Shareholders, Private Equity firms and Investors – Are they good for business?

All the time we read newspapers and hear on the news that private equity firms are buying or selling businesses. That share holders are disgruntled and continually putting pressure on CEO for better dividends.  There was an interesting article in the “Times” about CEOs. An externally appointed CEO is seven times more likely to be removed from their post in the short-term than a home-grown one. Externally appointed CEOs are great for cost savings but when this is done most have not much more to offer the article stated?

Often Private equity companies appoint board members to protect their investment and to bring highly skilled and experienced people to the business to ensure the strategy goes to plan.  

Private equity firms and the stock markets can sometimes be overly focused on profit and enforce short-term strategies that are sometimes not in the best interest of the business itself in the longer term. I am asking the question is this good for a business as often it seems that there is a business within the business that has absolutely nothing to do with the customer, and the business offer but the real value is about the business valuation and creating a quick return on investment based on an exit strategy.

Examples of this are the Spirit Group and Scottish and Newcastle pub and restaurant estate merger, parts were sold to Punch taverns which are now struggling with huge debt and are looking to off load 2200 restaurants and pubs in a demerger. The Little Chef restaurants once had 435 restaurants and is now down sized to 162 due to the misguided strategy of the “people restaurant group” and the level of debt they took on to buy the restaurants meant when they dropped menu prices and expected the footfall to increase it did not making the business unviable and default going into administration.

 R Capital who own Little Chef paid £10 million for what was left of the business yet the former owners paid £58 million from TLLC group holdings (Permira). I firmly believe the demise of Little Chef started because of the focus on profit over the customer trends and the customer experience.

It seems to me that some private equity and shareholder led businesses focus on business valuation , cost reduction, asset stripping and margin management at the detriment of concept / branding and the customer experience. As we can see in the Little Chef case £48 million pounds disappeared in valuation and in real terms this is physical cash, this is not unique to hospitality either if we look at the dot-com boom there are similar examples such as boo.com.

  Without emotion they are good for business?

If you take the emotional element out of  the way private equity firms and shareholders impact business , then this is a good thing that businesses are sold and resold for profit gained out of exit strategy valuation. For investors in most cases these opportunities are a great way to make a high return on investment and for shareholders in the short-term it means a dividend payment.

 For the existing employees and the customers I think the deal sometimes is not as good as often these investments bring about significant change based around increasing the company valuation. This change impacts the business hard and usually in a short period of time. Having worked as an operator pre and post selling of several businesses, everything in the initial stages is geared up like a marketing machine, rallies for the staff explaining how best practice will prevail and that the new owners values everyone in the new company, what is often neglected to have been said is that the incumbent business owners already have decided what is going to be practice and who will stay and go and what the strategy will be going forward. The new owners can be too focused on the quick win and exit strategy.

I believe that no one person is bigger than the business but people (being the team) often are the business and the risk to the new owners could be the de-skilling and dilution of what made the business a success in the first place of which I think sometimes in not taken in to account.

Great for start-ups and poor performing businesses?

I believe Private equity companies are very good for new start-ups as they can bring about growth and business mass quickly through cash investment and of course they have a strong network of their own people who they like to put on the board to protect their investment and ensure the exit strategy remains the business focus.

These people are proven and experienced individuals at bringing about significant change, with a very good understanding of how to asset strip and target investment to bring about the required return in time with the profit ratios a normal business would struggle to achieve as a norm.

I think it would be good if these companies took the John Lewis approach which for me is one of the best business models for managing a business with staff  and management teams being partners. We are about to enter a challenging time for retail so I will be watching how they manage this balance carefully. Although I believe John Lewis will continue to outperform the rest of the retail market regardless.

There definitely is a place for private equity firms and the shareholder led business model they are great for start-ups and good for businesses that are insolvent or performing badly that would other wise go bankrupt with out the expertise and cash investment private equity firms provide.

For businesses that are performing well and have a future under the right CEO and management team the business model they work with is not the best for profit alone but is better for the customer , the existing team and the actual business itself in the long run.

Your social network or your Job Status with risks?

 

Before the social network revolution Job status was a way people could demonstrate their success in their lives and show off their social positioning in society and this has been around for centuries. Through job status people were able to improve their quality of life, the people they kept company with and often people would be looked up to in their local villages, towns and cities because of their job status they held. People felt inspired to go and work and serve time in a job that would help them reach that all important Job role title.

Even today there are some senior managers who continue look back on their time served in a job and have not realised that we are living in a very different world. These senior managers need to wake up and join the social network revolution. For the ones that don’t I am feeling concerned for because there is a definite sea of change , a truly remarkable thing is happening, and it has nothing to do with work or job title it is to do with who you are connected to in your social network. Your status is now influenced by your LinkedIn, facebook.com, and ecademy.com networks. There are even now social networking sites that are specific to the industry you work in such as HR.com for human resource execs and social networking sites like Govloop.com for people working in government and Academia.edu for academics.

