Cyber Support not top of mind for Australian CEOs

Cyber Security CEO C SUITE

Since the Australian Privacy Act’s introduction 30 years ago, the dramatic evolution of technology has created extraordinary changes, challenges and opportunities in the way personal information is collected and used in Australia.

When asked specifically about cyber security threats, the majority of CEOs are only moderately (31 per cent) or somewhat (34 per cent) concerned. In terms of measures taken to protect data, nearly half of CEOs (44 per cent) do not use cyber security experts and just 19 per cent of CEOs outsource all cyber security management to specialists.

Follow the link below to find out more…

 

Fraud in the Family Business

In the last week I have heard three stories of fraud in business. Each of them happened to occur in businesses owned and operated by families. I have also attended a KPMG presentation where, in their recent survey, they state the “value of fraud rose by 16% between April 2016 and September 2016, to a total of $442m” in Australia alone.

Many perpetrators work from inside the business. Sometimes the culprits are family members. My story tellers all had their perpetrators working for them as trusted employees. Two out of the three found out by chance while the employee was still working for the business and the third business found out almost a year after the theft took place. The challenges faced are more than just monetary. The emotional pain can be huge. There is also the challenge to the values and culture always at play in family business, and any other business too.

Fraud comes in many shapes and sizes, and in general terms, it happens through gaps in systems, working around systems and breaking of systems. IT fraud is growing as well. In recent times, individuals have had their identities stolen and money withdrawn from their bank accounts almost immediately. One person, reported in the press, had to freeze her business and private bank accounts ….. and wages were due for over 100 employees.

Are you looking for fraud? Where are you looking for fraud? How do we prepare for fraud? And what do you need to pay attention to?

A few precautions to protect yourself from fraud and cyber crime are:

  • Do not give any personal information to organizations or people before verifying their credentials
  • Many frauds begin with a phishing email. Remember that banks and financial institutions will not send you an email asking you to click on a link and confirm your bank details. Do not trust these emails even if they look genuine – (UK Police)
  • Destroy and preferably shred receipts with your card details on them and mail with your name and address on. I density fraudsters don’t need much information in order to be able to clone your identity – (UK Police)
  • Make sure your computer has up-to-date anti-virus software and a firewall installed. Ensure your browser is set to the highest level of security notification and monitoring to prevent malware issues and computer crimes
  • Keep track of Purchase Order documents and Invoice documents. Have a check and balance system in operation.
  • Annual reviews of existing processes and systems to find gaps.

 

By John Broons – May 18, 2018

 

John Broons ✯ Family Business Specialist

About the author: John Broons – Is a an accredited Specialist Family Business Advisor and Fellow of the Family Firm Institute (Boston, USA) CFBA, ACFBA. John works with decision makers in family businesses of all sizes to get clarity and focus around family relationships and business success. John also coaches and mentors business owners and executives in creating, challenging and focusing their business strategy.

Further resources on this topic:

http://www.apca.com.au/payment-statistics/fraud-statistics

https://www.allbusiness.com/fraud-in-family-business-2-5222374-1.html

 

 

Posted in TEC

Smiling but sinking: why the competitive tendering system must change

In commercial and business-to-government markets, competitive tenders are the very first transaction that sets the tone for how buyers and suppliers do business together. They have been around for a long time now. And buyers will argue that they are working – to a point. Unfortunately, however, the competitive tendering system is broken in ways that buyers simply don’t get to see, because suppliers are too scared to tell them.

Recently I surveyed a range of suppliers to find out what they really think of competitive tenders and dealing with procurement. All of the survey respondents were employed in organisations that need to pitch for business via competitive tenders in Australia. 53% were from commercial businesses; 31% from professional services firms; and the remainder worked in not-for-profit organisations that compete for block-funded government service delivery contracts. 63% were from large organisations with 200 or more employees, with the remainder evenly split between medium-sized organisations (50-200 employees) and small businesses fewer than 50 employees.

The resulting comprehensive report, Smiling But Sinking, examines the attitudes and experiences of suppliers to competitive tendering and dealing with procurement in three key areas:

  1. The timelines suppliers were given to respond to competitive tenders,
  2. Their experience of buyers’ tender response requirements, and what they needed to submit within those deadlines, and
  3. Their backend experience of the feedback they received from buyers about their tender submissions, and its usefulness for continual improvement purposes.

Their responses show that competitive tendering is increasingly challenging and difficult for suppliers, mostly in ways that are entirely preventable.

