The Summit Way

The War for Talent

2010-03-08T18:23:00.000-08:00

The War for Talent - What do Young Professionals Want?

Recently I had the opportunity to speak with eight high-growth firms as part of discussions over a quality professional practice we are assisting in selling. These meetings again highlighted a major issue facing the profession – the attraction and retention of talented professionals.

Attraction and retention of young professionals is a challenging issue for many professions and was the topic of a report titled ‘Employee Loyalty Research’ completed recently. The report summarised the findings of a study into factors impacting loyalty amongst professionals under 35 years of age.

It appears that young professionals are looking for 3 key aspects from their employers.
1. Constant learning
2. Challenging work
3. Contribution to the organisation

Attracting professional team members
The survey provided solid clues to assist professions to attract young professional team members. Young candidates look most specifically for:
1. Career development and ongoing learning opportunities that are actively managed by the employer
2. A good reputation within the industry and with previous employees
3. A speedy recruitment process that includes exposure to staff and/or partners
4. Sound remuneration. You need to offer your team members compensation that reflects the value they deliver while at the same time gives them work, responsibility and accountability that stretches their ability and allows them to contribute to the organisation.
5. Work life balance. Firms in which people are expected to work a 45-60 hour week doing basic work are not attractive to young professionals. Even if team members do not work these hours, when they see the owners doing it they are turned off the prospect of ownership and will not remain in the company for an extended period.

Retaining Young Professionals
Retaining valuable team members is vital for business success. Surprisingly, nearly 45% of survey respondents indicated they plan to stay with their current employer for less than 3 years. The principal reason they list for leaving is lack of an obvious career path followed by remuneration then lack of challenging work.

People under 30 years of age are more interested in skills acquisition than they are in remuneration but as they get older they’re looking to be rewarded for their skills now acquired and are seeking promotion and more responsibility.

What’s also interesting is that amongst the sub 35 year old group 60% plan to leave within 5years and only 10% expect to be with their current firm 10 years from now.

In the survey, parents of before-school age children tend to want long tenure in their current role and appear to be more settled than those without children.

A number of younger professionals indicated a low tolerance for routine or mastered tasks and highlighted that this would be a factor in their decisions to leave an organisation. They want to quickly turn their experience into promotions or other challenges. Younger professionals are more likely to stay longer in small and medium sized firms if they are given autonomy, flexibility and greater client contact.
They also believe high remuneration, senior roles and work-life balance go hand in hand. 21%of respondents reported that greater work-life balance would improve their work satisfaction and affect their retention rates. Work-life balance and policies that support this are seen as standard features of employment and not optional extras.

One surprising finding was that young professionals expect their employer to take responsibility for establishing their career path, particularly within the first 12 months of hire, with 33% stating they would leave a position if they could not see a clear career path. Career path does not necessarily mean you need to promote the person – it could just be giving a new skill or larger client base. Whatever you do, you need to clearly spell out your intentions or you could risk losing valuable employees.

Implications for Professional Practices
How you manage your team and develop their potential is vitally important where 40%+ of your expenses are direct labour costs. Your ability to effectively attract, retain and manage your team is intrinsically linked to your business strategy.

To attract talented people and to retain them you must create a firm that does interesting and challenging work. This means designing and delivering services that are valuable to clients and which call for challenging and interesting engagements that stretch an individual's abilities requires the sharing of their skills. This in turn means you must attract clients who are willing and able to see the value you create for them and are willing and able to pay for that value.

If your business strategy is to focus on doing high volume, low level work that is routine and repetitive in nature and can only support modest prices, then you will have an extraordinarily hard time attracting and retaining talent.

Your younger team members will not stay with you for very long and you will experience lower margins partly because of productivity challenges arising from high team turnover and partly because you will have limited opportunity to premium price non-premium services.

Firms that achieve a sustainable competitive advantage as reflected by higher margins and a higher level of profit per owner/director are those that truly understand the importance of having a strategy built on offering the right services to the right clients at the right price.

As a result, these firms give their team member’s lots of client contact and assignment variety and are able to pay above average compensation. Because they are actively involved with helping their clients grow their business they are creating a “reliance relationship”. Interestingly, this foundation not only yields higher profit margins today but it also creates greater client loyalty, a much richer referral source and a very loyal & committed team. Note also with this strategy, to secure your risk, consider employment contracts to include restraint issues.

Your starting point for creating a great firm must always be the vision you have for it which in turn will define your strategy. Then it’s simply a matter of execution.

Having the vision and defining the strategy is the easy part – although it’s amazing how many firms have neither. Execution and being patient is the hard part but, as is the case with all things in life, the rewards for those who pursue the hard yards are significant and most definitely worth the effort.

Rate Your Practice

2010-03-08T18:05:00.000-08:00

Rate your practice for the new era.

Today we live in a business world dominated by the financial crisis. However as I travel around and meet people in all walks of business I find that there is a general frustration with the negativity of tough times. If anything, business people and professionals, in particular, simply want to get on with the future.

Now for some, that future is an ideal retirement. They are ready to sell or hand the baton over to a younger group within their organisation. They have had enough and the current crisis has brought forward their decision.

So strong has that demand been that Summit is now helping a number of practices with a transition of ownership or management. Allied with this is the recognition that there is a rationalisation process amongst professional practices which will be accelerated by the current business environment. And again Summit is being asked to assist with mergers and acquisitions for those exact reasons.

However, if you are of a mind to develop and grow from within current practice - then now is the time to examine the key factors that will ensure success in the future.
The important point to remember is that for most owners rating their organisation’s performance in these key areas – there will be a need for change. I believe that changing a practice is often more comfortable for the person managing the change than perhaps the employee who is being asked to change the habits of a lifetime or move out of their security zones.

On the other hand much of the change required after the evaluation will fall on the shoulders of the owners of the business. In other words the change will need to be at the top. For instance, I believe that the future will require acceptance of multi-disciplined practices. For many that will mean a great change in attitude. It will also require updating of systems and computer programs – not just to meet competition but to maintain young and talented professionals who don’t want to be left behind.

So let’s take a close look at the key indicators or criteria for future growth. Many of you who have read this column in the past or attended a seminar at which Summit have presented – will have seen a number of these factors before. All that is required is an honest appraisal of where you are now.

A Good Team
Attracting and retaining good people is a critical success factor for professional service practices. The old fashioned view ‘that we are paying them enough’ is not enough in today’s environment. Young people particularly will not endure a boring work environment. Successful firms celebrate successes (new clients, birthdays, major achievements) have sound training, career plans & feedback, job variety and recognition.
Use this criteria to rate your firm in attracting developing and retaining good team.

Poor Average Good
-5 0 5
Production Culture
A second department to be developed is what our team does produce – particularly, quality and timely work for clients.
Bringing the team together in a culture of ‘continuous improvement’ is one huge success ingredient in growing firms that also contributes to efficiency and effectiveness (i.e. control of costs & earners).

Successful firms have solid work scheduling systems whilst looking at capacity and technology capabilities with reduced time write offs and few job complaints about quality & delivery times.
How do you rate?

Poor Average Good
-5 0 5

Value Added Services
We’ve found clients want more and more a ‘one stop shop’ approach to related services e.g. for a surveying firm consider; engineering design, town planning, project management, architectural design etc without diminishing the core skill – in this case, surveying.
Unfortunately, as professionals, it is easy to stay with your core professional skill and not entertain cross selling.

Clients certainly don’t expect you to be the master of all these professions – rather be the controller of quality filtered alliance partners i.e. other professional firms.
How do you currently rate with this opportunity?

Poor Average Good
-5 0 5

Key Clients and Alliances Program
Most professional firms get clogged with the 20% ‘c’ clients creating 80% of problems, bad debts, write offs and loss in employee morale. At the same time relationships with client referrers (e.g. architects, engineering firms, lawyers etc) are generally poor.

Successful firms have a client and alliance partner review process which filters out unworthy clients and alliances and highlights the 20% A, B clients and alliance partners who give 80% of the revenue, profit, referrals and job satisfaction for the team.
So how do you rate in existing low value clients and alliances, attracting new clients & up selling and cross selling with new value add services & having regular meetings to review progress.

Poor Average Good
-5 0 5

Leadership
Using a corporate approach to different roles & responsibilities (e.g. shareholder, director, CEO), leadership is then the key factor in the way forward for professional service firms.

An owner or CEO needs to be leading the organisation towards a bigger future. That requires a number of hours not dedicated to servicing clients but rather servicing the business.
Which is better for the firm? – Producing currently 1200 chargeable hours or introducing 2400 new chargeable hours from new clients?

Thus developing roles for partners & managers (CEO, Business Development, Human Resources, Operations and Financial roles) to take on specific responsibilities is clear forward thinking on a tried & proven model.

So imagine a firm with compound growth of 20% with better quality clients, a high producing team, selling value added services with value billing (fixed fees).
Understanding this how good is the leadership at leading change, relationship building, keeping a strong focus on results, solid professional skills and commitment?

Poor Average Good
-5 0 5

Next Step
So after reviewing all the above - the next step is the where analysis. Where do I want this business to be strong in and what are the strategies I have to focus on to get there. The above model gives you a good guide for this. It is about setting your objectives for change. A year from now how do you want to rate yourself.

Creating a Value Driven Team

2010-03-08T17:37:00.000-08:00

Creating a Value Driven Team

Which of the following does your firm report on, monitor and react to most frequently? Is it client satisfaction levels, is it the strength of key client relationships, is it employee motivation and energy, or perhaps its financial results? Which consumes most of your management time?

If you answered financial results, don’t worry, from our experience without doubt so do the overwhelming majority of professional practices. And as a result your practice and others are making less money than would be possible with a change in direction.

We have all heard the expression, ‘putting the cart before the horse’; well in this case it is no different. Because managing a business by looking at financial results is like trying to win a game by keeping your eye firmly fixed on the scoreboard. Financial results are just that - results. They are the outcome. To achieve the right outcome you must report on, monitor, react and manage those things that produce value. And that means managing your team because energised employees who deliver outstanding quality and service to the marketplace - will bring far greater profits than a fixation with financial results.

Does this mean you don’t monitor and track your financial performance? Of course not. But the real key to business success is, not focusing all your attention and decisions on whether you made profit last week, but by getting your people sufficiently focused so that they eagerly and willingly strive for high standards. If you can do this, the dollars will follow.

Having completed many strategic plans for a range of clients I have noticed, quite remarkably, that they feature many of the same ingredients. Everyone sits around and figures out correctly which client sectors are growing, which services are rising in demand, and which dimensions of competition, such as client service or innovation, clients are looking for. Everyone knows what needs to be done. But those who succeed are those who can best action the strategic plan. And this in turn is determined by the following vital ingredients:

• energy
• drive
• enthusiasm
• excitement
• commitment
• passion
• ambition

Hence an owner’s role needs to be a creator of energy, drive and enthusiasm amongst their team. Alas, too often, owner’s are the destroyers of excitement. If all they ever talk about is finances e.g. “how are your billings? What’s happening to receivables?” it can deaden the spirit of your team. It doesn’t mean the subjects are unimportant rather that there should be a wider more exciting range of subjects to provide a more balanced environment.

Many employees believe their leaders only want them to be dollar focused. Whenever a choice needs to be made between strategy i.e. developing a reputation for superior quality, and short term cash, most people feel under significant and irresistible pressure from management to go for the cash. The message seems to be, go for the cash today, strategy can wait til tomorrow.

However if you’re willing to sacrifice value to earn short-term cash, you won’t create a market reputation for superior quality. If you want to be known as excellent at something, you have to be reliably, consistently excellent at it. Not be swayed by daily temptations, short term expediencies and wonderful excuses for why we can’t afford to stick to high standards today.

It takes courage to believe that a reputation for excellence is worth more in the long run than incremental cash. It begins with a promise in the vision, strategic plans, and objectives, but we see owners more often than not compromise this promise.

An effective owner must have the courage of the convictions they espouse, maintain a long term focus, and intervene personally whenever there are departures from the values and vision that create excellence. A key is to be disciplined about maintaining the integrity of those standards and leading by example. Team members need to know that there are consequences if there is noncompliance to set standards. If an owner doesn’t show leadership on these matters then other team members will see that maintaining the standards is not vital and cease striving to comply. The result is that a strategy based on a reputation for quality, will never be attained.

Let’s Make it Happen
To get started, take out your documents developed with your team's input that describe your company’s vision, purpose, values and strategy. Turn them into a questionnaire and ask your team how well they think the firm is going in relationship to those benchmarks for success.
If you find out that there are some things that you’re not doing so well it's time to re-evaluate and as a leader commit yourself and your team to achieving the standards or objectives the documents contain.

Another vital step is to involve as many people as possible in the process of implementing, if not actually setting, strategy. The task of energising, mobilising, and motivating action is easier with people feeling involved, rather than being imposed on from above.
As an owner, your job is much easier if you can share the load with a motivated team who want to help. Ask the team, I think you’ll be pleasantly surprised.

Lastly let me share what I think is a key message to be a successful owner and leader.
A leader doesn’t build a business. A leader builds an organisation that builds a business. Many owners start because of their technical excellence, their business development skills or their financial skills. However, there comes a point where the central question is, can you manage? Are you a creator of energy, drive and ambition in others? Can you cause others to strive to achieve high standards?

A Planned Retreat

2010-03-08T17:30:00.000-08:00

A planned retreat is winning business tactic.

Partner or senior management retreats can be a powerful tactic in the success of a professional practice. But like every worthwhile undertaking - prior preparation is an absolute requirement and most importantly there needs to be agreed objectives. Unfortunately, in my experience, this is not always the case.

Key questions to be answered should be “what changes do we want to occur as a result of this retreat?” and "what factual information should we have at hand?” Perhaps even more important “how will the results of the retreat be recorded in order that they can be actioned?”

Leading the retreat
There is no doubt that most senior people will want to have an input. There can also be a tendency for the more outspoken or senior to dominate or in pushing a viewpoint perhaps not give consideration to another's view. I often find there are many with complaints but few with real ideas or suggestions for creating a better system or a better business.

Therefore I believe that the either appointing someone to facilitate the retreat from inside the practice - if they have that experience - or better still hiring and thoroughly briefing a professional facilitator is paramount. Indeed after the decision to "retreat" - this is the next most important decision.

If sessions are planned they are less likely to get out of control, and then from an external point of view maybe other firm's stories and successful experiences that can be brought to the table.

Using this approach means initially preparing a great deal of information to make the retreat more valuable – financials, past strategic plans, client surveys, and internal management minutes.

Then following that collation of information, the partners and the external facilitator should meet beforehand to confirm what the firm wants to improve and precisely how the retreat can be used to make that happen.

Real Results
A well run retreat should have data collected so that the discussion is based on an external reality not someone’s opinions.
For example – if a topic is profitability, ensure the group is informed precisely where the profits are coming from – which clients, which services?

If a topic is marketing or client service undertake research or interview your clients about the firm's strengths and weaknesses. Ask questions like:-

• “What do we have to do to deserve and earn more of your business and to obtain unbeatable referrals from you?"
• "What should we do more of, what should we do less of?"
• "What do think are our strengths and weaknesses?"
If a topic is team development, ask members of the team:-
• "What do they think we do well what we do poorly?
• "How could we improve - better communication, better systems etc?"

If a topic is strategic direction, have the partners been asked to prepare their thoughts in advance on:-
“Priorities and initiatives they believe need to be tabled and discussed that will best grow the firm?"