 Today your next job is most likely to come through a connection in your social network and your social status will not be driven by job status alone but by quality and quantity of your social network connections. This new social status is a very new kind of status; it’s the era of the online networker.

There are websites that now measure your influence online one such site is called klout, it offers a score of your influence based on social networking, blogs etc. This is only the start of things to come within 10 to 15 years unless you have a social network presence on the web you will be a nobody a person who is friendless and one that will struggle to find work and most likely feeling very isolated.

On Twitter people can follow your comments and your followers can be part of your life experience in real time. Some of these people have a very large amount of followers on face book, and twitter and definitely do not have a business suit, it is most likely they are only in their twenties or early thirties perhaps younger and it’s highly plausible that some of these people don’t even have a job. Yet these people will be able to influence the masses, every word they type and put online will be followed and read and absorbed by thousands if not millions of people and in reality these people are the new stars of the global online stage and social revolution. These people are the ones who will become more powerful than our governments and politicians and most likely will become our representatives or politicians. These people will be able to mobilise mass support for things they believe in and they will be able to influence businesses and governments from their computer or mobile phone.

What does this mean?

For most of us it means we will either have to allocate time to make sure we have an online profile and presence that is up to date or employ a company to manage our online profiles for us. We all will have to consider carefully what we place on line about ourselves and share personal information carefully. It is important that we become selective about whom we will allow access into our social network and of course the level of personal information they can see.  More employers are definitely showing a greater interest in facebook and LinkedIn and there have been a few employees that have been dismissed because of what has been written on their facebook and or blog site. This goes to show we all need to be selective about what we upload or write online.     

 With all this personal information on line we need to understand that we run the risk of being identified and segregated because of our online information. If the world ever has a world war our social networking information could be used to cleanse people from society that do not follow the values and belief of the oppressor in power. I don’t want to scare people but this is something we should always be mindful of.

 Whatever we think I guess social networking is here to stay and it has become part of daily life for us as adults and our children born in the last ten to fifth teen years.    

I have added the following YouTube video with some interesting facts

Make Your Business People Centric

When writing this blog I am making the assumption that the business is already trading with a product offering and the target market has been defined and potentially there is or could be a demand. I hope parts of this blog will be helpful and of course I am very happy to debate any aspect of this blog.

Throughout the twenty years or so I have been a manager I have come to understand that selecting and recruiting the right people and team, with the correct skill set mix for the whole business is fundamental and critical to having a successful business in the long-term. My view is that all businesses must be people centric at all times as well as being commercial.

I say people centric as I think many managers and employees seem to forget that a business exists because of people. People being the customer and people being the whole team from the board of directors to the staff that are the face of the company in direct daily customer contact.

 I am always shocked at how many companies and managers do not place people at the centre of their decision-making and explore the potential impact of any decisions made on the customer and the team. It seems to me in this day and age that many companies place too much emphasis on what the investors and stakeholders want, which in many cases drives short-term strategies to turn a quick profit for the dividend payment or to achieve a bonus. I would argue that if the FTSE 100 investors pushed for greater focus on the levels of customer service and the team running the business, they would see a much stronger return on investment in the medium to long-term. Just to be clear I am not saying at the cost of financial performance , I am saying that if business decisions placed an equal or greater importance on people as they do a profit we would see greater more profitable companies , happier employees and most importantly happier customers.  

I appreciate that some decisions need to be timely and if not there could be some risks to the revenue and profit lines. Although Id argue that if you did not think about the impact of your decisions on your customers , and team , you will be wasting resource and time trying to realign or restructure the business somewhere down the line and this will be far more costly. What I am suggesting is that when making decisions at all levels of the business these three questions should be asked.

What is the impact on our customers?

What is the impact on our team?

Can we do it commercially?

Asking yourselves these questions will drive other questions and if you have invested wisely in your management team and employees and created an environment they can contribute too your employees will find the best solutions and or an alternative way to make things work, much like Spencer Silver in 3M and the post it note which has now earned 3M millions of pounds.

Your people are your greatest asset, many years ago when I worked for Dominos Pizza as a Technical store trainer responsible for training franchisees and new openings there were some Franchises that went bankrupt for various reasons, Dominos Pizza International at that time would recover the store and keep the store trading with the support of someone like me until another Franchisee was found to buy the store. Most of these stores had very low sales , yet the moment they had a great manager of a Franchisee who was very focused on the business the revenue and profitability of the store grew massively , one store in particular I can remember in the 1990s went from doing 2.5k per week to over 10k per week with the same area and most of the original team and the same product. The difference was that this Franchisee had made people central to all his business decisions and never compromised any standard that impacted on his customers and his team.