 

Key findings – timelines and deadlines

Tender timeframes have dramatically decreased, and suppliers are now given only half the time that they believe they need, to respond. At the same time, buyers’ information requirements either haven’t changed, or are increasingly onerous, while deadlines are often rubbery and prone to change. About a decade ago, the most common response timeframe for a competitive tender across industries was four weeks, but this has changed.

Most survey respondents said that they are now given two weeks to respond to a tender in their business or industry (52.8%), while almost the same percentage (50%) said that they believe four weeks is a reasonable response timeframe. 97.6% now say that tender deadlines are getting shorter, while response requirements either have not changed or have increased. Two-thirds of respondents also said that in the last 12 months, they received at least one tender with an impossibly short deadline.

Shorter deadlines are putting pressure on suppliers to redeploy staff at short notice, and to significantly redistribute their internal workloads in order to respond. A third of respondents said they had “very often” been forced to take staff out of their day jobs for a significant period of time when they were not expecting to, in order to cope with the demands of a tender. A whopping 72.2% also said they had “often” or “very often” received a tender at a difficult time, such as the week before Christmas, with a requirement to respond over a holiday period or peak working period when they were short of resources.

 

Key findings – tender response requirements

Vague, inadequate and confusing tender documentation comes at a cost to supplier response time and resources, and affects the accuracy of submissions. Requests for scope clarification frequently go unanswered, or are answered too late to be useful, and duplicate or irrelevant questions continue to complicate the task of responding to tenders. In the last 12 months, the majority of respondents (58.4%) said that they had “often” or “very often” found tender questions difficult to interpret and or answer. The remainder said that this was an issue for them occasionally.

More concerning, three quarters of respondents had “often” or “very often” seen poorly defined tender requirements that generated confusion among, and questions from, themselves or other suppliers.  As a result, a third said that they had “often” or “very often” asked clarifying questions about a tender to the customer’s nominated representative, only to receive no answer, or an answer that came too late to be useful.  Half of respondents said that this happened occasionally, and only a small minority said that it had never happened. A similarly large minority (41.7%) of suppliers said that they “often” or “very often” found that buyers put out multiple amendments and addenda to their tender documents, forcing them to re-work parts of their tender response.

 

Key findings – customer feedback

Despite the significant effort they expend in responding to tenders, suppliers continue to get inadequate feedback to help them improve. There is a lack of feedback overall, and a lack of specific feedback beyond (too high) ‘price’. When feedback is given, often it’s considered generic, and in some cases, may even come across as if the buyer has not read the tender that they are providing feedback on. In the past 12 months, 50% of suppliers said that they “often” or “very often” received no feedback; a further third said that they didn’t receive feedback on some occasions, and only a small minority had not had this experience.

As one respondent put it, “Any feedback would be great.”

A solid majority (63.9%) had also been told they lost a tender because of their ‘price’, without any other useful feedback on their submission. Suppliers were also asked to nominate what frustrates them the most about customers’ decision-making process and feedback on their tender submissions. ‘Lack of honesty’ was the top answer, closely followed by lack of confidence that the buyer had actually read their submission, and then the absence of useable feedback.

 

What happens next?

To change any relationship for the better, we first need to consider our own part in it. This means looking at our own habits and patterns, and the reaction they invite from the other party. This is true even in buyer and supplier relationships, where buyers hold the purse strings and therefore, the majority of the power.  These preventable problems with the competitive tendering system have major implications for buyers, who are missing out on valuable insights from suppliers into how they can compete better and do business better. As well as the supplier feedback, Smiling But Sinking also contains three quick wins buyers can implement in each area – tender timelines, response requirements and giving feedback. My hope is that this study will break down some of the communication barriers that exist between buyers and suppliers, helping buyers to make improvements to the competitive tendering system that will generate goodwill, collaboration, and better results for everyone.

 

By Robyn Haydon – Business Development Advisor | Specialist In Must-Win Bids, Tenders, Proposals | Speaker & Author at Robyn Haydon

About the author: Robyn Haydon 

Robyn is an engaging and authoritative speaker and business development consultant specialising in competitive tendering. Her clients have won and retained business worth hundreds of millions of dollars with many of Australia’s largest corporate and government buyers. She is also the author of three books, including Value, Winning Again, and The Shredder Test: a step-by-step guide to winning proposals.

Posted in TEC

The new KPIs for modern businesses

From Twitter to SnapChat, many of the most recognisable corporations in the world are making virtually no profit. Square, FedEx, and Amazon aren’t just industry giants; they also weren’t able to make a dollar for five years. That hardly makes them unsuccessful businesses — rather, key success measures have changed. Organisations across all industries are finding that they need to develop their reach before moving into profitability and that, indeed, they may not be moving towards traditional monetisation schedules at all. It’s possible for an organisation to make money for shareholders without making money for itself — and it’s also possible for a business to grow dramatically without income.