In this later case the use of a facilitator to address these issues with key players presenting the ideas anonymously at the retreat can often assist with balanced impersonal debate.

With the right planning and the right approach, partner retreats truly are an effective management tool.

The Surveying Industry - The Next Decade

2010-03-08T17:17:00.000-08:00

The Surveying Industry – The Next Decade.

At this moment in history, when the world is facing and trying to deal with one of the greatest financial catastrophes of all time, it is rather daunting to set out to provide an outlook for the next decade. Added to the crisis we know about is the amazing changes that are taking place around the world and affecting the way we work and live. The old order of society is changing rapidly. Here are a few facts produced by Sony for their senior executive group last year.

• China will soon be the largest English speaking country in the world
• The predicted top ten jobs in demand in 2010 did not exist in 2004
• There are 31 billion searches on Google each month (2008) in 2006 this was 2.7 billion
• The first commercial text message was sent in 1992 - today the number of text messages sent and received each day exceeds the total population of the planet.

While no doubt these changes and the pace of them will affect us all in time, there are two key factors that I believe will affect the surveying profession over the next decade.

Firstly, we will lose a large group of baby boomers from the profession in that time and secondly, we perhaps will not attract a satisfactory level of new graduates unless we can vitalise the image of the profession.

That said I believe we can at least hypothesise on what changes or trends might occur in order to develop our own plans and strategies for the future.

Many notables such as award winning author David C McCullough, have said we need to look to history to see the future "History is a guide to navigation in perilous times" others such as Henry Ford, a brilliant 'new thinker' of his time, seemed to disagree " History is more or less bunk" he is quoted as saying. I believe that we can look at what has been happening in the profession over the past decade a put down some directions that would be the good basis for discussion when developing a long term strategic plan.

The first is size of organisations. It seems to me that we are seeing more and more movement towards larger or multi-disciplined practices. With the combination of new technology and the cost of running small practices increasing - this move towards size is a real consideration for any professional looking into the future. The need for older surveyors to retire will mean a chance for larger firms to grow through mergers or acquisitions. This added to the benefits for clients of having a one shop concept with multi-disciplined firms, only adds to the argument for size. Another dimension of this maybe an increase in the support staff for each qualified surveyor in order to service clients efficiently.

I am not suggesting there is no future for the smaller one or two partner practices but, I don't feel that this is the future of the surveying profession - no more than it has been the future for professions such as medicine or law. Whether multi-disciplined or specialist surveyor - growth is a key element for those looking to the future in my opinion.

Last year I worked with a group of surveyors who merged their business. While the result was a greater size and no great savings in overheads, the idea between the merger was more a centralisation of the business side of the practices which allowed the qualified surveyors and other disciplines to focus simply on servicing their clients, thus increasing efficiency.

That said as we face the immediate future - regardless of our firm's size - there are some basic steps that need to be taken for survival and long term growth.

With careful planning, surveying practices can be agile and move with the times. With lean operations, the surveying industry will have the ability to improve efficiencies in productivity, sustainability and to establish market share.

When looking to develop a plan to help navigate the period ahead owners should consider reviewing trading cycles, costs and expected cash flow; get support and advice from business peers; undertake a SWOT analysis of your business and consider your market.

One thing is for sure, innovation will be mandatory for surveying firms over the next decade. Surveying practices must take up the challenge to be natural and continuous innovators as they result in improved products and services, better business processes, increased customer value and stronger financial results.

There will be changing demands of customers. Customers will continue to demand increasing added value from surveying practices over the next five years. At the same time these clients expectation of the service they receive is also expected to increase. Whilst these pressures are being brought to bear, surveying practices will fully expect to have to continue to decrease the costs of their product and service offerings.

But who will do it? Even as we look into a difficult immediate future, general industry research says that only 16% of professionals are proactive in adopting change. If this is true for the surveying profession it suggests a profession without enough committed practitioners to ensure a healthy future. Certainly the 16% of proactive adopters will be busy.

Finding new ideal customers is integral to growth and survival as is retaining them. Pavlov’s rule of 20% of your clients bringing 80% of your income has never been more pertinent in your need to develop a profitable streamlined surveying practice. Dated thinking by some owners has lead them to believe they don’t have the time nor resources to market their firm and services at a time when marketing has never been more important.

The critical marketing challenges for surveying practices will be to improve the target marketing to key ideal customers by making more effective use of the internet. Improved levels of customer insight will be required to build practices that are relevant to their customers needs. Exploiting one of the oldest forms of marketing communication - word of mouth - by creating strong networks locally and on the net.

As mentioned earlier a massive issue for the surveying industry is dramatic increase in the number of business owners reaching retirement age over the next decade. This was highlighted by a recent survey undertaken by the CPA association:

• Approx 24% of SME owners are now over 60
• Another 25% are between 50 and 60

Thus we are hearing more and more business owners saying “My business is my superannuation”. With 40% of owners looking to sell in the next 5-10 years it is a concerning fact that only 38% of surveying practice owners have a plan to sell or succession
Small business owners need to get smart, plan and prepare for their business succession or exit, years in advance of their retirement for the best results. Even if they are closing their business, planning will make a big difference to the amount they walk away with. Leaving their exit planning to the last minute is not a good strategy.
That said, surely this trend signals incredible opportunities for younger surveyors looking to create practices that are sizeable, innovative, utilize technology and suit the future.

10 Critical Mistakes When Selling Your Business

2010-03-08T17:10:00.000-08:00

You’ve spent the best part of your life building and creating a business that has provided you with so much…. it has provided you with a living, a creative professional outlet, a reason to get up in the morning, professional joys and challenges, an opportunity to lead others, create future financial security for you and your family… why ruin all that you have worked for by erring when it comes to what will be the biggest sale of your lifetime. A seemingly small error that could cost you and your family hard earned dollars. Do you really want to risk that? From my experience in selling small business practices I’d like to highlight the following pitfalls that I have personally seen that have cost others their dream retirement. I do this in the hope that you will avoid these:

1. Wrong price
Too high is bad and too low can be very costly.
Despite the old saying that "there's a sucker born every minute" the reality is that if the price is too high many buyers won’t bother to investigate the opportunity and no one wants to be seen as a sucker. Ultimately the offer has to be taken off the market and time taken before remarketing can take place. Worse still there is a large price drop required. If it is too low, you will first up be losing money but also be subject to a negotiation in which you can only lose more.
I find that most sellers don’t know the value of their business in the same way they don't know the true market value of their home. What to do? Ask a broker and get a proper valuation.

2. Inadequate Financial Records
Private businesses are set up to minimize tax, not show maximum profits. However this makes for a low valuation. The answer is not to pay more taxes but to keep thorough and accurate records to show earnings and cash flow attributable to the business. Nothing kills a deal quicker than an inability to produce accurate reports from at least the last 3 years.

3. Doing it yourself
Selling a business is a complex legal, financial and time consuming process. Because of the process and the many often emotional decisions that need to be taken you are best advised to employ a business broker. A good business broker helps you maximize the purchase price you receive by canvassing the marketplace appropriately, driving the execution of the transaction and adding value through effective negotiations.

4. Negotiating too hard
You should negotiate hard but not to the detriment of a successful outcome. It is better for the seller that the surviving company be successful. Here again a broker will work on your behalf to negotiate a win-win situation where everyone is happy with the outcome.

5. Demanding an all cash deal and no handover period
Some buyers are naturally suspicious of sellers who demand an immediate cash settlement. It suggests desperation or a lack of transparency on the real situation. Most seek to have a period of time during which the price paid actually relates to the performance promised. This is particularly true in professional practices where individuals are key to retaining clients. Buyers will also pay a substantial premium for seller financing. Sellers should keep an open mind on exit dates and financing - both of which may get an even better deal.

6. Selling to the wrong buyer
The best buyer is one whose philosophy and experience is synergistic with that of your practice and has a real motivation to buy. If the chemistry is not right with the person you are dealing with, terminate the negotiations. The aftershocks can be catastrophic.
Often selling to a direct competitor, employee or supplier improperly without full confidentiality can be a mistake. A competitor seldom pays full value and if the deal falls through they gain huge confidential information. An employee rarely has the money to pay full value and seller is at risk of getting paid. Suppliers have the problem of becoming competitors to their suppliers when they integrate forward or backwards.

7. Non qualified prospects
Beware tyre kickers, bargain hunters and general time wasters who can burn up a significant amount of your time, energy and money.
The first 2 questions a buyer asks is “why are you selling?” and “what are your financial results?”, therefore you should ask the prospective buyer the same equivalent questions.. “why are you buying?” and “what is your financial capability in purchasing our firm?”.

8. Lack of preparation
Many businesses come to the market without a single idea of what is involved in the sales process and what they want to get out of the sale. If you are poorly prepared, it will show, frustrate buyers and waste everybody’s time. The end result is NO SALE. Do not underestimate the costs and effort it will take to get a positive result. Treat it as an investment to get optimum sale value.

9. Timing
The best time to sell is when you don’t have to particularly when the business is on the upside and profits and turnover are at, or near their best. There can be a substantial variation in price depending upon the business cycle. It can be very hard to justify a great price and do a deal when your turnover and profitability are in decline. The mistake is that owners sit and wait for the "right time". If your business is not ready for sale - then get active and improve its performance - start a new business drive - employ better staff - fix your systems - cut your costs. Get the business ready for sale.

10. Why do you want to sell?
This will be one of the first questions a buyer asks you. Give some serious thought to why you want to sell. If you have not deliberated and come to the firm decision that you are going to sell, don’t start the selling process. Some common reasons include retirement, health, capitalisation or a career change. Be sure that you want to sell the business and have a solid reason why you want to walk away. Naturally if you find there are too many problems and you are tired - then this is perhaps not the answer to the seller's question. Take a break - get refreshed and then actively work with your broker to get the business in the market.

Unlock Your Full Potential

2010-03-08T17:02:00.000-08:00

Unlock Your Full Potential

One of my first clients in business coaching was a partner in a professional practice related to surveying. He was around 45 years old and working 10 to 12 hour days at least 6 days a week and hadn’t had a real holiday in four years. He was earning less than $100,000 per year, was unfit, overweight, highly stressed, and of even greater concern to his future health, not at all satisfied with his life. He felt overwhelmed, with too much to do and too little time. Both he and I realised that something had to change.

Together we closely analysed each part of his work and personal life. We identified the areas where he was getting the best results and making the most money. Likewise, we identified areas that consumed an enormous amount of time but contributed very little to his real goals. I had him make a list of all his responsibilities and daily business, social and family activities activities. It became clear that his lifestyle was out of balance and that other than money he was contributing little to his family’s well-being. I then asked him a key question. “With a snapshot of your life in mind – if you had the chance to start all over again - would you continue on in the same way”?
Clearly the answer was a resounding no.

This became the first step to creating a better business and better life. I helped him set new goals, for his work, his family, his financial situation and his life in general. The result was a complete re-balance of his life and reengineering of his business.
This man had a wonderful opportunity, to step back, analyse his life, make specific decisions and then follow through on those decisions. The result was that within three months, he had cut his work week from seven to five days. He had refocused his efforts on the top 20% of his clients and organised his activities to acquire more clients in that same category. At the same time, he began reducing and cutting back on the amount of time he was spending with the 80% of his clients who contributed only 20% of his revenues. This enabled him to spend more of his time with the clients who provided most of his income.

With his work life simplified and streamlined, he refocused on his family. He began spending more time with his wife and children. First, they arranged to go away for a weekend holiday, something they had not done for years. A few weeks later, they took an entire week away from work and school. Within six months, he was taking one week off per 2 months with his family.

Meanwhile, because of his increased focus on his most valuable clients, within a year his income increased by more than 100%. He was exercising regularly and had lost 11 kilograms. By doing fewer things of higher value and discontinuing activities of lower value, he dramatically improved the quality of his life in every area in just a few months.
This early case history led me to establish a 7 step program to creating a more balanced, satisfying life for highly stressed professionals. Particularly, professionals who want to be successful but have recognised that overwork is not the way to achieve great things in life.

Here is the 7 step program that you can take with the aim of doubling your income and doubling your time off.

1. Decide to reengineer your business with perhaps a better quality client base of A&B clients with a smaller better quality giving you a lot more energy and making more cash.
2. Crystallize what you excel at professionally (is it professional skills, relationship building, leading change, getting results?)
3. Clarify what gives you most satisfaction and energizes you (gaining new A & B class clients, completing top quality work etc?)
4. What are you most eager to learn and grow (e.g. how to sell, how to grow a high performing team, or purely redesign your business direction)
5. Determine the core competencies to put you in the top 10% (that’s where all the big earners are). Perhaps this might include training the team, technology upgrades, relationship marketing. Resolve with yourself, what one skill if I did excellently would double my income.
6. Choose to take time off regularly to clear your head & think about the business to keep it in line with your plan (i.e. quiet time by yourself every day, a long weekend, a week off every 2/3 months)
7. Start today to pay closer attention to the things you do. Identify the most important tasks that give the greatest value and concentrate on them single mindedly. (Once today goes, chances of change for the better diminish considerably tomorrow).

Your Company Image

2010-03-08T16:54:00.000-08:00

Your company image: make it real, make it work

Critical areas that influence your image

Your telephone image

How does someone perceive your company when they ring you? Do they get a crisp, friendly and professional image or could there be weak link in your team?

The key is to regularly put a critical ear to the way your people handle those calls. Phone in occasionally as a prospect or an irate customer. You’ll instantly see whether the image you have of your company is what the customer “sees” or whether it’s time for you to invest in more training.

Your letterhead

Your letterhead communicates much more to the reader than the actual words on the paper. The reader most certainly will make subconscious judgments about the writer and their company based on the appearance and colour scheme of the letterhead and the subtle messages communicated by the logo.

If your letterhead is just average on a plain paper with boring colours and a logo whipped up by your local printer then the impression you give is that you are just average. Even worse if it's just something you've knocked up on your computer. Unless you're very good at this, it's likely to look cheap and ordinary...attributes that go straight to your business image.

Yet if your letterhead subtly contributes to even 2% more sales a year, isn’t that a mighty powerful investment in your business-building?

In reality, a quality letterhead sets a high image standard for your company — one that will play a key part in creating dramatic sales increases.

Your business cards

The same principles apply here. Your business card really does say something about you and your company. Make absolutely certain the texture, colour scheme and typeface come together as something any top corporate executive would be proud to carry.

Also, never assume the recipient will know everything you offer. Use the white space on the card (or, even better, the back) to list your services.

Who knows how much extra image and business that will bring you — and all at no extra cost.

Everything else

If you are to achieve maximum impact with all your business communications and marketing materials, make sure you have a consistent and identifiable image.

This means consistency in design, colours, logo, and overall “feel”. This also applies to your invoices, uniforms, company vehicles, premises — everything your customers are likely to see.

Always keep thinking about other ways can you communicate your image to your clients.

Never assume they know all the good things you do for them. If you offer a number of services, a client will usually tag you as a provider of that service only — and be totally unaware of everything else you offer. (They may even go to a competitor, being totally unaware that you could have provided the item or service better and at lower cost!)

It pays to put together a newsletter or guarantee certificate that tells them the benefits of your service and features of your company and how proud you are to stand behind them. It also gives you the opportunity to cross promote the other services you offer...creating new sales opportunities.