Being Human Isnt Easy

Really not sure how this blog is going to turn out as I am going to write this on the fly and even where or when this blog will end so please forgive me for flipping thoughts from one point to another. I will write as I see a connection and perspective to what I am blogging and thinking about at that time. (I hope it’s not too confusing) 

Human beings are such complex creatures and I could talk about us forever and no doubt I will, this blog may never end as I am always amazed at people and  how they think , behave and develop. The craziest thing is that just as you think you have seen it all a curve ball comes and smacks you right on the head and you learn some more about human beings and how they respond. I guess this is called evolution! Long may this continue to happen.

I think on the surface it looks really easy to be a human being and if I was an alien looking down on earth at first glance id probably think how cool it is to be a human in comparison to a fish or bird or other animal. More importantly I think if I was a fish, chicken or other animal id think I got the short straw but then no matter where you are the grass always looks better on the other side. I like the thought of being a bird or fish until I realised that I’d probably end up on a plate or be another animal’s dinner.

  I am a bit of people watcher and always have been since the earliest days I can remember when I was a child I  think it was my way to try to work out why adults are so difficult to understand and how sometimes they react and make weird choices and definitely behave in the most oddest of ways.

As a child you can do something that in your child’s mind seems perfectly logical and correct and yet you will get a good telling off from your parents and then on the other hand you will do something or behave in such a way that you are expecting the worst from your parents and you will get lots of love and praise.

 How complicated is that for starters. Yet to a child all things appear the same just adventuring and learning. As adults we would describe these as opportunities and would think about exploiting them, it isn’t long before we have these conditioned and shaped up by our education system of conforming and parents.

 Although to my mind which is based on I being a child all things appeared as an opportunity the thing that told me if it was right or wrong was dependent on the emotional state of the adult and in which way a response was given back to me. Mostly I would say it was definitely not proportionate or consistent.

We can quickly see as a child it’s a challenge to be a human being and that’s even before we have embarked on the issues of relationships with the nuclear and extended family, friends, social and personal relationships aspects of being a human being. Let’s not forget we then have to try to work out the ” I” question and sense of belonging , sense of purpose questions with finding answers to questions like who I’m “I”? And Where or does god play a part in my life?  This leads to us having to answer questions like freedom of choice, being good or bad and dare I say taking responsibility for our own lives and actions and not blaming society and others, which is a chapter in itself.

As children our parents lie to us as they force their beliefs on us which are based on lies (to protect us mostly and to give us an element of happiness), an example is father Christmas as children we are told he exists, we are told tooth fairies exist. So we look to underpin these beliefs, through seeing the gifts and finding the money that is placed under our pillow only later to find out it is not true. So we have to ask ourselves as adults how many of our beliefs are false.

Given that most of us hold untrue beliefs we can see why stress is now a major cause of sickness in the work place. I once read an article about a little girl at school in an art lesson and the teacher asked the class to draw and paint anything they like. As the teacher walked around the class room she stopped and asked the little girl what had she painted the little girl said “god” the teacher responded and said to the little girl we don’t know what “god” looks like. The little girl said we do now. This type of schooling represses innovation and creativity and the ability to think for ourselves. Perhaps some of us as human beings conform so much through external influences that we lose the real us and become what others want us to be.

Even from a work perspective we have to have the right look and fit and that’s before the company has decided that you have the right experience and skill sets. Things are definitely going to be getting tougher with social networks like Face book, Ecademy, LinkedIn – soon we will see that having the right people in your network will be commensurate with the quality of life you have. What is very worrying is automatic deselection from and isolation in society based on your web profiles.   This may even be here now, the truth is it mostly likely is.

We really do have a very challenging start to life, with what is true, and what is false, we have learned ours parents values and without really knowing it we have had our emotional states and reactions influenced and shaped by people that we have come in to contact with daily and the huge amount of media we are exposed to.

It is not really difficult to understand why our society is a messed up and how for us as individuals how difficult it is to grasp and learn how to work through the debris and challenges of our human existence!

Consider this if our happiness is shaped by all the things we are exposed to and the things I have mentioned in this blog we have not got it easy to be human being at all. The problem is we learn our behaviour in auto pilot and most of us then go in to auto pilot in our interaction with others and because of this we become unaware of our own behavior and its impact on other people.  This causes us conflicts which we have to learn to overcome in order to move forward or we end up being in an institution of some sort or have a complete emotional breakdown.

Something I want to share with you is when I was in India recently and I saw some very poor people from a material perspective and yet they looked some of the happiest people id seen for a long time. It goes to show that as a human being where and what you anchor or tie your emotions too is a very important question and for many of us we do this trying to or in seeking happiness. On happiness very few of us take in to account the true perspective and value of our current life situation , personal beliefs ,  life values, and take in to account that our self perception could be flawed. Therefore if we compared our life to others who were born in the wrong place , with bad parents or with a health issue we  may appreciate that we are already in heaven.

