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Business Development & Marketing General Turnaround

Apply the insights from business anthropology to your company

business anthropology and the evolution of human behaviourHaving introduced business anthropology in a blog last month, now is a good time to start applying what you have learned.
To remind you, business anthropology looks at the relationships and interactions between people working with each other. It looks at the relationships and motivations of individuals and teams and how you might ‘press the right buttons’ to improve productivity.
Great insights cam be gained by observing people and how they behave with others. This can be difficult for leaders as it involves watching and listening objectively and not interfering while carrying out their research. It raises their level of awareness.
It can also be used to look at clients and consumers whether looking at their interactions with your products and staff, or at your staff and how they deal with customers, rather like a secret shopper.
Essentially business anthropology insights can be used to make improvements to your business.
There are three areas where you might consider applying such insights. These are in changing the corporate culture, refining relationships with customers and clients, and in developing new or improving existing products/services.

Business anthropology and corporate culture

In a situation where the age profile of the workforce may be changing as new, younger employees join your business and have to learn to interact with older employees it may be that you should pay some attention to understanding the differences in approach and work style of the two groups and introducing ways of encouraging greater integration.
There will be many more areas to look at but the approach begins with awareness of a need to change and is implemented through engagement with those affected.

Business anthropology and customers

This is about listening for unmet needs, pain points and challenges.  It is also about how your employees interact with customers.
It can be helpful to go through the process of buying and using a product yourself and this can often feed in to developing a new product or service.
An illustration of this is from 1999 when Procter & Gamble, suppliers of cleaning products, engaged anthropologists who watched people cleaning their floors. They noticed that the process also involved a significant amount of time spent cleaning the mop itself.  The result was the development of the Swiffer, floor cleaning equipment that came with a handle/applicator and a collection of disposable pads to attach and use for wet or dry cleaning.  This remains one of the company’s most popular products.
It worked because the observation of the process identified a “pain point” and provided an adaptable solution that cut down on the amount of time needed to clean a floor.
Please let me know if you have applied business anthropology methods to your business and what insights you gleaned from your observations.

Categories
General Rescue, Restructuring & Recovery Turnaround

Why whistleblowers can be a force for good in your business

not whistleblowersMany people are afraid to speak out when they discover wrongdoing or questionable behaviour in their workplaces for fear of the damage they may do to their careers and employment prospects since all too often they are often regarded as outcasts.
The recent high-profile revelations by whistleblowers in the Cambridge Analytica and Brexit campaign organisations have shown that, in these days of ubiquitous social media, those who were brave enough to speak out became the target of some high-profile abuse and attacks, some of them personal.
But if your business is one where a culture of speaking out is either frowned on or not encouraged it may well be missing out on information that could help it to improve not only its operations but also its values and reputation.

Make your business safe for whistleblowers

Employees are often in a better position to see when something is going wrong than its board members are.
So how can you ensure that you are alerted to behaviour or practices that could damage your business?
You need to make it clear that revelations of malpractice or ineptitude are welcomed and that your business culture is transparent and open to people being able to voice concerns in a responsible and effective manner.
Malpractice can cover a wide range of situations from bullying, theft, bribery, fraud and corruption to endangering people’s health and safety to misuse of company property as well as any attempts to conceal such misdeeds.
Ineptitude becomes a whistleblowing matter if it has an adverse impact on people and the business or if it relates to breaches of company policies.
It is therefore good practice to have a clearly-defined whistleblowing policy and to let everyone know it is safe to raise any concerns they might have and that allegations will be treated as having been made in good faith.
The policy should clearly state the procedures that should be followed when anyone identifies something that they feel ought to be reported. It should also set out the procedures for managers to deal with the matter and cover confidentiality and protection for everyone involved.
Confidentiality is an issue that is also covered by privacy law. Those making allegations should be encouraged to put their name on record although disclosure needs to be managed carefully. You should also identify an investigating director within your business with whom concerns can safely be raised.
If the whistleblower feels that they need it, it should be made clear that your business is happy for them to be accompanied by a trades union or other representative at all meetings and hearings.
The investigating director should be required to fully investigate the allegations and prepare a written report of the allegations, their findings and their recommendations, preferably with the involvement of your HR department.
The whistleblower must be kept informed of progress as should the person about whom allegations are made, especially if they are an employee.
If necessary, it may be appropriate to involve relevant outside authorities, such as the HSE or the company’s auditors and if necessary the police.
While the company culture should be one of trust such that employees who report a matter as a whistleblower should be believed, you should also be aware of their agenda. The investigation may reveal that the whistleblower is in fact the problem which is one reason why the investigations should be discreet and the confidentiality of all parties preserved. If a whistleblower does turn out to be the problem or they are using the procedure to pursue their own agenda then they should be dealt with under the company’s disciplinary procedure.
Whistleblowing is, however, essential when some people are wilfully blind to behaviour that ought to be addressed. An open and constructive approach to confronting and dealing with such behaviours is essential to a company’s values, culture and reputation.
A properly constructed whistleblower policy can encourage people to act in the best interests of your company and ultimately ensure your business reputation is not compromised.