 

Customer Satisfaction and Brand Reputation

Customer satisfaction is one of the most critical success factors for a business — and for good reason. It takes time to build faith with your customer base, while losing faith can be accomplished overnight. Profit can be built internally, but turning around the public perception of a brand takes a good deal of outreach. A business must be focused on meeting customer needs and managing how its brand is perceived by its customers. A single , from Qantas to McDonald’s. Mitigate this potential damage by keeping track of public sentiment, and by measuring customer satisfaction following interactions.   

 

Company Culture and Employee Retention

Do your employees work hard for your business? Are they likely to stay with your business or do they already have one foot out the door? Employee culture and satisfaction is a key component to the longevity and sustainability of a business. Employees are more likely to achieve high productivity when they find meaning in their work, feel their contributions are valued, and feel their job utilises their strengths and talents. Moreover, high employee churn ultimately leads to high costs and poor customer care.

A satisfied employee won’t just be more productive, they will also work to improve their organisation through innovation. They will go above and beyond for customers and management, and will therefore be able to improve upon the company’s overall reputation. 

 

Knowledge Management

When it comes to a scientific study, the study itself is only as important as the accuracy of its data. Studying company success is no different. If you cannot successfully manage and analyse your data, you won’t be able to determine whether you’re moving toward or away from success. Knowledge management systems are designed to track and analyse indicator metrics, thereby making it easier for an organisation to learn about itself. Without appropriate knowledge management, a business cannot know whether or not it is truly successful. 

Knowledge management comes from internal discipline, processes, and continually evolving strategies. Businesses must be willing to audit their knowledge management processes, adjusting it as they go. They must be able to utilise their performance metrics across all levels, from employees and management to logistics and shipping, and must be able to create real and actionable conclusions from their reporting. 

 

Digital Return-On-Investment and Customer Acquisition

Twitter, Facebook, and even Uber — the key to their success isn’t measured in profitability, but rather in customer acquisition. These businesses may not be making tremendous profits, but they are scoring revenue, by managing their advertising return-on-investment and by expanding aggressively into new markets. This is quite a different world than what the C-suite may be accustomed to.

Businesses today need to consider not only their revenue streams but also their potential for supporting new growth. As they continue to expand, they also push out the competition. Sometimes breaking even is all they need to do; in fact, some businesses like Uber are willing to operate in the red for some time with the knowledge that they can outlast the competition. 

This is where customer acquisition becomes important. As long as a business is acquiring customers it is building value. Customers themselves have value, as it is possible in many ways for the customer to become the product.

 

Social Media and Brand Awareness

Modern organisations rise and fall based on their social media presences. A social media presence can suddenly bring a business back from the brink of death; as well, it can close the casket on a thriving business that has taken a highly visible misstep. Social media is everywhere; information about businesses can propagate like a flash fire. It’s your job to make sure that information about your business is positive, and that if anything goes viral, it’s marketing.

Brand awareness, in and of itself, is a measure of success. A highly recognisable company name has intrinsic value, even if the company has not reached profitability. Investors will look upon a business favourably if it has built out its influence in this way. There are many businesses that have been able to build their social media reach and brand awareness while still being pre-revenue.

Modern organisations are looking at a substantially different landscape than before. They must be willing to measure success differently, in a world in which businesses are often building value without building their financial performance. By exploring alternative methods of success scoring, businesses can focus on what they do best — building value for their shareholders.

 

TEC: The Executive Connection

Disruption is going to continue occurring, and business is going to change dramatically even in the next ten years. Mentorship and connections with colleagues can help in navigating this difficult terrain. With The Executive Connection, you can connect with like-minded individuals throughout the world, learning about trends, and growing as an executive with the advice and direction of others. 

Find out more about what we do

 

Liberate the workforce using technology 

agile workforce executive connection

At a roundtable recently, The Executive Connection discussed how new and emerging technology will change, and already is changing the way people work; evolving to a point where capability is no longer just human.

The automation of a range of jobs and workplace functions is speeding up processes and driving efficiency by automating the predictable, most repetitive and dangerous jobs.

However, as technology replaces the repetitive it does not replace the need for human interaction, but rather it enables employees to work in new and different ways.

In fact, by allowing machines to complete mundane tasks, employers can liberate their staff from their desks, and the clock; providing them with the environment needed to take on new challenges and opportunities anytime, anywhere.