Our mind is an incredible piece of natures design, yet it can destroy us as individuals in a moment, It is so important we control how we talk to ourselves as a child and as we are grown ups. Our eyes physically see only a small part of what is reality the rest is filled in by the brain which may not be as it really is. So we have the challenge of managing not only what others tell us about ourselves and our world but what we tell ourselves in words while we work, rest and play. If there is one thing we should all do and that is shut our minds voice off when it tells us negative things.

 The reality is being human is a bit of a lottery from a learning and living perspective because if you were born as a child in to a wealthy country or in to a royal family or in a  wealthy family you may have a head start (depending on nature not disadvantaging you) but this does not mean or guarantee us being happy (another challenge of being human) and as each generation comes along for children being born now in this day and age we now have the challenges of a digital age and it is getting faster and complicated by the hour to live through.

 You could argue that it should be easy with technology but the reality is every time we simplify something to save pressure and time we add something in to that time slot so we can keep doing more. I believe we will see very soon information sickness as common cause of stress. People will be sufffering from social network syndrome sickness because too many people have left their networks or a friend has upset  them on face book is only around the corner.

It will not be long before we see people who completely shut down due to the amount of things we cram in to our time and have to manage and cope with the amount of information that comes to us via our TVs, Phones, computers, tablets and other gadgets. We are being shaped continually by media, advertisements selling a life style we aspire to have that most of us will struggle to reach.

I have only covered just the surface. I will continue this blog in more details as soon as I can make time. So please give yourself a break from life and celebrate and appreciate all the challenges we have had to overcome in becoming us and in our efforts to become a fully fledged human being.

Feel free to contribute

Michael Butler

www.intravici.com

http://twitter.com/intravici

Change Management Strategy

The Background

Companies will be reviewing their business strategies and opportunities for 2011 to negate the impact of the coalition’s austerity plan and to compensate for any consumer spending reductions in the UK and in the wider euro zone / global economy. Many retail and hospitality companies will expect to see their revenue lines suffer, as across the globe people tighten and review their spending.

CEOs and FDs will be reviewing and looking for signs that areas of their businesses are at risk and will initiate some company change management programs and initiatives that they believe will protect their revenue lines and profit conversions and in some cases improve customer service.

It is likely recruitment freezes and headcount reductions will be enforced in the early part of 2011 and companies will be only allowing essential expenditure rather than investing. With planned public sector cuts in the UK, combined with the private sector tightening and targeting their spending, we will see a snowball of business closures and a lot change management activity to try to off set risks.

I am certain for hospitality, restaurants and retail companies that they will be looking for ways of increasing revenues and reducing costs to try to neutralise the impact of the 2.5% VAT increase on the net sales line and inflationary driven supplier increases. As well as this business will have to contend with the austerity plan impact and in particular the fear brought about by people feeling personally at risk job wise and thus saving and reducing debt rather than spending on non essentials items.

In efforts to try and encourage consumer spending and reduce costs many companies with initiate some sort of change management program in order to maintain performance or to survive. The problem is companies will enter in to the change management process with an initial momentum with limited employee buy-in that will quickly fizzle out due to the method, approach taken and scope of the change , Change is difficult to make happen and even Harvard Business School recognises that only one-third of all change management initiatives succeed.

Why do Change management initiatives tend to fail?

Clearly for me to try to blame failure of change management initiatives on one particular cause would be rather judgemental and could not be substantiated. What I would like to do is explain how I think change management has a better chance of success and the method I believe is best to use.

Most change management programs are initiated from the top down and fail because the people at the bottom of the company either have not understood why change has been implemented most likely because most change management initiatives can become diluted or if there are not enough benefits to the organisation meet resistence. 

Buy-in is a fundamental requirement for all stakeholders for change management to reach a successful conclusion.  While it is usual the rationale of the change management programs  may be sound and logical the reality is in a lot of businesses change initiatives , changes are normally focused on fixing the symptoms rather than the root causes of the poor business performance, so while in the short-term things look like they are improving the reality is in the medium term momentum will be lost and quite possibly the business would have ended up standing still and put needless strain on either the remaining work force or suppliers. It is my belief that companies should take the time to decipher the noise and de-tangle the root causes of the reason change is being tabled and discussed ideally through empowering people at all levels of the business to be able to contribute ideas / solutions for improving the business and for the company to listen. ( perhaps using small working groups.)

 Change management should not be bull dozed through the business unless your intention is to cause huge resistance and increased employee turnover. I believe companies should look at change management as very similar to growing a plant.

What has the success of change management and growing a plant have in common?

Change management involves mostly people; people are natural and organic beings and follow the laws of nature.  Change management should be viewed in this way. There is absolutely no point in trying to get change in to a business that does not involve or reach the roots of the business, the roots being the employees. Be sure to consider that the fix being suggested is not politically motivated or hiding a poor performing manager. (or gardener if you take my suggested approach).