Buying a Practice

2010-03-04T17:47:00.000-08:00

Buying a Surveying Practice
I have shared with you many tips and experiences on how to grow your surveying practice but possibly the smartest thing you could do to accelerate the growth of your business is to consider buying somebody else’s practice on a variable basis. Using the techniques, systems and ideas that I have mentioned in earlier articles to increase the effectiveness of your surveying practice you could easily enhance the profit by 15 to 20 percent and pay for the purchased practice with that enhanced profit. The rest is gravy.

If you have a fully utilized practice but are entrepreneurially minded, like me, you could buy a second surveying practice on a no money down, deferred payment basis, bring in staff to run it on salary or a percentage and still make money by keeping the lion’s share of the profits.

It doesn’t matter what you pay for the practice; it matters more how you pay for it. If a practice is billing $500,000 a year, you can pay two or three time its marketable worth if the duration of the payment is long enough. In other words, if you acquire $500,000 work of under-deployed billing and the going market price is one half times annual billings, you could offer two or three times that amount as long as you negotiate a sufficiently long payment period.

Strategic Planning

2010-03-04T17:40:00.000-08:00

A Plan to Grow in 2010.
One hundred years ago, in 1910, two teams of men set out to be the first to reach the South Pole. One team was led by Scott the other Amundsen. Both had a plan. Both had the same objective. Both achieved the success of reaching their goal – one achieved the ultimate goal of being first. From Amundsen and Scott we learn the necessity of a plan and we also recognise that the content of that plan is critical to its success.

Planning is an essential element of business success. You will often hear that people have the Midas touch – “they just seem to be in the right place at the right time”. The fact is that neither luck nor any form of clairvoyance is a dependable element of business success. The real requirements are - key objectives that are realistic but will stretch you and your team and a strategic plan that allows you and your team to achieve the success.

The Planning Environment
If you would like to give your plan a 50% better chance of success the first step is to choose an environment that encourages clear thinking, escapes the frustrations of the office and everyday business concerns. Start with a room that has windows and then add views and peace and quiet. Into that room introduce your key executives or stakeholders.
Add a professional facilitator – who has some knowledge of your type of business. It is obvious that the strategic plan for a professional services group will likely have different insights and content than that of a manufacturing organisation.

Getting The Right Participation
If this is the first time the group has met to create a strategic plan it is very important to review where the business is now. Let the frustrations come to the surface for evaluation and discussion. Be open to recognising the weaknesses of the business but balance that by examining and writing down the strengths. Before your team can look to the future and be involved with blue sky thinking – the everyday agendas need to be put aside. If we are to set stretch goals or objectives – the knowledge of where we are now is essential.

The Time Frame
Most strategic plans encompass a 3 year time frame. They will contain objectives that are measurable. The first meeting and eventual plan will contain objectives for the entire plan but detailed strategies and tactics for the first 12 months.

The Objectives
While you may have in mind a singular objective - the fact is that most strategic plans will have a number of key objectives. A single plan may seek revenue or profit targets. You may look to increasing locations or lifting partners in a professional services practice. Always keep in mind that the objectives must have stretch factor. Objectives that are impossible to reach will simply de-motivate your team while being able to pat everyone on the back through easy objectives will simply breed laziness rather than lift team spirit.

Living With The Plan
As an owner or chief executive you will ultimately be responsible for achieving the plan. It is important however to also set your own series of personal objectives. It is reasonable that the same be asked of the key stakeholders. We all need to strive continuously to grow. It was Gary Player who once said the more he practised the luckier he got – there is no doubt that the harder we work to overcome our weakness and better apply our strengths the more successful or “luckier” we will become.

Having developed the plan and involved yourself personally in it, you and your team need to “live it”. Start by reading it every day for 21 days straight. A good plan will be able to be read in 15 to 20 minutes. The plan should be like a well practised golf swing you know it so well that it becomes automatic to think and work to the plan.

Then monthly you need to meet with your key team members using the plan as the basis of judging your success and perhaps highlighting those areas that may not be “going according to plan”. A plan is a living dynamic instrument for your success. As such it may require amendments based on your experience – always look to align actual performance against the plan.

I urge you to think about the future of your business now. If you don’t have a strategic plan in place, begin immediately to assemble your team and create an opportunity and an environment for them to meet and create that plan.

Remember however that the plan is not just a “must have” document. As with Amundsen – it is a document that should have the right strategies and tactics to ensure true success.

Succession Planning

2010-03-04T17:35:00.000-08:00

Successful Succession Planning

Retiring from your business which you have built up for many years can not only be an emotional milestone but also a financial and legal challenge. Getting it right is important for your future well being in retirement as well as the continuation and growth of your business.

Recently I came across some statistics that showed that 31% of all small business owners are aged over 50. Additionally, in another survey, it confirmed that 40% of small business owners surveyed indicated they planned to sell their business in the next 5 years.

Many practices we see do not have adequate superannuation and face a bleak retirement if they cannot access the value they have built in their business.

Indeed a lot of professionals think there is little goodwill value in their business as the value revolves around the owner and, hence, do not, consider it an asset and not worth building.

I think this could largely be true in certain circumstances i.e. a 1 man operation and a business with no structured processes, little profitability and being in a remote area.

Equally, a profitable, well systemised growing business with a good diverse client base, that is well located and possesses a good team is worth value to sell, I’m sure you wouldn’t just give it away for nothing.

The business can indeed be a very good asset to sell, after all, you as owners have spent many years in hard work developing it to this stage. So to extract maximum value, an owner, needs to lay down plans well in advance generally 2 years or more.

Psychologically handling the transition out of the business for the owner also isn’t easy as there are fears, doubts about the prospect of withdrawing and uncertainty of just how to do it, which can be quite a considerable issue.

Equally, stay on too long and self sabotage can set in and your asset can diminish in value very quickly.

However, you can be reassured it can be made a lot simpler, reassuring, and satisfying with a well planned succession plan.

What is succession planning?

We see this as the early transfer of both management and control of a business, which may not mean a complete exit.

It may well mean the sale of the business outright or the owner/partner retaining equity and receiving profits after withdrawing from management.

However, in essence it is a focus on redundancy for the right reason.

The key is firstly to strengthen the business in terms of sustained profitability and asset building built on a platform of solid systems, quality client base and a high performing team.

There are a number of different options when it comes to succession planning. They could include:
1. Sell the business - consider a logically planned process?
2. Manage a team buy in, perhaps phased – is the team competent?
3. Family succession – is the skills and enthusiasm appropriate?
4. Merge - are the values, attitudes and ethics similar or complimentary?
5. Close the business and sell off the assets – consider a structured plan?

Clearly if we are to maximize the value we should consider: having a clearly articulated exit strategy that firstly embraces as to when you want to exit; taxation and financing issues have to be addressed; development of successors; and essentially having the business in a strong saleable shape.

5 Steps

Sound succession planning can be considered in 5 steps:
1. Assess the current business in detail and obtain an appropriate valuation and also consider including shareholder and employment agreements for current directors and owners, keyman insurance and an assessment of risk management issues etc.
2. Develop comfortable time frames to exit and where appropriate heads of agreement.
3. Build a strong strategic plan to enhance ultimate value, build current profitability and have an early foray into a enjoyable lifestyle change (e.g. only work 4 days a week perhaps)
4. Consider a strong team of advisers: lawyers, accountants, financial planners, insurance brokers, and a solid business development coach. This is to cover all the legal, financial, tax, insurance and business development matters.
5. Implement the plan, as obvious as this seems, it is critically important that the succession plan be managed whilst the owner continues to work in the business.

In summary, a succession plan will enable the business owner to extract maximum value and needs to be laid down well in advance of retirement generally 2 years or more.

The Biggest Sale of a Lifetime

2010-03-04T17:17:00.000-08:00

The inside advantage to selling your life’s work for maximum value.
A famous story tells of an African farmer who gave up his farm to look for a diamond mine, so that he could become fabulously wealthy. He sold his farm and wandered off into the vast African continent for 15 years until finally, broke, alone, sick, tired and exhausted he threw himself into the sea, and drowned!

Meanwhile on his farm, the new farmer was out watering his mule in a stream that cut across his land. He noticed a rock that threw off light in all directions – which was found to be a diamond. They returned to the stream to find another, and discovered that the farm was covered with acres of diamonds!

The farmer had gone off seeking diamonds elsewhere, without looking under his own feet.
It is the same for your business. Your business is a field of diamonds that you can capitalise on when you sell your life's work.

Why sell your business?
Maybe:
1. The fun has faded
2. You have lost a major client, supplier or team member
3. You have hit a patch of ill health
4. The market collapses
5. You have an immediate need for cash for a equipment upgrade or to pay a partner out
6. New legislation means you have to reconsider your options
7. Litigation
8. There is no family successor
9. You want to spend more time with your family or go on an extended holiday
10. A better opportunity has come along

Most business owners will only sell a business once in a lifetime. Without previous experience it can be difficult, complicated and emotionally a very stressful experience. It is also a major financial decision and can be a costly one unless all areas are considered.

Preparing for sale

So what do you need to do? Be prepared before you list your business for sale. Just like diamond mining, a bit of digging and preparation can substantially increase the value you generate.

A comprehensive plan for selling your business will give you the highest probability for gaining maximum sale value. With as little as 3 months to 2 years preparation, you will significantly generate a more profitable exit from the business.

First, you need to think like a buyer.

They want to know ‘what’s the financial and strategic benefit to me to buy this business?’ Basically – what's in it for them?
When buyers look at a business, they place a dollar value on things such as profitability, business risks and the profit & growth potential. By looking at these factors and creating a solid plan to address them prior to listing your business for sale, you can dramatically increase the sale price of your business.
The following model shows how you can increase the value of the sale of your business 2 to 9 times.
The Proactive Business Sale Model
To work through this example, the goodwill component of a current business has a net profit after tax (NPAT) of $100,000.
Activity Impacted Value
1. Current business not prepared for sale $200,000
2. Introduction of structured marketing, people, operations, & financial systems for better team and clients, strong systems & greater profit (+50% NPAT) $300,000
3. Reduce risks through agreements with team, clients & suppliers & stronger diversified client base with better products/services (+33% NPAT) $400,000
4. Strong history of profit growth (+25% NPAT) $500,000

So being motivated for a higher sale price is a key, but more so I believe a critical question to ask when selling is, ‘what does life look like after the sale?’
Then if we confront that issue, we find you’ll be willing to put time & effort into preparing the business for sale. Possibilities will open up, for e.g. for some, the pursuit of having a long holiday in the short term, honorary charitable work, developing another opportunity. There really is an extensive checklist available.

Preparing for Sale Action Steps
1. Review your business model. Determine when you want to exit the business and implement strategies to increase sustainable profits, reduce risks, & build a platform for growth potential in order to boost ultimate sale value.

2. Create a personal plan. No longer working in your business requires some careful thought and planning). So talk to a professional about life after the sale of your business to include. For example develop another opportunity, a long term holiday, charity work etc.

3. Assess your sale price. Have an independent valuation prepared whilst also being aware of the current market value of comparable businesses so you don't under or overvalue your business. Then see how this lines up with your personal financial goals.

4. Checklist of potential buyers. Assess potential buyers for your business from a wide pool of potential buyers including your competitors, customers, employees or alliance partners. Start building relationships with them and create public awareness of your business well before the possible sale date to maximise your buyer pool. Find out their reasons for wanting to buy your business as this will help create negotiating leverage.

5. Develop your documentation. Develop your sale information memorandum outlining your business & its potential to a buyer. Additionally develop all legal documentation including for example 1. Confidentiality agreements 2. Heads of agreement 3. Due diligence checklists

6. Share sale agreements 5. Shareholding and employment contracts 6. Trademark transfer to name but a few of the more relevant.

7. Create a marketing plan. Develop a strong marketing program to a potential buyers pool to attract and develop multiple buyers which will build competitive tension and improve your sale value.

8. Develop a strong negotiation. Negotiations are emotional at the best of times – but when they are about the value of your life's work it is harder to be impartial. Remain detached during negotiations or have someone negotiate on your behalf in order to retain the upper hand.

9. Get good advice. From my personal & professional 25 years of experience, using independent, experienced professional advisors, accountants, lawyers or business sales consultants who have taken a number of owners through the sale process is invaluable. The best advisors understand your industry so find a specialist who understands and values what makes a successful professional practice sale. Look at these professional fees as an investment not a cost.

In essence, how much your business is worth is inextricably linked to “who will buy my business?”……

The bottom line is if you prepare your business for sale, you will gain a greater sale price, a quicker sale, as well as increasing your personal profits during the preparation phase. Isn't this the true mining of the diamonds at your feet?

Going or Growing?

2010-03-04T17:14:00.000-08:00

Sometime ago I wrote an article on the “New Era of Surveying”, the basis of which is a paper I was requested to submit to the FIG 2010 Conference in Sydney in April. In my view, a small proportion of surveying firms have commenced a change process but to date a vast majority continue with outdated processes, shrinking prices and margins, with an increasing difficulty in attracting & retaining staff. All of this against an ageing, shrinking surveyor population with a current steady, if uncertain, market makes for interesting times ahead.

We see the progressive firms, a maximum of 15 percent, can see the pressure coming. The next 40 percent, the early majority sense something is happening – not sure what it is but starting to feel the winds of change. The next 30 percent, the late majority, read about changes and will still procrastinate until they see the early majority do something. The last 15 percent are the laggards who will never change, will retire and leave the profession in the next 5-10 years and they will walk away or get very little on the sale of their practice.

What we’re seeing in the surveyor market place emerging is exactly these trends – more enquiries for people selling & a number of enquiries for acquisitions.
I also highlighted, in this submission, some key operational drivers for those wanting to accelerate the growth of their business, namely; developing a clear direction for the future, attracting and retaining a talented team, strong financial management, building a sound culture, having a one stop shop of value added services and displaying strong leadership skills.

It is certainly becoming clearer the choices surveying firms have:
1. Grow organically internally with some sound structured strategies to have the foundation of the firm set on a strong platform for growth;
2. After achieving this or in some instances running concurrently, some firms are achieving faster growth with a structured program with acquisitions;
3. With the ageing surveying population some see it as an opportunity to maximise the value for selling their life’s work by selling out even if they are sale ready.
After having work with Surveyors for over 7 years I’ve found these more in depth results:
1. From an internal business development perspective for those owners committed to change:
 A much stronger focus and understanding on the key financial drivers to increase profitability & cash flow
 A significant enhancement of modern operating systems
 A leading edge approach to marketing based on image, brand building & relationships
 Breaking down the communication barriers with the team to produce significantly higher team energy through a more loyal, committed, united approach of communication by the owners themselves as well as with their team.
 A clearer sense of direction
2. Taking a structured approach to fast growth through acquisition. Some firms, in my view less than 5%, are fast tracking through either financial acquisition or strategic acquisition.
Financial acquisitions are about merging an acquired firm into the current company after the purchase & achieving economies of scale (nil or reduced overheads), and gaining leverage and an opportunity to sell a packaged arrange of services to a new client base of A & B, maybe some C, class clients.
If a business is bought well, to also have a strong return on investment. In some cases the revenue acquired can go straight to the bottom line of the purchasers company as most firms have available capacity within their own team as in my experiences firms aren’t as effective, efficient with team utilisation as they think they are.
3. An emerging trend is for some owners to underplay the value they have in their practice after spending years developing the goodwill of their business (i.e. strong client base, loyal team, quality systems) & think that it has little value.

In some cases it is clearly less than what it could be due to poor practices but it still has some value through the core A & B class clients, better team members, & quality system.

