Nov 20, 2011 | Change, Leadership, Management, Strategy
The chaos in the European monetary system, and the appearance of a lack of the required backbone to address the issues has parallels in every commercial change situation I have ever seen, irrespective of the size of the oranisation:
- It takes a while to stuff up a sound system with hubris an self-interest, the decline is slow, but with hindsight, absolutely clear.
- The leadership that got into the mess is unable to clean up its own poop, and needs changing.
- Necessary changes cannot be made until it seems there is no option, and the stakeholders recognise that the status quo is simply unsustainable.
- In change, some get hurt more than others, but most suffer from some austerity. If the stakeholders clearly understand that there is simply no option, and they trust the emerging leadership to take tough, but in the long term decisions that benefit all, they will suffer the short term pain to set things right.
In Europe we are half way through this process. Most Europeans would recognise the status quo is unsustainable, and that change must happen. The leadership is changing, Italy and Greece have changed, and Spain has an election coming up at which the incumbent government will probably be decimated, Ireland made the changes a year ago, and appears to be recovering, and Portugal is just tagging along, so far so good in driving change. Next step is to ensure the measures are appropriately tough, and that they “stick” despite the opposition that will emerge from organised vested interests.
It seems to me that the whole process is being facilitated by the Germans. They do not want the EU to implode as it would see their new Deutschmark soar, removing their current competitive advantage, so they are paying the price of short term financial market instability to force the changes elsewhere in Europe, to give impetus to the general understanding that aggressive change is the only way forward.
If Europe was a company, this is exactly what we would see if a number of key subsidiaries got into trouble.
Billy Bloggs & Co, my small client undergoing some painful restructuring is showing us what will happen in Europe.
Nov 18, 2011 | Management, Marketing
This process has many forms, I have probably seen most of them over the years.
Percentage of sales, opposition activity, what the P&L can bear, what was spent last year, what seems like a nice round number, what the new CEO says, the last and “balancing” item in the budget, and there are others, including and significantly the confusion between strategic investments and short term tactical spending which is often just a cost of doing business in a distribution channel.
Notice the absence of customers in the mix?
All of these common budget setting tools are internal, the serve the operational needs of the business, and have nothing to do with customers, and how they are to be reached, engaged, and persuaded to become apostles for your business.
No wonder we get so much random rubbish thrown at us through the multiplicity of media channels we now have, that have nothing to do with the brand building and strategic positioning of the product or service.
Nov 14, 2011 | Leadership, Management, Small business
The conduct of meetings, whether they be the AGM of a major company, or the committee of the local raffle group should run by the same basic set of rules, worked out over a long period to ensure that a meeting comes to a conclusion at the end of a comprehensive “due process”.
Whilst the AGM of a public company should be far more formal than the local tennis group, nevertheless, some rules should never be broken, significantly the one that states: “No-one can speak twice on a topic until all who wish to speak on the topic have done so”.
This simple rule ensures that the local opinionated motor-mouth who seems to pop up on most small committees is controlled.
It is up to the chairman to keep the discipline, but many a local meeting I have attended has failed because the basics of conducting a meeting are not enforced.
Nov 10, 2011 | Management, Operations
Writing a business plan is usually a priority in business, some do it well, some do it poorly, but what most do not do is write a business plan that evolves.
Effective business planning considers the long term context in which the business operates, and how the resources are to be allocated against the priorities, but shorter term, most tend to be fixated on a period, and the plan becomes a “set in stone” folder articulating financial outcomes that are as often as not wishful thinking, and in which all but the short term tactical stuff is dismissed as “too busy right now” to do.
Really effective planning engages with the reality of the environment right now, considers how the longer term direction will be impacted, makes judgments about emerging trends, and marshals resources and capabilities .
So, in summary to be effective:
Revisit the plan often
Reevaluate the risk assessments
Experiment and evolve.
Nov 8, 2011 | Management, Strategy
The electronic revolution in all its guises is a paradox, and a huge challenge to any management group, and individual who seeks to make a mark.
On one hand, the advances in the capacity to process, store and transmit data is ravaging 20th century business models, on the other, it is creating huge opportunities to create new value.
The area in the middle of these two extremes is rough commercial terrain, full of quicksand for the unwary. This observation applies to both the businesses that survive on the web, as well as those more traditional manufacturing and processing businesses who still need factories and farms to produce stuff. It is just that all the processes that support the management activities have been changed dramatically.
Nov 2, 2011 | Management, Operations, Strategy
Yesterday’s question time, a childish brawl over who knew what and when about the Qantas decision to ground its aircraft, lock out staff, and leave customers around the world stranded, got me thinking. Not just about the pointless squabbling amongst the pollies over a point of history that legally is none of their business, but about the way a business can be subject to expectations way out of line with their competitors, and its legal obligations.
It is obvious that Qantas had considered grounding as a tactic in their industrial dispute, it is completely stupid to think Alan Joyce woke up on Saturday with a bright idea, there would have been a deep consideration at board level of a very aggressive and disruptive tactic that was almost of a “bet the farm” nature.
The real question is, what obligations does Qantas have to act in what politicians consider to be the public interest, when Qantas is a public company, and the Government sold their shareholding years ago in order to free themselves from the demands of being the major shareholder?
Qantas is fighting for its survival, the competitive world of aviation has moved on, and Qantas must adjust or disappear, and yet, there are clamourings for it to ignore the probability of its demise without change.
What gives the pollies, and a large portion of the public the right to demand that Qantas shareholders take a bath to satisfy an emotional attachment that is not backed by any financial commitment? If this was almost any other company in the top 100 listed companies, the tactics in an industrial dispute would be of little general interest, only the stakeholders directly involved would be making their points, and then within the legislated framework.
Why is Qantas different?