A gardener plants a seed in our case it’s the change management strategy. He will water it and make sure all the conditions are right for the plant to grow, some times the gardener may influence the speed of growth  (growth being change management initiative) through changing certain conditions. The gardener understands that he will not receive the fruit he is looking for without caring for the plant as it grows and continually watering the roots and ensuring the plant has sunshine, sunshine being praise for good work done. A gardener allows the plant to grow naturally and can influence growth by increasing food (food being communication) , sunlight (praise) and if necessary change the temperature (reviewing of change Strategy)  A gardener will help the plant grow naturally and will provide support throughout its whole life until he receives the fruit he wants.  Many companies start change management programs and provide an initial amount of support and then after a few weeks nothing including feedback or communication of the progress or if the end result was reached. Imagine watering a seed only once ,   It would germinate grow a little and die like many change initiatives.

My point is change is a journey and usually ends up evolving,  it’s a continuous process and one that should be treated with care, attention and reviewed for the life cycle of the change that is needed. Most importantly are you fixing the symptom or the cause?I hope I have been able to get my ideas across and if you have any questions please ask.

What Bus are you taking in 2011?

I was walking past the Strand in London and saw several red London buses with different numbers going to different destinations and stops and of course leaving from different places with different people from all walks of life. I then got thinking about life and success and achievement and how the choices you can make will contribute towards you having a good journey and reaching your destination or a not such a great one. There are other factors like in life such as timing of the bus, will the bus break down, will someone on the bus introduce you to another opportunity or will they cause you further challenges.  It must be the thought of the New Year and knowing that I want to try and achieve so many things that has got me thinking in this way.

Buses and Life?

The buses to me are going on a journey and it is up to the passengers to get off at the right stop at the right time or to get off when other factors and influences helps them change their mind. I then recalled that if you get a bus late during the week many people sleep on these buses and miss their stops. I likened this to life that many of us go about our lives getting on different buses that could take us to different stops and ultimately to a different destination but many of us sleep through the journey and miss so many opportunities.

I then thought about all the people that get on buses everyday go to the same destination and then get off at the same stop and in some cases wonder why they are having the same result in their careers and life. Maybe for once they should consider getting a different bus?

Planned Journey?

So does this mean if you planned your journey, left in time and waited that you would get the right bus and achieve everything? I think not as there are some buses that breakdown others that can arrive early or late , the bus driver may make a decision that prevents you getting on the bus , such as striking or being sick or even another factor such as an accident  something may happen to prevent you getting to your planned destination. Does this mean you should give up or wait for another bus? I guess that depends on the consequences and what the weather is like outside?

So what does this mean?

To me it means that you can set yourself a destination in your life and the journey you take may not be the one you set out to go on for numerous factors, for some people the journey will be easy for others they may not make it and for most they will sleep through it. At the end of the day would you get on any bus? Probably not! Would you hope the bus will get you there most definitely, will you deal with it if it something happens so you can continue your journey most likely. Bottom line life is like the buses you choose a number, destination and journey some of us will get there on time, some of us won’t at all and some of us will change our minds, but those of us who are determined to get to our stop in 2011 will

Is good good enough for Hotels and Restaurants in 2011?

My belief is that 2011 will be a very challenging year for many hospitality and restaurant companies, especially if you are in the mid to high end in terms of market positioning. Of course there will be those hotels and restaurants that will be lucky enough to be considered to be in vogue that will be immune to the general decline that I am expecting to see throughout 2011.

Perhaps January 2011 will be marginally better than January 2010 due to the poor weather we saw in December 2010 and people may have rescheduled their company Christmas parties in January. After January I believe we will see a decline in guest dinning frequency and spends throughout 2011. It would not surprise me to see REV Pars and occupancy for hotels to go back to the levels we saw in the early days of the recession in 2008 / 2009.

So what does this mean for most of us? For starters we are competing for less guests / customers. Our customers and guests will most likely have a budget in mind and lower tolerance of mediocre service standards. We will have to focus on being very proactive in the area of building relationships with our customers and recognition of their loyalty to our businesses. To do this we will have to engage our teams and managers to continually go above and beyond what our customer expectations are. For me the following things should be focused on.

People

Employees are your company without employees your hotel is just a building, your restaurant is simply a waiting room with tables but through creating a guest and employee centric culture you can create a company that has something very special. The important influential factors are the selection and recruitment of new employees, choose your employees very carefully never compromise on the person fit and skills sets needed , your employees will help your company create the differential advantage you need to beat any competitor.

You have selected your talent, they are a perfect fit to your organisation and a complete skill match, you have put energy and time into recruiting these people, you have referenced them and the company they have left has confirmed that they are all you had hoped for. You now have a window of opportunity to make these people ambassadors of your company. Your new employee is conditioned to be receptive to change, wants to impress, wants to learn and wants to progress for goodness sake please give them a proper induction, introduce them to people in your organisation, welcome them into your team the moment they start as you would any customer in to your business, allow them to experience as a customer what your company is about, and buddy them up with your best people and train, train and train.