So clearly there is an opportunity for a win-win approach for firms selling – gain some value on a sale (albeit at a discount) as opposed to walking away and for firms buying – instant quality growth (i.e. let the C & D clients & team go through acquisition) bought at a discount thus producing instant profit enhancement & stronger value in their own business for eventual sale either internally to the team or to the outside suitors – competitors, clients or strategic alliance partners.
Professionals generally are poor marketers (generally it is reactive referral marketing i.e. when the phone rings).

Which phase are you in – going or growing?

Let me know what you think or if you’d like a free confidential conversation to discuss your own business don’t hesitate to call us on (02) 8883 4699

The Biggest Sale of a Lifetime

2009-02-09T19:21:00.000-08:00

The inside advantage to selling your life’s work for maximum value.

A famous story tells of an African farmer who gave up his farm to look for a diamond mine, so that he could become fabulously wealthy. He sold his farm and wandered off into the vast African continent for 15 years until finally, broke, alone, sick, tired and exhausted he threw himself into the sea, and drowned!

Meanwhile on his farm, the new farmer was out watering his mule in a stream that cut across his land. He noticed a rock that threw off light in all directions – which was found to be a diamond. They returned to the stream to find another, and discovered that the farm was covered with acres of diamonds!

The farmer had gone off seeking diamonds elsewhere, without looking under his own feet.
It is the same for your business. Your business is a field of diamonds that you can capitalise on when you sell your life's work.

Why sell your business? Maybe:
1. The fun has faded
2. You have lost a major client, supplier or team member
3. You have hit a patch of ill health
4. The market collapses
5. You have an immediate need for cash for a equipment upgrade or to pay a partner out
6. New legislation means you have to reconsider your options
7. Litigation
8. There is no family successor
9. You want to spend more time with your family or go on an extended holiday
10. A better opportunity has come along

Most business owners will only sell a business once in a lifetime. Without previous experience it can be difficult, complicated and emotionally a very stressful experience. It is also a major financial decision and can be a costly one unless all areas are considered.

Preparing for sale

So what do you need to do? Be prepared before you list your business for sale. Just like diamond mining, a bit of digging and preparation can substantially increase the value you generate.

A comprehensive plan for selling your business will give you the highest probability for gaining maximum sale value. With as little as 3 months to 2 years preparation, you will significantly generate a more profitable exit from the business.

First, you need to think like a buyer.

They want to know ‘what’s the financial and strategic benefit to me to buy this business?’ Basically – what's in it for them?

When buyers look at a business, they place a dollar value on things such as profitability, business risks and the profit & growth potential. By looking at these factors and creating a solid plan to address them prior to listing your business for sale, you can dramatically increase the sale price of your business.

The following model shows how you can increase the value of the sale of your business 2 to 9 times.

The Proactive Business Sale Model
To work through this example, the goodwill component of a current business has a net profit after tax (NPAT) of $100,000.

Activity Impacted Value
1. Current business not prepared for sale $200,000
2. Introduction of structured marketing, people, operations, & financial systems for better team and clients, strong systems & greater profit (+50% NPAT) $300,000
3. Reduce risks through agreements with team, clients & suppliers & stronger diversified client base with better products/services (+33% NPAT) $400,000
4. Strong history of profit growth (+25% NPAT) $500,000

So being motivated for a higher sale price is a key, but more so I believe is a critical question to ask is when selling, ‘what does life look like after the sale?’

Then if we confront that issue, we find you’ll be willing to put time & effort into preparing the business for sale. Possibilities will open up, for e.g. for some, the pursuit of having a long holiday in the short term, honorary charitable work, developing another opportunity. There really is an extensive checklist available.

Preparing for Sale Action Steps

1. Review your business model. Determine when you want to exit the business and implement strategies to increase sustainable profits, reduce risks, & build a platform for growth potential in order to boost ultimate sale value.

2. Create a personal plan. No longer working in your business requires some careful thought and planning). So talk to a professional about life after the sale of your business to include. For example develop another opportunity, a long term holiday, charity work etc.

3. Assess your sale price. Have an independent valuation prepared whilst also being aware of the current market value of comparable businesses so you don't under or overvalue your business. Then see how this lines up with your personal financial goals.

4. Checklist of potential buyers. Assess potential buyers for your business from a wide pool of potential buyers including your competitors, customers, employees or alliance partners. Start building relationships with them and create public awareness of yoru business well before the possible sale date to maximise your buyer pool. Find out their reasons for wanting to buy your business as this will help create negotiating leverage.

5. Develop your documentation. Develop your sale information memorandum outlining your business & its potential to a buyer. Additionally develop all legal documentation including for example 1. Confidentiality agreements 2. Heads of agreement 3. Due diligence checklists 4. Share sale agreements 5. Shareholding and employment contracts 6. Trademark transfer to name but a few of the more relevant.

6. Create a marketing plan. Develop a strong marketing program to a potential buyers pool to attract and develop multiple buyers which will build competitive tension and improve your sale value.

7. Develop a strong negotiation. Negotiations are emotional at the best of times – but when they are about the value of your life's work it is harder to be impartial. Remain detached during negotiations or have someone negotiate on your behalf in order to retain the upper hand.

8. Get good advice. From my personal & professional 25 years of experience, using independent, experienced professional advisors, accountants, lawyers or business sales consultants who have taken a number of owners through the sale process is invaluable. The best advisors understand your industry so find a specialist who understands and values what makes a successful professional practice sale. Look at these professional fees as an investment not a cost.

In essence, how much your business is worth is inextricably linked to “who will buy my business?”……

The bottom line is if you prepare your business for sale, you will gain a greater sale price, a quicker sale, as well as increasing your personal profits during the preparation phase. Isn't this the true mining of the diamonds at your feet?

Predictor of the Future

2009-01-15T19:42:00.000-08:00

You don't need a crystal ball to determine the success of your business

I was talking with a new client the other day on the Central Coast, who had just been trying to work out what was going to happen in their business as a result of the economic downturn. I suggested "if you really want to predict how successful your business is going to be, just look at how you treat your customers."

In my experience, if you treat your customers well, provide services they need in a timely, cost-effective and friendly fashion you are likely to generate repeat business. It is this repeat business and client loyalty that has a major impact on business growth & profitability.

If your business strategy and its execution results in a high proportion of loyal clients who are also strong advocates or promoters of your business, then you can confidently predict a highly successful future for your business.

Looking for a low cost strategy that boosts your profits by up to 100%?
Sometime ago Bain & Co., a management consulting firm, revealed that a 5% increase in customer loyalty could yield an increase in profits of 25% to 100% and that companies with the highest level of loyalty grew revenue at a rate of twice that of their competitors.

Repeat business is obviously financially good for business, but how can you accurately predict how loyal your customers are to you? To do this for my clients I use what I call The Advocate Index (TAI).

To calculate the TAI, we start by conducting in-depth phone focus groups with clients of our clients, to gain feedback as to how they are going and also to understand what are their priorities.

During this process we ask a key question that provides us with the most valuable feedback of the focus group: “Would you give an unqualified endorsement (or recommendation) of this company to a business colleague or friend?”

With this question we ask for a rating of 0 to 10, where a score of zero indicates the respondent is not likely to recommend the company and a score of 10 indicates it is extremely likely.
Clients generally fall into one of three groups on this question.

There are 3 types of clients in your future ...

Advocates
These are people who are loyal enthusiasts who not only love dealing with the company but will urge their friends to do likewise. They are advocates and will generally give a score of 9 out 10 on the scale. They are your enthusiastic supporters.

Passives
These are the people who are satisfied but not overly enthusiastic who show subtle loyalty, yet could easily switch to a competitor if the right price came along or they built stronger relationships with your competitor. These people we call passives and generally will give a score of 7 or 8 on the scale.

Critics
The final group are called critics. These are people who are unhappy and are often feeling trapped in their relationship with the company and are what I call ‘C’ clients or ‘cash cows’ or ‘D’ clients for detractors. They generally give a score of 0 to 6.

Bill Gates said "Your most unhappy customers are your greatest source of learning". Listen to what they have to say and take their feedback on board.

The TAI is simply the difference between the percentage of people who give a score of 9-10 (advocates) and the percentage who score 6 and below (critics).

But what does that mean for your business? In our experience there is a strong correlation between those companies with a high TAI score and those with high profitability and high company value.

So, firstly, consider having independently asked 10 sample clients who will give good constructive feedback to the above questions and determine your current rating, then consider the following plan.

How to boost the number of your Advocates
If you suspect your TAI may not be as high as it could be, you need to seriously consider introducing client service standards, relationship marketing for referrals, client management systems and build the number and quality of your strategic alliance partners to help you boost the number of advocates for your company.

Introducing customer service strategies involves 3 specific actions:

1. Decide to take action to build and adhere to strong client service standards.

2. Deliver with superb service, strong relationship marketing for clients and strategic alliance partners.

3. Develop these processes through a simple structured client & alliance management program and reinforcement with your team of client service standards to ensure regular & reliable consistent high level service.

Building a team culture around continuous improvement in developing the client experience provides great internal focus and purpose for your entire company.

Incidentally another intrinsic benefit of having advocates is advocates tend to give more energy to your team, bring more fun and as a result you’re more likely to do your best work for them.
So consider taking stock of your TAI measurement index each 6 to 12 months to evaluate how far down the path to success you are.

By monitoring your TAI score you can see if your business is getting better or worse in the minds of your clients and what impact introducing customer service strategies are having on improving your score.

In the words of Mahatma Gandi:

A customer is the most important visitor on our premises; he is not dependent on
us. We are dependent on him. He is not an interruption in our work. He is the
purpose of it. He is not an outsider in our business. He is part of it. We are
not doing him a favour by serving him. He is doing us a favour by giving us an
opportunity to do so.

In these difficult economic times this low cost high return strategy is indispensable to give you a competitive advantage. To predict and make your future successful you don't need a psychic – just pay close attention to monitoring your client satisfaction.

The 3 Must Do Priorities for 2009

2008-12-20T19:49:00.000-08:00

As you prepare for 2009, here are three universal priorities that will have a significant impact on both you and your company:

1. Focus on Strengths
Instead of hiring more (and extremely difficult to find) surveyors to keep up with the growth, one of our clients focused on making his current surveyors happier and more productive. How?
He took a page from strength guru Marcus Buckingham. I had read his highly successful book, Now, Discover Your Strengths, but had never really understood the power of his ideas until thinking about them in depth.

One of the finest communicators I’ve ever read, Marcus drove home the point that we waste way too much time trying to fix our individual weaknesses and should instead play to our strengths, focusing on activities that energise and make us strong, while finding ways to delegate or eliminate those activities that drain us. To do this, Buckingham suggests taking a couple of weeks and documenting all those activities you either love or loathe (I’m doing this right now as I write this column).

This is precisely what my client has his surveyors do, noting all the activities that are energy draining and keeping them away from their primary strength – surveying. He then compiles this list, eliminates those activities no one should have to do (they creep into every job) and then uses the remaining list to create a job description for a new position. He then finds someone whose strengths and passion matches this combined list of activities. Result – happier, easier to retain, and more productive surveyors while minimising the need to hire more.

2. “Stop Doing” List
A perennial New Year’s exercise, I’ll keep emphasizing the importance of saying “no” so long as I’m writing for and advising leaders of growth firms. As Jim Collins emphasizes in his book Good to Great, we need “stop doing” lists more than we need “start doing” lists.
Along the same vein of Buckingham’s strengths revolution, if you are unhappy with anything….whatever is bringing you down, get rid of it. Because you’ll find that when you’re free, your true creativity, your true self comes out.

As part of your annual planning process, decide on two significant “stop doings” for 2009 – services that need to be eliminated; activities that can be halted; ‘C’ & ‘D’ customers with whom you’ll spend less time; poor performing team members to let go. Anything that’s brining the company down, purge from organisation. Until you close some doors, others can’t open.

3. Three Concrete Objectives
Circling back to Marcus Buckingham he reminded us of the brilliance of New York City Mayor Rudy Giuliani’s clarity of objectives when he first took office. Faced with a city wracked by a myriad of major problems, it would be easy for any leadership team to feel overwhelmed. Yet, Giuliani stayed focused and picked one single priority and message – a priority he believed would be the first domino that would create a chain reaction of other good things to happen in the city.

He decided to focus on enforcing the city’s petty crime laws, enacting a no tolerance policy; his theory being that hardened criminals start as petty law breakers. Then he got even more specific, outlining three concrete and visible objectives:
Rid the city of the squeegee guys using jaywalking laws (for those unfamiliar with these people, they would linger around tunnel entrances and major intersections and clean your windshield and then expect a tip). Eliminate graffiti from the subways. Make the taxicab drivers wear collared shirts.

In 2009, rather than babble on about generalities like improving customer service or driving revenue or reducing costs, get concrete and specific. Name three specific and measurable changes, like reducing turnaround time from 2 weeks to 5 days, you expect will create a positive chain reaction throughout the organisation.

There you have it: Focus on Strengths; Create “Stop Doing” Lists; and outline Three Concrete Objectives for 2009. Here’s to a profitable and growth-oriented 12 months!

Get Great Results with 3 Simple Ideas for 08/09

2008-06-15T17:34:00.000-07:00

This month's top tips come with a little help from the guru himself, Marcus Buckingham. After reading his highly successful book, “Now, Discover Your Strengths” and then seeing a client put Buckingham’s words into practice, I really started to understand the power of his ideas.

Our top tips this month are simple and straightforward and requires some ‘out of the box’ thinking, but they are very powerful and will have a significant impact on both you and your company, once put into use:

1. FOCUS ON STRENGTHS
Quality not quantity – invest in and play to your teams’ strengths.
Instead of wasting valuable time and money on recruiting more Surveyors to keep up with growth, try focussing on making your current employees happier and more productive. By concentrating on activities that energise and make them strong, while simultaneously finding ways to delegate or eliminate those activities that drain them, you will see an immediate improvement in morale, performance and loyalty.

How do you do this you ask? Just like Buckingham suggested, my client had his Surveyors note all the activities that were inhibiting them from their primary strength – Surveying (I am doing this right now as I write this column). He then compiled the list, eliminated those activities no one should have to do and used the remaining list to create a job description for a new position. This allowed him to then find someone whose strengths and passion would thrive within that job, whilst the performance of his existing Surveyors improved ten-fold.

2. CREATE A ‘STOP DOING’ LIST
The importance of simply saying NO.
Two inspirational men agree on this philosophy. Jim Collins, emphasises in his book “Good to Great” that we need “stop doing” lists more so than “start doing” lists. Buckingham’s strength revolution says “if you are unhappy with anything, whatever is bringing you down, get rid of it. Because you’ll find that when you’re free, your true creativity, your true self comes out.”

So, what do you do? Write a ‘stop doing’ list as part of your 08/09 planning session, don’t go overboard, and just pick 3 - 4 significant issues within your business that need addressing.
A ‘stop doing’ list sample:
1. Eliminate services that are unprofitable
2. Cut ties with “C” and “D” list clients that are taking up too much time
3. Let go of poor performing team members
4. Stop activities that are just not worth continuing

Add to your list anything that is inhibiting the company’s performance. Until you close some doors, other doors can’t open.

