Grow Your Business
- Staff Satisfaction – 10 Points
- Most owners fail to maximise their business sale price!
- 10 Crucial System Tips for Small Business
- Have you suffered enough yet?
- “But, I couldn’t find the time!”
Consumer and business sentiment is not at its highest point at present as was witnessed in our most recent Business Horsham Survey. This is for a whole range of reasons both local but also external.
For employers, owners, managers here is a simple 10 point checklist I recently came across that could be used to provide insights into how we may ‘fire up’ the second most important components of our businesses, yes, our staff!
A motivated team will take our businesses so much further than the opposite. Those who view their employment as a career will no doubt outperform those who see it as a job. Improved staff satisfaction, can only be beneficial for customer or client satisfaction and in turn, improves bottom line performance:
- Start by measuring employee satisfaction so you have a basis to work from. In firms with 6 or more staff, try a structured method such as an internal or online survey. For smaller organisations, a more personal touch might be more appropriate. Some refer to this as MBWA, (management by walking around!)
- Be aware of what motivates each staff member. This will become known by actually asking each staff what is important to them. This need not be a direct question, but will become apparent by MBWA and or by formal questionnaires or on line surveys.
- Many employees want to contribute at work, to make a difference; so develop mechanisms to gain feedback. Regular strategic or team meetings is one such way. Once they share constructive ideas, acknowledge their contribution.
- Employees need training to do their job confidently and to a high standard, so provide regular soft skill andtechnical training and ensure they know what is expected of them.
- A mentoring program is a great way to improve employee satisfaction by providing guidance, training and to help recognise issues as they arise.
- Deal with staff (HR) issues promptly. This demonstrates both empathy and strong leadership, which good staff will appreciate.
- Open communication and access to management are highly regarded by employees. An ‘open door policy’ along with MBWA helps here. Regular staff reviews provide staff a formal opportunity to both provide and obtain feedback on their performance, but also provide a forum for discussion regarding aspects important to the staff member. This not only gives respect to staff but also opens up communication and enhances morale.
- Well planned Induction systems for new staff, can prove very helpful to settle into a new position. Both morale and productivity are enhanced.
- Australian workplace surveys suggest that as high as 87% of staff leave their job, because they failed to make an emotional connection with their supervisor, manager or employer. Everyone needs a ‘friend’ in their workplace!
- Ensure that the ‘right people are in the right seats’ results in a happier and more productive staff.
Improved staff satisfaction results in improved customer or client satisfaction. Staff loyalty and retention is enhanced which in turn is beneficial in more ways than one.
Statistics suggest that two thirds of business owners plan to use their business as their primary source of retirement income.
With a third of businesses having an owner with an average age over 50 and our aging population there are likely to be increasing numbers of businesses come up for sale in the coming decade.
The typical benefits of an exit strategy will depend largely on how you plan to leave the business and the timeframe involved. The two main scenarios are selling your business or succession.
Which path you take will depend on a number of factors such as the wealth you have already accumulated, the likely selling price, your desire for the business to continue, the existence of someone within the business willing to take over the business etc.
If the sale of your business is going to be a major factor in your retirement plan then it would make sense to plan carefully your exit strategy. An exit strategy will:
- Maximise the value you and shareholders get from the sale by helping you prepare the business for sale
- Allows you to choose the ideal time to exit on your terms
- Gives you a plan to groom successors
- Can help minimise tax liabilities through planning
- Help you decide your retained involvement in the business
- Help plan the systems and procedures required to attract potential buyers
- Help you understand the decision drivers from the potential buyers viewpoint
The author Stephen Covey encouraged businesses to ‘begin with the end in mind’. Business owners should be thinking about their exit strategy from Day 1 and reviewing it annually as part of their strategic planning process.
The key elements that should be covered include:
- Document your business performance
- Systemise and document your business
- Find & train a successor
- Determine your optimal selling price
- Prepare the premises for inspection
- Seek professional assistance
A recent CPA survey indicated that 84% of businesses were very dependent on the owner and that very few businesses bothered with an exit strategy if they had no one to inherit the business or they deemed their business too small for sale.
Ideally to optimism your return businesses need to start planning their exit strategy up to 5 years prior to their intended sale date. However with professional guidance and support this can be reduced significantly. Research from MAUS indicates that businesses that are prepared for the sales process can boost their potential valuation by more than 20%, which can certainly add up and affect the quality of your retirement.
For those that are unsure about their next step, talk to your tax professional or business advisor sooner rather than later.
Have you ever stopped to notice just how many business owners you come across that are always under the pump, jumping from one urgent problem to another, working ridiculous hours just to stay on top of things. In my experience these business often suffer from a lack of quality systems. There the focus of this article will be looking at some systems small businesses owners can implement to improve the operations of their business.
Firstly, so we are all on the same page let me simply define a system as a way of performing any given task in a consistent way that will give a predictable outcome. This may include computer hardware or software but it is certainly not limited to them. It may include application forms, scripts or any number of resources including people that simplify your various business processes.
10 Systems Tips for Small Businesses
1. Possibly the most important reason to develop great business systems is to create a better, more consistent customer experience. Look at your customer touch-points and ensure you are delivering a great experience through systems that ensure consistency and reliability.