Once they are in your organisation ensure they receive settling in reviews and managers are having a coffee and a chat and owning / solving anything that could impact on the employee to give you there best. Talk to people in the existing team and resolve any potential personality conflicts. The more you put into this the more your customers will receive from your team. It’s a win-win a no brainer happy staff will mean very happy and loyal customers. Happy staff starts from the top, invest in all of your managers throughout your whole organization. Middle management and senior management always seem to be forgotten when it come to training remember everything has to start from the top. If you want your managers to train, encourage and motivate your teams the leaders of the company have to ensure the managers are receiving the same attention.

Performance manage

People are not machines, actually they are very emotionally fragile, and their mind in some cases can play tricks on them, they can start to feel undervalued that the company doesn’t listen or care about them and it will be the companies fault in their minds.  The once great employee will become a burden and a liability to your company very quickly.

 Encourage your managers to read the signs and then act to recover as you would for a valued customer. There is a tipping point where your employee will shift paradigms and view your company and customers in a very different way that can be damaging to your business, teams and customers. If managers do not act quickly to resolve the way your employees feel your managers will be focusing 80% of their time of 20% of your team. It’s a self full filling prophecy if your managers spend 20% of the time left on 80% of the team your business will haemorrhage employees and customers at the same time. It is not difficult to work out that very quickly you will be losing sales and profit.

Never accept Good

How many times have you been to a hotel reception and the receptionist has auto piloted your check in? How many times have you been to a restaurant and you have received the company robotic spiel? Empower your staff to personalise the service and interact with your customers and guests. Change the thought processes of your employees to understand and know that they are responsible for creating positive lasting memories for your customers and guests.

The challenge for your teams needs to be to have your customers come in as friends and leave as family. Train, Train, in your product knowledge, not only about menus and room types but about what is going on locally and historic information that may be of interest.   You would be shocked by the number of hotel receptions or concierges that if you asked them about the in house restaurant menus or wines for room service or the restaurant that they would not know about the menu although they would know everything about a competitor. In the same way if you went to the restaurant in the same hotel and said to the waiter tell me about the facilities the hotel has, they are unlikely to know to any level of detail. Product knowledge is the foundation to help your staff go beyond Good. In fact I believe in 2011 “Good” will not be good enough and okay means you will be struggling to survive.

Customer Relationship Management

Your company selects the right people, trains them and encourages them to do well this does not mean in itself your business will be successful in retaining loyal customers. Your customers and guests will become desensitized to the service standards you provide and remember all competitor companies will raise their game too. You will have to become more innovative and creative, create ways in which your staff and managers can find time  to freely express and discuss crazy ideas on how to win your customers hearts and minds. It is the simple things that can make a difference, record guest preferences on a good CRM system (customer relationship management software). Appoint a person to own this. Review the quality of data recorded. Reward and incentivise staff for relevant information. This information should only be recorded through observation. Reward your customers randomly, shock them with how much you care and value them. This can only be successfully done by having staff and a culture that wants to do this as a way of doing business.

If we get it Wrong

Your duty managers and staff must be empowered to recover your guests at the time they are in your business. The power of social media, twitter and customer review sites can cause huge issues for your businesses reputation. If a guest is in your hotel and twitters room is noisy or that the food made them ill it is live and will be seen by many people. Face book users have an average of 130 friends and it does not take a genius to work out one message of dissatisfaction will reach many people. It is absolutely crucial your team is focused on owning your customers and making certain they leave wanting to put on their face book your business is the best in the world. Use software to search keys words for your business in twitter etc and direct message your customers and solve any complaints, this will at least show other potential customers that your organisation really does care about its customers / guests.

In Summary

If you do not make 2011 about the customer and your employees you may find your company cutting costs and reducing head counts in order to survive.

Its all about attitude in 2011

I have decided to reflect and look back to what has happened in 2010 both personally and business wise It is new years eve tomorrow . I started to ask myself some questions , such as have I achieved what I set out to do in 2010?

Reflecting on the past year I feel I have learned a lot and I have achieved some real milestones and business objectives particularly in that no one really knew how this year would pan out with the global economy being in recession in 2009 and slow to recover in 2010 . We have had some real challenges such as the ash cloud , the tube strikes , student protests and bad weather and lets not forget the banks holding on to their money to pay back borrowed money from the state rather than loan to businesses, which in my opinion has not helped our economy grow as it could of, but may be that’s another blog for the future.

For one I am still trading , many businesses have closed and my business has had sales growth on the prior year . Secondly my audit application app has improved and I believe I have really achieved some positive things in india which have huge business potential and lastly I think I am finally starting to build my credibility as a consultant who can make a difference for the right reasons to companies.

