Over the last 15 years I have been in New Zealand our company has had varying opportunities with other companies.  One of the very first of these opportunities was in Christchurch where we looked at a business that had its geographical presence just in Canterbury and we went through and did a lot of work and because of the nature of the opportunity their company also looked into how we ran our business.  The deal didn’t happen.  About a year later one of the people from within the company that we were in talks with used information that he had gained through this period for his own personal commercial advantage.  From that day forward I began to understand about confidence, trust and commercial sensitivity. We did successfully go on to complete another opportunity with the Kent Prier Group – they we the epitome of trust.

Our business has grown progressively over the last 15 years.  We have taken doubled our marketshare to new record highs through our current membership and organic growth.  The business we are in has had an has a lot of competitors.  Over the years different competitors have had varying degrees of success with their model.  Some of our competitors are no longer here. 

When you get to a certain level in business (generally leadership) you must look for opportunity.  It is part of growth and the way a business evolves.  When you look for opportunity, you have to talk to people within your own company and those in other companies and in doing so respect of the information that you have learned for your own benefit is of the utmost importance. Ice and thin ice.

Recently I became aware of another company who have passed information onto their members about a commercially sensitive discussion and for the second time in my career I find myself questioning some of those who are at the leadership level of business.  The best companies build their reputation through their leaders.  The key leadership qualities that are known are trust, confidence and the ability to see the big picture.  A couple of questions arise for me when I deal with people in regards to opportunities.  Firstly, can I trust them?  Secondly, do I have confidence in their ability to focus on opportunity rather than gain? And, do I know that they can look beyond the deal to see the growth? 

Across the world of business those who can fit these categories will take their companies from good to great.  Those who don’t understand trust, confidence and commercial sensitivity will find their businesses losing opportunity and amongst those that are dropping in marketshare because when it all comes down to it, it doesn’t matter what the colours are or what the brand is, the leader reflects the business.

How do you market a business, a product or a service successfully while keeping in line with a marketing budget?  The first thing is to work out your marketing budget.  I was fortunate to be taught early in my career about percentages.  Understanding of total revenue base and how a business can maintain a profit by working in percentages. 

I was with my friend this morning and he has a car wash business.  He will have an annual turnover of about $300,000 per year.  He has run this business for just on 3 months.  What should he spend on marketing? What marketing should he do? How does he measure the results? 

When you take into account a business and the three key costs which are generally labour, premises and marketing, usually labour will be approximately 45% of total turnover, premises 5%, and marketing should be no more than 4%.  The balance are generally sundry costs which add up to around 20%.  This gives the business a target of 25% gross to net profit.  If we quarantine marketing then he has a total spend available of $12k.  It doesn’t seem much but there again he is in the business of making people feel good about their car 

What we all know is who our customer is.  80% of his customers are known.  So immediately he has a target but if he can only spend on average 4% of his total turnover to attract a customer then where does he target it? 

The best form of marketing for his business is brand marketing through the customers that he currently is getting.  Emphasising loyalty and referral will be the best way for his business to continue to grow at a steady rate.  Remembering that the customer of his business will always want their car washed.  The question for him is “will they come back?” 

It is important to know the percentages within your business, they are standard and how you market your business or your product, linked with your service, is a key to new customers and customer retention.  In our business of real estate, generally the focus is on the product and rarely on the brand but with many businesses the focus is on the brand and then it drills through to the product.  My recent experience at looking at cars shows an emphasis on the brand which then provides the different products within that brand.  How much do you spend on marketing and is it at the 4% level?

As we come towards the end of the year key people more so this year will make decisions regarding their career path than they probably have over the past number of years.  As the employment market loosens up good employees are going to be given the opportunity to begin to review their current positions with more confidence.  This brings some direct benefits for both employers and employees but get ready 2010 could be the year of seat-switching.  In a recent survey conducted by the Adler Group showed that of the 59% of people would talk if they were approached but of that 59% only 19% would be actively looking for a new position because of the perception that it is still a risk to move in the current environment.

There are four key areas for employers who are looking to get the best people on their team in 2010: 

1.  The need for a direct approach at a targeted candidate list whether you do this directly as the employer or whether you outsource this, making that first contact will give a much better result than potentially a response from an advertisement.

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When will you ever have more time than you do right now?

When we talk about resources for leaders in economic terms three usually come to mind:  labour, capital and land.  There is a fourth resource that may be considered for an individual to be far more important – that of  TIME.  

Time management experts have developed a model which helps prioritise leadership activities and to make the use of time more effective.  This is broken up into the areas of Important and Non-Important, Urgent and Non-Urgent.   On the left hand side of the quadrant graph is the area that effective leaders spend their time.  The area on the right hand side of the graph is potentially the leader who is run by crisis management.  Lets take a closer look at the left hand side of the graph:

Urgent and Important:  There activities are deadline driven, importance based on consistency, potentially demanding problems, response to a specialised area with the business.  This area of the quadrant should take up 40% of a given week.  These activities are generally prioritised first, however they can cause stress because they sit in a time sensitive zone.

Important, but Not Urgent:  There is no doubt that the best leaders spend the most amount of time in this area of their business.  It includes preparation and planning, execution of projects, crisis prevention, long term diary management, recruitment and skill improvement.  Whenever a leader in a business is undertaking these activities they can focus on the future successfully and begin to prioritise the direction of the business. 

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Non performance of staff is one of the critical issues that is faced by today’s leader.  It is also one of the reasons why businesses cannot grow and at times are culturally unable to gain momentum. 

Non performance for the leader can cause conflict and be an emotional barrier towards effective communication.

In the first instance we need to look at ourselves as leaders as to why non performance is occurring.  More often than not it can be through poor communication Read the rest of this entry »