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Business Development & Marketing Finance General

The pros and cons of team building activities for SMEs

team building activities or socialising?There is considerable disagreement about the effectiveness of company team building activities, especially those that involve away-days for things like paintballing, go-karting, white water rafting and the like.
The question is whether team building activities away from the office will make a noticeable difference to your productivity, rather than simply to the bottom line of the businesses that offer such facilities.
According to Forbes Magazine, Kate Mercer, author of A Buzz in the Building: How to Build and Lead a Brilliant Organisation and a co-founder of the Leaders Lab consultancy, warns that such activities can actually damage your workplace because it takes a great deal of skill to bring out the learning points and to transfer them back to the workplace.
Not only that, she says, they can make some employees feel embarrassed and others feel patronised and too often they confuse socialising with actual team building activities.
Such exercises can also be expensive, particularly for a small business, and the American researcher Kenneth Stålsett argues in his doctoral thesis that while they may be fun – for some – they rarely alter established ties between colleagues or enhance communication and collaboration skills back in the workplace after the event.
Stålsett argues that team building should be tailored to the unique challenges that exist within each group, or business, and that team building should be a recurring exercise.

Do SMEs need team building activities?

There is a distinction between social and team-building events. During the planning, you need to be clear about the purpose and outcomes you want.
Of course, you want your business to function as efficiently and effectively as possible and therefore you want your employees to work well together.
This can be particularly crucial for an SME in today’s fast-paced economic environment where it is important to get new employees to fit in and become productive as quickly as possible.
There is no denying that your business productivity can benefit from a co-operative and well-knit team of employees and it is therefore important to encourage this.
This means your business environment needs to be comfortable, positive and welcoming, in the sense that everyone’s contribution is valued and where people are stimulated, challenged and recognised for doing their best.
Your team building activities need careful thought and design to encourage people to respect, trust and co-operate with each other and should be part of an ongoing process of building trust and reinforcing goals to ensure everybody is heading in the same direction and has a shared set of values.
So yes, your team building activities are important, but they are about a continuous process, not about expensive away-days.
Those should be seen as enjoyable social activities, perhaps as a reward or thank you for employees’ exceptional efforts. They should definitely not be compulsory.

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Cash Flow & Forecasting Finance Rescue, Restructuring & Recovery Turnaround

Are managers redundant?

managers redundant to corporate structureAll four of the UK’s big superstore chains, Sainsbury, Tesco, Morrisons and Asda, have announced plans to make significant changes to their staffing structures, mainly affecting store managers.
Department store, Debenhams, has also announced plans to cut its store managers by a quarter.
All the retailers said they were facing a more challenging environment, not only because of intense competition from budget retailers, Aldi and Lidl, but also because consumers were becoming more price conscious as well as changing their buying behaviour.
Sainsbury’s hope to save £500 million over three years, but, in common with the other retailers mentioned, also said the changes will introduce “a more efficient and effective structure”.
Stripping out layers of management is nothing new. It has been used as a favourite cost-cutting tool by businesses in the past, most notably in the 1990s.
In some instances, no one notices when a layer of management is removed, but in others it can leave a void, especially in those where staff have not been empowered to make decisions.