Helen Wiseman, The Executive Connection Chair says, “The role of technology means that many undesirable jobs will disappear; putting less pressure on employers to entice workers into jobs that much of the workforce doesn’t want to do. This offers organisations huge opportunities to transform their attraction and retention programs by putting skilled workers to better use.”

Understanding the benefits of technology and how to apply it will allow leaders to capitalise on human potential in new ways.

Download the whitepaper on ‘The Agile Workforce’ now 

 

Posted in TEC

How to benchmark the financial performance of your business

Nothing drives success quite like some competition. In order to gain some leverage against the competition, CEOs must first understand the competitors they’re stacked up against and compare it to their company financials to track how their own performance is measuring up. Like a sports team watching a film to learn more about the team they’re facing, CEOs can garner a lot of valuable insights by benchmarking their company against their competitors.

In this guide, we’ll look at how you can use the financial reports of your competitors to gauge the success of your own company and devise a strategy that allows you to rise above the competition.

Important benchmarks to consider

When comparing the current state of your company to the current state of other, similar companies that you are in competition with, there are many important data points for you to consider. These data points include:

  • Operating costs
  • Gross profits
  • Net profits
  • Sales trends and profitability trends
  • Marketing expenses as a percentage of gross revenue
  • Cost per employee
  • Revenue per employee
  • The ratio of revenue to fixed assets

Once you’ve identified your competitors, comparing these data points to that of your company allows you to determine how well you are performing against the competition. Since competing companies will likely be operating a business very similar to your own, it’s valuable to have the means to analyse and learn from how they’re running their operations while saving costs to generate higher profits. Doing it this way may also  reveal constant bottlenecks in your operation and highlight key areas where there is room for improvement. Likewise, identifying these key areas enables you to use them as a leverage so you can set yourself further apart and always be one step ahead of the competition.

Where to find financial data on your competitors

One easy way to garner loads of information on your competitors is to hire a consulting firm that has access to a large databank of industry data as well as individual company data to produce a comprehensive report that compares and contrasts your company against its competitors. However, if you wish to produce this report in-house, there are plenty of resources available so you can find the data points outlined above both in your industry and the individual companies you are in competition with. These resources include:

  • The Australia Bureau of Statistics. The Australian Bureau of statistics offers data on sales trends based on industry, product, and geography. Combined, this data can help you compare your own sales trends against the sales trends of the competition.
  • The Australian Department of Jobs and Small Business. The Australian Department of Jobs and Small Business provides information on employee wages per industry, enabling you to conclude how your cost per employee compares to the average amount of money other companies in your industry are spending on their employees.
  • Risk Management Association. The data provided by the Risk Management Association is the data that most banks use to evaluate a company, making it an invaluable resource for benchmarking your own company.
  • Morningstar – Morningstar provides comprehensive financial data on publicly traded companies. While this resource is most often used by investors, the same data can be used for benchmarking purposes.
  • Dun & Bradstreet – Dun & Bradstreet offers a wealth of data on individual companies, including sales data, important ratios, balance sheet data, data on employees and their earnings, and much more.

These, of course, are just a few of the resources available for unearthing enormous amounts of data both on individual competitors and industry averages. With a little time and a few expenses, you should have no problem finding enough data to thoroughly benchmark your business.

The value of benchmark-based goal setting

Goal setting is one of the most important things CEOs can do to achieve a benchmark that their whole team can strive for. However, it’s important not to set these goals at random. If the financial goals you set for your business are too high, you risk setting an impossible standard that hurts morale when it is not met. If your goals are too low, your company could end up meeting its goals and still underperforming.

This is why benchmark-based goal setting is so valuable. Once you determine how well your competitors are performing across a wide range of metrics, you can use that data to set goals for your own company. Since these goals will be based on the performance of other companies in your industry, benchmark-based goals largely eliminate the concern that the goals you set will be too high or too low.

Setting goals based on the performance of your competitors is just one of many ways you can use the data you’ve garnered from your competition’s financials to drive the strategy of your own company.  By taking the time to benchmark your company, you’ll gain a better understanding of your company’s performance and be in a much better position to rise above the competition.

TEC gives you access to one-to-one executive coaching and mentoring sessions with experienced business leaders who can help you achieve this. Contact TEC today to find out more.

Related article: How to stay motivated and stick to your goals by TEC Chair, CEO mentor and coach, Richard Appleby

Posted in TEC

CEOs hit the ground running, but need to future-proof for long-term success

Growth, hiring, and effective decision making were the key challenges for Australian CEOs during 2017. Now with 2018 in full swing; technology, culture and productivity will be the pressure points that force CEOs out of their comfort zone this year.

