The Experion Group Blog

An Unconventional Path from “In Transition” to New Career

2013-10-30T10:00:00.000-04:00

by Cheryl Crumb

I reconnected with a colleague today who was “right-sized” by his employer after 15 years. He told me he’s currently an “in transition consultant”, a way to put food on the table while scrambling to find a new job.

In these uncertain times with high performers out of work, here are some less conventional ways to proceed.

Become conscious of your mood

The first step is simple, but not easy. Examine and reflect whether you’re feeling bitter about your “ex” and how you were unfairly treated after years of faithful service. While resentment is natural — and there are hundreds of friends who will fuel the evilness of The Dastardly Company — it’s essential to consciously put energy into accepting the situation.

Why … especially because feeling “victimized” makes you feel so “right” and them so “wrong”?
As human beings, we’re always communicating, and people can “hear” what we don’t say loudly. In other words, our bitterness will be evident to potential new employers, and that’s not something they find attractive. Employers are looking for resilient people with positive attitudes.

Consider that resentment is a choice we make (albeit unconsciously). That opens the possibility of our choosing acceptance, a counter-intuitive, but healthy alternative. To do so, we need to find a way to reframe the situation that allows us to move on to the future rather than getting stuck in the past. How? Come up with reasons why the business decision to let you go was smart. It’s not about right/wrong, but moving yourself through the change process.

Don’t automatically drift

The second step is to realize that we can design our future or drift into the future. Again, it’s our choice.

Let’s call my colleague “Fred”, and his project “Designing Fred”. Rather than drifting into applying for jobs similar to what he did previously (knee-jerk reaction), “designing” has two components “Reading Fred” and “Reading the World”. The former is getting to know yourself better and the second is increased knowledge on the world (business) since you will be uniting both.

Take a computer/pencil/paper and jot down answers to the following questions. Keep a journal so you can reflect, input, wait, sleep on it and input more. Allow yourself to float in the questions rather than look for “right” answers.

Reading Fred

What is the value that you bring to an organization? (This is not “resume speak”.)
What are activities you love doing, even if they don’t add up to a “job”?

For each, what about it gives you energy and joy?

If you could design the worst job in the world for you, what would it be asking you to do?
What are your talents? (Don’t be shy.)
What were key moments for you in life? What did they offer you or what did you learn?
What haven’t you done, but the thought sounds exciting? Why?
What environment brings out the best (worst) in you?

Ultimately, you’re a collection of talents and preferences that shouldn’t be constrained by the jobs you’ve previously held.

Reading The World
Your access to “the world” is through perceptions of senior level people in various fields. Your goal is to engage them in provocative conversation, not to sell yourself as a possible candidate, but to learn insights and perspectives. Consciously get outside of your comfort zone industries. Questions to ask them might include

As you look off to the future, what are the challenges you see organizations facing?
What are the changes you see coming down the pipe?
What is different about what you’re looking for now compared to a few years ago?
What kinds of jobs/roles are becoming more (less) necessary?
What are lessons you’ve learned from your customers/suppliers/shareholders?
Where recently were you blindsided? What did you learn from that?
What lessons have you learned through success and failure?

The results

Why are the questions valuable? These are the issues that will drive job creation. Consider that a job is the gap that exists between the world as it was and the world as it’s becoming. Why might an executive even engage with you? I believe that profound and extraordinary conversations are a gift to executives. These questions help them articulate thoughts never uttered but dancing in their heads.

So, if you were downsized out … consider that your Ideal Future might be something more invigorating than a repetition of the past.

Links

image courtesy of Svilen Milev

Cheryl Crumb helps you get customers for keeps. She is an ISO 9000 accredited trainer, coach, transition consultant and facilitator who designs training programs to fit specific corporate needs. You’ll find more details on her website, the Experion website and LinkedIn.

Emotional Restructuring: The Sink and Drown Approach

2013-10-23T09:30:00.000-04:00

by Florian Meyer

When you finally admit to yourself that your business is in trouble, you also have to admit to yourself that it was probably something you’ve done wrong that has left you in this position. And, you have to admit that fixing it will require you to make some emotionally difficult changes. Dr. Phil says, “If you keep on doing what you’ve been doing, you’ll keep on getting what you got”.

But, it’s not always easy to see what you did wrong. And, when creditors are climbing all over you, it’s even more difficult to rationally identify what you need to change to solve the problem. “When you’re up to your neck in alligators, it’s hard to remember that your original goal was to drain the swamp.”

Outside Help

Admitting that you need unemotional, objective, outside advice from someone with more experience at helping distressed businesses recover is a good first step.

Perhaps you’ve engaged consultants in the past only to end up feeling like you’ve paid them to tell you what you already know. As the joke goes, “When you ask consultants for the time, they’ll grab your wrist and tell you what time your watch says it is”.

The right consultant won’t tell you what you already know nor tell you what you necessarily want to hear. That’s just another version of “doing what you’ve been doing”. You can’t fix a problem you refuse to acknowledge. The solution begins by casting off that sense of failure, those feelings of guilt and self-blame over your inability to repay all your debts, and by committing yourself to taking those hard-to-swallow pills prescribed by your “business doctor”.

Chief Restructuring Officer

That “doctor” is usually referred to as a Chief Restructuring Officer (CRO). CROs specialize in healing distressed businesses. It’s important to remember that yours is not the first business they’ve helped recover from a tough financial dilemma. And, you have to remember that you’re paying them to tell you the unvarnished, painful truth and for recommending proven methods that have helped others in similar financial straits.

Yet, even the most experienced and successful CRO’s can lose the battle when their clients refuse to emotionally accept the forthright, unbiased recommendations that have worked so well for others. The most perplexing and frustrating challenge is the client who pays for a CRO’s well-founded advice and then chooses to ignore it completely. Isn’t that just another version of “doing what you’ve been doing?” You can throw a drowning man a life ring, but he has to choose to reach for it.

Case Study

In one particular case, we were asked to help a client after the bank moved its account to the Special Loans Department (for distressed companies). By the time we were engaged, its future was already looking very bleak.

The business was founded and successfully operated by the same family for over fifty years and distributed its products nationwide. However, the current family members who managed it were in positions that did not really suit their skills and abilities. Ineffective management that went uncorrected for too long progressively eroded the company’s financial health. Some were encouraged to move into positions that better suited their individual talents. Others, who decided to resign, were offered career counselling and financial support. The remaining family members were supported by existing professional managers and further strengthened by promoting other staff from within and hiring other managers from outside.

