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28 March 2013

What is a Quality Management System?

So your boss has told you that you need a Quality Management System. You also heard the word ISO 9001:2008 and you don’t know where to start. If this sounds like you, then this article should hopefully give you a better understanding of what it all means.

The first thing you need to understand is that ISO 9001:2008 is an international standard and in order to meet this standard, your company needs to have a Quality Management System in place. The aim of having a Quality Management System is to ensure that your company is continually improving to meet and exceed the expectations of not only your customers, but also your employees and stakeholders. It is a documented system that contains all of your company’s plans, strategies, processes, procedures, forms and any other necessary documents required to operate efficiently.

The second thing you need to understand is what exactly ISO 9001:2008 is. ISO (the International Organisation for Standardisation) is a worldwide federation of national standards bodies that develop a range of international standards. ISO 9001:2008 is a standard that focuses on quality management and provides guidance and tools to assist companies and organisations in operating efficiently and in delivering a quality product or service. To gain ISO 9001:2008 accreditation, your Quality Management System will need to be audited externally by a Conformity Assessment Body who ensures your system complies with the standard.

The benefits of having a Quality Management System and ISO 9001:2008 accreditation include the following;

  • Well define operational procedures and documents;
  • Greater operational efficiency to support continual growth and that leads to cost savings;
  • A higher level of customer satisfaction;
  • A better quality product or service suited to your customer’s needs; and
  • The ability to compete for larger projects with Government and private companies who often require quality assurance accreditation.

Companies will often engage a consultant to help them establish a Quality Management System that suits their needs and prepares them for ISO 9001:2008 accreditation. You can access the following benefits using a consultant;

  • Ensuring the Quality Management System is set up correctly with all the appropriate documentation;
  • Assistance in putting together key documents such as the quality manual and quality policy;
  • Guidance in conducting an internal audit and management review as required for accreditation; and
  • Someone that can train the company’s quality manager to manage the system into the future.

The importance of having a Quality Management System along with accreditation is on the rise as companies seeking to increase efficiency, differentiate themselves from their competitors and tap into new revenue streams and opportunities.

Posted in Business Improvement, Business Planning, Business Tips | Tagged , , , , , | Leave a comment
19 March 2013

Small Changes Can Have a Big Impact

When businesses are faced with a challenge, whether that’s an attempt to kickstart growth, reverse a downward trend or increase market share, the default response is often to change as many things as possible, and often go looking for a big change to be the catalyst.

However, the reality of business is that radical, turn-the-business-upside-down type change, is often not as effective as simply looking for small changes that can have a big impact in key areas.

The problem is that it’s the “radical, big risk” changes that get the press when they come off, which tends to lead business leaders to think that this is what’s required all the time (think the Apple iPhone as a symbol of this approach). Not all businesses can be Apple. Not all CEOs Steve Jobs. Applying this kind of mindset permanently can be dangerous.

The notion that small things can have a big impact is familiar to many business owners and managers through the work of Malcolm Gladwell’s The Tipping Point, which uses real world examples such a New York crime rates and the re-emergence of hush puppies as case studies where small changes has had a major impact.

The key for business owners and managers is to work out what are the key metrics or areas within the business where a small change can have a big impact.

In one case I saw recently, a large multinational put increased emphasis on the number of client meetings senior business leaders were having in their respective International regions. Over a period of four years, return-per-client increased dramatically. All the company did was publish (at the annual general meeting) the number of meetings each person had attended next to their name up on a big screen.

By focusing on the right metric, with a very small change (making the data public), significant results were achieved.

One of the things we recommend to our clients is to look to areas of the business that they believe have the potential to improve the business overall and make a small change to test that theory.

This might be in the number or type of client interactions, the average email response time, the format of client deliverables, a production input or a staff-led initiative.

You’ll be amazed by what impact that sort of change can have.

Posted in Business Improvement | Tagged , , , | Leave a comment
18 February 2013

In Business, Be Prepared to Challenge Everything

One of the common mistakes we see business owners or managers making on a regular basis is undertaking decisions based on only one piece of advice, one case study or more generally, just one source of information.

Regardless of whether your source is a professional business consultant, International case study, management book or scientific study, in business there is never just one answer.

But surely there must be some business rules that are universal, right?

Innovation is good for business.

Your staff are your most important asset.

Well, let’s put those to the test. In the case that “innovation is good for business,” everyone knows the stories where innovation has triggered business success (Apple being the poster-child for this) and where a lack of innovation has proven a company’s downfall (Kodak versus the digital camera, Borders versus Amazon, the encyclopaedia industry versus Wikipedia, etc).

