How do growth companies survive in complex times?

Australia’s small and medium-sized growth enterprises face ongoing and increased stress in these challenging times. Business owners have to make difficult decisions constantly and demands come at you from every angle, all day long.

Successful entrepreneurs know, however, that there are enduring key principles that improve a company’s prospects for growth and continuing profits and make it stand out from the crowd.

“At Bibby Financial Services we are constantly interacting with entrepreneurs and fast moving companies. Fast movers are the growth engine of our economy, and this is a key reason why we continue to support the sector, says Greg Hardiman.

“We have observed time and again that staying calm in difficult situations and applying the following disciplines are key when a business is trying to get ahead of the competition.”

Disciplines for success

Cash flow is the lifeblood of a business. Cash flow can be the first casualty in a downturn. In tight times fast movers develop conservative cash flow budgets and ensure they get paid more quickly. They are diligent in collecting what they’re owed. Effective accounts receivable collection frees up cash and can reduce reliance on credit.

Always challenge certainty, especially your own. When entrepreneurs think they’re right, they also think to ask what is missing and search for improvement. Excellence is an unrelenting quest and striving for it is the surest route to enduring satisfaction. The best leaders and fast movers are forever challenging their comfort zone.

Emotions are contagious and feelings are infectious. The best leaders inspire. They are optimistic and ensure employees are just as inspired to succeed in their roles.

Understand basic finance principles. Fast movers ensure financial information and accounts are timely and critical documents are maintained and delivered on a set day every month.

Clearly communicate a business’ point of difference. Clear communication of a company’s point of difference and strategic direction to its customers is imperative. Fast movers view downturns as an opportunity to stand out from the crowd; they continue to tell the market what they do best and remain visible.

Delight customers. Fast movers make frequent customer contact, great service and rewarding loyalty a priority. Fast movers ensure customers are left in no doubt of their importance to the business.
Work smarter, not harder. The best fast movers don’t let running their business run them into the ground. They continually invest in time-saving systems, software and products to free up valuable working hours.

Form great relationships. Strong relationships with mentors, financiers, bankers, suppliers, clients and partners significantly help a business. These relationships endure in good times, when the business is running well and cashflow is well-maintained, and in tough times, when cash flow is tight.

Meaning isn’t something to discover, it’s something to create. Entrepreneurs derive meaning from finding a way to express their unique skills and passion in the service and products they deliver. Figuring out how best to contribute is a lifelong challenge, to be taken one step at a time.

Take responsibility. In a fast moving company no one is left in any doubt as to who takes responsibility for the key decisions. Right or wrong, the buck stops with the leader.

Greg Hardiman

Bibby Financial Services is one of the world’s largest independent providers of debtor finance spanning Australia, Asia, Europe and North America. Debtor finance is designed to improve business cash flow and support business growth by releasing cash tied up in unpaid invoices. Unlike other funding arrangements, no real estate security is required, making it more accessible for small and medium-sized business owners. For more information on Bibby Financial Services please visit www.bibby.com.au

Plan the Action! Action the Plan!

I do get frustrated at things not happening quickly enough for my liking.  My frustrations tend to build up while I am waiting for things to happen.  You know what it is like, you finish a specific activity, and then you have to wait around for someone to either do the next bit or come back to you with an answer.  You can sit there waiting for a long time or at least that is how it feels to me.  Well, I simply don’t do it.  So what do we do about this never-ending cycle of hurry up and wait?  The truth is that there is not a lot you can do about the need to wait for others to complete their side of the job, so don’t make it an excuse.  If business is not going that well or at the pace you would like take ACTION NOW!

If I had a dollar for every time a client told me, “So and so has not responded yet so we can’t move on and we are just waiting for a few more responses before we make the next move”, I would be a millionaire.  Sitting around waiting for things to happen is so debilitating.  You certainly need to keep the pressure on people to ensure you can close the deal.  On the other hand, if you sit around waiting for their response you will begin to doubt their commitment or your product or ability.  Have someone in your office be responsible for making those “How are you going?” calls.  You don’t need to do it yourself.  You need to get back to your action list and keep on actioning! In fact, if you don’t have a good periodic action list i.e. daily, weekly, monthly, quarterly etc you will find that waiting for people to come back to you becomes a convenient excuse for doing nothing.

It is not difficult to set up a simple 90 day action plan using a excel spreadsheet.  Set out your weekly monthly and quarterly goals.  There are 13 weeks and don forget there are 7 days (not five) in week.  I find it best to reverse the order, so I set my goal or goals for the quarter and then work back to my weekly goals and then to the daily actions I am going to need to take to reach my goals.  Commit to this action list and do not deviate.  Distractions will arise each week so you will need to be completely disciplined. Stick to your guns here.  Give a copy of your action to someone who know cares about your success and will make you accountable each week for meeting you objectives.  Set up a convenient time to discuss each weeks achievements and the week ahead.  Discuss both your success and importantly your failures.  Why have you not undertaken certain activities or followed another course other than the one you committed?  Be rational and listen to yourself as you respond, you will sometimes hear the guy with the excuse trying to get out.  Don’t let him.  As much as we hate to admit to it without an organized actionable list few of us would achieve very much at all.  “Better offers” are presented every day you just have to learn to say NO. Do this religiously for 30 to 60 days and you will astonish yourself at what you can achieve in a day, a week and a month.