Creditor Proposal

Even with the improved management restructuring, we knew that the company could not survive unless it could jettison some of the debt from its very weak balance sheet. Rather than being forced into outright bankruptcy, the better approach for the company (and for its creditors) was to submit a Creditor Proposal under the Bankruptcy Act.

Suppliers had provided a lot of product (inventory) on credit. But, that inventory proved to be unsalable. Much of it had to be severely discounted or written off completely. A Creditor Proposal would, in effect, acknowledge that the unsecured creditors would have to share in the losses from the non-marketable inventory by accepting a reduced payment for those items over a number of years. The alternative was to receive nothing at all as the company slid into bankruptcy. Air Canada, among other notable companies, put itself through a Creditor Proposal, and is now reporting record profits.
When we proposed this option to the family members, they would not for an instant consider it nor investigate it as the logical and best approach for all parties involved. We threw them their life ring, and they chose not to reach for it.

Plan B

Instead, they went to one of the larger suppliers and asked for time to pay off their debt in return for an ownership position in the family-owned business. Consultants can only recommend – they can’t ultimately decide for their clients. If the family was adamant about taking this approach, we could only recommend that they offer only a minor ownership percentage that would allow the family members to retain control of the business.

Under the completely legal and frequently utilized Creditor Proposal, a company’s equity position is not compromised in any way. It would have left the family still owning 100% of the business. After the proposal had been fully paid off, the company would be in a much stronger financial position. The bank would most likely have removed its unfavourable Special Loans status, and it would clearly be worth a lot more should the family later decide to sell all or part of their business.

Instead of reaching for the life ring that would pull it to safety, the family, in its panic, grabbed an anchor that would pull the business, and them with it, to the bottom.

Tough Terms

They chose, instead, to offer the supplier a 45% ownership in the business with no additional cash injection or investment. The supplier modified the offer and accepted a 50% interest with immediate voting control over the business. AND, it included an option to take 100% control of the business.
The supplier take-over did nothing to strengthen the company’s financial position. It was still left facing very tough financial and operating decisions. The supplier had effectively used a previously written-off bad debt to acquire another company with no additional expenditure of cash. It then assumed complete control of its operations and moved it to a new location. The one family member that the new owner continued to employ was demoted from his senior position to a minor mid-level management job on a very short leash.

The Outcome

Jumping forward 18 months, we read in the business section of a national newspaper that the business was sold for over $30,000,000, and the original family members did not receive one penny from it. They were scraped away with only partial proceeds from the building they owned, and the last employed family member was asked to leave with a small severance.

Subsequently, the family came back to us and asked, “Why didn’t we listen to you about that Creditor Proposal?”

And, all we could say was, “Yes – why didn’t you?”

Links

Bankruptcy – ‘Creditor Proposal’ as a business funding model
image courtesy of Allan Donque

Florian Meyer is resourceful and imaginative Chief Restructuring Officer (CRO) who maximizes the benefits of restructuring for the business. As a client recently said, “You never give up until a great solution has been developed and implemented.”
Florian has an MBA and CPA, CA and is a Principal of Newhouse Partners Inc. He has been consulting as interim CFO and CRO to a number of private and public companies since 1996, You can reach Florian at fmeyer@newhousepartners.com or 416-873-8684. You will find more details on the Experion Group website and LinkedIn.

Why Employers Need An Employment Policy Manual

2013-10-16T09:30:00.000-04:00

by Jim White

A well-written Employment Policy Manual will clarify many of the expectations within the workplace. It will also minimize your risk of facing expensive litigation, such as a wrongful dismissal or a constructive dismissal lawsuit, by ensuring that your current employment practices conform to current employment-related legislation and case law. An Employment Policy Manual is like an insurance policy.

If you should find yourself facing a judge defending yourself against an employment-related lawsuit, the only reasonable defence that will work for you will be based on the documentation that you can provide that clearly shows due diligence on your part. The Employment Policy Manual, along with a clear ‘paper trail’ of disciplinary notes, etc., will be an important part of that due diligence defence.
From the point of view of your employees, both current and prospective, the Employment Policy Manual will clarify much of what is, or will be, expected of them during their employment. It will also clarify and communicate what they can expect of you, their employer.

The best employees will be looking for employment with organizations that present their employment practices in a clear and confident manner.

Ideally, the workplace expectations should be clearly communicated before the employment relationship is established. A copy of the Employment Policy Manual should be given to the prospective employee as part of the employment contract.

A well-written Employment Policy Manual, along with consistent application of those policies, will:

clarify and communicate many of the general expectations of the workplace;
ensure that everyone in the organization has the same understanding of the general parameters (non-job specific) within which they work;
help to ensure a degree of consistency in operations, output and quality;
be useful as a training and orientation tool;
serve as an arbitration device in the event of disputes;
be the basis for performance management, including discipline;
reflect the “personality” of the organization;
support good employer-employee relations;
attract the ‘right’ employees to the organization; and
reduce the chances of expensive litigation.

Links

image courtesy of .shock

Jim White, JSW & ASSOCIATES, has over 40 years of experience involving close interaction with a very wide variety of organizations. He believes that one of the most important responsibilities of management in any organization is to ensure that all employees understand what is expected of them. You can contact Jim by e-mail at jwhite@j-s-w.com. You’ll find more about Jim on the Experion website and LinkedIn.

Cash Management

2013-06-09T09:57:00.000-04:00

by James Phillipson and David Balmer

Cash management is essentially the process of managing working capital. One way to get a high level view of your business is to calculate its cash conversion cycle. This is the time that it takes to convert cash outflows that are needed to produce goods into cash through sales and collection of accounts receivable.

Example

An example would be for CN Railway using their 2010 annual financial statements:
34.1 Days Receivable-$775 (Accounts Receivable)/$8,297 (Sales) x 365 days
14.5 Days Inventory-$210 (Material and Supplies)/$5,273 (Operating Expenses) x 365 days
(46.7) Days Payable-$675 (Trade payables and payroll)/$5,273 (Operating Expenses) x 365 days
1.9 Days

In their case, receivables and inventory are almost entirely financed by payables, so an increase in sales will require a minimal increase in working capital.

Considerations

Management of a business should calculate the cash conversion cycle separately for different lines of business and for different geographic areas. A consolidated set of financials can mask significant differences between different businesses and countries.