3. SET THREE CLEAR, CONCRETE AND VISIBLE OBJECTIVES
Simple clear direction can lead to vast improvements.
When planning for the year, it is so easy to be too general and waffle on about high level objectives, for example, improving customer service or reducing costs. This year try to name three specific and measurable changes that will create a positive chain reaction throughout your organisation.
Buckingham again reminds us of this strategy through the brilliance of New York Mayor, Rudy Giuliani’s clarity of objectives when he first took office.
Faced with a city wracked by a myriad of major problems, Giuliani stayed focused and picked one single priority and message – a priority he believed would be the first domino that would create a chain reaction of other good things to happen in the city.

He decided to focus on enforcing the city’s petty crime laws, enacting a “no tolerance” policy; his theory being that hardened criminals start as petty law breakers. Then he got even more specific, outlining three concrete and visible objectives:
1. Rid the city of the squeegee guys who were breaking jaywalking laws (for those unfamiliar with these people, they would linger around tunnel entrances and major intersections and clean your windshield and then expect a tip)
2. Eliminate graffiti from the subways
3. Make the taxicab drivers wear collared shirts
So as you can see, thinking more specific and setting concrete and visible objectives can have a major impact on the rest of your organisation, without wasting time planning a myriad of unachievable objectives.

I can’t emphasise enough the importance of trying these top tips in your Surveying practice. I myself have conducted the above ‘must dos’, so I can say first hand I have put my advice into practice when writing and advising leaders of growth firms. Give it a go and watch the growth in your Surveying practice over the next twelve months.

The Parthenon was "built to last". Was your business?

2008-04-22T17:44:00.000-07:00

In 479BC the largest temple on the Greek mainland, the Parthenon, was built by the Athenians following destruction of their city by the Persian forces. After many years of painstaking planning and excruciatingly hard work, the 150 pillar Parthenon has stood the test of time for over 2000 years and has become an apt metaphor for successful business.

A high level of commitment was required to build this amazing structure and this passion and drive is what is also required of any business striving for success today. The business you are building is as important to you as the Parthenon was to the Greeks. Like the Parthenon, your business is also supported by pillars which are integral to its stability and survival; ergo The Parthenon Principle.

This ‘Parthenon principle’ is based on the philosophy of strengthening your business pillars through constant small changes, resulting in the improvement of the overall success of your business - ideally increasing productivity and profitability.

Just as the ancient Greeks found all those years ago, “Small improvements in multiple areas of your business can result in large improvements in your results.”
Every business consists of several foundation systems (pillars), all of which are interrelated. In our coaching program we consider these core systems to be:
• Sales
• Service
• Pricing
• Promotion
• Referrals
• Productivity and
• Profitability

An improvement in any one of these systems can lead to the overall success of your business.

As the table below indicates, if you achieve just a small improvement of 10% in each key pillar, the cumulative effect will impact the overall productivity and profitability of your business, possibly doubling your business profits over the next few years.

Business Pillar Performance Improvement Cumulative Effect
Services 10% 1.10
Pricing 10% 1.21
Promotion 10% 1.32
Referrals 10% 1.46
Selling 10% 1.61
Productivity 10% 1.76
Profitability 10% 1.94

What are some examples of small improvements you may ask?
I have outlined below some suggestions that will get you thinking… remember the Athenians hard work and dedication paid off, the Parthenon is physical proof of that , that same level of commitment from you can achieve that same level of ultimate success.

OUR 7 TOP TIPS TO STRENGTHEN YOUR PILLARS & BUILD YOUR PARTHENON

1. Sales
Increase your conversion rate of inbound opportunities by enhancing your selling skills and proposal winning techniques. Understanding good sales techniques gets you that step closer to a done deal.

2. Service
Quality service is paramount.
• Try providing a ‘packaged service’. Bundle related services together (e.g. engineering support, town planning and project management) so your clients only need to come to you. Work with alliance partners to develop a service solution for your clients.
• Make your business more client-friendly; consider the final presentation of your product and how you can improve the customer service experience.

3. Pricing
You are running a professional practice supplying a quality service and product, ensure you are charging appropriately! Don’t discount, make sure you charge a professional fee. Try increasing your charges by 10% to a more commercial level. Review after a month and assess the results.

4. Promotion• There is a lot to be said for investing in existing clients rather than spending time on finding new ones. Client management is about building relationships. Take the time to visit your clients and find out ‘how you can help them more’.
• Don’t forget about your clients, communicate on a regular basis, keep them informed about what you are doing and services that can assist them.
• Build relationships with those alliance partners (i.e. Engineers, lawyers, town planners, architects etc.) so you can provide them also with the ‘packaged service’ mentioned above. Create a platform of win-win for both parties.

5. Referrals
Once you have strengthened your relationships with your clients and alliance partners proactively seek high quality referrals from them. Word-of-mouth is a valuable tool.

6. Productivity
Set daily productivity targets (i.e. chargeable hours), monitor them through simple reporting procedures and ultimately increase them by a minimum of 10%. Watch your bottom line profits soar!

7. Profitability
When was the last time you reviewed your expenses from your Profit and Loss statement to evaluate if you can reduce or eliminate them?

Put these 7 tips into practice and start seeing the rewards. Solid foundations will provide a platform for your business to succeed. Remember however you must always review the performance of your pillars and constantly implement small changes and improvements when you see the opportunity.

Developing and managing your Brand Advantage

2008-02-21T16:46:00.000-08:00

It is estimated that if you were to try and buy the Coca Cola Brand today the asking price would be in the region of $US70 billion dollars - more than 60% of the total worth of the company. Now while most of us won’t be making an offer in the near future, the fact that the brand as a single element is worth more than all of the other assets put together provides us with food for thought. Indeed it is indication of why your brand, whether you are a giant soft drink producer or a small professional practice is so incredibly important.

A strong brand is both a long term asset and an everyday business advantage.

What is a Brand?

The term ‘Brand’ can be applied to a person, organisation, product or service. The Brand will appear on business cards, labels, brochures, websites, advertising or the front door of a one person professional services organisation. At its most simple level it is a device along with a logo that will differentiate your product or service from a competitor. The way in which a brand name is displayed such as the logo and type face can carry a message of modernity or conservatism, amongst other important elements of a brand’s character.

However Branding has moved far beyond simply differentiating one competitive product from another. As competition has become more and more intense over the years ‘Branding’ has been the subject of vast levels of research and development.

The most important difference between Branding before the 1970’s and after was the realisation that branding had gone beyond a simple ‘positioning statement’ or the often discussed Unique Selling Proposition (USP). The USP suggested that there really is a difference between one product or service that could be readily identified and protected. Technology and its partner ‘speed’ made real USPs increasingly rare.

Developing a Brand

Most modern marketers look at a brand as if it were a person (e.g. think of Virgin – think of Richard Branson). Indeed the aim of modern branding is to make the product or service something that your target audience wants to be associated with and sees as their friend.

Branding is not just about putting your name on the door or at the bottom of posters in your local area – it is about creating an attractive and strong character for your brand that will be attractive to potential customers.

Understanding your target market and what they want

Having moved from rational product differentiation (positioning) to emotional differentiation (personality) we need as marketers of our brand to understand our clients and potential clients.

Once we start to think of clients as emotional and rational beings rather than just rational – we can see that a brand of jeans might help tell the world that you are single and adventurous, or a brand of aftershave might say that you were sophisticated. Marketers understand the emotional because the character of the brand has been developed to deliver these messages.

Truly successful Branding seeks to marry the emotional and rational sides of a Brand. It is called Brand Character. To justify the purchase of a Mercedes or BMW we might talk rationally about the superior engineering or high resale value in the case of Mercedes or the precise handling of the BMW. And while these rational things are true, Mercedes recognise that they are appealing to a desire to demonstrate status or power within the community or the company in the case of Mercedes, whereas BMW are appealing to those who want to be seen as successful but still ambitious business people.

Starting to develop your Brand Character.

Here are some questions you might like to ask yourself.

• How long is it since I updated my logo and the look of my overall presentation?

• Do I want to be seen as modern and vital or perhaps long established, conservative and considered?

• More importantly, what image would my current or potential clients wish to be associated with?

• Depending on the answer – Do my premises, furniture, business card, dress code and attitude support that image?

• If I have a current logo – have I taken the trouble to make sure that this is constantly seen or are there items that have not been branded – old order forms or work sheets for example?

• Do I have a consistent look for communication? If you were doing a Powerpoint presentation would it have a standard template?

Working with the answers to questions such as these you can begin to develop and communicate a character for your brand that will help you gain business and build your business. The Character you create will demonstrate more than simply professional excellence (which naturally is of primary importance) but will also demonstrate an understanding and connection with your target audience that will give you a Brand Advantage over your competitors.

Coca Cola again

At a supermarketing conference a number of years ago the Chairman of Coca Cola – the company with a $70 Billion brand – was asked a question about the distribution of the product in Asia. His answer was that he had no idea and that if the questions were about the marketing of the product then they had the wrong man. He went on to say that his role was to manage the image of Coca Cola at government and legislative levels particularly in the US and other leading market economies. In essence he was involved with maintaining the Brand Character of Coke with key influencers as far as its future was concerned. This of course is an area which could have enormous influence on the Brand’s Character at consumer level.

Take a look at your Brand Character today. Look to strengthening your connection with your target audience and creating an image and promise that meets their needs – both rational and emotional. Use you Brand Advantage to build you business.

Improve your selling techniques to increase your revenues

2008-01-18T16:38:00.000-08:00

I think it was a famous Mr Barnum who suggested that there is a sucker born every minute. If we are to believe him then picking up new business and increasing fee revenue in a professional practice shouldn’t be too difficult. The fact of course is that our clients and potential clients are far from being “suckers” and they are always looking for ways to improve their business.

As a professional business coach I am always looking to increase the efficiency and efficacy of my instruction manuals and ability to facilitate my client’s business development. As part of my own improvement I regularly attend conferences or seminars dealing with business development. One the key topics for many speakers relates to the negative effect of ‘comfort zones’.

I see this most often when I deal with professionals, who are highly competent accountants, solicitors, engineers, architects or surveyors, who, however are not prepared to face the many extra challenges that running a successful practice involves.

In my experience one of the most avoided challenges is that of selling. Yet selling is without a doubt a key requirement for growing your practice and even more importantly, good selling techniques can turbo-charge your revenues.
So if you want to see your practice improve in the critical area of revenue – you will have to step outside your professional comfort zone and start to sell. Like everything in life it will take practice but, it is well worth the time. For example here are four ways that you can increase your fee revenue. They each require you to sell. Succeed in just one of these ‘strategies for growth’ and you will be pleasantly surprised. Succeed in all four and you will be amazed at the dramatic growth they produce.

1. Make more sales

It sounds obvious - to increase revenue, simply make more sales and expand your client base. However do you have in place a plan for making more sales? Do you employ a range of techniques such methods for example including converting cold calls for survey proposals, generating referrals from your client base, developing related alliance partners, and more.

2. Sell more often

Some professionals make the mistake of thinking that once a client has been gained, the need for selling is over. The truth is that the selling has just begun. We need to keep selling our enthusiasm and professionalism to keep the business. However the most positive way to maintain a strong and growing client relationship is by finding more and more services we can offer. In short, we need to look for ways to increase the number of times to sell to them. A simple approach is through a structured client management system with regular personal contacts. Listen to their needs and also look to develop more services that can be presented to them.

3. Sell more services

In addition to increasing the number of transactions to our clients, you might also be able to sell additional services. If you have a surveying practice you might offer a one stop shop featuring engineering, project management, town planning or architectural services through your own practice or by using alliance partners.

4. Increase the perceived value of your services

The easiest way to boost revenues is to increase fees. While such increases can often be justified based on the cost of living or the cost of people – the most satisfying way of increasing fee revenue is with a demonstrable rise in the value you offer. Perhaps it is through a greater use of technology that speeds up delivery and provides greater accuracy. The key is to accompany fee increases with positive benefits.

Making the sale

Most professionals with whom we deal register very few complaints from clients about the quality of their service or the fees they charge. However one of the most common and in most cases, negative selling techniques involves the discounting of fees. So let’s take a look at how we can improve our selling performance without throwing away the profit margin. Always remember that clients that don’t make a profit are simply not worth having.

Before the sale

If you are serious about selling then you need to set goals and action plans. If you attracted four new clients in 07 through luck – why not look at eight new clients based on actually trying to sell this year. Set revenue objectives from your existing and new business.

Next, you need to start thinking positively - use my ‘3 benefits technique’ for example.

Start by identifying 3 clear benefits that you can offer your potential new client (e.g. timely completion and certainty of decision making) and 3 benefits of your firm (e.g. 20 years of experience and the use of current technology). Also what related services can you provide which facilitates cross selling and up selling. With these develop a 1 page sales system that you can apply whether you are talking to the potential client or writing to them or using your website to communicate why your practice is the best for them.

During the Sale

People love to buy for their reasons and not be sold. So talk about what they want and show them how you can meet their needs.

Our job is to help them achieve their needs. That means we must:-
1. Listen to everything – empathise
2. To elicit information, ask: ‘So that I can help you the best, do you mind if I ask you a few questions?’
3. Give away ideas – (the law of reciprocity – give something for free and they will feel obliged to reciprocate by buying)
4. Follow-up and return phone calls promptly to keep the level of enthusiasm up to combat buyer’s remorse.

Buying is built on trust. Show that you are interested, demonstrate solutions to their problems, offer greater value and most of all deliver. Good clients are those that trust you. Work to develop that trust even before they become clients.

Learn from each and every sale opportunity

Whether you win or lose the sale - Invest a few minutes to debrief yourself on what worked and what didn’t. Revise your sales plan accordingly – always look to improve your technique based on experience. Keep up the selling side of your practice and soon selling will be a part of your comfort zone.

Your Steps to Go Forward

At the beginning we remembered Mr Barnum who suggested that you could always do well out of a ‘sucker’. In reality here was a man who worked hard to present a great product and then sold hard to make it a success. He often stepped out of his comfort zone to become a great impresario.

As professionals we need to keep developing our product and be a positive committed achiever by developing our selling skills. Incidentally there is a word for those who don’t quit …… successful.

The Profitable Art of Communication

2007-11-20T18:26:00.000-08:00

In the early 1960’s when many were concerned about the effects of TV on the family and communication, one man envisaged a communication system that would within 30 years radically change the way we communicate. The man was JCR Licklider and his science paper titled “Man – Computer Symbiosis” – the idea was a global communication network which eventually became the Internet. It was the Internet which gave birth to email and the World Wide Web.

These days, in both our business and social lives, one of the most common phrases we hear is “how technology has changed the way we communicate”. And if the success of Bill Gates and the computer industry is our guide – then the world has taken to the new age in communication with relish. However, I believe that there is a huge profit both in financial and efficiency terms if we move the clock back a little in our business communications.

I would like to go back say 20 business years when many people actually picked up a phone or went to a meeting rather than send an email into the ether with the belief that its recipient would first of all be able to receive it and then understand the many nuances often disguised by our new “4get” style of English.

Recently I was in an office where it was common practise to send emails containing rather simple questions from one person to another when just 2 metres of open space separated them. I have also worked with companies determined to allow their staff to work in isolation – often at home and depend again on email communication.

The fact is that we are losing the art and the benefits of face to face communication. As part of our coaching program I always hold a focus group meeting with team members. One only has to ask them to talk about their role or how the company could improve – and the flood gates open. Issues that simply need discussion and solutions that have built up in some companies appear to be huge blockages in the success of the business.