But, there have been countless occasions were companies have over-innovated, stretching their capabilities and losing touch with what is their core competency, often leading to major issues or substantial cost blowouts.

Boeing’s recent 787 project over-extended their capabilities as they attempted to overhaul too much at once (battery cells, electronics, fuselage and more), and an aggressive attitude towards innovation (as a knee-jerk reaction to losing the number one plane builder title to Airbus in 2003) on the design of that project lead to a change of battery technology to save a grand total of 16kg across an entire plane.

Not only was there considerable cost attached to that ultimately negligible weight saving, the batteries have a tendency to catch fire, leading to the grounding of many of their planes, as well as millions of dollars in cost blowouts. Too much innovation, or in layperson’s terms, “biting off more than they could chew,” will see the 787 go down as one of the company’s biggest failures.

Harvard Business Review no less also talks about balancing innovation with complexity, ensuring that innovation projects are not over-extended (you can read that here).

But what about staff being the most important asset in a business? Surely everyone needs great staff?

Well, Australian company Freelancer.com works on a model where it makes money by not employing anyone directly, but acts as a technical platform allowing others to find “free lancers” themselves. Even those who using the platform aren’t actually employing anyone, but merely using them on a project-by-project contract.

This sort of model has led to a rapid increase in the number of businesses that are essentially “shell” companies, employing contractors on a project-by-project basis depending upon their needs.

What we encourage all our clients to do is take this “challenging” approach to business. Just because a competitor has successfully implemented something, or just because a business consultant told you to do something a certain way does not mean it will work for you.

For every piece of business advice or cliche, you will find 50 businesses that have successfully followed that methodology, and 50 where it has failed.

What this leads to is the ability for business owners and managers to synthesise multiple different theories, approaches and pieces of advice, and apply these in the context of their own business, not someone else’s.

Then they are in the best possible position to arrive at the decision that is best for their business.

[Image by Kentaro IEMOTO@Tokyo]

Posted in Business Tips | Tagged , , , | Leave a comment
13 February 2013

Why “Managing Up” is Good for Your Staff and Your Business

When many think of ‘managing up,’ mostly negative connotations spring to mind. Many perceive it as a blatant attempt by ‘brown nosers’ to make themselves look important or a better performer in front of their boss, often at the expense of others.

This isn’t managing up. This is performance dishonesty.

Managing up, when done well, can have massive benefits for the individual employee, their immediate boss and the business overall.

So firstly, what is “managing up” when it’s done well?

Ultimately it comes down to communication. Everyone has a communication preference. In the workplace, this can boil down to a preference for face-to-face, email or phone communication.

But it also goes beyond just simply the communication medium, to also the types of information presented. Bullet points? PowerPoint? Long, winding emails? Facts and figures? Case studies?

Traditional notions of management have put the onus of working out the most appropriate communication method onto the manager (i.e. managing down). After all, they’re the ones responsible for the success of the project or business. However the typical manager has on average 14 direct reports. That’s 14 different communication preferences a manager has to juggle.

What managing up does is reverses this. If a direct report is able to understand the communication preference of their immediate manager, and actually tailor their communication to that preference, things get done with increased efficiency. This can also include an understanding of what issues matter most to them in a decision? Is it speed, cost, growth potential, innovation, etc?

For example, if an employee is able to determine that their immediate manager likes things in writing, with costs in bullet points, and typically prefers a few days to “mull things over,” then arranging a face-to-face meeting at short notice and expecting an immediate answer is not only going to fail, but likely going to be completely counter-productive.

An employee well versed in managing up is able to deliver the right types of information, using the right method, at the right time. Naturally, that sort of behaviour not only helps their manager make informed decisions more efficiently, but also bodes well for the employee come promotion time.

For employees, managing up has obvious advantages, but many seem reluctant to do it. Again, traditional notions are probably to blame here. Research performed by Future Workplace actually suggest Gen Y is better at this than most (you can listen to a summary of this research in a Harvard Business Podcast on managing up here).

This is where managers can actually sit down with their direct reports and discuss the way they’d like to receive information, and openly discuss the way they go about making decisions and how their staff can assist in that process. With everyone on the same page, stuff gets done and everybody wins.

 

Posted in HR | Tagged , | Leave a comment
18 November 2011

Why Should My Business Have a Blog?

Building a successful business blog can be quite a challenge and can require a great deal of time and effort. A business blog is usually kept on the business’ website and there are a number of benefits of having this blog.

  • A channel to promote your business;
  • Educating your readers on specific topics;
  • Helping your website rank better in search engines;
  • Establishing yourself as an expert in your field; and
  • A means of engaging with your target audience.