The cash conversion cycle can be speeded up by collecting receivables faster, lowering inventory levels, and stretching payable payments. These actions can have consequences. Speeding up collections by implementing stricter collection and credit policies can reduce sales, as slow paying customers may no longer qualify for credit and other customers may switch to suppliers who do not demand payment as quickly. Reducing inventory may increase the chances of having to stop production because materials may have run out, or turning away business because the inventory to produce certain products may not be on hand. Stretching payments to suppliers can result in missed discounts, late charges, higher prices to finance delayed payments and delayed shipments until payment is received.

Accounts Receivable

Management of accounts receivable is influenced by a company’s credit policies, billing procedures and collection practices.

1. Credit policies and terms are critical for determining a company’s credit exposure. This will determine the risk profile of the customer and your credit exposure (credit limit).

Have a procedure to set and approve credit limits. Your gut is a bad prescription.
Use a credit application form to gather information and obtain permission to gather information from third parties such as credit rating agencies, banks and other suppliers.
Ask for financial statements.
Use credit agency reports and set up alerts for significant changes in ratings so that you can review a customer’s credit limit, based on the reasons for the change.
Review all credit limits at least annually and larger limits more frequently.

2. The information system that monitors AR should be integrated with the credit policies and terms, so that sales are in compliance and it will facilitate receivables management such as aging receivables.

3. How soon after shipment are sales invoiced? Delays in invoicing mean delays in receiving cash. A number of companies pay based on when they receive the invoice rather than the invoice date. How are the invoices delivered? Electronically, fax or mail?

4. How are you being paid?

Electronic credit to your bank account eliminates problems in collection. Either you have been paid or not. You can make this part of your terms of sale.
Cheques in the mail result in payment delay (mail float), deposit delays (going to the bank), uncertainty about payment (did they really issue the cheque) and risk of a mail strike delaying payment.
Reduces fraud as payments are made through the banking system so risk of cheque diversion is eliminated.

5. Do you have collection procedures about how overdue payments are followed up, who follows up, how they follow up and how they report progress to management?

Calculate days sales outstanding taking account of seasonality and analyze reasons for changes.
Set targets and compensate collections people for achieving them.
Make collections someone’s job and include it in their job description. Specify time to be allocated.
Collection calls should be polite and professional with the aim of moving your invoice(s) to the top of the pile.
Keep notes, follow up and diarize. Consider collection software.
Call before payment is due and shortly after, if it is not received. They must anticipate receiving the call. Establish a relationship.
Call at least weekly, when the invoice is overdue.
Ask for a commitment to pay. Ask for post-dated cheques.
Make it easy for them to pay by picking up cheques and accepting credit card payments.
Consider offering discounts for payment now.
Review the credit terms with them.
Management must manage the collection process.
Cut them off until they pay
Consider deposits/retainers/progress payments to reduce exposure.
Negotiate and renegotiate payment terms.
Escalate if not making progress on receiving payment, by using collection agencies and as a last resort, lawyers.

6. If you have a few larger customers, you may get a better result by having one person establishing an ongoing dialogue with them.

7. If your sales force is compensated by commission, consider changing the commission structure so that they are paid when the customer pays you.

Inventory

Inventory is critical to most company’s sales and production activities. The amount of inventory being held depends on the company’s objectives.

Sales change over time so it is useful to determine how many months of sales each inventory item represents based on say the past 3 month’s sales/production volume.

Consider your supply lines, their length and the risk of interruption, and set policies accordingly.
For most slow moving inventory, focus on the maxim “cash is king” and liquidate it.
The information system that monitors inventory should be integrated with the production or sales systems to facilitate determination of aging, economic order quantities, supply alternatives, etc.

Accounts Payable

The primary objective is to make authorized payments to suppliers on a timely basis at an appropriate cost.

1. Consider using purchasing and other credit cards for high-volume, low dollar purchasing to, reduce processing costs, allow front end controls on types of purchases, and improved spending reporting. This can aid in negotiating supply agreements for specific types of purchases, such as office supplies.

2. Consider using electronic payments to pay suppliers, which will eliminate the costs of issuing cheques, reconciling and use of bank services such as positive pay to reduce fraud.

3. Electronic payments will also ensure that suppliers receive payments on time to earn cash discounts. A 1% discount for paying earlier is currently significantly more than the interest that can be earned on investing surplus cash.

4. Consider using payee positive pay, in addition to regular positive pay which just checks the cheque number and amount, against the issue file that you send to the bank.

5. Analyze your trade payables to determine which payables can be stretched without penalties. There are significant penalties for not paying some obligations on time such as payroll, and taxes in general. Utilities can and do shut off access to their services for non-payment.

6. Stretch your credit terms with selected suppliers to determine how sensitive they are to delays in payment. Explore the limits of their tolerance.

A focus by the CFO of a business on the management of the cash conversion cycle will often reduce significantly the working capital tied up in the operations of the business and release cash for re-investment. An excellent way to improve, and ensure that this focus is maintained, is to change the bonus structure to link the bonus to achieving working capital targets.

Links

Identify and leverage your Key Performance Indicators
Bankruptcy: ‘Creditor Proposal’ as a business funding model
image courtesy of gracey

David Balmer is a Chartered Accountant with over twenty years of Treasury experience with companies such as RJR Nabisco, Cott Corporation and Maple Leaf Foods Inc. He has presented at treasury conferences in Canada and the United States. He has also earned treasury designations from treasury organizations in both the United States and United Kingdom. You’ll find more details on LinkedIn.

James Phillipson is a Chartered Accountant and a Principal of Mastermind Solutions Inc. with over twenty years experience in large and small businesses. He has provided financial counselling to his clients since 1996, often in the role of or as a coach to a Controller or Chief Financial Officer. James has experience in financial roles in a wide variety of businesses and industries. Contact James at James@MastermindSolutions.ca. You’ll find more details on the Experion website and LinkedIn.

Better - Faster - Cheaper

2013-05-30T09:00:00.000-04:00

by Jay Perry

Regardless of what business we are in, we will always be challenged with a common task: to provide a product or service Better - Faster - Cheaper.

Look at any business. It is the same challenge. From the logging industry to manufacturing cars to computers to television news, always a better mouse trap. You are in business. What makes you think you are immune to the same challenge? You are not.