2. Don’t rush and make hasty decisions regarding your systems. You should have a strategic plan in place and this should help determine the best systems for you. Your systems need to align to your goals and your vision for the business.
3. For a small business it is essential that the owner is able to step away from the day to day operations and work on the business. Systems will create that invaluable freedom.
4. Some basic yet often overlooked systems revolve around your people. Don’t forget your people systems. Ensure you have Performance Standards, Position Descriptions, Procedural manuals, Staff Reviews and Reporting systems in place to get the most from your team members.
5. Systems help grow your potential sale price. When looking to sell your business a potential buyer is looking at how they can run it without you. If you have no documented systems this will have a detrimental effect on your businesses valuation.
6. Many businesses implement new systems and they turn out to be a disaster as the team reject them. To maximise the chance of successful implementation don’t impose change (be consultative), communicate the benefits and address any fears.
7. Avoid biting off more than you can chew. Lack of time and resources can quickly kill good intentions so start small and build momentum through the successful implementation of smaller projects before attempting larger changes.
8. Systems are a great way to grow your business. I see too many businesses where everyone is busy but there is no growth. The development of systems will create the necessary capacity to help your business grow.
9. Don’t set and forget. Once you have implemented a system don’t assume it will manage itself. Ensure you review the system at regular intervals and make any changes required to improve the system.
10.Off the shelf software is often expensive and generally better suited to larger organisations than small businesses. When looking for a solution don’t be afraid to get a quote from a Systems Analyst or Software Developer that can develop a customized system for your business on an hourly rate.
Bonus: Get your team involved by creating a culture of continual improvement. Encourage team members to challenge the status quo in an environment that supports and rewards change.
There are a host of reasons why you should be systemizing your business, from improved customer experience, to more freedom, to a higher business valuation, higher productivity, whatever your reason there are numerous options available to you.
What happens to businesses when the owner loses their drive or passion for what they do? How do they address prolonged periods of declining sales? What is done when fewer customers start enquiring about your products and services? What happens when your staff start leaving or worse, remain but lose their enthusiasm?
According to the Australian Bureau of Statistics on average a little over 500 businesses permanently close their doors each day. As these businesses close it can have a devastating effect on those that depended on the business.
But a lot of business failures can be prevented if only the business owner recognized their peril early enough and sort assistance. In my experience most business owners do recognize the signs of a hemorrhaging business but they fail to act soon enough to do anything about it.
Many business owners when starting out are very confident in their own knowledge, ability and enthusiasm and this is often enough to get the business off the ground. But far too often down the track when the business starts to falter they stubbornly apply the old principles that no longer work.
As Albert Einstein said, “We can’t solve problems by using the same kind of thinking that we used when we created them.”
How to identify if you are a struggling Business owner?
- Are you making more money now than you would if you worked the same amount of hours for someone else?
- Could you sell your business tomorrow and receive a satisfactory return from your investment?
- Each year is your net profit greater than what you would have received if the money used to run the business was invested elsewhere?
- Are your profits after you pay yourself a fair wage greater than the rate of inflation?
If you could not answer yes to all of the questions above then I would ask “have you suffered enough yet?” Is it time to start doing things differently before I become just another statistic?
Successful businesses re-invent themselves when they need to. They do this through innovation and learning from the experiences of others. If you recognize that your business is starting to decline you owe it to yourself and your fellow stakeholders to seek assistance immediately to fix the issues before it becomes too late!
How often do we hear the phrase “But, I couldn’t find the time”? Maybe it’s an employee, a supplier, a family member or even ourselves saying it. In our busy lives we are constantly distracted preventing us from achieving what we know we should be doing.
A few simple time management tricks can make all the difference.
A useful system I came across sometime back is the ‘4 Ds of time management’. To truly manage your time effectively you have to look at the tasks that need doing and decide how to handle them. For this you can use the four Ds of self-management. These are:
* Do it – This cannot wait and needs to be taken care of now
* Delegate it – Not the best use of your time. Pass it on to someone else
* Dump it – Anything that is unimportant now and in the future. Bin it.
* Defer it – Something for the ‘to do’ pile. Come back to it later
Most, if not all, of the tasks and activities in your day, week, month or year can be put into one of these categories. Try to identify the time wasters that are holding you back and eliminate them from your life.
Where possible delegate as much as you can. A good rule of thumb is if someone can do the same task at least 80% as well as yourself let them do it. If they can’t yet, invest in the time to get them to this level.
At the end of the day you want to be addressing only the critical tasks that need your personal attention.
· Know what your strengths and passions are and delegate the tasks that don’t fall into these areas.
· Look to introduce new systems, technology and process to create efficiency gains.
· Get assistance before you burn out – the consequences of not can be severe.
· If after this process you are left with a couple of free hours a day/week don’t stress, just think of all the great working ‘on’ your business projects you can undertake or extra time you can spend doing what you enjoy most!
These were just a few tips to get you started. Remember, each of these small steps will bring you closer to your vision and leave you with time to do all of the things you want each day.