The more diligent you are in keeping your blog, the more effective it will be; however, if you don’t have the time and resources, a simple blog is better than no blog at all.

Know your audience

When blogging, it is important to know who your audience is and select content suited to them. This is important as the content you write will keep readers coming back to your blog. Your target audience will develop expectations for your blog and your reader loyalty will increase as you meet these expectations.

Be Consistent

Your company blog is directly related to your business and its brand and you need to make sure that the brand messages you are sending as a business and also as a blogger are consistent. Update your blog as frequently as possible without compromising the quality of the content for the frequency of posts.

Choose relevant topics

It is important that you choose topics that are current and relevant to your business and the industry you operate in. This will insure that you are attracting the right audience and will spark interest in your readers.

There are also a number of additional online benefits for writing on relevant industry topics such as helping your business rank better in search engines through the addition of fresh relevant content to your website and through expanding your network of online links to and from your site.

Be Honest and Original

When writing blogs, give your honest opinion and don’t be afraid to incorporate your personality. You also need to make sure that you are original and not merely producing a simple list of facts or a news article that could be obtained from a range of other sites. Your style and tone of what you write will set you apart from others.

The effectiveness of your blog depends largely on the time and resources you devote to it and the strategies you implement in optimising your blog to have maximum online impact. It doesn’t matter what stage you are in developing a blog, there are always strategies to better utilise this resource.

Posted in Business Tips | Tagged , | Leave a comment
15 July 2011

The Great Social Media Bubble

Social Media is overrated. There, I said it.

In fact, Social Media is well on it’s way to becoming the next economic bubble.

And what’s remarkable is that we’re only just a decade on from the dot com burst, which saw Internet stocks wiped of close to three quarters of their total value in a matter of weeks. The lessons from this crash have seemingly been forgotten amid the mad scramble for social media stocks.

Before looking at the numbers, a quick crash course in stock valuation. Most companies (particularly those without tangible assets – like a lot of web companies) are valued based on revenues and profit margins, taking into account growth rate and the potential for future profits to continue long term. That’s an oversimplified explanation, but it’s worth keeping that in mind before looking at the actual numbers being thrown around.

The real key point is the “potential for future profits to continue” because that’s what essentially causes a bubble. Overconfidence in a stock’s future or “speculation.”

Let’s look at the facts:

LinkedIn

LinkedIn went public in May. Initially it set an asking price of $32 per share. At the time, analysts were calling this overpriced, as it valued the company at around $3 billion, a giant amount when you considered the company’s total revenues were just over $240 million (meaning profit would likely be around a third of that).

Despite this, the asking price was increased to $45 per share just days before the float (adding another billion or so to the company’s value). At this stage everyone who could work a calculator was double checking their maths.

However, what’s incredible is that on the opening day of trade, the stocks opened at $83 and soared to a high of around $120 per share by midday. At that point, the company was valued at $9.7 billion, close to $7 billion more than what it was worth before the day’s trade and a whopping 40 times its annual revenue.

Social Games

Rumours are currently circulating that social games developer Zynga (think Farmville) is currently filing for an IPO with speculation they’re aiming for a market value of between $15-$20 billion. This would make them the most valued games developer in the world, surpassing Electronic Arts (which incidently has revenues of around $4 billion) and putting their total value at the same level as Yahoo.

Again, what’s staggering is that Zynga’s revenues are estimated at $850 million (with a rumoured $400 million in profit).

Around this time last year, they were valued at $5.5 billion. So a threefold increase in less than 12 months.

On a smaller scale, PopCap games (makers of Plants v Zombies), have just been acquired (by EA Games no less) for $750 million, despite the company turning over just $100 million in revenues.

Facebook

Speculation is also mounting that Facebook, Social Media’s current champion, is also planning for an IPO worth somewhere in the vicinity of $100 billion. This is despite the company reporting revenues of around $4 billion.

Now Facebook has been growing at an incredible rate, so some might call that valuation justified. But consider that Facebook growth has slowed worldwide for two consecutive months now and total user numbers have actually dropped in the US, UK, Canada, Russia and Norway.

Facebook say they are now focussed on increasing “time on site and engagement” rather than raw user numbers but the simple fact remains that they are basically hitting the ceiling of how many people are getting onboard.

This, coupled with the new threat of Google+, makes the 25 times multiplier of revenue to company valuation seem ludicrous. Having said that, my prediction is that their actual IPO valuation will be much higher than $100 billion by the time it rolls around.

The other big consideration with Facebook is how Mark Zuckerberg will deal with the scrutiny of being a publicly listed company. Zuckerberg has already publicly said that he wants to keep his hands firmly on the steering wheel, but that raises another question. Is he going to continue as CEO?