That’s what the findings of the Quarter 4 2017 TEC Confidence Index show, but how leaders adapt and overcome their unique business challenges is set to be no different.

Business forecast upbeat

The year is off to a great start with CEOs around Australia optimistic about the future, with growth firmly in their sights. Sales, profitability and headcount are all expected to see an increase in the next 12 months.

It seems the strong economy is lifting confidence and creating a stable environment for growth. The NAB Quarterly Business Survey revealed that in December 2017, business confidence increased to its highest level since July 2017[1]; aligning with our findings that reveal CEOs anticipate economic conditions will improve in the next 12 months.

CEOs get their house in order 

Australia’s leaders know that growth will only come if the business is set for success. The three key decisions CEOs will be making this year relate to strategy, business processes and culture.

Strategy including planning, succession and mergers and acquisitions are the number one priority for business leaders as they seek to develop strategies which will help them evolve and adapt to external influences.

The second area of attention is optimising business processes, including sales, operational efficiencies and managing customer expectations. Its clear leaders understand that creating a strong foundation will help leverage growth and boost productivity.

Finally, HR decisions continue to weight heavy on the minds of business leaders; with culture, productivity and hiring at the forefront of decision making.

By identifying the areas of the business that require the most attention, organisations can ensure appropriate processes are in place and working seamlessly to boost growth.

Upskilling trumps hiring new talent

The skills shortage and the war for talent continues to be an issue for leaders. In Quarter 3 2017 business leaders focused their efforts on boosting wages to attract skilled workers, however this quarter they’ve changed tact.

CEOs have decided to prioritise upskilling their current workers in 2018. By developing the skills, ability and experience of existing employees, leaders hope to implement a sustainable approach to help achieve business growth.

The big business threat

The new Mandatory Data Breach Notification laws means all businesses must report any data breaches, whether perceived or confirmed, to authorities and the general public.

It’s therefore surprising that 37 per cent of organisations do not have a cyber security strategy in place that’s communicated to executive leaders.

This is especially concerning following the release of a recent report from PwC which reveals 89 per cent of Australian CEOs cite cyber threats as the greatest risk to their business.

As technology, innovation and disruption continue to change the corporate environment CEOs must develop new strategies to keep pace and stay ahead. The Executive Connection remains dedicated to supporting leaders as they make decisions that positively impact the business in the short and long term.

 

Download the full report now 

Posted in TEC

The top 6 areas CEOs need to explore in 2018

It’s not your imagination: business is changing at a much faster pace than ever before. What was once considered market disruption is now commonplace — and CEOs are finding it necessary to evolve quickly. It’s time for all CEOs to revisit old strategies and explore new opportunities, investments, and trends. With that in mind, here are some of the most important areas CEOs need to consider in 2018.

TEC Dec 2017 CEO Confidence Index Report

 

Download the latest CEO Confidence Index Report 

 

1. Artificial intelligence and machine learning

AI and machine learning are starting to become widespread, showing extensive growth throughout 2017. Through AI and machine learning, businesses are able to automate and streamline their business processes, reducing the amount of necessary workforce they need as well as potential errors or bottlenecks within their operations. Companies such as Coca-Cola Amatil have been able to improve their market share by using AI in their business analytics.

Many industries are still exploring how artificial intelligence and machine learning can fit into their business structure. At the same time, more advanced and robust AI and machine learning solutions are being released. Many organisations will never need to develop their own AI system, but instead will take advantage of third-party resources that include it within their offerings.

2. Freelance workers and virtual office spaces

From Amazon to Apple, many businesses are now embracing the remote worker.  Businesses are now finding talent from all over the world, as technology has made it easier for businesses and employees to operate effectively from anywhere. With cloud-based document storage and communication suites, businesses can operate virtually almost entirely.

For employees, remote work has proven to be more accessible and attractive, and thus the employers who offer remote work are often able to procure better talent. For employers, remote workers reduce the overhead for the organisation and make it easier for them to scale up as needed.

3. Social responsibility and inclusiveness in company culture

Organisations are now taking proactive steps towards social responsibility. In the wake of the #MeToo movement and many high-profile harassment cases, many businesses have taken an active role in developing internal policies meant to reduce harassment and discrimination.

In 2017, companies ranging from Uber to Tesla were accused of discrimination in the workplace. These accusations have taken a significant toll on these companies, both in terms of legal fees and public perception. Social responsibility is now being explored in terms of risk management and prevention, to better understand the contributing factors, and minimise overall risk.

4. Automation of tasks and robotic workforces

From industrial robots to virtual ones, organisations are now transitioning towards increased automation. Task automation increases productivity, reduces risk, and positively impacts an organisation’s bottom line. Businesses are able to capitalise on automation to improve their scalability and reduce their overhead.