I always ask a new client for a schedule of meetings that are held amongst team members. So often I find that there are none or perhaps we might find an annual meeting and infrequent reviews – not attended by senior management. Senior partner meetings can be more common – but below that level or between these two levels there is a paucity of face to face communication – or simple conversation. How can we resolve problems, remove blockages, increase efficiency, grasp key team issues via emails? How can we enthuse or motivate our people if we don’t meet with them or even empower them to meet and work through issues that need to be resolved?
I am equally amazed at the lack of communication – either face to face or by phone with clients.

So now let’s get positive about communication.

Recently I read an article about Tony Ferguson, who in the late 1990’s was at the helm of BT Australia when it was being off loaded by its parent company. These were tough times for Ferguson and the employees of BT. Yet in the article he said that he was most proud of his ability to communicate the issues to his 3000 strong staff.
If it can be done at that level why don’t many small to medium, professional practices maintain good communication practises?

Let us start with what are the most effective forms of communication. I put them in the following order with number one being the best by far – 1) Face-to-face 2) Telephone 3) Email or in written form generally. From there it is easy to understand that we need meetings with our staff and clients if we are to use the most effective form of communication.

Let’s start by reviewing our meeting schedule or implement a meeting schedule which will allow for a number of levels of staff and management input. As leaders we must talk to our team. I regularly meet owners who are simply afraid to openly discuss issues that affect staff, “it will just get negative” or “I don’t know what I should be talking about”. Like many things in life – the reality is that we need to try it. And perhaps in some circumstances – simply sharing your vision for the company, the people in it and asking for positive thoughts and ideas – will get the ball rolling.

Of course meetings need to be the subject of good practice. They should have a focus – operations, work in progress, or new business development. They should be held at regular times to allow for preparation. Those attending should be the ones who are involved with or are responsible for the matters discussed.
Here is a short list of thoughts that might help:-
• Frequent reviews on personal performance
• Cover daily, weekly and monthly key operational & business development aspects
• Quarterly meeting to set 90 day goals
• Six monthly isolation meeting to review & reset strategic targets with senior management
• Annual strategy planning meeting to set the platform for the year ahead
• Have a focused agenda for each meeting with a specific time limit with a start and an end
• Make sure that anyone raising a problem also offers a solution before the meeting discusses the matter.
• As a leader – make sure you listen and absorb what is being said. Misunderstanding or defensive or aggressive reactions will soon quell the spirit of openness you want to achieve.
• Separately, ask yourself – “am I meeting with my clients regularly enough asking the right questions and listening to them for their wants, needs and feedback on our performance?”

Also think about other levels of communication like social events that will provide extra dimensions of fun and to enhance team spirit.

The more communication & meetings you have the more your business will grow and equally the more your business grows the more communication & meetings you should have.

When JCR LIcklider formulated his ideas for global communication he helped change the world. When you develop a positive meeting schedule and open the path of communication you will unleash a whole new form of energy in your business. You will find road blocks to efficiency and profit will be cleared. All it takes is for you to open your diary (book or electronic) and get the ball rolling.

Next month I want to talk to you about Brand Advantage and how this subtle but significantly important marketing concept can add enormous value to the equity and growth of your business.

Until then seize the day and have a great month.

Creating An Ideal Team

2007-10-23T23:55:00.000-07:00

I frequently ask professionals what they consider to be the difference between a great team member and a good team member, or in short, your ideal.

These are some free flowing answers that I am told:

 Do whatever it takes to get the job done
 Really listen to the needs of the owner
 Take pride in their work, and show a personal commitment to quality
 Are eager to learn as much as they can about the business they are in
 Get involved and don’t just stick to their assigned role
 Learn to understand and think like the owner so they can represent them when they are not there.
 Are always looking for ways to make things easier
 Anticipate, and don’t wait to be told what to do. They show initiative
 Reach out for responsibility
 Are team players
 Can be trusted with confidence
 Are honest, trustworthy and loyal
 Are open to constructive critiques on how to improve

All of this list can be summarised thus:

Great team members CARE.

Following on, two observations I have found is that, firstly, this list applies to all of us, from secretaries to senior management. Secondly, you’ll notice the list has nothing to do with technical skills.

Very rarely do I find that an ideal professional, is a great technician, with an ordinary attitude.

With the current professional skills shortage, in terms of number of available qualified staff, it is very easy to hire for skills only.

But maybe we should consider hiring for people with more the elements of energy, drive, enthusiasm, pride in their work, a personal commitment to excellence and a sincere desire to help.

For owners, just think, wouldn’t it be great to have a happy productive team around me so you don’t have to do it all by yourself?

So think about having a smaller happier team rather than just a large team.

Even an owner with a great secretary, who has the above attributes, is a highly desirable team.

So how do we build an ideal team?

Here are a few simple suggestions.

Firstly you might like to consider future recruiting via a simple structured recruitment program to avoid the hire and hope policy which is fraught with failure.

Everything from setting up your expectations with an ideal job description to ultimately your letter of appointment.

Consider hiring for attitude and training for skills.

Once we’ve crystallised our expectations in our initial meeting in our recruitment program, the next thing you might like to consider is giving feedback as to how our team are going. From my experience, most people really like to know how they are tracking, what their strengths are and what joint goals could be set for the future.

So consider a simple structure performance review process. These are easy to do and very rewarding for all concerned. They should be conducted on a 6 monthly time frame, and could be the basis of salary reviews and incentive bonuses.

From numerous surveys with team members on what people want from their jobs, out of 10 criteria, the following are generally rated the top 3:

1. Feeling “in on things”
2. Appreciation for the work done
3. Varied and interesting work

(Interestingly wage generally rates as the 5th most important, whereas the owners will mostly rate it as the most important)

So what is “feeling in on things”?

This is keeping your team informed either formally through meetings, or, informally, through casual conversation.

They might like to know:

1. Operationally what have we got on for this week, and, after reviewing last week, how could we have done it better.
2. From a company development perspective – how could we improve our service delivery & improve the company after addressing key frustrations
3. Where is the firm going – what plans, objectives & strategies are we going to do to get to where we want to be

All of these meetings should be structured, succinct and built on a culture of continuous improvement.

This gives your team a real purpose and in my opinion if they have that, chances are they are highly likely to excel.

Developing a plan to achieve new heights for your business

2007-10-23T22:00:00.000-07:00

In 1910 two teams of men set out to be the first to reach the South Pole. One team was led by Scott the other Amundsen. Both had a plan. Both had the same objective. Both achieved the success of reaching their goal – one achieved the ultimate goal of being first. From Amundsen and Scott we learn the necessity of a plan and we also recognise that the content of that plan is critical to its success.

Planning is an essential element of business success. You will often hear that people have the Midas touch – “they just seem to be in the right place at the right time”. The fact is that neither luck nor any form of clairvoyance is a dependable element of business success. The real requirements are - key objectives that are realistic but will stretch you and your team and a strategic plan that allows you and your team to achieve the success.

The Planning Environment
If you would like to give your plan a 50% better chance of success the first step is to choose an environment that encourages clear thinking, escapes the frustrations of the office and everyday business concerns. Start with a room that has windows and then add views and peace and quiet. Into that room introduce your key executives or stakeholders.

Add a professional facilitator – who has some knowledge of your type of business. It is obvious that the strategic plan for a professional services group will likely have different insights and content than that of a manufacturing organisation.

Getting the Right Participation
If this is the first time the group has met to create a strategic plan it is very important to review where the business is now. Let the frustrations come to the surface for evaluation and discussion. Be open to recognising the weaknesses of the business but balance that by examining and writing down the strengths. Before your team can look to the future and be involved with blue sky thinking – the everyday agendas need to be put aside. If we are to set stretch goals or objectives – the knowledge of where we are now is essential.

The Time Frame
Most strategic plans encompass a 3 year time frame. They will contain objectives that are measurable. The first meeting and eventual plan will contain objectives for the entire plan but detailed strategies and tactics for the first 12 months.

The Objectives
While you may have in mind a singular objective - the fact is that most strategic plans will have a number of key objectives. A single plan may seek revenue or profit targets – look to a planned increased in team numbers such as in building a sales force or developing a franchise group. You may look to increasing location s or lifting partners in a professional services practise. Always keep in mind that the objectives must have stretch factor. Objectives that are impossible to reach will simply de-motivate your team while being able to pat everyone on the back through easy objectives will simply breed laziness rather than lift team spirit.

Living with the Plan
As an owner or chief executive you will ultimately be responsible for achieving the plan. It is important however to also set your own series of personal objectives. It is reasonable that the same be asked of the key stakeholders. We all need to strive continuously to grow. It was Gary Player who once said the more he practised the luckier he got – there is no doubt that the harder we work to overcome our weakness and better apply our strengths the more successful or “luckier” we will become.
Having developed the plan and involved yourself personally in it, you and your team need to “live it”. Start by reading it every day for 21 days straight. A good plan will be able to be read in 15 to 20 minutes. The plan should be like a well practised golf swing you know it so well that it becomes automatic to think and work to the plan.

Then monthly you need to meet with your key team members using the plan as the basis of judging your success and perhaps highlighting those areas that may not be “going according to plan”. A plan is a living dynamic instrument for your success. As such it may require amendments based on your experience – always look to align actual performance against the plan.

I urge you to think about the future of your business now. If you don’t have a strategic plan in place, begin immediately to assemble your team and create an opportunity and an environment for them to meet and create that plan.
Remember however that the plan is not just a “must have” document. As with Amundsen – it is a document that should have the right strategies and tactics to ensure true success.

Summit sponsors Excellence Awards

2007-10-08T21:04:00.000-07:00

The most important and prestigious event in the calendar of Surveyors took place at the Westin Hotel Sydney on Friday 28th September. The Excellence in Surveying and Spatial Information Awards attracted a record 350 people to see the cream of the industry be recognised for outstanding achievement throughout the year. Summit Partners helped sponsor the evening. David Wolrige seen above with Greg Goodman, President of the Surveyors Association of NSW said, “It was a most exciting evening and I am particularly proud that like last year a number of the winners had been graduates of Summit’s coaching program”.

Strategic Alliances

2007-09-09T22:22:00.000-07:00

One of the more interesting aspects of my business is the reasons which motivate a client to seek business coaching. For some it is simply a business that is not making enough money or not growing. For others it is quite clearly a feeling of not being in control of the basic business aspects of their practice. One client I enjoyed helping, exhibited all these issues. I soon realised that the practice was not growing, was only making enough money to cover its overheads and it seemed to me that the partners were not in control. However when I initially asked what the key reason for talking to Summit Partners was - I was told – “we have too much business to cope with and therefore we need help to organise the practice”.

Now when starting out with a client we look to assess their business as it exists. And in this case it didn’t take long to identify a key problem.

The client had a lot of ‘C’ & ‘D’ class clients that took time to service, were difficult, paid late and accounted for a large proportion of the fees being generated.

This in turn meant that what should have been a well staffed practice, in comparison to gross fees, simply could not cope because of a poorly proportioned client base. And this simply compounded the problem of poor profitability.

Having identified and agreed on the problem we began developing a plan that would see our essentially competent group of professionals given a client base that contained a greater proportion of ‘A’ or “ideal clients” with which to work. Ideal clients are those which generate a high level of fees and who because of their own professionalism are pleasant to work with and understand the benefits of efficiency and transparent relationships.

That said – we were not suggesting that the practice immediately fire clients and perhaps reduce staff. The idea was to gradually develop a better client base and move on problem clients over time. Our first objective was more ideal clients – and in doing that create what I call controlled profitable growth.

This obviously required change in the way the business was being run and very specifically a change in direction on developing new business.

The key to this change was the building of “strategic alliances” as a method of finding ideal clients at very little cost while building worthwhile relationships in the wider business community.

What are strategic alliances?

This is the development of a wide range of relationships with other businesses, groups or individuals who are in a position to warmly endorse and refer you to their clients who maybe in the market for your particular professional services. Sometimes they are related to your business – a surveyor for example will be involved with engineers, architects, lawyers, town planners & real estate agents to mention just a few.
It also becomes a win-win situation when you are able to recommend a ‘strategic alliance partner’ to one of your clients or friends.

I believe this strategic alliance approach is the no.1 marketing leverage strategy for most businesses seeking quality clients.

That is, one source equals multiple referred clients at little cost.

Clients referred to you are generally pre-sold, more open to advice, more pleasant to deal with and more profitable. If they are those things then they are also very likely to be highly professional in their own areas of expertise. At this time they become more than clients but rather potential strategic alliances.

So how valuable are strategic alliance partners to your practice?

Let us say we develop 5 strategic alliance partners (i.e. an engineering firm, an architect, town planning firm, real estate agent and a legal firm). Now, if after building the relationship each one refers 1 ideal client worth $20,000 p.a., and then if these new clients use your services for the next 5 years then the value is half a million dollars - a very effective marketing strategy that employs a little of your time.

How to find the right strategic alliance partners.

To gain quality referrals we recommend you seek to establish alliances that exhibit desirable core business values such as sound ethics, a good business reputation and have a positive attitude.

While the rewards for you (and your alliance partner) are significant they may not be easy to find. Certainly in a business sense they, like you, will need to take some time to develop the trust that is required to refer a client to another organisation. An excellent place to start is to consider those business you are already working with eg town planners, architects etc who you currently have a relationship and maybe under service or take for granted but where trust has already been established. Next, look to those businesses where you are already working together such as you your own lawyer or accountant.

The Approach

When I introduce this concept to many clients they will often say “We have great relationships with clients and associates and we are sure they would refer us if they had the chance”. My response is to ask how many times they have recommended you or an engineer or a lawyer to someone else. The truth is that many people are reluctant to recommend or in a business sense, don’t recognise the power of strategic alliances.

It is also true to say that the instinct to recommend, like many other good habits, needs to be worked on. With this in mind you will soon see that we need to approach the building of strategic alliances in the same way we organise other parts of our business dealings.

Firstly establish a list of candidates of ideal related services/firms who have the profile to have these ideal clients you’re looking for. Consider a brief phone call to introduce the subject and confirm a letter will follow with a more detailed proposal that could help both businesses grow with referrals (both ways). Mention this article as the instigator of your idea if you think it will help broach the subject.

The proposal should be brief and avoid explaining the alliance concept in detail, rather outline the benefits and to set an appointment to mutually build on the relationship and the concept. Certainly the letter should suggest a meeting between you to discuss the benefits of a strategic alliance for both parties.

The appointment is to develop synergy and confirm how you could add value to each other’s services. Perhaps you could leave them with a simple overview of what your company offers & how you could help them & their clients. For example your lawyer or engineering partner will probably not have a very detailed idea of what you offer your clients and benefits.

Most importantly educate your strategic alliance partners on the value your recommendation could have to their business.

This then becomes a win for your partner, a win for the clients and a win for you.

Do strongly consider follow up meetings to develop “top of mind” awareness & building that trust & confidence to refer you.

That firm we talked about earlier has grown in a controlled manner over the past 18 months. While they had many issues to address as part of a coaching program, this one marketing leverage strategy has made a decided difference to their business. They still have some of their C and D clients – to suggest we only have ideal clients is simply not a real world scenario for most of us. However the client base has a far great number of the A clients and overall the practice is more profitable and more in control of the new clients they take on board. They are also focussed on upgrading their C and D clients through more active credit control and operational systems.

Professional Relationship Pricing

2007-09-09T22:21:00.000-07:00

When Summit Partners first began working with surveyors on improving the profitability and equally, developing the opportunities of their practices I was immediately surprised at the low pricing for professional services being charged in the industry. This was even more apparent when I factored in the value that surveyors brought to their clients projects. It seemed to me that the fixed percentages of real estate agents and architects or the far higher rates per hour charged by solicitors and engineers were more appropriate to the benefits they delivered their clients.