CEOs of publicly listed companies have enormous responsibilities to shareholders and boards, not to mention all the compliance and regulatory requirements that come with it.

This was exactly the reason why Google founders Sergey Brin and Larry Page brought in Eric Schmidt to be the company’s CEO in 2001, as software engineers rarely make good CEOs.

It’s hard to see Zuckerberg making that call, which also brings into question their long-term revenue potential.

Google+

Even Google is not immune from social media speculation, with Google shares adding $20 billion to the market cap in the first week after it was announced.

Google+ has so far grabbed around 20 million users it its first few weeks following launch, and whilst the revenue potential for Google+ is apparent, it’s yet to make its first dollar.

The Warning Signs

MySpace anyone?

The once great social media site was bought by Rupert Murdoch for $580m a few short years ago, only to be sold for $35 million earlier this year.

At one point, analysts were valuing it at close to $1 billion, and it’s now at less than 4% of that. However, MySpace revenues were at $600 million at the time of that valuation, making its valuation a modest 1.7 times its revenues. Yet, despite the relatively low valuation (by 2011 social media standards), it still turned out to be about 25 times too high.

And then of course there’s the fact we’ve been through this before. In the late 90′s all a business had to do was add an ‘e-’ to the start of their name or a ‘.com’ to the end and watch the masses fight for shares.

At the peak of the boom, Yahoo shares were worth $118 a piece. Following the crash, they were worth $4.

So When Will it Happen?

If I knew that, I’d be keeping it to myself and making a fortune on stock trades.

My best guess is around two years from now. It won’t happen until after the Facebook float, and is likely to be triggered by a high profile collapse or downswing in revenues with one of the biggest players that causes a mass exodus.

We’ll have to wait and see… but don’t say I didn’t warn you.

Posted in Economy | Leave a comment
7 June 2011

Effective Communication: Why it Matters

Effective communication at all levels is fundamental to organisational success.

Everybody in an organisation is accountable for their own communication which is why organisations need to make sure that their employees are properly trained in effective communication techniques.

Below is a list of techniques that we’ve found useful and encourage our clients to adopt in the workplace.

Taking the time to listen – It is amazing what you can learn from others when you take the time to listen. Often in a group situation, the person that makes the most noise is the one that people listen to. We’ve seen this time and time again and more often than not, they do not have all the answers. You can get more out of the people you work with if you take the time to listen to each person and manage those that are making the most noise.

Filtering necessary information – When it is your turn to pass on information, cut out the unnecessary information and only give people what they need. This will speed up communication channels, increasing efficiency and saving time.

Being clear and concise – Be clear and concise when reporting or passing on information to others. This principle applies to all forms of communication. People don’t have the time or the patience to read an essay-length report when you could have given them the same information in a few dot points.

Knowing the right form of communication – Knowing the correct communication channels to use for the right situation can save you valuable time and money. This applies for both internal and external communication. Should I make face-to-face contact, send an email, or make a phone call? There is no point going out to visit a client to ask a few simple questions that you could have done via an email or phone call and by doing this, you have wasted your time as well as your clients.

Finally, for communication to work effectively there needs to be an environment where questioning, discussing, reasoning and feedback are encouraged, as this is the nucleus for better communication.

Posted in HR | Tagged , | Leave a comment
23 May 2011

Product Positioning: Stand Out From the Crowd

It is important to develop a product positioning strategy to influence how your product is perceived in the market and where it is positioned. Product positioning can be made easier through effective branding.

Take for example Toyota and Lexus which are both car brands of Toyota Motor Corporation that have different positioning strategies. A Toyota Camry and a Lexus IS may be comparable in shape and size but the two models are designed and marketed to reach two different consumer groups, the Camry for consumers wanting reliability and economy and the IS for high-end consumers wanting prestige and luxury.

When you take a proactive approach, you can influence the market on how they perceive your product. Failure to actively promote and position your product will result in the market doing it for you, and this can be detrimental to your company’s ability to gain a strong competitive position.

So how do you position your product?

First, you need to select the target market that will be most receptive to your product’s positioning. Segmentation decisions are instrumental in developing your company’s product positioning strategy.

Knowing your target market allows you to effectively position your product to meet the needs of that specific market. With this in mind, you are then able to develop and implement more cost-effective and efficient marketing strategies.

Once you have determined your target market and their needs, you need to formulate a positioning strategy that will appeal to the targeted demographic. You must decide how you want to position your product in the minds of your targeted customers.

