Reshaping Recessions – Reinventing Behaviours

Reshaping Recessions – Reinventing Behaviours

Ripples of relief are running around the world this month even though the pandemic rages on. Here, the much talked of travel bubble has begun and while it may provide some ease for the harder hit sectors, the shadow of recession is cast and many predict a long, hard slog ahead.

While the pandemic is a new experience for most of us, recession is a familiar nemesis with business owners preparing to hunker down and brave the next economic storm.

Yet in the same way we have had to be flexible and inventive in dealing with the pandemic, perhaps it is time we reviewed our response to recession – change our behaviours or, at the very least, look at things differently?

Traditional approaches to business development in a recession have been geared towards survival, retrenchment, cost-cutting and job losses but is this the right way to go? Doesn’t that perpetuate the boom-bust cycle?

At our board meetings, we’ve been talking about ways to approach business in hard times and it’s been fascinating listening to business owners as they work on smart thinking to beat the slump or take advantage of an opportunity.

What we found is that technology is a silent untapped resource and we still underutilise its potential. Some of us are even afraid to explore alternatives or feel we don’t have the skills and/or money to take advantage of it. One safe solution to step out of your comfort zone is to do it with the wisdom of others around you and discover how and what other businesses are doing in their industries, what existing technology they use and consider how it could be adapted for your own industry and business.

This brings me to a key hurdle which is you taking action – yes, we have to start with ourselves – making small changes in our everyday environment and the things we do. Add influential habits into your time management, small things that drive the rhythm of your day. For example, while you’re driving, listen to e-books or podcasts instead of the radio or music. If you want to stop buying a pie for breakfast each morning on the way to work, change the route you travel and miss the pie shop. If you want to walk more and drive less, park further away from work. These small habits add up and become significant as a whole.

Back in the business, start adding small improvements to your key operational functions. Something as simple as a five to ten minute team huddle every day to identify current issues can be really helpful – preferably In person, but phone or video call is ok too. Crucially, it has to happen each day – same time, same place, same routine. This regular check-in gives everyone a chance to highlight issues as they arise rather than accumulated troubles suddenly bursting into our comfort zone.

Ask people about the changes they’re seeing, what’s on their horizon, whether they’re stuck on anything and where they think positive steps can be taken to deal with emerging difficulties. Innovation starts from within and creating an environment conducive to innovation takes work. Ideally, you want to reach a point where everyone in the business is confident that they contribute to the business every day, morale is high and, when tough times occur, the whole team deals with it together.

Collaboration and discussion helps to reshape the way we see difficulties – we can look for opportunities and – as we saw quite often during the early stages of COVID19 – this can take the business in a new, profitable and sustainable direction.

So as the clouds gather on the economic horizon don’t default to past approaches – switch on new thinking and be a guiding light towards recovery.

Cultivating company culture in the time of COVID19

Cultivating company culture in the time of COVID19

Employment issues were top of mind for business owners in our most recent Pulse Check report and those issues come in all shapes and sizes.

Every workplace has seen tremendous upheaval in the last year and there are more upheavals to come as employers find themselves having to develop vaccination policies, infection control procedures and other measures designed to keep staff safe and their business operating.

These upheavals, complex as they are, have been easier for some businesses to manage. Why? Because their company culture has been considered, crafted and nurtured so their values are lived every day by everyone in the business.

A healthy workplace culture creates happy workers – and happy workers work better than miserable ones. That may seem obvious but it is surprising how many businesses – large and small – fail to think about the employee experience, the culture and communication.

Company culture starts at the welcome mat. A good culture eases the recruitment process as it attracts people who want to stay for the long term, rather than the job being a short step up the career ladder.

Positive experiences in the workplace lead people to stay longer with a company. This creates stability, reduces staff turnover and, in the long term, recruitment costs are reduced.

Other advantages include enhanced performance, greater collaboration and a deeper understanding on the part of the employees as to the issues facing the business – so when a crisis hits, or a pandemic breaks out, everyone deals with the situation together, often contributing beyond expectations.

Encouraging a positive workplace culture can be tough for small businesses that are growing bigger, not because there is a reluctance to do so but because it is often hard to know where to start.

At The Alternative Board we have tools and techniques to help business owners look carefully at their culture and build the type of workplace where people can’t wait to start the day. If you’d like to know more let’s talk about the ways to create a healthy, happy workplace.

Do you plan to not lose, or plan to win?

Do you plan to not lose, or plan to win?

Often in business, we size up a situation and become determined not to be worse off but in so doing we lose focus and miss out on creating successful outcomes.

It comes down to mindset. Are we actively looking objectively at strategies that put us in a position of strength or are we setting minimum standards and fixing mistakes as we go so as not to fail? It takes foresight and effort to plan to win. It is about proactively weighing up strategies that have risk but are calculated to provide a greater benefit. It is about learning and adjusting as we go.

At a recent peer-advisory board a business owner was faced with a $6,000 “expense” that could be eliminated. A wise choice – reducing expenses – because as confirmed in our recent Business Pulse Survey there are dark clouds on the horizon for New Zealand businesses. But during discussion with other business owners on his advisory board – the return on the $6,000 “investment” would add $70,000 p.a. to his net profit and by analysing and taking this path he would become more motivated to grow his business during a downturn. Also, with the opportunity to double the “investment” to $12,000 he could add $140,000 p.a. to his net profit in these troubling times. Sure, this is not a given – he still needs a defined goal, strategy, and action plan to achieve it but that’s what planning to win does – it makes you put in place a plan to take advantage of opportunities. Planning to not lose is reactionary and cautionary and can gradually stunt business growth. It avoids the need to be visionary, create a plan, and be held to account and often the business owner who finds themselves in this reactive position is there because of difficult circumstances and lack of motivation or encouragement. Are you planning to win – or, subconsciously, doing just enough to not lose?