The Challenge

The challenge will always be the same. That sameness is actually providing the difference in the “day-to-day” that keeps us going to the shop to open the doors. Without having a challenge, you would have no interest in your business. As an owner, manager or supervisor, the job of looking for continued improvement to the efficiencies of your operation should be your primary concern.

Customers are no longer willing to pay for industry’s inefficiencies. Consumers are more educated (and protected) than before, also making demands that stretch our abilities. They make “unreasonable” requests. I say to you those “unreasonable” requests are going to be the new standard for minimum performance by your business. It is the business that responds to the marketplace’s requests that will soar above the crowd of competitors.

Keep Looking

Also, you should always be on the lookout for people to assist you in improving your business, making it run smoother, developing into a better place to do business for the community you serve. The people can come from outside your industry or could be as close as one of your vendors. Keep your eyes open for people who have a caring attitude toward others and enroll them into the supporting of your business.

The Lime

Here is an actual experience.

When I arrived into town late one evening, I went to the hotel restaurant. I felt like having a beer. After ordering one, I asked a server for a lime wedge. The woman I asked this of was not my server but one of the regular staff, filling salt shakers. After she was gone for what seemed a long time, she returned with a little bowl full of lime wedges. I asked her what had happened. She informed me that the kitchen was out of limes so she had to go clear across the hotel’s casino (very large) to the bar to get some for me. I recognized this as someone who would not let anything stand in her way of making the customer happy and subsequently talked to her about a job as Customer Service Rep at one of my clients’ businesses. She interviewed and took the job offer. She become their best performer in the month of December of her inaugural year.

You need to lookout for people who can make a contribution because they hold the view that part of their purpose is to help others. With the continuous improvement they can bring to your business, you can do what you do better, faster and cheaper.

Links

Overcoming mediocrity consistently
image courtesy of Klaus Eppele

Improve the processes and you change the culture. Ally Business Coaching helps progressive companies manage both aspects of these kinds of transformations. Leadership is developed in people, not trained. With over 20 years of experience in developing leaders through a coaching style, Jay brings quick, effective and permanent improvements to clients all over North America. Here are the complete services. You’ll find more about Jay on the Experion website and LinkedIn.

Survive and Thrive In Turbulent Times

2013-05-15T11:10:00.000-04:00

by James Phillipson

When a business encounters turbulent times, there are many ways that the CFO/Controller and CEO can face the challenges to enhance the financial position and significantly improve opportunities to restore business growth. These strategies enhance the likelihood of the business surviving turbulent times and being put in a position to thrive again, when the environment improves.

Cash flow management

The management of cash flow is one of the cornerstones of most successful businesses and becomes much more critical when a business goes through turbulent times. We all agree that “cash is king” but many businesses leave the decisions about cash flow management to the clerical level staff and only occasionally instruct that minor changes be made. The CFO/Controller and CEO must have management of cash flow as one of their key areas of focus during challenging times.

Consider the possibility of your biggest debtor (often your biggest customer) being unable to meet established payment terms. In many businesses this would cause a potentially fatal cash flow crisis. This is not an unforeseeable event for many businesses in today’s economic climate.

So many actions can be taken to improve cash flow from working capital that it often only requires some focus and a determination to find the best way to reduce your risk. The first place to focus your attention is on collection of accounts receivable. See the article on speeding up the collection of receivables in the Mastermind archives

Consider your ability to release cash tied up in your business by managing the following:

Payment of suppliers
Reduction of inventory
Speeding up the production cycle

Banking Facilities

We have all heard that “a banker is someone who only wants to sell you an umbrella when the sun is shining,” or some variation on that. Certainly, if you expect to have a downturn in financial results in the next few months, then now is the best time to ask for an increase in the facility that you have with your bank and to seek out other sources. After a downturn in operations causes the need for a larger facility, it is difficult to convince a banker that you are deserving of his umbrella — much better to ask before there are a few months of reduced profitability or even losses.

Key Performance Indicators

Take a few minutes to carefully assess the trends in your ratios and Key Performance Indicators (KPI) over the last two years. Consider how you can reverse any adverse trends and how you can improve those that are stable. It often helps to consider each of the factors in the calculation of the KPI, not just the result, as that is where the action step will need to be taken to yield the result. For example, when assessing the KPI of Days Sales Outstanding, examine the amounts outstanding from individual customers – say the twenty largest balances and any balance that is more than X days outstanding.

Update the KPI regularly and incorporate them into the ongoing reporting and management of the business. Include them in the budgeting process and report the KPI compared to budget.
Ensure that you investigate and take action on any KPI that changes from expectation. Challenge your management to improve on selected KPIs each month. For example, make next month the month in which you challenge your management to improve Days Sales Outstanding by 10% (and then illustrate the success by showing the effect on cash flow).

Ratios have the ability to reflect trends that are not easy to spot. If you track and graph your ratios on a monthly basis, with comparatives to previous periods and budget, you should be able to easily explain why a ratio has changed and what you propose to do to manage the situation, for better or worse.

For example, the Days Sales Outstanding and Days Inventory on hand are often effective warnings about cash flow problems and usually the first sign that more analysis and focus is required, so that management can develop a solution.

Disposal Of Non-core Assets

Consider every asset in your business as a candidate for disposal – no exceptions! There are often assets hidden in categories where the component part can be sold. For example, slow moving inventory, surplus or old equipment, waste, scrap, by-products, accounts receivable, business units, lines of business, product lines, etc.

If your challenge is caused by a downturn in business volumes, consider selling or sub-letting surplus space. One creative idea, in certain circumstances, is to “sell” your surplus capacity to a non-competing business that would need the same equipment. In other words, your business becomes a sub-contractor for them. A simple application is to use surplus space to provide storage for another business.

Take a page from retail businesses that sometimes have concessions in their premises, selling products that complement their lines of business. This can generate cash flow from the rental charge for the space, as well as draw additional traffic to your store. Is there a way to apply that to your business?

Links

Identify and leverage your Key Performance Indicators
The small business hard times survival guide (About.com)
Five tips to help your small business survive tough times (MegaDox, Mar 2013)
image courtesy of Paula Fisher

James Phillipson is a Chartered Accountant and a Principal of Mastermind Solutions Inc. with over twenty years experience in large and small businesses. He has provided financial counselling to his clients since 1996, often in the role of a Controller or Chief Financial Officer, for both public and private corporate clients. James has experience in financial roles in a wide variety of businesses and industries. This includes several large corporations and many medium-sized public and private companies. James can be contacted at james@mastermindsolutions.ca or 905-731-8255. You’ll find more details on the Experion website and LinkedIn.