A solid understanding of your market and your competitors will assist in being better able to position your product. Comparing your product’s features to that of your competitors and identifying your unique selling points is a good way of determining what differentiates your product.

Revision of your positioning should be an on-going process to help refine your position according to changes in the market. Environmental changes or shifting consumer preferences often force firms to rethink their positioning strategy.

There are a host of resources available to assist you in communicating your positioning statement to your target market.

Social media is an important modern day marketing channel, that if utilised correctly, can give a company valuable market-specific exposure and vital product related feedback. A social media presence backed by a solid following creates an environment for open discussion on your product.

There are many innovative marketing tools available today to assist companies in achieving their positioning strategies. Different tools will suit different products, but the key to success is choosing the right mix to match your product and the goals of your company.

So if it has been a while since you last thought about your product’s positioning, now would be the time to do so.

Posted in Sales & Marketing | Tagged , , | Leave a comment
3 May 2011

Dollar Hits New High: What it Means for Business

Well, we were right…kind of.

Around 15 months ago we made the prediction via Twitter that the Australian Dollar would hit US $1.10 by Christmas.

At the time the Aussie dollar was buying around 90 US cents and opinion was split over how high it would go. Sadly, it didn’t quite reach the $1.10 mark by Christmas last year, but we weren’t far off.

But the big question now, is what does this mean for local businesses?

As a general rule of thumb, a high Aussie dollar is great for importers of overseas products as the cost of those goods is comparatively cheaper. It also usually means consumers win out as well, as online shopping from International stores is much cheaper, even after the extra shipping costs.

Exporters, as well as those in tourism, generally lose out as a result of a high value local currency. Exporters find their products are now much more expensive for overseas buyers to purchase and those in the tourism sector find that travellers will prefer to head to places where they get better value for money.

But despite all this, the high dollar presents a great opportunity for local businesses in a number of ways.

Setting up an International Presence

With the Aussie dollar high, the cost to setup International offices or a presence in other countries is historically low. Not only do you get more US dollars/pounds/Euro for your buck, but thanks to the GFC leasing costs in overseas markets are also down considerably.

Higher unemployment means that recruiting good staff is easier purely because there’s more to choose from and depending upon your industry, the Federal Government has grants available for those looking to sell overseas.

What’s even better is when the dollar heads back to its natural levels (around 75-80 US cents), those that have invested now will be well placed to multiply overseas profits when they bring them back to our shores.

Utilising Overseas Labour or Products

Whilst this might seem un-Australian to be promoting using overseas labour or products, the realities of business mean that in some cases, getting cost-effective products or services in Australia just isn’t possible.

We have one of the lowest unemployment rates in the world at the moment, meaning there’s less labour available, and our high dollar makes using overseas labour (particularly for administrative or back-of-house processing) highly attractive.

Likewise, now is the time to shop around for cheaper products or manufacturing if it’s practical to do so.

So whilst the high Aussie dollar has its benefits and shortcomings, the best businesses are looking for ways to use that to their advantage.

Posted in Economy | Tagged , , , | Leave a comment
11 April 2011

The Importance of Branding

In today’s market, there is an increasing number of marketing and advertising channels available. This is resulting in intensified competition as companies try desperately to “cut through the clutter” to gain customers’ attention and dollars.

As competition increases, what makes some companies triumph whilst others flounder and fail? The answer lies in branding.

In most cases, people think of branding as being all about a brand name, a company logo or a slogan.

However, it is much more than this. An effective branding strategy creates an identity for the company and personifies the brand in a way that relates to the target market.

Branding is an expression of your company’s values and the intangible attributes that differentiate you from your competitors. This provides your company with a brand identity that goes beyond the products or services offered by relating to the customer on a personal and emotional level.

So why is this important?

A brand that has an identity can develop a connection between the customer and the company.

This connection simplifies the decision making process as customers are no longer evaluating the product or service attributes, they are evaluating the intangible elements of the brand that are controlled by the company through the brand messages.

If executed effectively, branding will assist in developing consumer trust as customers feel they ‘know’ the brand through the emotional connection they have established with it.  This can translate into long-term sales and customer loyalty.

A well established brand can help communicate value or quality through the intangible elements of the product or service. This can result in an opportunity to command premium prices or cement your company as a market leader in your industry.

Ultimately, a brand lives in the hearts and imagination of your customers, but this is influenced every time they come into contact with your company. From your TV ads to your service staff, everything you do sends a brand message.

So with branding having a major impact on your customer’s decision making and purchasing habits, maybe it’s time to evaluate your company’s branding strategy?

Posted in Sales & Marketing | Tagged , , , | Leave a comment
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