As highly trained professionals it seemed that surveyors often found themselves in ongoing discounting situations. We also noted the general style of clients and their buying habits – developers and builders who are driven by profitability and time pressures and, separately, individuals who are more price driven in the absence of any other criteria. We couldn’t see how your importance could be underestimated.

We found that the more surveyors ‘discounted’ the more clients continued to expect cheaper prices and, separately, the more the clients subconsciously questioned the quality of your work. When such ‘discounting’ took place, together with the general introverted personal profile of surveyors, this presented a continuously downward spiral of: lost profitability on jobs, time pressures on staff, and generally unhappy business owners and often their clients.

The more we worked with surveyors the more we understood why discounting on price was rampant throughout the profession. We discovered that the reasons why prices weren’t more commercial was largely because of 3 principal factors:
1. Fear of a complaint
2. Fear of losing a client
3. Competition – particularly from small 1 person firms

This led to poor fee paying clients, poor profitability and a poorly paid team and owners.

Then after completing numerous client surveys, it has become clearly apparent that clients essentially wanted 2 clear results from surveyors: a quality & timely product, and, also, a relationship. Equally we found, if there is no relationship, price will reign supreme as the most important criteria to evaluate on.

Finally we reviewed how surveyors price their services and we came to the conclusion that suggests pricing was set on: firstly, surveyors own beliefs on prices; the guide for fees in the handbook (which we understand is based on historical costing methods) or, thirdly, competition. All these were based around our fears.

So how do we go about building a more commercial professional fees structure?

From our experience and through our pricing model, a successful adjustment to your prices can clearly be made if you follow a trusted and proven formula.

First, enhance your self belief by questioning yourself about how many complaints you get from the quality of your work and the price on your invoice. Maybe a conclusion you might have is that if we get 5 complaints out of 100 that maybe we’re too cheap.

Secondly, consider delivering quality work in advance of expectations.

Thirdly, and this is the key to this article, build strong relationships preferably with your ‘A’ and ‘B’ clients. When was the last time you had a coffee or lunch with an ‘A’ or a ‘B’ client just to see how you could help them more?

Next consider setting new prices and payment standards and test.

Finally, continually review and improve.

This model has had significant success, however, a word of caution, if you believe you can’t move your prices (which are justified by the odd complaint or poor success on quoting) then your right, you can’t.

But if you believe you can, then read on.

How do I present my new prices?

(Incidentally notice I used the word ‘price’ which has some perceived value, as opposed to ‘fees’ or ‘charges’ which is perceived as a cost with no value)

For phone enquiries – develop a model of seeing how you can help a new enquiry by asking, what, when, why and discuss benefits to the client.

(From our experience, quoting prices on the phone will more often than not succeed or fail based on your sales process and not the price)

For written survey design proposals (not ‘quotes’ i.e. price based) clarify not only the technical requirements but also include clear benefits of the product and service you will provide and features of your firm or ‘why I should use you’. Consider a range of prices to cover obvious unknowns.

For current clients – a superbly worded letter and call model should go a long way to reassuring and enhancing client relationships.

Finally consider your invoices which should be very detailed as to all work completed and the layout is also critical to send a good final message of quality and the volume of work.

What prices do I charge?

If you’ve followed the above relationship formula, consider adjusting your prices by % for 1 month and test the clients’ reaction.

Don’t take exception to the few complaints (i.e. price shoppers etc), focus instead on the vast majority who don’t complain and who understand and still really want to do business with you.

I do understand it takes time, particularly if you haven’t adjusted your prices for some time – hang in there, it does work.

Bill with pride, being content in the quality of your product provided and the timely nature of the service given.

So the message is develop strong client relationships and then sell on value not on price. If you do, I guarantee price will be less of an issue and the positioning of your firm will be more that at the quality end rather than that at the discount end.

Listen to Clients and your Team

2007-08-26T18:56:00.000-07:00

One question I am often asked at seminars is “How can I get my team as committed to the firm as I am?”

Now in business coaching we look at a number of ways to increase individual and team commitment. Regular reviews, guidance, respect are all part of the package. However while there are many techniques – there is no doubt in my mind that the word “involvement” covers the most important and useful of them all. .

“Involving your team” in the running of your business will not only increase commitment, it will also make running your business easier because it will give you access to their experience and viewpoints – providing a greater information base.

By working with your people you can create an understanding and commitment to your business strategy and objectives. This clear focus and singular direction will also be a breeding ground for new ideas and continuous improvement.

Your team will like to feel ‘in’ on things and equally really like to help with ideas for improvement and maybe some opportunities for you. They are often your ears to the client’s comments and concerns.

Indeed the philosophy of involvement recognises that in most companies, the team is much closer to the customers than the owners are.

The idea of involvement doesn’t just end with your team. It applies to your clients as well. Your clients will really like to contribute ideas to help you as well.

Their view is important – not just because they are important to the health of the business but also because they will often see things differently about your business. What might seem like a nice informal arrangement to you might seem to be inefficient to them. On the other hand they may see areas in which your business can grow simply because they have the ears of their friends in the business. Involvement can lead to those all important Strategic Alliances we talked about last month.

This is certainly true for my business. That’s why we conduct client focus groups and constantly get feedback from our team on how we can improve.

Having agreed involvement is important, so what are some of the ways we can create meaningful involvement?

One of the best ways is consistently (say a minimum of every 6 months) have short interactive client phone feedback sessions and team focus group meetings.

Some may ask “what are client and team focus groups”?

A Client Focus Group

To serve its customers exceptionally well, a business must learn the act of listening – really listening – to what its customers are saying.

Unquestionably, the most rewarding way to truly listen is to invite a cross section of customers to a “Client Focus Group” phone feedback call. In the search of excellence in the field of customer service they are a necessity.

By organising a client focus group we hope to:

 Grow the business by listening to your customers’ perception of your strengths, weaknesses, opportunities and threats and give you an opportunity to use them in your strategic planning.

By actually asking for their opinions you will build team of clients that are in part keeping an eye on your business and on your competitors for you.

A Team Focus Group

A Team Focus Group involves inviting a cross section of an organisation’s team members to participate in a formal group discussion. It offers invaluable feedback and advice in improving the overall operations of the company and better meeting our client’s needs.

Remember while it is important to cover problems and key issues – this is also the forum to encourage creative thinking, allowing the team to be involved with the future of the business.

Let me say right now – it is also imperative that the team see that their ideas are appreciated and perhaps the best way to do this is to include them as part of your ongoing plans when appropriate.

Particularly involve young people as they tend to be most creative and innovative by age 30. They will gain in confidence, and, in the team environment, also gain in experience.

A Team Focus Group allows your team to: -

 Discuss their roles in the company and how they assist the company in achieving its goals.

 Express their ideas on improving the company’s performance in areas such as, customer service

 Provide their perception of management and the effectiveness of the organisational structure.

 Openly discuss their effectiveness as a team, how that can be further improved and what performance standards are in place.

Not only does it provide important information but it also builds fierce loyalty and commitment from amongst the team. Then you have a team dedicated to keeping an eye on improving the business whilst looking for opportunities.

So how do we do it?

Let’s start with your clients. Consider asking a good cross section of relatively happy clients, ten or more, questions such as: -

“If a business acquaintance asked you about your experience with (your company) would you give us an unqualified endorsement, yes or no? If not, why not?”

Having reviewed the information it is now time to share it with your team. Suggest improvements or opportunities – get the ball rolling.

At the team meeting ask for their views on improvements, what’s important to them in their jobs, how are we going with our client service and their views on work flow performance.

Armed with all of this great information it is critical to undertake two further steps.

1. Send thank you letters to clients and convey thanks in an appropriate form to your team….and,

2. Take action

As suggested if clients and your team see improvements happening, then loyalty & commitment will become entrenched in your firm as a result.

Client and team focus groups are highly rewarding opportunities to grow your business through improved service and innovation. Of course they are not chargeable hours however, consider this - chargeable hours determine your cash for today – non chargeable hours spent building commitment and loyalty will undoubtedly determine your future.

Leadership - Is it Charisma or a Learnable Skill Set?

2007-08-09T22:08:00.000-07:00

There is no doubt that in this media driven age that leadership can sometimes be mixed up with charisma. We tend to judge a politician’s leadership skills by how they appear on TV rather than actual policies or actions. Therefore those who may not feel particularly charismatic can begin to doubt their leadership aspirations.

The truth is of course that the foundation for leadership is based first on real knowledge of the business or profession in which we seek to lead others and secondly a desire to accept the responsibilities of leading others.

As for providing leadership – it is not about charisma but rather a series of learnable skills. Indeed experience with coaching many business leaders and empirical research shows that there five key skills that lead to the development of lasting leadership qualities.

Good leaders exhibit strong characters

Of crucial importance to your team is their individual importance to you and your attitude to developing and testing their skills. In short they are asking you to create challenges and opportunities for them as well as providing useful critiques of their work. Indeed it is all about helping them to perform by improving either the environment, systems or strategies of the team overall.

This is where character rather than charisma becomes very clear. Your team will judge you not on a wonderful speech - but rather on your everyday performance and the example you set for them. If you are transparent, treat others with respect, constantly search for improvement from yourself and your team, are passionate about your clients and your team – then you will be leading by example - delivering what you are asking them to deliver.

Relationship Building

Here you need to work with individuals and your team as a whole. Communication is a must. Issues such as how their team performance contributes to the company overall should be understood by the team as a whole. You should be seeking ideas from the them and when relevant using them. Giving credit to the team or team member who thought up the idea is critical. Be quick to let incompetent people go if you are satisfied that it is their incompetence not that of the team or the company which is at fault. The old saying about bad apples in barrels is quite true. Don’t be seen to reward incompetence. Look for ways to celebrate with your team – rather than with individuals. At the end of the day – it is the team that you want to deliver. Lastly be accessible I know one senior chairman in the communication industry who always tried to answer his own phone. Rather than be inundated by trivia his team appreciated his availability and used it wisely.

Leading Change

If it’s not broke don’t fix it is in many cases a truism of business. However if it is ‘broke’ then it is time to demonstrate your leadership by looking to change the way your company or your team does business. Chances are your team will feel threatened by the difficult operating climate and even more threatened when you set out to make changes. It is therefore critical to set out clearly why changes are required and co-opt the support of the team to implement them. Your relationship with the team will now be critical. Set objectives involve the team in your strategies and keep them abreast of the success resulting from change.

Focus on results

Ultimately good leadership is judged by positive results. And if you are to accept the accolades and rewards for good leadership then you must realise that your individual performance is a key ingredient of leadership. Here are a few questions you should be asking yourself on a regular basis:

 What stretch goals need to be set for my company, my team and for me?
 Do I constantly focus on the goals we set or do I drift off and think only of today’s operational jobs?
 Do I give feedback to my team on their performance?
 Have I provided a clears vision for my team?
 Do I give strong consideration to the needs of my clients with appropriate customer service standards?
 How can I improve?

Personal Skills

Jack Nicklaus once said that many golfers failed because they tried shots that they were not capable of completing successfully. He was saying that we need to understand our level of skill and then if we want to improve – set about improving those skills.

Just as leading sports stars have to constantly set new goals and develop new skills via coaching, applying psychology, constant practise – so too, today’s business leaders need to constantly improve.

You should consider attending professional workshops, reading journals in your industry and associated industries, seek business coaching and mentoring and learn to use technology more effectively.

Seek inspiration from those around you. Talk to your coach about setting personal goals, talk to and copy other leaders or people you respect. Most of all accept that the hardest person to change is ourselves. Many who are happy to change others do not like change being instituted in relation to their own roles. So accept the challenge of change and consider:

 New ways to improve productivity
 New approaches to client service and marketing
 New systems and tools
 New ways to train and develop your team.

In short, step outside your comfort zone. With each step you will grow as a leader.

Be an effective leader

We began by suggesting that charisma is often confused with leadership. It is true that many great leaders have charisma. Some leaders are shaped by circumstances such as a family with a history of leaders in business or the services. However for 95% of current and future leaders the areas we have outlined make up a manual for learning great leadership skills.

This article is really about improving your game. Lifting your skills so that you will be a better leader capable of helping others also improve both as an individuals and team members.

Why not make “being a better leader” your objective for 2007.

Cash Flow Acceleration

2007-07-29T22:05:00.000-07:00

I recently received a call from a client asking what he should do about an opportunity for $30,000 worth of surveying work.

While not normally a question he would raise with me – on this occasion it related to an issue that we had been working through during recent coaching sessions. Essentially the client offering the project had a bad track record with the practice – slow payer, price shopper, fee negotiator etc, etc. On a scale of A to D - this client was a ‘D’ and had already been identified as a concern.

As always with ‘D’ clients we were seemingly looking at a trade off. The revenue involved would assist the practice through a lean period, particularly as the client needed to move quickly with the project. On the other hand, it would only help if my client could defy history and accelerate his cash flow from this client.

So what is cash flow acceleration?

There was a time in business when accelerating your cash flow meant being paid in advance of your normal terms of trade. Sadly today the definition really means being paid on time by a majority of clients and it is more and more a critical element of running a successful business.

Getting paid is the fulfilment of the process of selling and providing your product or service. In that sense it is simply a part of your professional relationship with your client. Equally, being paid on time is also a part of your professional arrangement. It should simply be the result of a quality, on time service.

However just as we need to educate clients on the value they receive – the issue of payment needs the same attention in many cases. You should clearly establish your terms of business at the very beginning of your client relationship. Having established those terms there needs to be a very definite plan to ensure that the terms are kept. A serious attitude by you or your firm will in most cases be respected by the client – particularly those clients who share your principles in the way they do business. Also attitude to payment will be a key indicator of client quality. It is rare to find a ‘D’ client who pays on time.

The psychology of meeting debts is a positive factor in the process. Most people actually want to keep their promises – whether they relate to payment of bills or on time delivery. By reminding clients of payment the emotional response is usually a desire to fix the matter..

However when your requests for payment go unheeded you have to consider all your debt collection options from personal calls, visits, debt collection letters, debt collection agency letters, legal letters and action.

It must be understood that the longer it takes for a client to pay the chances of getting payment are slimmer by the day.

What is the benefit?

The way I see it, there are two key benefits to accelerating cash flow.

The most obvious benefit is improvements in cash flow through securing deposits, interim payments and prompt payments on completion.

However there is another less obvious, more powerful benefit. The systematic application of good credit control will result in greater acceptance of your terms by clients. That then means less time spent on what for many of us is simply a chore. In turn it allows those responsible for this role to move onto more positive aspects of their job with far more energy and enthusiasm. And usually that means they will then be able to deliver better customer service, develop better products and services and build a far better business and enjoy doing it a lot more.