Removing layers of management can improve productivity

One of the most significant organisational differences between SMEs and large corporations is their flexibility and ability to communicate throughout the organisation.
On the whole, SMEs have fewer layers of management and this enables them to adapt more quickly to change and to discuss and communicate plans to all their employees. This flexibility can attributed to everyone feeling part of a team, and where necessary doing each other’s job. There is often no need to defer to a manager for a decision.
Larger organisations, on the other hand, tend to have much more complex structures with more rigid procedures. Communication normally passes from the top down, from senior management through numerous layers to the workforce. Where decisions have to be made this is still down to managers or decision-making committees. Everyone simply follows procedures.
This makes it hard for initiative and feedback up through the layers of management. The focus is on lean structures and optimal efficiency. However, this runs the risk of suppressing initiative and reducing scope for employee consultation. As a result, larger businesses are often unable to react swiftly in a world where the pace of change is accelerating.  
A flatter structure assumes even more rigid procedures albeit ones increasingly being overseen by workers instead of managers.
The challenge is to improve productivity while at the same time empowering staff by giving them scope for taking their own initiative. Or is the next step automation and self-service retailing?

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Business Development & Marketing General HR, Redundancy & Trade Unions

What is the purpose of a staff appraisal?

appraisal?For many businesses the usually-annual staff appraisal is seen as an opportunity for managers to review an employee’s performance, provide feedback on areas for improvement, agree trading needs, set targets for the coming year and address any problems that may have arisen in their behaviour.
As a result, too often employees view the annual appraisal with dread.  It depends heavily on their relationship with their manager and his or her ability to be objective.
Yet the appraisal can be of benefit to both employee and business if structured and handled in the right way.
Ideally, it will be seen as a constructive opportunity for an exchange their views, not simply as a tool for management to assess and, if necessary, improve the employee’s performance.

The constituents of a constructive appraisal

There needs to be a culture of trust and openness in the business and ideally, managers who are appropriately skilled, for example in asking good questions and active listening.
Ideally employees should be receptive, prepared to align with business objectives, learn and take responsibility for their performance.
The appraisal is an opportunity to recognise achievements and find out about an individual’s career objectives. It should recognise their achievements and be a genuine two-way conversation.
It should cover the whole period under review not just recent or isolated events and the result should be an agreed set of actions.
By the same token, it should also offer the employee an opportunity to feed back suggestions for improvement in company processes, ideas for the future development of the business and to highlight any processes that are clearly not working.

Set out and document clear appraisal objectives and purpose

The appraisal purpose, structure and process should be clearly defined and written down so that all parties are clear about what to expect. The aims, frequency and process should be clearly and simply outlined in the staff handbook.
It is helpful for both parties to have done some preparation for the meeting, ideally both should attend having completed the same questionnaire but from their own perspective. The completed documents can be compared and provide a framework for the meeting and its outcomes.
An appraisal is hardly likely to be seen as a constructive opportunity to all involved unless it is seen as a fair process. This could include appraisals always being carried out in the presence of a neutral third party, usually someone from the HR department or from the company to which HR is outsourced, whichever is applicable.
It should be clear that the business has made every effort to eliminate the danger of bias in an appraisal, perhaps because there is a clash of personalities between a manager and an employee.
Far too often the structure of an appraisal is seen as an occasion to be dreaded when properly defined and constructed it can be an opportunity for both individuals and the business to move forward.
I believe that appraisals should always be carried out by the employee’s line manager since their role is normally one of pastoral leadership. While there are many types of leadership, managers should consciously develop their own skills and style with the aim of getting the best out of their team. The appraisal is an opportunity to reinforce the relationship and improve everyone’s performance.

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Business Development & Marketing Cash Flow & Forecasting Finance General Insolvency Rescue, Restructuring & Recovery

Restructuring is not a dirty word

dial pointing to optimisationThere is a saying: “If you always do what you’ve always done, you will always get what you’ve always got” variously attributed to Anthony Robbins, Albert Einstein, Henry Ford and Mark Twain.
Whoever said it, the phrase is particularly appropriate for businesses, from SMEs to larger corporates, in that no business can afford to stand still, even when things are going well.
Economic environments and business circumstances change as time passes and so should business plans, models and methods in a process of continuous improvement. If not, a business that was previously performing at the top of its abilities compared with its competitors can rapidly start to drift through inertia into potential failure.
An obvious example of this drift has been the well-known chains in the retail sector, which went through phases of presence on every High Street to shifting to large stores in edge of or out of town retail parks.
Then, when the pace of closures started to accelerate, it became clear that they had failed to factor in the growth of online shopping or react with agility to the challenge it presented.
Inevitably some went into administration and could not be saved, such as Woolworths and more recently BHS. Could they have been saved if they had been less complacent?
A proportion of consumers say they would still prefer to be able to inspect goods before they buy them, but it took a while before the retailers restructured and developed a model that satisfied both online and in-person shoppers – whether easy return by post or click and collect – and those that did have survived and remained profitable in what is a difficult market.
Manufacturing, banking,  estate agency, even legal services are all examples of industries that are undergoing a radical transformation with many individual examples of businesses that are going bust having failed to evolve.