I consider myself a bit of a “say how it is person” I started to think about what has not gone so well for me and I recognised that I have not grown my revenue enough to be able to do what I want to ,  I wanted to give my time to developing and growing a technology and consulting business with a higher head count that was profitable. I wanted more clients , more opportunity and to get better at networking and social networking.

What am I going to do in 2011 and am I going to do anything differently? I then started to think about excuses and how easy it is to blame the economy, other outside influences and other people. A few moments later I thought to myself hang on a minute it actually doesn’t matter what goes on in the world what matters is how I see the world and how I allow it to impact on me. I then remembered what Henry J Ford said which is “Whether You Think You Can or Can’t, You‘re Right” . So clearly its about me having the right attitude choice, and having an attitude that will not take no for an answer for one and an attitude of achievement and success no matter what the challenges are.

I then got thinking about  my reticular activating system which to explain as I see it , it is an automation filter for my thoughts helping me see things such as potential opportunities and risks that are passing me by everyday and most importantly alerting me to these opportunities .This filter works from my life experiences and learning’s  based on my own beliefs which have mostly been formed through either disappointment and or to stop me being disappointed , so to re focus this is a bit of a challenge but a must for me, I think I have played things a bit too safe. Its time to re-condition my thoughts and beliefs to be more positive about taking risks, even ones that may lead to disappointment , but then if I back it up with determination and persistence. I may get there in 2011 – I am feeling better already about the New Year soon to be here.

So clearly I need to be more open to opportunity in 2011 despite me seeing and looking for evidence of potential business doom and revenue decline risks that the media would have all of us believe for 2011. I have to keep working towards my personal goals which are to enjoy my job 80% of the time while being able to pay my bills and build on my reputation for bringing solutions and expertise to complex operational problems in areas related to operating standards and change management, business coaching – hopefully with some technology thrown in.

I then got around to asking myself some more questions why am I doing this let alone blogging it  , why am I evening thinking like this its 2am and I am unwell with flu? I came to the conclusion that maybe someone some where may benefit from my thought processes. On a selfish point its about me wanting to be happy now rather than feeling ill and for me I know my happiness in part comes from enjoying what I do which is about me feeling I am making a difference and in particular helping businesses achieve better results regardless of a recession or other outside influences and of course from the benefit my family gains from the business doing well.

What is important to me this year is to manage my choices of attitude, my beliefs on the future despite what I read and see in the news , the biggest challenge for me is keeping a strong and persistent focused approach to grow my business and  to achieve more with less time and this is my goal for 2011 is to keep this attitude  no matter what happens and to keep working harder when it gets tough. I also know I have to be more creative , more innovative and keep being solutions focused.

It’s sometimes difficult for me to remember the following especially in the moment but we are all  in control of our emotions , our actions , our choices , our thoughts and beliefs so here is to 2011 and any challenges it may bring to us and most importantly to the successes we achieve and challenges we over come. I hope for all of us it brings more of what we want and less of what we don’t – of course as you may have guessed this is up to us and our choice of  our attitude . Happy New Year  to everyone !

Digital age and are Social networks bad for your Life?

I was watching and listening to Thomas Power talking on the future of social networks. He brings to us some insights based on his experiences having spent 16000 hours online and adjusting to the digital age and the digital humanisation. After watching his video it raised some questions in my mind and I want to share some thoughts that are in my mind. He discusses about information sickness and tries to offer some insights on how to deal with this through Filtering and provides some shocking stats.  His advice is about being open, receptive and supportive to people who come to your attention through various digital platforms including spam.

He mentions governments and companies that like control and warns us about fighting to keep control out of the web and digital age. I then got thinking, I love technology and love to see how it helps us all, and it is really quite amazing, when you consider where we are now. We can order pizza online, make our friends on line , get our next job on line , lose our job online , learn online , shop online ,report a crime online , have a library on line of music, photos and books and this is only 5% of how much we are engaged, connected and integrated into the digital world and web based platforms.

It dawned upon me that effectively we now will have the birth of Digital NLP, where people can learn about our behaviours and copy them without actually meeting us or interacting with us. They can see what words we write in and understand our preferred sense to communicate through and for those of us that are immersed into the digital world they can study us online by watching our videos see what content you like to talk about, read and study. Twitter is a god send it lets them know what you are thinking or doing in real time.

The thing that amazes me is that most of us know and have people in our networks that are scattered across the world and yet we don’t know our next door neighbours.

 We have to be careful with this powerful technology. We will become assimilated like the Borg on star trek through technology platforms that recommend and or introduce. We are becoming socially adverse to physical interaction and communication in the true human sense as we are starting to do most of our socialising through face book, my space, LinkedIn and twitter. Google shows people where we live and with GPS on line in map software like Tom Tom, Google maps and social platforms like face book.

 In fact even thieves have become smart – they can steal your car and the GPS in your own car they have now stolen will take them home while you are working. I have heard some people become your friends on line or a friend of your friends online to gain information about you. Yet we trust ourselves with this technology?

