodent clear about its noble purpose. I just happened along our purpose management? after listening to the impact RedBalloon.com.au was Below is our noble purpose show having on customers - when they reel. told us about what it meant to them to go on a RedBalloon experience:
Naomi Simson is founder of fastgrowth experiential gifting retailer http://www.redballoon.com.au. An employee engagement advocate and sought after employer, RedBalloon is listed as one of only six Hewitt Best Employers in Australia and New Zealand with an engagement score of over 90 percent. Comments and questions can be sent to Naomi via her blog at http://www.naomisimson.com
We believe everyone deserves to have fun, feel good and be happy! We are passionate about giving people more good times.
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MARKETING | Edge
DON’T MISTAKE WHAT YOU DO FOR WHO YOU ARE By Michel Hogan
When people know what your company stands for and have confidence in it, they buy even more products! Guide the thousands of decisions that have to be made as the company gets up and going. ‘What you do’ can, will and should change over time; ‘who you are’ should not. Your product is not your company (at least it shouldn’t be). Don’t confuse them.
ready to ship. The trouble is that getting to those things involves exploring messy questions such as “why” – not something people focused on “what” usually want to take time doing. I have lost count of the number of times I’ve worked with startups who say they will get to “that stuff” later.
We have all seen it. A single great product gets the company started but then in turn becomes the company. None of which is a problem until you are trying to launch a new product and no one But here’s something to consider knows who the organisation behind before you ditch the next the product is or what it stands for. discussion – people buy products from companies, and when they Where do you go from there? know what your company stands It is certainly a trap that for and trust and respect it, they entrepreneurs and start-ups buy even more products! So taking particularly technology product that time might be the best companies, seem to fall into with investment in your future you can depressing regularity. make. Building a company foundation of belief and purpose is just as important as getting your product
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be made as the company gets up and going. I can always spot the ones who haven’t done the work. The what and how they go about things are littered with contradictions and misalignment. If you look around you will see a trail of companies that reach year three and suddenly find themselves stuck with a product and company that are synonymous with no place to go. Trying to create separation at this point, both internally and externally, is at best expensive and at worst, nearly impossible.
When you build the value of your company and make that visible to your customers and other stakeholders, you create a stronger Having a solid foundation of why is reason for them to purchase from also a great way to help guide the you than just the features and thousands of decisions that have to benefits of the product.
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Case in point, I could buy lot’s of different washing powders. The supermarket shelves are overflowing with choices. I will go out of my way to find and buy Ecover, because I like what the company stands for. I could buy simple slip on shoes for ten dollars in KMart. I choose to buy Toms Shoes online and get them shipped from US because I like what the company stands for. Sure these are consumer examples, but the principle holds just as true for B2B. For example software company Atlassian has largely defined and differentiated itself in a crowded space by what they stand for (and what they make - let’s not forget that is still important too). What you do can, will and should change over time, who you are should not. There are plenty of product companies out there that are built to flip long before this becomes an issue. However, if you are aiming to build something for the long haul, the question of “who are we and why are we here” should be top of the agenda at every company meeting until you find your answer, no matter what your products are today. It’s never too soon to start.
TIPS, ADVICE & GUIDANCE ON OUTSOURCING FOR BEST RESULTS
Michel Hogan Michel Hogan is an Independent Brand Advocate dedicated to helping organisations make promises they can keep and keep the promises they make - with a strong, resilient organisation as the result. Currently based in Victoria, Australia, she works with a diverse range of clients throughout Australia and the United States – including small-tomedium size enterprises, individuals, larger corporations, and nonprofits. She also publishes a blog at michelhogan.com. You can follow Michel on Twitter @michelhogan.
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ENTREPRENEUR | Edge
THE NEW BREED OF STARTUPS MASTER THESE 5 PROCESSES By Marty Zwilling
Nail the pain. Nail the solution. Nail the go-to-market strategy. Nail the business model. Scale it.
I see more and more entrepreneurs who seem to have everything going for them vision, motivation, passion, even a good business plan, product, and money, and yet they can’t close customers.
“Nail It then Scale It: The Entrepreneur's Guide to Creating and Managing Breakthrough Innovation,” but I will net it out here.
low customer pain (solution is only nice to have), or selecting a narrow customer pain (small number of customers willing or able to pay).
2. Nail the solution. I found their five phases of the process to be compelling, based Maybe it’s time to look harder at on my own years of experience Neither breakthrough technology the mantra of a new breed of nor maximum features will assure mentoring startups: gurus and successful that “if we build it, they will come.” entrepreneurs, including Steve Nail the pain. Great businesses Blank and Eric Ries, called “nail begin with a customer problem In fact, NISI recommends starting it then scale it” (NISI). with the minimum focused set of that has a big and monetizable features and technology that will pain point. You can review all the specifics drive a customer purchase. of this approach in a recent book Avoid the three big mistakes, of by Nathan Furr and Paul guessing but not testing the pain Success demands testing the Ahlstrom, appropriately titled (on real customers), selecting a solution early and quickly in the market, then iterating to get it right.
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3. Nail the go-to-market strategy.
5. Scale it. Don’t attempt to scale it until you have a proven repeatable business model that predictably generates revenue.