5. Digital marketing and global analytics

Even many local businesses are tapping into the advertising potential of digital marketing. With the increased ability to pare down to a specific audience and geo-target a specific region, digital marketing has become the primary solution for businesses trying to reach out. Both on a B2B and B2C level, it’s become necessary for organisations to boost their digital marketing to continue bringing in traffic and interest.

At the same time, organisations now need to explore their advertising analytics to determine whether their strategies are effective. Analytics may combine technologies from artificial intelligence or from machine learning to find information on which strategies are and aren’t working.

6. Managing cybersecurity threats and risk management

According to our latest CEO Confidence Index report, cybersecurity threats are now a major concern for CEOs. Yet, 37% of organisations surveyed by The Executive Connection do not have
a cybersecurity strategy that is documented or communicated to executive leaders. Download the full report to find out the challenges faced by Australia CEOs today and where their focus will be for 2018. CEOs are going to have to react to this increase risk if they are to mitigate risk for their organisation. In 2018, CEOs are going to need to take some additional steps towards improving their security. This may include running security audits or investing in next-generation cybersecurity solutions.

Many organisations will also be investing in cybersecurity insurance, to reimburse them for the costs associated with a data security breach. The cost of a data breach often amounts to millions.

Where are you focusing this year?

Ultimately, 2018 is about new, emerging forms of technology, and integrating this technology into current business workflows and strategies. It’s also become a more culturally conscious world, in which businesses are required to be empathic, morally conscious entities, and a brand identity has to evolve its own social and environmental awareness. Depending on industry, CEOs may want to look towards updating both their organisation’s technologies and their company culture.

Being a CEO changes from year to year, and there are a tremendous number of potential missteps. In order to make the right decisions, you often need well-educated, qualified advice. TEC can help. Through our monthly meetings, you can reach out to a number of CEOs, professionals, and entrepreneurs, who have also been updating their techniques and their operations. Contact TEC today.

 

TEC Dec 2017 CEO Confidence Index Report

 

Download the report 

The (r)evolution of business

The revolution of business

 

The combination of globalisation and the dizzying rate of technological advancements means that the corporate world is on the brink of a Fourth Industrial Revolution.

At a luncheon recently, The Executive Connection discussed how this new environment has evolved and how its challenging leaders to rethink traditional revenue streams.

The catalyst of this revolution has been the increase in the volume of international trade and cultural interaction that we’ve seen in recent years. This means that goods, services and ideas are flowing across borders now more than ever before.

Ainkaran Krishnarajah, Director, Strategy, Optus summed it up perfectly when he said, “Established enterprises want to grow and innovate in new areas but are challenged by the drug of traditional revenue streams and profit margins, which steers thinking closer to the core and to shorter term objectives.”

The scale and force of change is impacting businesses across all industries and as a result, is driving companies to reassess whether their current business model is now the best approach; from processes to people the shift in the landscape is fundamentally changing the way businesses operate.

Not only does this challenge organisations to rethink how they structure their workforce, but also the way they approach their business processes. Companies with inflexible structures will struggle to compete and the knowledge economy will see skill diversity triumph.

Businesses that recognise the need for change and react accordingly will ensure they’re building a business ready for the future of now.

 

Download the whitepaper on ‘The Agile Workforce’ now 

 

Posted in TEC

The key to successful change management for CEOs

Throughout Fortune 1000 companies, change management has been estimated to only have a 50 percent success rate. Some estimates even place success rates at as low as 20 percent.  Acquisitions, mergers, down-sizing — all of these are critical events expected to happen throughout the organisation. With the fast-paced evolution of technology, employees will experience change constantly. Whether it’s the introduction of a new service offering or implementation of a sales tool, the success of change within an organisation often lies in the hands of its employees. Change is inevitable, but successful change can be evasive.

Transparency and consistency

More than anything else, employees value an open line of communication with upper management. When employees believe that they can easily reach out to the management team, they become 54 percent more likely to be engaged. On the other hand, when employees do not feel that their management is open and approachable, engagement is only 2 percent, while 65 percent are actively disengaged.

All of this underscores the importance of transparency and consistency. Employees are concerned about the ramifications of changes at work as it can impact their lives. Organisations may be concerned about expenses and income, but employees worry more about how it can impact their families, their health, and their personal time. As this change occurs, this type of uncertainty can translate into poor work performance.

Before, during, and after change, communication needs to remain active and transparent. Often, this will require a communication management plan.