Until next time

Your, back to the list and into action, business coach

Neville@thesmallbusinesstoolbox.com

The Opportunity Value of Risk

I have just come away from a meeting with a client who is looking to implement a new strategy. Really, it’s an OLD strategy with a new twist, but who am I to say anything. The issue with this new/old strategy as with all strategies really is there risks involved. As we, all know risks need to be managed. The, 64 thousand dollar, question is how?

There are a couple of ways of looking at the management of risk in your business. One is to develop procedures and monitoring to ensure that the risk doesn’t arise. This is the eradication of risk approach, see it, and kill it off!

Alternatively,the second is to see the risk for what it truly is, an opportunity to be understood and managed. The eradication or, expunging etc of risk is by far the most frequent approach adopted by management and particularly by a Board.

The Board certainly do need to be concerned with risk because that s their job and in today’s nervous corporate environment, Board risk is an issue.

I know that you may have a small company and you are wondering how does all this risk stuff affect you. Just think about it.

Most of us risk our lives just getting up out of bed everyday. We cross the road, often against the pedestrian traffic lights and with traffic coming through a busy intersection (J-Walking. Oh sure you have!), or by eating a meat pie from a dodggy road side cafe, or jumping on a new low cost airline aeroplane to get to a holiday or business destination.

That’s different I hear you say. Well, not really!

Each one of the actions outlined above is calculated and when you proceed, you have decided thatwith the benefits being assessed to outweigh the apparent risk. Just because it is done almost instantaneously doesn’t mean you haven’t thought about and how you would manage the risk.

Take, for instance, booking on a low cost carrier out of London’s Stansted Airport or even from Johannesburg or Changi Airport in Singapore. The flight might well be delayed, or they send your baggage to your previous destination from two weeks ago! On board they might run out of food and, of course, worst of all it might not even make it to your destination. I bet you have considered all these possibilities (okay maybe not the luggage bit!) and you have developed a back- up plan to cover the eventualities. You didn’t write it down, or maybe you did. In any event, you thought the whole event through and proceeded on the basis that you had managed the risk. The outcome was , you had more money to spend on your holiday or business trip. You created value for yourself. Well done you!

Now, take this approach into your every day business life. You will face decisions, every one of which is subject to some form of risk. As with your holiday flight decision, where you saved mega bucks because you chose to take a risk on a low cost airline. The same will happen in business. Can you see what the potential value might be created in understanding how to manage you risks and realize the financial benefit, rather than expunging the risk and not achieving your financial goals?

Value Risk management is a tool or process available to all businesses and professionals regardless of what size your business is. The value of the process is in its ability to meet narrow or complex businesses needs. I have used it with companies that turnover $2m a year to $1.5bn a year and everywhere in between. The process is so simple it can be incorporated into ongoing management and Board level reporting. The benefits to business are that the strategy is managed on an ongoing basis rather than once annually in the planning meeting and then stuffed away until next year.

Valuing the opportunity of risk rather than mitigating it may seem counter intuitive but it is after all the very reason the entrepreneur exists.

Until next time Your, humble keeper of risk, coach

Neville@thesmallbusinesstoolbox.com

If I just had more time!

Probably the most frequent response I hear from business owners is that there is just not enough time for them to do all that needs to done.  This is completely understandable if these owners, who are in the majority by the way, are working in their business rather than on their business. I recently met Jack a business owner for more than 20 years.  His wife had just returned from a trip overseas after attending her father’s funeral.  “I should have been with her but I just can leave the business unattended,” he told me.  “Why couldn’t you do that Jack?”  I asked.  “Well there is simply so much going on I have to be here.  I wouldn’t be able to respond in time if I was away.”  On another occasion, I was playing golf with a business owner.  As we walked the course, our frustration built as he was continually taking calls from the office.  I asked him “can’t someone else do that for you.”  “No.  I need to make sure we deliver on time.”  Well I had had enough!  “If you can’t turn your phone off for the rest of the round we are just going to move on without you.”  He got the message, even if it was begrudgingly.  You see these people are working in their businesses not on them.  In both cases, they had management who they were not prepared to make accountable for the day-to day operations of the business.  If they did, they would have had time to do what a good entrepreneur does and that is work on the next stage/phase of business growth or planning for their ultimate exit from the business.

Working on your business requires that you develop the discipline to do the planning required.  “I don’t have the time” I hear you say, again.  Yes you do.  It is really that you choose not to.  If building your business is your priority then make the right choice.  Start working on your business today.  Don’t wait.  Step back and try to look from outside in or take a ‘helicopter’ view.  Review your company’s vision or mission statement.  If you haven’t stated a purpose for your business develop one.  Then, look at your current business strategy.  Don’t hold back.  How can we improve, what management do you need to realise the opportunities and so on.  Take this right through to marketing and selling of your business, products and services and then into the financial aspects.  Get your team involved.  They are in the ‘front line’ every day.  You will be surprised at what great ideas for improvement they have but never thought to tell you about. (May be you haven’t asked).

There are some great tools available at www.thesmallbusinesstoolbox.com that will help you build and achieve your dream.  Giving yourself time to work on your business is not a luxury it is a necessity.

 

Until next time

 

Your, sitting back and thinking about it, business coach

Neville@thesmallbusinesstoolbox.com

 

 

How to Get Your New Business Started

Thinking of starting your own business? We’d like to share this thought provoking article “10 Mistakes that Start-Up Entrepreneurs Make” By ROSALIND RESNICK