Bankruptcy – ‘Creditor Proposal’ As A Business Funding Model

2013-05-02T11:30:00.000-04:00

by Florian Meyer

Hard as you try, does it feel like your business always has more debt than it can pay off? You’ve spoken to your banker, your family and friends, and no one is able to offer you any financial help. Does the constant debt pressure make you wonder whether it would be better to just throw in the towel and bankrupt the business? No … not yet!!!

There is a solution that could provide you with the breathing room you need to help you recover. And it’s legal.

Within the Canadian Bankruptcy & Insolvency Act (BIA), you are allowed to make a proposal to deal with your creditor debt and remain in business.

How To Start

First, you need to engage a Chief Restructuring Officer (CRO) and a Trustee. The CRO works inside the business with you to develop and monitor a clear plan for moving the business into a more positive financial position and to encourage you to make some of the hard strategic decisions.

The Trustee works with you for the benefit of the creditors. The Trustee begins by preparing a Notice of Intention to File a Proposal (NOI) that is filed with the courts. That stays all creditor actions against you. In other words, creditors are legally prevented from doing anything to collect on the existing outstanding debts.

After the NOI is filed, you have to ensure that all obligations incurred in the future are paid as they become due. Within ten days of filing the NOI, you have to file a Cash Flow Plan with your Trustee and the courts. The Cash Flow Plan shows how you expect the company to generate enough cash flow to cover any new debts plus a portion of the historical debts that were stayed by the courts. Your CRO will help you prepare the Cash Flow Plan and will help present it to your Trustee.

The Creditor Proposal Meeting

With the cash flow filed, you have 20 days to develop a plan for the business and a plan to repay a portion of the historical debts before you are required to have the Creditor Proposal Meeting. It’s often possible to get extensions of up to six months for having the Creditor Proposal Meeting as long as the creditors are not disadvantaged. An extension requires court approval and needs a reasonable justification, such as:

You have not negotiated a settlement with the secured creditors, or
Another activity that needs to be completed before the proposal is ready to be presented to the creditors.

Payments

Generally, you will offer to repay 15% to 20% of the existing, unsecured debt over a three to four year period. You send a cheque monthly to the Trustee who annually distributes the payment among all the creditors included in the NOI. The Trustee’s fees to administer the process are paid out of the pool allotted to pay the creditors, with no additional cost to you.

Bear in mind that a Creditor Proposal will not reduce your obligation to pay off any bank loans or other secured debts. By obtaining a secured interest for their loans, the secured creditors have acquired a legal interest in some or all of your company’s assets. You and your CRO will have to negotiate with them to arrange a repayment plan that eventually pays those debts in full.

After the Cash Flow has been filed and a repayment plan has been negotiated with your secured creditors, the CRO will work with your unsecured creditors to obtain their verbal agreement to the plan. Finally, the Trustee will hold an official Creditor Proposal Meeting to receive legal and court approval of the process.

Benefits

The Creditor Proposal Process gives you a legal avenue for reducing your unsecured debt to a more manageable range of 15% to 20% with a defined schedule of how it will eventually be paid off. With the assistance of your CRO, you will develop a go-forward plan to bring your finances back to a much healthier position. Your CRO will help you negotiate an achievable repayment plan with your secured creditors and help you look for additional sources of financing, if needed. And, your time can be more effectively devoted to managing and improving the business to ensure that the plan works.

Resolution

Now you can move the business forward with a much improved cash flow. The creditors are no longer calling to collect, and you have a new plan that allows you to move forward with the historical issues resolved.

Example

As an example, I worked with a client that was behind in payments to the landlords and other vendors. It owed a large debt to the Canada Revenue Agency (CRA) which was primarily unpaid payroll source deductions for which the owner was personally liable. At first glance, there simply seemed to be no way to move forward.

I stepped in as the CRO, connected the client with a Trustee, and introduced an accountant who could effectively manage the financial reporting. By helping the client work through and obtain approval of its Creditor Proposal we accomplished the following:

Developed a go-forward plan that realistically gave the company a chance to succeed.
Engaged a lawyer and obtained court approval to eliminate an obligation to a creditor who had inappropriately attempted to declare its claim as a secured debt.
Established a six-month payment plan with CRA. They would no longer continue to chase for collection, and the accrued penalties and interest were stopped as of the date of the Notice of Intention to File a Proposal (NOI).
We renegotiated with the landlords to have rent reduced to a level that the company could afford. The accountant worked with the internal staff to ensure that informative and timely monthly financial Statements were now being produced.
After the six-month payment plan with CRA was completed, the plan began paying the unsecured creditors at 15% of the original obligation over the next four years.

Although it may feel as though there is no hope of keeping your business afloat, our legal system provides a life raft to give you a second chance.

Focus On The Important Not The Urgent

2013-04-24T13:28:00.002-04:00

by James Phillipson

Many executives wish that they had an extra hour in every day. However, I would bet that most of them would get very little that is really important done with that extra hour. The time would often get consumed by the same type of urgent issues that laid waste to the rest of the day.

The Challenge

For many people, the challenge is to separate the strategically important things that will provide your business with transformative growth from the tactics that are perceived as urgent because they are time sensitive.

Ensure that you manage your time so that you allocate a significant amount to focus on the tasks that will grow your business. The urgent will always be there and will consume all of your time, if you permit.

Decide

It is up to you to manage your time to enable you to focus on what is relevant to your personal growth and to the business growth. Just like anything else, this does require management. It is not surprising that if you do not manage your priorities, they tend to absorb all of your time without focus on those that are really important.

If you do not have a list, you really need one. Read and implement the strategies here.

What Is Article Marketing?

2013-04-10T10:49:00.000-04:00

by Don Monk

It’s pretty simple. Article Marketing is just what it sounds like. You are marketing via Articles. It’s a way of promoting your website and product or service for free.

Articles are among the easiest ways to promote your website in order to generate traffic and increase your earnings.

How does this work?
Write articles relating to your website and submit them to “free content” submission sites. Easy to do, takes little time and can increase your website traffic, sales and your income.

How can article writing boost traffic and income?
The article on the free content site contains a link to your own website. Readers, after reading your articles, may choose to click on the link and pay you an unexpected visit. Having them on the free content sites is also making these articles available to other webmasters who may wish to publish that article on their site.