Introducing employees to the change

The initial communication between you and your employees will set the stage for further interactions. Organisations must be able to communicate change clearly, honestly, and empathetically. They must explain why change is occurring and how it will be occurring.

Everyone absorbs information differently, as well as at different rates and this is something you need to consider. Although you can communicate the mechanics of the change in multiple ways, it is best done face-to-face as an announcement or in a meeting. You’ll need to highlight why this is necessary, how it impacts you, and more importantly, how it impacts them. Be transparent about the potential effects and address their concerns right away by outlining your contingency plans. At the end of the meeting, send out a wrap up email to solidify the discussion and highlight important points clearly.

At the beginning of the change management process, CEOs must not only clearly communicate the facts of the change to their employees, but also give employees information about how to further connect with their supervisors and discuss their potential concerns.

Communicating the benefits of change

At all levels of an organisation, concerned parties will be wondering why the change is occurring. It’s imperative that stakeholders understand the direction that the company is headed in, as well as upper level management. Don’t overstate or over promise. Instead, inspire, motivate, and be honest.

Benefits should always be emphasised that may directly or indirectly impact employees. Remember that information will trickle down from the top. Apart from company-wide communications, information will transfer from executives to managers and from managers to employees. Each time, some of that information may be lost to misinterpretation and only the major talking points will remain.

The organisation as a whole can transition more smoothly towards change if everyone views it as a positive experience. If individuals within the organisation feel that change is unnecessary or even potentially harmful, they will be less eager to participate.

The impact of change

In addition to the positives, you also need to be realistic about the negatives. Part of being a leader involves quickly and directly addressing issues that may arise before rumours circulate and they go out of hand. Don’t try to hide the negatives; if this is what will happen, it will come out eventually. Be honest and empathetic and let all employees know what they are in for. It is important to build an atmosphere of trust with your employees. They will be better prepared for the negatives to come and will most likely weather through it if they are properly advised ahead of time.

Employees understand that negative issues can arise. They simply need to know that they are under solid, confident, and honest leadership. By being honest, you can inspire your employees to work harder. Discuss the complexities of the change and what they will have to endure, and then tie it into the rewards and benefits that they can expect as soon as the change is complete.

Prepare your contingencies in advance

Not all negatives and drawbacks are certain. There are a number of complications that could arise that must be planned for. Communicate these potential complications as well as the contingencies in place to address them. All parties involved will rest easier knowing that their concerns are being addressed, and they will be better prepared should these possibilities become a reality.

Open lines of communication are important: if there are contingencies that you have not considered, employees and management must feel as though they can report them to someone higher up and have them addressed. This is critical to success, as it ensures that employees will feel comfortable addressing any potential blind spots.

Following up after success

Your job isn’t complete after the change has taken place. You must also make sure to celebrate the success. You owe it to the employees to reward them for their hard work and trust. The next time change arises throughout your organisation, your employees will remember this and be more willing to pitch in.

Organisations able to manage change successfully are 350 percent more effective than their peers. Managing organisational change is often a matter of knowledge, skill, and experience. With a tremendous number of moving parts, change management requires both logistics and social skills. If you want to improve upon these skills, you may need the help of peers and mentors. Contact TEC to find out how monthly meetings with a CEO peer group can help you deal with different types of organisational change.

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The employee retention strategies used by Australian CEOs

TEC

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32 percent of CEOs now believe that talent is harder to retain. Businesses are now competing for the top talent, both acquiring it and retaining it. CEOs must focus not only on obtaining staff but also retaining them. Not only do talented employees add value to the organisation, but the costs of rehiring and retraining employees can be considerable. Replacing an employee costs, on average, six months of salary for the position in question. Investing in employee retention can be an excellent way to improve profitability.

To that end, CEOs are attempting to make their businesses more attractive to their employees. Their strategies include:

  • Improving training

Many employees find themselves leaving otherwise fulfilling positions because they feel that they don’t have any opportunities for growth. Improved training along with a transparent process for promotions can give an employee goals to consider. 33 percent of CEOs believe that improving training will lead them to the right path towards drawing the right talent.

  • Adding benefits

Benefits can be added as an employee gains seniority to reward them for their loyalty. Employees with the company for a long time could be rewarded with additional vacation days, health benefits, or flexible working hours. 32 percent of CEOs are adding benefits, compared to 17 percent who are increasing wages.

  • Increasing wages

A regular increase in wages is often necessary to keep the best employees, especially in industries where they may be considered by competitors or where salaries are advancing quite quickly. Salaries aren’t the only way to retain employees, but a lack of salary increase can make employees feel undervalued even if they otherwise enjoy their work.