Take cover – and communicate

Take cover – and communicate

It’s a rocky road for employers these days – one day it’s a COVID19 alert level change and the next we’re dealing with an earthquake. Much support has been given to employers to help them through these times but have employees been properly supported by all the processes and systems we’ve seen launched since COVID19 first made its presence felt?

A couple of weeks ago the national alerts sounded following the earthquakes – particularly the big one in the Kermadecs – and many employees were sent home. The question is, were they sent home with or without pay? What were their expectations of their employer in that particular emergency? Did they expect to be paid for the day even though it was unlikely they would return to work until the emergency had passed? It’s hard for businesses to bear that cost in the current COVID climate yet, if employees don’t know what to expect from their companies when emergencies occur, how will that affect their relationship with the business? As we know, one of the many COVID fall-outs is the lack of skilled staff – so will poor communication or unclear policies lead to staff losses?

All these questions take us back to the topics of contingency planning and internal communication. In between emergencies – which seem to come thick and fast – it is worth taking some time to work out how your business is going to manage employee expectations. As businesses grow, it can be hard to maintain good internal communications but it should always be a priority. Strong businesses are strong from the inside out. Internal communication that helps employees understand emergency processes – from where to head when an alarm goes off to expectations around pay, sick leave and holidays – is essential for a business to thrive.

All businesses – large or small – should communicate constantly with their staff. That way when the unexpected does happen, what comes next is no surprise. Physically, when the tsunami warning sounds, we all want to be high and dry but nobody wants to be left high and dry financially. Forward planning, understanding your cash flow – getting inside the numbers – building reserves where you can, all help you, as a business owner, survive the storms and make sure your employees are sheltered when the going gets rough.

New Zealand’s small businesses are known for their ‘family feel’ and the majority of business owners create a work whanau where trust and respect flourish. This is often the result of good internal communication backed by great business planning on the part of the owner. If you are a young business, a growing business or even a larger business that may have lost touch with its employees and their expectations, the advice would be take a moment and sort out your policies today then let people know what to expect and when. Being prepared for the next emergency and knowing how you are going to manage the situation is all part of our new reality where the unexpected is the norm.

Privacy Act 2020 Webinar

Privacy Act 2020 Webinar

On Friday 19th March, we are pleased to host Steve Conti, joint owner of a Christchurch based business, New Zealand Business Tools (NZBT). NZBT specialises in helping organisations create the necessary protocols to enable compliance with our new privacy laws, enacted last December in the Privacy Act 2020.

During the webinar, Steve will explain the key features of the Privacy Act and describe the steps businesses should be taking to protect the privacy of individuals associated with that business, including employees, clients, suppliers and so on.

The webinar will be held at 1 pm on Friday 19th March via a zoom link. Please register below to be sent details of the link, and a copy of the recording following the webinar.

By clicking this button, you submit your information to the webinar organiser, who will use it to communicate with you regarding this event and their other services.

Why every year-end should be a beginning

Why every year-end should be a beginning

‘Year-end’ – just who is it good for? Absolutely no one – except perhaps the IRD and accountants. ‘Year-end’ exists for tax purposes only, is set by governments and is purely to determine your tax liabilities.

It is a necessary compliance exercise, normally done by an accountant on your behalf, who may well have no connection to you as a business owner. The irony is that the numbers we report at ‘year-end’ – often several months afterwards – document our ‘history’ and are not the ones we need if we want to really understand our business.

Every ‘year-end’ should be a beginning. We should keep our eyes on the numbers every day and those numbers should speak to us all the time. Get them to pop off the page and tap us on the shoulder so we pay attention and know what they’re up to.

When a small business is born, the focus tends to fall primarily on cash flow, sales and immediate costs which means some indicators as to business health are missed, ignored or simply unknown. It’s easy to get caught up in jargon but there are a ‘number of numbers’ to consider. Labour efficiency ratios, for example, may sound complicated but they help us to understand productivity and the value and return achieved for every dollar invested in wages. Looking at our figures on a rolling twelve-month basis allows us to keep our finger on the pulse, build confidence and make strategic, proactive decisions.

Here at The Alternative Board, we have the tools to help you understand your numbers so you can make sound and timely decisions about your business. Advice on tracking your numbers, your business performance and business improvement is how we help you make a new beginning and a fresh start every month.

The reality for business owners is that keeping a close watch on your numbers will not only help you predict sales, trends and downturns, it will help you prepare for a crisis, develop business continuity plans, allow you to ‘expect the unexpected’ and deal with it accordingly.

Our dynamic tool to help track your historic and forecast financials is one I would highly recommend. It provides a current and accurate picture of where a business owner is now so the right decisions can be made. Rolling reports show trends and highlight the numbers that matter every day.

In April – alert level changes permitting – I’ll be running a workshop for business owners interested in getting to the root of their numbers. If you would like to come along, get in touch (contact us) and let’s start a new beginning together.

Business Planning