If they do, your article will include a link back to your site. And anyone who reads the article on that site can still click on the link to visit your site.

As the list of your published articles grow larger, and more and more of them are appearing on different websites, the total number of links to your site also increases. Major search engines place lots of significance on incoming links to determine the importance of a site. This will then increase your website’s placement in the search results.

If your site is into promoting a product or service, the links that your articles have achieved will mean more potential customers for you. Even if visitors only browse through, you never know if they might be in need of what you are offering in the future.

There are also those who already have specific things they need on their mind but cannot decide yet between the many choices online. Chances are, they may stumble upon one of your articles, gets interested by the content you wrote, go to your site and became enticed by your promotions.

See how easy that is?

Search engines do not just index the websites, they also index published articles. They also index any article that is written about your own website’s topic. Once someone searches for that same topic, the list of results will have your site or may even show the articles you wrote.

And to think, no effort on your part was used to bring them to your site. Just your published articles and the search engines.

It is no wonder why many webmasters are suddenly reviving their old writing styles and taking time to write more articles about their site than doing other means of promotion
.
Getting your site known is easier if you have articles increasing your links and traffic and making it accessible for visitors searching the Internet. Since many people are now taking their buying needs online, having your site on the search engines through your articles is one way of letting them know about you and your business.

The good thing with articles is that you can write about things that people would want to know about. This can be achieved in the lightest mood but professional manner, with little not-so-obvious sales pitch added.

If you think about it, only a few minutes of your time is spent on writing one article and submitting to free content site. In the shortest span of time also, those are distributed to more sites than you can think of.

Even before you know what is happening, you are getting more visitors than you previously had.

If you think you are wasting your time writing these articles, fast forward to the time when you will see them published and widespread on the Internet — not to mention the sudden attention and interest that people are giving your website and your products or services.

Try writing some articles and you will be assured of the sudden surge in site traffic, link popularity and interest. Before you know it, you will be doubling and even tripling your earnings.

Nothing like getting benefits for something you got for free!

Don Monk of Internet Marketing Planners helps market your business online as part of a complete Internet solution. You’ll find Don’s profile on the Experion website and LinkedIn.

Ask More Questions

2013-03-27T11:30:00.000-04:00

by Billy Anderson

Bad leaders have all the answers. Great leaders do not.

We live in a world where management is expected to have all the answers, all the time. If an employee comes to you with a question you probably feel you should give an answer immediately (God forbid the “boss” doesn’t know something). Why do we do this? Because admitting we don’t know something means showing vulnerability, which many people assume is a weakness.

If that’s you, you make up the majority of management who underutilizes their team’s potential. As a leader, you will get more from your team when you ask more questions and give fewer answers. Asking them questions leverages their skills while showing them respect, and respect motivates the right people more than anything.

Try It

Next time an employee comes to you saying, “I’m not sure what to do about this”, try responding with “What do you want to do about it?” Chances are they’ll be taken off guard the first time, but they’ll get used to using their brain more and they will come to you less often with challenges they realize they can sort out on their own. They will then feel empowered, and empowerment fuels creativity and hard work more than green beer fuels St Paddy’s Day.

Goals

Now let’s look at your organizational goals. Every organization (and individual) needs goals: they provide direction, focus, and a strategic filter for decision-making. However, goals and guesswork both start with the same letter for a reason: goals are educated guesses.

We set goals based on what we know about the company, the competition and the market as it stands right now. But all that will change over time. If you follow your five-year strategic plan to the letter for the entire five years, you’ll go out of business. You set goals and targets in order to provide direction, but you have to accept they might change.

Once you have your goals and strategy, you need to determine how often you will revisit them to see if they still apply. Put the review dates in the calendar. At this point you’ve figured out what you need to do to get there.

Now you can focus on who you need to be as an organization. Who are your employees being when they’re at their best? This will link to your organizational Values because your company will perform at its best when living true to its Values and Mission (assuming they were created properly in the first place, which most aren’t).

So try not knowing. Ask your employees more questions more often. Have the courage to know when a plan no longer works and needs to be revised. Have the guts to admit you don’t know and follow with “…but I’m confident we’ll figure it out”. That will gain the respect of your team and encourage them to do more.

Links

image courtesy of Paul Moore

Billy Anderson is a Courage Coach & Speaker, and founder of Made You Think Coaching. He helps people get the life they want, because once they have that they perform like superstars.You’ll find Billy’s profile on the Experion website and LinkedIn.

How To Benefit From A Group Blog

2013-03-20T13:30:00.000-04:00

by Promod Sharma

When you work for a big company, you have the advantage of a known brand. You gain credence by association. When you're on your own, building a brand is essential but more difficult. You probably can't build awareness through advertising.

If you're part of an established group like Experion, you benefit to the extent the shared brand is known. As a member, you help spread the message. You then get the benefits by association. The other members do too.

The process is simple. Here are the three steps, starting with the easiest.

Share links to blog posts
Make comments on blog posts
Write blog posts (here's how)

1. Share Links To Blog Posts

These days, content circulates by "word of mouth", which means by circulating links.
If you share one link per week with 100 connections, you invite about 5,000 potential visits in a year. If 20 members share, that’s 100,000. If an average network has 200 people, that’s 200,000 potential visits. There’s also traffic from web searches.

To find out about new articles by email, subscribe now.

There are two easy ways to share a link.

A. Share Button

When you read an article online, you'll often see sharing buttons on the side, top or bottom of the article (this blog has them at the bottom). Facebook uses "Like", Google+ uses "+1" and Twitter uses "tweet". Click and you share with the network of your choice. Feel free to share with more than one network.

Note: the location and look of the buttons may change over time but the basic functionality remains

B. Actual Link

There is another way. Each web page has a address. By clicking on the address bar, you can copy the link and then paste it using your sharing tool. For instance, let's say you want to share via LinkedIn. Paste the link into a status update, type a brief description and send it out.

This screenshot shows the steps in LinkedIn.

Bonus: You can also post links in LinkedIn Groups or send them out via email or newsletter.

2. Make Comments On Blog Posts

At the bottom of each blog post, you'll see an option to leave a comment. Type in your thoughts and submit them. Commenting anonymously doesn't build your brand. Use your real name.

When you comment, you usually see future comments too. If you wrote the blog post and make a comment, you're notified when others leave messages. It's good form to participate.