  • Company culture

Employees often find it easier to work with a business if they identify with its culture. Businesses should establish their company culture quickly and make it a point to invest in employees that are a good fit.

  • Acknowledgement

In addition to salaries and benefits, there are many employees who simply want to be acknowledged for their contributions to the business and their hard work. Setting up employee reward systems and regularly acknowledging employee input will show employees that they are appreciated by the business and that their work is not going unnoticed.

A business that is able to retain its employees will have lower churn and a greater sense of stability. Not only will it reduce its hiring and training expenses, but it can build upon employee knowledge to develop more innovative and well-optimised business processes.

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4 relationship marketing strategies

Building relationships with customers is a way to increase customer lifetime value, improve customer retention, and reduce marketing costs. Just a 5% increase in customer retention can improve the profitability of a business up to 75%. Through relationship marketing, businesses are able to establish strong bonds with their customers, leading to customers who are more willing to engage, purchase, and advocate.

Even businesses unlikely to have repeat purchases and return customers can still benefit from the promotion, referrals, and brand awareness acquired through loyal and satisfied customers. But how do you get started? Relationship marketing isn’t a single strategy. Instead, it’s a type of marketing strategy. By learning more about the strategies available, you can find the strategies most applicable to your business and brand.

Strategy 1: Train and promote effective sales support.

Support is an incredibly important aspect of a business, so much so that positive support interactions can mean more to a customer than the quality of a product or a service. Sales support should be responsive, transparent, and ultimately focused on promoting customer satisfaction. This strategy puts customer support and satisfaction at the forefront of a company’s marketing strategy.

Implementation: Train staff members from the ground up to promote a ‘solution-focused’ form of customer support, in which employees attempt to find resolutions to a customer’s problems and effectively address their emotions. Sales support teams should be dedicated to identifying a customer’s needs and fulfilling them, and should be aware of when to escalate calls or when to provide additional benefits (such as discounts and refunds).

Strategy 2: Keep your lines of communication open.

Modern customers expect to be able to communicate through multiple channels: email, phone, live chat, social media accounts, and more. The more accessible your business is, the easier it will be to forge long-lasting relationships with your customers. Additional lines of communication will improve brand reach and awareness among multiple demographics.

Implementation: Invest in software that makes it easier for your customers to reach you. The appropriate CRM solution (discussed below) will give your employees easy access to customers through live chat, email, and voice calls — and will encourage your customers to contact you when they have questions or concerns. Every time you interact with your customers one-on-one, you build your relationship and develop further trust and loyalty. Make sure your employees are available when needed and respond promptly to customer communications.

Strategy 3: Invest in the right ERP and CRM technology.

Enterprise resource planning and customer relationship management suites work together to improve customer service and retention. Through this technology, employees are proactively given the information that they need to best serve customers — in addition to identifying top customers quickly. Through ERP and CRM, support staff can see a customer’s history, appropriately score leads, and follow up with customers who may have issues to resolve. 

Implementation: From comprehensive cloud-based solutions to smaller, on-premise software, there are dozens of popular ERP and CRM solutions. Companies should explore the solution that best meets their needs, supports their specific industry and targets them based on their company size. For many companies, a subscription-based cloud solution will be the most versatile tool available. Once setup, employees will be able to take notes about customers, consult customer information, and contact high scoring customers to check-in.

Strategy 4: Boost your loyalty and customer referral programs.

Getting customers to come back can be as easy as creating a rewards program. 79% of customers look for loyalty and reward deals before they commit to a purchase, with 26% looking for these types of promotions while shopping. Reward and referral programs show customers that you care about their business and that you appreciate their support. It also promotes and monetises their word-of-mouth efforts, potentially creating opportunities to develop brand ambassadors.  

Implementation: Many point-of-sale systems today have built-in tracking for loyalty, rewards, and referral programs. Test out new programs in specific markets, with different forms of reward (such as 10% off discounts, points towards merchandise, or free rewards). Promote your reward and loyalty programs through your social media accounts — especially referral programs. Referral programs are most useful for businesses that don’t expect a lot of customer retention, such as businesses that sell one-off luxury products.

Attain and retain with relationship marketing

These are only a few of the relationship marketing strategies that may be applicable to your business. For each individual business, different strategies may be necessary — and it may not always be possible to tell which strategy will be most helpful until tested.

If you want to learn more about the advanced marketing strategies driving consumer marketing today, you need to connect with other like-minded professionals. TEC can provide an exclusive, advanced network of entrepreneurs, CEOs, and other professionals, who are experienced and knowledgeable about the changes being made. Contact TEC today to find out more. 

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