How to implement a cash flow acceleration program

Here are some key considerations that you might like to build into a system that will work for you:
1. Consider the payment of fees in your client selection criteria then build the relationship and demonstrate your value.
2. Quantify the fees in advance at the initial meeting with the client/prospect, or at the first transaction.
3. Educate new clients upfront by clarifying the expectations of your payment terms, also explain and add some free value up front (i.e. info sheet, newsletter, regulation updates)
4. Endeavour to get deposits for up to one third of the total fees, upfront.
5. Where practical, present the account to the client when giving over work or send out invoices promptly (i.e. within a few days) and regularly provide interim bills for large work. This sends a clear message that prompt payment is important to you.
6. Clearly print on invoices your bank account details for easy internet bank transfer payments, or, for regular work periodical bank payments for credit accounts. Request bank transfers as a normal way of conducting transactions.
7. After making payment terms - ideally 7 days or for large corporate accounts 30 days - follow up promptly. Again this sends the message that you are a professional and payment is important to you.
8. An alternative to verbal follow up is a series of well written personal but, standard letters 1, 2, 3 followed by threatening legal statements if required. This method has its place however is a poor alternative. Verbal follow up is always recommended.

Now about that client I mentioned at the beginning. His ideal outcome was obviously to be awarded the $30,000 project but be paid on time. We agreed that he needed to put in writing that he would undertake the project based on a one third deposit with the balance on completion. He also emphasised that the practice would need to make room for the project given the urgency – thus adding value.

The result? The customer wrote a cheque, paid the balance on completion and the surveyor more importantly now has the deposit requirement on all new work proposals with the obvious benefit of accelerating cash flow.

David Wolrige

It's All About Time

2007-06-10T22:48:00.000-07:00

We have all heard the cliché that “time is money” and I’m sure you would agree it is a truism when it comes to business. We might also extend the thought behind the cliché and say that time is in fact a currency and how we choose to spend our ‘time’ is of critical importance. And like any limited resource we must be careful not to let others waste our time.

Let’s take a look at a situation facing many people in business today. Specifically “I can’t find quality people to help build my business”. The strategy that is employed to overcome the problem is often one of curbing business growth, using more time working with current clients and in a sense treading water. However as someone once said about business – if you aren’t going forward, you’re going backwards. In essence natural client attrition is not matched by new client growth and your team members find they aren’t growing and thus the original problem is amplified.

So what’s the solution? In short it’s all about the proper measurement and allocation of your most important business resource – time - not only your time but that of the people who work for you.

I ask a lot of professionals how much income producing time they achieve each 40+ hour week. Answers range from; “I don’t know” to typically 20-25 hours, or approximately 55% of their week. This suggests that 45%, of their week is involved in “pursuits that do not create revenue”. Yet there seems to be little real understanding of what they are doing with this apparently non-productive time.

Of course there is a litany of labels for the wasted 45% - phone calls, administration problems, people issues etc.

The reality is that we can all develop bad habits originating from when they first started a new business. Because you had to do everything ten years ago with two staff – continues on when you have ten staff but the business is busier. Of course if you are not managing or nurturing your own time your employees will have the same problem.

So the answer to the problem of a lack of good staff is not in “I must do more” – the answer is “I must be smarter with the time resource I have. Let us look at an example based on a current unplanned 45% resource usage. Let’s allocate it as follows:-

 15% or 5 hours per week extra income producing (or 225 extra income producing hours per year!)
 15% for business development i.e. building client relationships, skill building of your team, personal marketing for new clients, developing new tools & systems and most importantly looking at new people & new clients on a regular basis rather than as a last minute exercise.
 15% for administration or financial matters i.e. phone calls, emails, accounts, correspondence etc.

You can see there is a huge potential to increase revenue by increasing income producing hours, and business development time.

Unless you plan your time, the urgent drives out the important.

Why not consider some new time categories when developing your ideal week model.

Income time: (we call it “blue” or cash generating time):
- blocks of time for today’s income producing

Investment time: (“black” time for business development)
- blocks of time to create your future

Individual time: (blocks of ‘red’ time for everything else)
- time for personal emergencies, proposals, unexpected client requests, thinking, administration

Consider putting in key systems for your team to allow them to understand the management of time and the need for a planned approach. Find ways to help them block off time with a minimum of interruptions such as a system for only taking appropriate calls from clients and leaving others to a set part of the day. There is no doubt, that focus on the job at hand and doing that for as long as it takes to complete is a smarter way of using blocks of time.

This colour coding strategy for time will see the following objectives met:
1. Improved productivity to make up for the short-term issue of new staff
2. Increased client satisfaction as you and your staff appear more accessible
3. Greater time allocation skills for you and your employees
4. Better clients and more of them because you will have actually focussed time on building the business

Income producing time determines your current income - non income producing time determines your future. To neglect non income producing time is to neglect your future.

Finally as any coach will tell you – many amateur golfers use practise time doing what they already do well. For example if they are good at hitting a golf ball a long way – they’ll spend time with the driver at the range because it is easy to do. Equally if they putt well then it is enjoyable to spend time on the practise green. Professionals on the other hand practise and work hard at the most important things for them to succeed. It is the same with your business time. If you don’t enjoy administration – focus harder on delegating more & giving it to someone who is more proficient. You’ll make more money building on your strengths and being brilliant at what you do best.

David Wolrige

What You Can Measure You Can Manage

2007-05-21T21:55:00.000-07:00

You will all be familiar with the phrase “free measure and quote” in advertisements for everything from flyscreens to garage doors. The customer perceives free as a benefit while the retailer recognises that the measure is an absolute requirement if they are to get the sale.

Similarly in business the need to understand the dynamics of your business and be able to measure and then manage the key economic drivers that affect its success are critical.

Have you ever stopped to think what those key factors are for your business? Have you ever developed a set of performance targets that need to be met or exceeded if your business is to be as profitable and dynamic as you would want?

Take a moment now and list down 3 critical elements of your business that can be measured. You might start with areas of the business that you feel could be better managed or that you simply have concerns about.

Some of these could include:
• Productivity of your team
• Sales conversions
• Poor cash flow from customers not paying on time
• Too much money tied up in Work In Progress

Having identified the problems and then established a measurement for them – the task of developing strategies to improve these dynamics is a lot easier for you and your team.

Now we have all heard of “paralysis by analysis” So the idea isn’t to start measuring all the factors that may have an impact on your business. The amount of coffee the team drinks each day or the difference between fancy or plain biscuits to the overheads are unlikely to be of concern. The key to moving your business forward is to identify the critical components to get right.

We’ve found that by helping to identify, measure and manipulate the key economic factors in our client’s businesses they then begin to show very fast signs of improvement in profitability. More importantly the installation of consistent measurement and monitoring aligned with strategies to improve the actual performances are foundations for improved growth and a culture of continuous improvement and purpose throughout your company.

In recent years we’ve had some interesting examples of measuring key performance indicators that have made a huge impact on business.

For example one professional practice was writing off some $300,000 worth of fees as a result of a combination of factors: 1. Under quoting by a partner 2. Inefficiency in completing jobs 3. Partners writing off fees as they didn’t think clients would pay. While the first issue could be directly attributed to one individual – the establishment of cost and timing norms for the performance of certain functions along with attention to work in progress on a monthly basis would have overcome the problems long before we were brought in to help.

Another firm with cash flow problems had almost half a million dollars tied up in work-in -progress - when the real number should have been $200,000. Quite obviously work in progress was for this company a critical economic factor but it had not been identified, measured and managed for a number of years.

Generally we’ve also found that a lot of businesses only monitor there progress by cash at bank or at best monthly financial statements. We suggest valid measurements that measure key performance drivers in marketing, operations and human resources will identify problems and indeed opportunities long before dry financial statements.

The frequency of monitoring these key performance indicators varies from business to business. However experience shows that weekly and separate monthly financial management monitoring is a must. If you monitor your key drivers weekly, this gives you an opportunity to create history 50 times per year. Consider this against annual financial reporting which is just reporting on history.

Measurement requirements are often peculiar to certain types of business for example:-

• Billable hours vs. budget
• No. of proposals and success rate
• Number of jobs produced on time and in budget
• Debtors, Work In Progress, Cash at Bank

Have a think about monitoring your key economic drivers and establish ways to measure and monitor their performance. Then simply establish objectives and strategies for improving your performance in these areas.

David Wolrige

How can you be more successful in business?

2007-04-19T21:29:00.000-07:00

Have you ever wondered why some people are incredibly successful while others, though talented, often have very ordinary careers?

About a year ago I attended a school reunion and met two former classmates. While not particular friends of mine during our school years I had very clear memories of two friends who were bright, personable individuals. I seemed to remember they had intentions of following professional careers. As it turns out – both had graduated in commerce and taken up careers in accounting.

As someone with an accounting background I found it interesting that one of the men had become a senior partner in his firm and was a key factor in the practice’s increasing success. The other had a comfortable career but had never achieved more than simply being a cog in the wheel of a small suburban practise.

Now perhaps one was more talented or ambitious than the other. Perhaps one had connections that the other hadn’t. Maybe one had more luck than the other. These words or phrases are often used to explain away the differences in careers.

However after many years of assisting individuals and their organisations to be more successful, I have concluded that it is more than native intelligence, personality, talent or ambition that are behind success. Certainly it isn’t that one person wants success and the other doesn’t – however this is a very important start point for success in my opinion. ‘You have to want to make it – to make it’.

In my search to find out more about success - some time ago I decided to commission a research program on the subject of success. We interviewed small business owners and established a formula of success based on growth over a ten year period. Given the rate at which small business fail – ten years was a significant timeframe.

We then looked for similarities between those businesses that had shown growth and those that were essentially stagnant – perhaps moving with inflation. In the no growth group, which was indeed the larger group, we found the following common factors

87% had no clear direction for their business
92% adopted a ‘hire and hope’ policy in staff recruitment
95% no idea of what style of clients they wanted to attract
77% had no clear control over the key financial and non-financial aspects of their business

In the success group we found one key ingredient – the desire by the management to learn and try out new thinking. Invariably the people in this group read management books, had taken advantage of new technology, had hired people and created careers for them and encouraged some form of ownership to ensure continuity into the future and with their client or business base.

Today I believe that this success group is turning to professional business coaches to formalise and perhaps enforce the development of their businesses. Recently we asked some of our clients why they had hired us. The very common answer was – “we weren’t managing our business well enough”.

Coaching is fast becoming the leading development tool of choice for small to medium business owners looking for managed business growth. And unlike applying the thinking found in business books or trying new “things” – a coaching program which isolates weaknesses and establishes goals – can be seen as integral to future success.

Specifically, a business coach takes a step back and casts an independent eye over the way the business operates and what areas could be improved upon. Remember the coach is not trying to make, in the case of surveyors, – better surveyors. The coach is about making well qualified and dedicated surveyors into better business people capable of growing their practice.

The fact is that most surveyors don’t start up a practice based on their knowledge of marketing, finance, human resources and administration. Yet if they are to succeed –they will need to take on or manage all these roles, while still maintaining the raison d’etre of the business.

A business coach will help uncover and clarify your personal goals and help develop a set business objectives. This managed approach to the business will give the owner more time for clearer thinking. Together with the owner or key executive group they will be instrumental in moving the business forward in key areas such as :
• Building better top line fees through modern marketing
• Developing a great team through innovative team building and human resource techniques.
• Growing bottom line profit with sound financial strategies

How it works

The reality is that the business coach and their client need to create a relationship based on mutual respect. With an understanding of our strengths the coach will:-
• Become an independent thinking partner and confidante who gives an unbiased, non judgemental view
• Help the client to become organised and focussed on what’s important
• Provide an opportunity to discuss ideas, results and challenges free from conflict
• Present and help institute solid business models and systems that can be easily implemented
• Assistance in building confidence as the client gains more and more control over their future development

Coaches help business owners with a broad range of information via on site coaching sessions, workshops, email, phone calls that is of specific and real significance to entrepreneurial minded people.

Not just theories and thought but real results gained from real experiences and successes in areas that their clients have not experienced.

What should you be looking for?

Experience is the number one priority when looking for a business coach. Look for someone who has experience in client coaching and can show personal success in business. Don’t be afraid to ask for proof of qualifications and referrals from previous clients. You should also ask about their own business training, memberships of coaching associations etc. You need to feel a good rapport with the coach particularly as sometimes they may have to “be cruel to be kind”. Lastly, make sure you can comfortably fit the fees in your budget. Equally, as with most things, we pay for what we get. Sadly, some pay for what they don’t get – so please do look at the credentials and references of anyone you intend to hire.

An Investment in Success

Properly instituted, understood and managed, change can, in turn, mean growth.

Hence, if the time is right for change then business coaching, to help you manage and direct change, could be just the investment needed to grow profitability. And of course a properly managed business will give you confidence and perhaps the freedom to enjoy the fruits of your success.

In Conclusion

Now I should talk about those two classmates that prompted this article.

The more successful of the two men gave me a call about month after our meeting. We had lunch and he talked about developing a program for his senior partners. Over the years he had personally taken up many opportunities to improve his knowledge of business and how to operate a business. While not formally involved with coaching he had set out to find mentors or consultants that expanded his thinking. Calling me was simply a reflex action of someone constantly looking to improve.

In his personal situation the search for help had been a less formalised system of development that what we offer our clients and easily explained given that business coaching in this country is relatively new. It offers a far more controlled manner of learning and developing as an owner.

A business coach can’t promise you success. The reality is that everything worthwhile achieving usually takes time and application. However once you are committed to a coach and to a properly based program you will be given every opportunity to succeed. Indeed business coaches are about preparing people for success.

David Wolrige

David heads up the results driven business coaching team at Summit Partners, who are NSW’s leading specialist business development advisors to surveyors and other professional groups. Visit their website at www.summitpartners.com.au or contact David directly on (02) 8883 4699

9 KEYS TO PEAK PERFORMANCE

2007-03-23T21:36:00.000-07:00

To start off the new financial year here are a few key ideas for you and your business:

1. MARKETING - Building Relationships
Customer/clients not only want a good product/service, they also want a trusting happy relationship.
How much time do you spend on relationship marketing?

2. TEAM - Hire slow & fire fast
Get the right people on the bus, the wrong people off the bus and have the right people doing the right things
How much time do you spend on recruiting the best and developing your team?

3. TIME - My most important task
Starting each day and concentrating single-mindedly on completing my most important task will give you positive endorphins to think like a winner - think about the rewards - the more you do it the more positive you become.
Would that make a difference?

4. FINANCIAL - Build assets & grow
Start by listing your assets and liabilities and then after developing a forecast for your business, decide what you would do with surplus profits - buy more assets and/or reduce liabilities - and then regularly monitor progress
Do you have a list of your assets and a budget?

5. IDEALS - Think what I want and how I am going to get it
Decide exactly what you want, write it down, set a deadline and make a list of what I need to do to achieve those goals. Highly satisfying.
When should I start a planned list?

6. HEALTH & FITNESS - Life only gets better when I get better on the inside
Have you considered?:
1. Fitness (i.e. walking, running, stretching , sport)
2. Nutrition (i.e. better diet, more water, less coffee)
3. Personal Development (i.e. more solitude & thinking, more holidays)

7. EXCELLENCE - Resolve to be exceptional
If you’re going to be in it why not commit to do your best to be in the top 10%. Learn more, earn more. Continuous improvement thinking.
What one skill, if I did it excellently, would help double my income?

8. SOLUTIONS - Think about solutions most of the time
Focusing on solutions and not the problem will make you feel better. Ask yourself how questions - e.g. how can I spend more time at golf? How can I spend more time with my family?
What important questions could I ask of myself?

9. ACTION
Develop a sense of urgency. Become proactive to make it happen. Once in motion stay in motion
When will I start my plan? ________________________________

If you would like further advice about any of the above please feel free to ring us on (02) 8883 4699. Or if you think you know someone who could benefit from business coaching, simply email or ring us. We’d be delighted to contact them to see if we could help.