So why does restructuring have such a negative image?

Sadly, many businesses that end up in need of restructure and turnaround leave it too late, until after an insolvency practitioner has been called in because they are in financial difficulties.
This, we believe, is why there is such a stigma attached to the word “restructure”, when actually it could be seen as a positive, agile and forward-looking initiative.
It may be that some have practised continuous improvement to update their business plans, but have lapsed in their rigour.
One issue is that change tends to involve investment in people, premises, equipment, process and marketing which can be expensive and tends to have a negative impact on short term profits. Incentive packages for professional managers have contributed to such short term thinking.
Investment like continuous improvement can involve constantly updating to stay current with the latest developments in an industry, where all too many treat it as a one-off activity that plants the seeds of future failure.
In a fast-changing economic world it does not take long before performance, sales and revenue start to slip, supplier prices perhaps start to rise and before they know it they are facing a cash flow crisis.
In fact, calling in a restructuring adviser when things are going well means a business has access to an objective outsider with the knowledge and expertise to assess their business model and processes and suggest improvements that will help a business to remain prepared for whatever the future may bring and to plan ahead for the investment they may need to make in such things as automation and new technology.
Whether restructuring, turnaround, change or transformation it should be seen as a positive initiative.

Categories
Business Development & Marketing General Interim Management & Executive Support Turnaround

Better know your weaknesses than be unaware of them!

eliminating weaknessesAs a business owner or manager it would be nice to think you have no weaknesses but how realistic is that?
It can be instructive to learn what others think about you and perhaps the first step in getting a realistic picture is to resolve to be honest with yourself.
It can be helpful to list the key characteristics you need for your role. As a business leader you need to show leadership, for example, to be able to stand back and concentrate on strategy and business growth and to not get bogged down in unnecessary detail.
However, as a leader you might prioritise accomplishing defined goals or you might prefer to set values and a vision. The fact is that no one style is right or wrong but you need to know what gaps need to be filled by yourself or others. You may need to work on your weaknesses.
As a manager you will need to be involved in getting the job done. You will need to be good at planning and scheduling, at organising and motivating staff and at all manner of tasks that you cannot delegate to others.
But personal strengths and weaknesses are not related only to how you approach business and management; they also include how you deal with others like investors, customers or suppliers, essentially how you communicate effectively ie in a way that gets results.
To find out about your strengths and weaknesses it can be helpful to consult one or two trusted colleagues or perhaps an objective business adviser and to map them using the SWOT analysis method.

Identify your most important weaknesses to work on

It helps to have a personal development plan with a timeline and goals to monitor progress.
Identify whether you need training, counselling or self discipline. Feedback is also important and again an objective mentor or business adviser will be useful, not only as someone to whom you are accountable but also who will provide you with positive feedback.
At the same time it can be useful to look at your strengths.  Are they essential to your role or an indication of you inability to let go, to trust or to delegate?
With issues like short temper or procrastination it may be helpful to enlist the help of a specialist counsellor to help work on behavioural skills.
Equally important to in-work skills is the ability to switch off, rest and recharge. This is something people in key positions often find difficult but it may be time to consider taking up a leisure pursuit that is sufficiently absorbing and interesting to encourage this.
To avoid being left behind, you need to be aware of your weaknesses and constantly work on them.

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Banks, Lenders & Investors Business Development & Marketing General Rescue, Restructuring & Recovery Turnaround

Strengths, Weaknesses, Opportunities, Threats – SWOT, So What?

business improvement working digitallyInvestors, banks and advisers often ask clients to carry out a SWOT analysis.
But a SWOT analysis is meaningless unless the business is clear about its purpose and intends to arrive at a series of actions to be taken as a result.
While it is perfectly acceptable to use a SWOT analysis as part of a business review, all too often it is an overview that doesn’t help anyone.
(image courtesy of Pixomar at
FreeDigitalPhotos.net)
More helpful are the insights that can be gained from a close look at different aspects of a business.