Thomas Power focuses on filtering the right things, in our heads we all have something called the reticular activating system which helps us filter information although usually influenced heavily as a child and subsequent life experience , this is what we need to reprogram for the modern digital times.

An example of the reticular activating system is that if you buy a particular red car and prior to this you have never seen this car in red! Guess what now you own it you see many other red cars like yours –

My point being all of us need to filter carefully and just now and then be random, focus on learning something you would not normally do, speak to someone who you normally would not come into contact too. Change your habits frequently; don’t let technology blind you to your true capability as a human being.
Knock on your next door neighbour’s door and introduce yourself. I am not saying technology is bad as I could not imagine being without it myself and of course I develop web based tools to help businesses, but I do remain cautious about being fully immersed and do not want to become at one like the Borg – Remain true to yourself remember it’s good to have a break from the information high way.

Thomas Power TEDxNewSt – Thomas Power – The Future of Social Networks http://ff.im/-svcRm

Responsibility for our Financial mess

We have all just come through a decade of growth and wealth with very cash rich times. Many governments and people across the world including our own spent beyond their means and were running their countries on borrowed money. Many people in the UK borrowed huge amounts of credit with mortgages that are only manageable while the interest rate remains low.

 Now it’s time to pay back the money with interest, we must accept that the good times as we knew them were not sustainable and that the greedy times are now officially over. Our country and Government believed a recession or depression could never return to this capitalist world where house prices and pay rises just kept on going up year after year.

 We have become a throwaway society.   Officially the London Metro heads lines reads 500,000 jobs to go this morning  let’s accept it the good times as we knew them have gone, no more quantitative easing , we have the lowest interest rates we have had for 315 year history and the world is still in a slow down. The financial world is cyclic and you cannot have a boom without a bust and we have just had a boom like no other. So let’s pay some attention to this as we are very much in a mess and are heavily influenced the impact of globalisation. We have out sourced most of our manufacturing to China like the rest of the world but we are a service industry country and therefore reliant on visitors from other countries coming over to the UK and making use of our facilities such as tourist attractions, hotels , shops etc in simplistic terms.

For People and Companies

What can we do? We need to return to the days where we repaired things, no longer throwing things away – let’s teach ourselves how to repair and fix things again. We must stop sending good clothes to charity shops because we wore them a couple of times and now don’t like them and actually we didn’t need them in the first place. We must stop supermarkets selling two for ones items and if they choose to do so the free item given must be a voucher for the next time we visit the shop – we have to stop throwing things in the bin that still can be used. We must stop being a nation of over eaters, supply and demand impacts on our retail selling prices and  a good benefit for us all by eating less is that it will help save money for the NHS, we must stop taking sick days because we want an additional holiday. We have to take ownership and responsibility for our own lives and actions that we make and take and try to stop blaming the labour party that we as a nation voted in. We can make a difference if we all do our part.

 Pay attention to the natural or manmade global warming which has influenced all weather patterns and is messing with our food crops, fish stocks etc all these are impacting on our food prices. We need to stop agricultural land being given over to Agro fuels as this means less food is being produced again pushing up food prices for everyone  even in the poor countries.

 Trust me taking action now and doing these things means we will live in much better world and have a good life situation.

Sticking together

 Let’s not behave as the French have –  they clearly have not learnt from the French revolution when things were tough and the people needed bread and the king soon to be beheaded said give them cake…..

Now it’s the populous that wants the cake but can only have the bread if they are to survive this financial mess. I admire the solidarity of the French but the solidarity should be about making the country work and helping to support the country to remain stable and balanced.

 My point is that being British people we are reserved and the closest we have ever come to solidarity is where the lorry drivers blockaded the fuel depots and motorways – bless them and now the Diesel is much more expensive. No one supported them and we allowed the government to change the laws blocking freedom of speech through demonstration. 

Personally I don’t think or believe there is any point in demonstrating and causing the country further costs and debts i.e. through striking and other tactics- but I do believe it is now a time for solidarity – this is where we all pull together that is all the  companies, people and governments and we all have one common aim and goal to work together changing our habits and practices so we can come through this mess before other countries securing our place in the global pecking order at the top.

 Private companies should employ people more responsibly – perhaps they should consider paying slightly less so they can employ more people – this lessens the burden on the state in terms of benefits and helps contribute taxes and national insurance rather than taking from taxes. This would increase people contributing to national insurance which helps pay the pensions. We should all insist that our government helps businesses to get off the ground making the banks invest sensibly in them and forcing them to help entrepreneurs and high achievers in small businesses to excel with support from experts and targeted cash investment.

Bottom line we have to accept we are all in this together, the sooner we all work together the sooner we can be on a stronger financial footing ready for the next hopefully controlled boom – where we will put money away for these recession / depression times.