Comments here use Disqus, which gives you credit for your comments on Harvard Business Review and other participating blogs. That context lets readers quickly see if you’re credible.

Exercise: As a experiment, leave a comment on this article.

Bonus: wait until your comment goes live before you circulate a link (step 1). Readers can then read what you said too.

3. Write Blog Posts

Sharing content shows that you're good at curating (a parrot). That's good but creating content is even better (a pundit). You then show your current expertise. Isn't that the reason clients hire you?

The process of writing may seem daunting but think of the benefits. Your words remain visible at no cost. Your article gets read and re-read. That’s better than advertising.

As blog traffic grows, you get read by visitors who arrived to read other articles. You're more likely to show up in web searches too. When you help a group blog, everyone benefits.

Momentum

Imagine if 20 members commit to writing one article per month. That’s one post per business day or about 240 in a year. That will bring ongoing traffic and credibility to Experion and you.

Can you spare 10 minutes a week? That’s enough time to share one link (takes seconds) and make one comment (takes minutes).

Links

Promod Sharma is your insurance literacy tutor. Learn about life and health protection online (wiki, blog, Twitter) or at a live event. At Taxevity, get a fee-only insurance review and help updating your coverage. You’ll find more details on the Experion website and LinkedIn.

PS Be sure to subscribe to receive new blog posts by email.

Reasons To Get A Mentor

2013-03-13T10:53:00.000-04:00

by Cheryl Crumb

What makes successful people successful? Sure, they’re likely bright. They might have advanced education. Maybe they were even lucky. There’s another hugely important ingredient to add to the mix.

Think about it … what do the following successful people have in common: Sir Richard Branson, Alexander the Great, Oliver Stone, Wolfgang Amadeus Mozart and David Beckham?

They all had mentors … experienced people who thought, “You are worth my time and effort; I can offer you ways to expand your horizons and increase the likelihood that you will achieve success”.
The Chinese ancients had a proverb:

“A single conversation across the table with a wise man is worth a month’s study of books”.

Albeit politically incorrect and gender dismissive, this belief was echoed by Dr. Beverley Kay in her recent book “Help Them Grow or Watch Them Go” when she said,

“Behind every successful person there is one elementary truth: somewhere, somehow, someone cared about their growth and development. This person was their mentor”.

Enlightened organizations are realizing the truth behind these statements and are orchestrating formal mentoring programs as part of their knowledge management and succession management strategies. Find a wise and experienced individual and team her/him up with an emerging leader.

Why A Mentor Matters

Why do you want to have a mentor? Look at this laundry list and select what appeals to you:

Offer you experienced guidance and support
Further your professional development
Share the pros and cons of various career paths
Offer new and different perspectives
Be a sounding board to test your ideas and plans
Expand your personal network
Provide you constructive feedback on your developmental areas

Boiled down, a mentor’s role is to help you become a better observer of yourself and your blind spots. That let’s you take new actions you didn’t have the knowledge, perspective or courage to take previously.

From a more personal level, a mentor is there to:

Be someone you can confide in during your darkest hours
Help you to get back up when you crash
Help you to accept changes or change what you can’t accept
Rebalance yourself
Find your motivation when it’s temporarily lost
Help you to think outside your box
Introduce you to contacts
Step out of your comfort zone

Finding A Mentor

But what if your organization isn’t enlightened? What if you’re on your own with no company resources behind you? Take charge and find a mentor!

Keep your eye open for people you respect … people who have enjoyed the “thrill of victory and the agony of defeat” as ABC’s Wide World of Sports proclaimed decades ago. Since wisdom isn’t gained easily, learning includes spectacular failures! Be bold and ask an individual if they would be willing to be your mentor, that you would be honoured to learn from them.

Why Mentors Mentor

Why might mentors willingly invest themselves in you? Past mentors have told me

mentoring renews their enthusiasm
they enjoy the opportunity to share expertise
mentoring enhances their skills in coaching
mentoring allows them to practice a more personal style of leadership
mentoring enhances their generational awareness.

How To Be A Mentee

Being a mentee isn’t about sitting at the feet of your mentor and waiting for her/him to pontificate brilliance. Instead, actively take ownership, identify your initial learning goals, use your initiative to drive mentoring sessions, be open and coachable, seek feedback, accept criticism graciously, and ask questions.

Contrary to popular belief, the most effective mentoring relationships are ones in which the mentee is relatively proactive and the mentor is relatively passive. In other words … you as mentee need to be in charge!

The Process

The mentoring process begins with definition: together, define your boundaries, set your ground rules, clarify your objectives. Share perceptions you think others have of you, and what you see as your strengths and weaknesses. Be honest with your mentor and yourself. The second stage is identifying your developmental needs and priorities. The third stage is action: ask for insights, discuss options, set a plan, practice, do it, debrief.

Remember, mentoring should lead to change. It was Darwin who said,

“It is not the strongest of the species that survive, nor the most intelligent, but the one most responsive to change”.

Mistakes are inevitable!

Get Started

Start by reflecting:

What do you really want to be and do?
What are you doing really well that is helping you get there?
What are you not doing well that is preventing you from getting there?
What are you willing to do differently tomorrow to meet those challenges?
How can your mentor help?

Arrangements can be formal or informal. To formalize with your mentor, create a contract including your willingness to be coachable, the number of times you will connect monthly, how long your meetings will last, how you will deal with confidentiality, and how you will periodically assess the value to both of you.

Mentoring is a science and an art. And don’t despair if The Most Respected Individual You Know is 4,000 km away … phone mentoring can be very powerful!

Find a mentor. Be a mentor. Buy the T-shirt!

Links

Why a private mentor matters (and how to get one for free) (Marketing Actuary, Oct 2012)
Every woman should have a mentor at work (Business Insider, Dev 2012)
Why you need a mentor (OPEN Forum, Jan 2012)
Why you need a mentor (BusinessWeek, Feb 2007)
10 good reasons for having a mentor (CIO Update, Nov 2006)
image courtesy of Studio CI Art

Cheryl Crumb helps you get customers for keeps. She is an ISO 9000 accredited trainer, coach, transition consultant and facilitator who designs training programs to fit specific corporate needs. You’ll find more details on her website, the Experion website and LinkedIn.