Here’s an example

SWOT analysis diagramA business might choose to analyse its process from production of a product through to delivery.  The SWOT analysis may reveal a Strength in producing consistently good quality products.
However, when it comes to delivery it may identify specific issues such as poor labelling or packaging that doesn’t reflect the quality of the goods, or failed deliveries because the customer isn’t in to sign for the goods which both might be classified as a Weakness due to poor service quality.
Delving deeper will produce actions that can be taken to improve these, such as changing the packaging and couriers.
It could also mean looking more closely at the customer service process or considering setting up a tracking system that customers can use to find out delivery date and time.
This example focuses on improving the customer experience and reinforcing the business’ reputation for quality:  great goods, in good packaging, and delivered on time. The analysis is used to reveal the Weaknesses but the key is to have an action to do something about them.
When looking at the SWOT items it helps to look at them through the customer’s eyes so that actions benefit the customer, as well as the bottom line.
Rather than wait to be asked for a SWOT analysis, they can be carried out regularly. It is useful to focus on one aspect of the business at a time but treat the review as part of normal business.
Great businesses do this all the time and simply call it Continuous Business Improvement.

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Business Development & Marketing Cash Flow & Forecasting Finance General Turnaround

Protecting a business in choppy economic waters

At the start of January the Chancellor, George Osborne, warned of a dangerous “cocktail of risks” facing the UK economy arising from the global economy.
The prospect of doom and gloom returned to the business media in January – and the dire outlook was reinforced by comments coming from bodies representing business, such as the British Chambers of Commerce (BCC).
Volatile stock markets, plummeting commodity prices, a “slowdown” in China, a poor Christmas for retailers and uncertainty about the UK’s future in the EU are all contributing to the general unease.
Of greater concern is talk about an impending financial crisis which is introducing fear and uncertainty.
For the moment at least, parts of the UK economy are enjoying some degree of success thanks to low costs resulting from the same low commodity prices, particularly oil, to low interest rates. There is also an easing of consumer credit.
Consumers have been spending a little more, especially on leisure and new cars. While it is unlikely that pay rates will increase, perhaps everyone is fed up after seven years of austerity and they are reassured by the property market. But there isn’t much confidence about.
While the increase in consumer spending may be propping up some businesses, sooner or later commodity prices will rise again and prices will follow.

Steps for protecting a business

protecting a business, financial crisisWhatever the future, businesses need to be prepared. Plans must be made and these rely on predicting what might happen.
We believe that now is not the time to be investing in growth, but by the same token it is not a time to cut expenditure to the bone. Endless cuts end up with having no business to take advantage of the recovery, when it eventually happens .
So what should businesses be doing to “future-proof” themselves as preparation for an uncertain future? Staying calm and consolidating their share of the existing market is the short answer, whether it is focus on existing customers or it is improving operational efficiency.  We will be looking at these issues in more depth over the coming month.

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Business Development & Marketing Cash Flow & Forecasting Debt Collection & Credit Management Finance General Rescue, Restructuring & Recovery Turnaround

Business improvement is a continual process

As people become a bit more comfortable in their businesses, growing and selling more, it is easy to forget the basics.
It is easy to do when the pace has picked up and everyone is busy keeping on top of all the extra work.
However, all businesses will experience ebbs and flows of activity and if they do not keep on top of the “housekeeping”, not only will they not be forewarned when a fallow period is looming, they will not be ready to deal with it.
Good practice means continuing to monitor the cash flow, regularly reviewing the management accounts, making sure the tracking of orders from start to invoice and including credit limits for customers and payment terms are adhered to.
Keeping an eye on debt collection is one of the activities that can slip when things are going well.
Continuous business improvement means finding new efficiencies, cost savings and better quality as an incremental process with the aim of building a more sustainable business.
This is especially important when times are good as it prepares a business for survival during recession.
There is no right or wrong way to do this. It depends on the individual business but among the items that could be regularly reviewed are reporting of management information, production or service speed and quality, bought in and inventory stock levels, working practices, safety and environment, staff training, marketing and communication, all initiatives to relentlessly make a lasting and beneficial difference.
Maintaining good habits like this will help to smooth out the inevitable peaks and troughs of business and ensure fewer nasty surprises.