In parallel with nailing the solution, you need an in-depth understanding of your target customer’s buying process, the Only then is it time to focus on the job they are trying to get done, get-big-fast strategy, and the the market infrastructure, and a stable of serious pilot customers. transformation of three key areas from startup to a managed Do real tests with real pricing to growth company. see if customers will pay you, These areas include market, without being pushed. process, and team transitions. 4. Nail the business model. These pragmatics and points of focus can effectively counter Leverage your customer three core myths which trap too conversations to predict and many enterprising and capable validate your business model. entrepreneurs today: For example, when you think ● Hero myth: Why about distribution channels, believing in your revenue streams, or the product leads to failure. relationship with the customer, ask customers what they expect. All too often, founders fall in love with their products Don’t forget a viable financial or technology, ignore model of costs, margins, negative feedback from customer acquisition, and break customers, and spend even. years building a product based on a vision that no one else shares.
● Process myth: Why building a product leads to failure.
Conventional wisdom is that after a great idea, the next steps are raise some money, build a product, then go sell the product. This doesn’t work when attacking unknown problems with untested solutions.
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ENTREPRENEUR | Edge
● Money myth: Why having too much money leads to failure. The old saying that “it takes money to make money” isn’t so simple. Money allows entrepreneurs to execute a flawed business plan far too long, rather than stay focused on the market and adapt.
At the heart of it, to be a successful entrepreneur you have to be totally customer centric, and learn to change and adapt as fast as the market. The pace of change in the marketplace is escalating, so entrepreneurs have to improve their ability to deal with change.
In my view, savvy “super angel” investors such as Mike Maples, Jr., and leading incubators such as Y Combinator, are already on this one. How far behind is your startup?
At the same time, more entrepreneurs are jumping into the fray, and less money is
Marty Zwilling‘s passion is nurturing the development of entrepreneurs by providing firsthand mentoring, funding assistance, and business plan development.
to a large online audience of over 550,000 Twitter followers. He is also a regular contributor to Forbes, Harvard Business Review, Business Insider, and the Huffington Post.
He is the Founder and CEO of Startup Professionals, a company that provides products and services to startup founders and small business owners.
He also published two books, “Do You Have What It Takes To Be An Entrepreneur?” and “Attracting an Angel.”
He writes a daily blog for entrepreneurs, and dispenses advice on the subject of startups
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available from investors. It’s time for a new startup model.
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ENTREPRENEUR | Edge
GETTING TO KNOW YOU: MARK FERNANDEZ Franchising is a highly competitive sector with a unique set of challenges. But we discovered that successful franchises have one common characteristic, and that is extraordinary “passion”. This is a key asset for any business owner, particularly in franchising - along with getting great advice - as Mark Fernandez from Business Development Alliance explains. 1. What inspired you to start BDA? What are your goals and values?
passion and determination. With our never ending search for excellence coupled with our experience we believe that we have a lot to offer anyone either BDA has been servicing the Franchise and Business sectors entering or already immersed in since 2002 and we have grown the sector. into one of Australia’s Premier Management Consultancy. Our 3. What experience do you values enable us to express what have helping franchise sector we do and what we believe in, clients? which, in turn enables us to put into practice what we are We have been involved in the committed to, which is – Franchising sector for over 40 excellence in everything we do. years and have experience across all facets of franchising. Our goals revolve around With this vast experience we providing the best advice, believe our clients can only service and education to benefit from what we have Franchise Networks whilst learned along the way and that assisting and educating brings expertise to the table prospective franchises to when making those critical become more profitable. business decisions. 2. What was the driving force behind your decision to specialise in the franchise sector? Its all about passion!!! This sector demands a high level of
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4. Do you service other sectors as well? Yes, we have worked in many sectors assisting business grow including; manufacturing, retail, hospitality, shipping and wholesale. We have the capabilities and experiences to assist any small business find its growth path. 5. What are the main reasons that someone would choose BDA to assist with developing their business?
Businesses choose BDA as we assist in finding the right growth path. We will determine wether Licensing, Agency Agreements, Dealerships, Co-Operatives or Franchising is the best way forward. Most business understand the need for control Our Director is a Committee when expanding however, may Member of the Franchise Council of Australia WA Chapter not be aware of the boundaries in which that control can be and is intimately involved in a exercised. number of well recognised brands within the sector.
We have had many clients over the years that just need good, sound business advice and that’s where we come in. A’ sounding board’ for senior management and for those franchises that need assistance along the journey. 6. What process, services and support do your clients receive?
completing the Viability Study, Financial Modelling, Scripting Operation Manuals to Training and Recruitment. The real work starts after the launch of a franchise, we then take a ‘coaching ‘ role in the organisation just to keep things on track and to enable the practical application of the system is actually in play.
7. Who is the target market We provide a ‘one stop shop’ for for your business? franchising your business. We undertake all activities in setting Typically we find that business up a franchise; everything from looking to grow and have heard about franchising but not really sure what It’s all about. Yes they know of the major brands but are looking for a guiding hand to take their business to a new level. Business that have been operating successfully for at least 12 months and are profitable are now looking to expand. With this in mind, setting the structures and putting the infrastructure in place for growth can be a costly exercise and without sound advice can leave you exposed and put your business at risk, hence we are finding more and more Mark Fernandez - brings over 20 entrepreneurs seeking years of senior management experience in business development professional advice. and franchising to your business.
8. Do you provide services nationally? Yes we do, we have worked in all states and territories in and across our beautiful country. 9. Do you have any plans for overseas expansion? We are looking to form international affiliates with companies that have the same values and principals as us. 12. What would you say to someone looking to franchise their business? The key here is to get good quality advice. If you want to be successful in an industry that employees around 650,000 Australians and contributes more that $140b to the Australian Economy, then you need to have a relentless search for excellence. Surround yourself with the best advisors that you can afford and get out and chat to people in the industry – these are my top tips for business that are looking to grow through franchising. Mark Fernandez firstname.lastname@example.org www.bda-online.com.au
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