Structure Your Presentation

2013-03-06T13:02:00.000-05:00

by Heather Stubbs

Structure! It benefits both presenter and listener. A clear framework keeps speakers on track and helps audiences follow and remember what is being said. Here’s a method for creating a structure that enables you to guide your audience on a journey from starting point to destination, and helps them stay with you along the way.

Premise

Your first priority when planning a presentation is to be clear in your own mind about your purpose. What’s the core idea you want your listeners to take away? Can you state it as a concise headline? The premise of a photographer’s talk might be, “Good composition creates great photos.” For a succession planner the core idea might be, “Advance planning avoids future headaches.” A presentation to a Board of Directors might have “Better customer service will increase profits” as the premise.

Strive to write your premise in eight words or less. If your talk were a house, your premise is the roof under which everything you say is gathered.

Opening

As I mentioned in my Tips on Talking article “A Strong Start”, don’t waste your precious opening moments on meaningless fillers like, “Tonight I’m here to talk to you about...” That kind of opening takes the audience’s initial intensity of interest and dials it down several notches.

The first few words of your talk are probably the only time you have the full attention of the entire audience. Take advantage of that attention and dive right in! One way is to open with your headline premise and expand on it in your next sentence or two. Take a look back at the opening paragraph of this article for an example.

Three Points

Chances are you know volumes more about your topic than you have time to convey in your presentation. There’s so much you want to tell them! It’s important not to try to “pack it all in.” Your audience won’t remember everything you say, anyway. They’ll probably remember one outstanding point, and perhaps a couple more.

Let’s say you’re planning your talk and you have a host of sticky notes all over the top of your desk, each one with an aspect you could talk about. Think in terms of support for the roof of your presentation house, your headline premise. Pick no more than three points for the walls holding up that roof. The more points you make, the less your audience will remember, so discipline yourself to three. Don’t be afraid to number your points as you talk through them. It helps your audience to follow you.

If they need to know more than three points, distribute a handout.

On Track And On Time

Building your presentation around a three point structure gives you a clear sense of direction and keeps your mind on track. If you find yourself getting off on a tangent, structure pulls you back into the right direction. If you’re concerned about forgetting which point comes next, use a 3 x 5 card with key words for each section of your talk. A quick glance will bring your thoughts into focus.

Structure also helps keep you on time. You know you have just so much time for each point, so plan it out. Be sure to allow time for your opener, your conclusion and Q&A. If audience questions threaten to derail your timing, knowing you have one or two points yet to cover allows you politely to move on by suggesting you chat with the questioner after the presentation.

Illustrate With Stories

Back up your points with two or three supporting points (no more). Bear in mind that dry data is boring and will instantly be forgotten, so incorporate the human element. The surest way to keep your audience engaged is to illustrate facts with stories. Use analogies to make numbers relevant. If you have data like “At this very moment, there are 600 million stray dogs in the world,” make that number real with “That’s nearly two dogs for every person in the United States.”

Conclusion

Conclude your talk by reminding the audience of your three points and then “close the circle” by restating your opening in a way that includes a call to action. Invite your listeners to take the next step.

For your next presentation, let a clear structure keep you moving efficiently from point to point and keep your audience in step with you all the way.

Links

image courtesy of Gorilla

Heather Stubbs helps her clients discover their own potential as exciting speakers at Skilltime. She has been performing onstage since early childhood as a musician, singer and actress. Heather compiled the lessons learned and mastered over a lifetime into a training program called, “SPEAK UP! How to Talk So People Listen”. She offers workshops, keynote speeches and private coaching. You’ll find more on the Experion website, LinkedIn and Twitter.

Overcoming Mediocrity Consistently

2013-02-27T10:19:00.003-05:00

by Jay Perry

I came across a quote from Jim Collins, best known as the author of “Good to Great”. He states:

“The signature of mediocrity is not an unwillingness to change. The signature of mediocrity is chronic inconsistency.”

In every business I have worked with I find this to be true. Some things get done well one time and then not as well another time. A case in point is a client company where we had instituted a scheduling program to better control work flow for their production. It was off and running well two months prior. I arrived for a follow-up visit to find that they were using the system only 50% to 60% of the time. In other words, inconsistently. What were the results? Chaos!

Diagnostics

I also see inconsistency and mediocrity in diagnostics. When done properly, there is a smooth production flow. Then someone has a “better idea” — usually to go back to what they used to do — and the everything falls off the rails again.

The true enemy of greatness in business is this inconsistency in performance. What causes that inconsistency? Myriad reasons but one of the most common is complacency or satisfaction with the status quo. That is fear. People are afraid to make a full commitment to a new way of being. They have reached a certain level of comfort and go into “preserve mode” which means let’s not get too far from the average way of doing things.

Great Leaders

That is where the call for great leaders comes in. Without a great leader who is willing to look at bold ideas and then present them in a safe way that the followers can support the new initiatives, nothing will get done.

The followers will not do proceed on their own. Not because they do not want the benefits of a better way but because they cannot connect the dots between their current position and where they potentially could be.
In leadership the job entails more than looking at new ideas. You must make it OK for people to accept the changes necessary to affect improvement. Followers are willing to change if shown an acceptable way to do so.

Accountability

What follows next is the need to root out the inconsistency that will creep back into people’s behaviors. Holding people accountable for the promises they make in implementing new ways is one of the most important things a leader has to do. A leader often figures that everyone else can see the same benefits that they see. To the leader it is a “no-brainer” that we should do this and everyone will support it. That’s a mistake as others do not see things exactly as we do. Accept that truth and make your life easier.

Many leaders also do not see themselves as helpers. They like to think of themselves in a more romantic fashion, riding the great steed, leading the army into victory, always looking forward. Like the old saying says “Get off your high horse.” Your job is to constantly help others do their job better today than they did it yesterday. Once that mindset is firmly entrenched in your being and your behavior shows it.

The Dangers Of Advertising Through A Group-Buy Daily Deals Site

2013-02-20T10:00:00.000-05:00

by Elizabeth Lipsz

If you are considering advertising through group-buy promotions, make sure this strategy works for you. This type of marketing has made a big impact on the service and retail industries in North America. Here is some advice from a retailer who has been there and done that!

Group-buy companies look for deep discounts and will push a retailer to discount more than 50% on their offer. The marketing fees are typically 50% of the revenue earned and their payment terms might be as long as 90 days after the sale date. The marketing company will also sweeten the offer by saying that 20% of the coupon-buyers will never get around to redeeming their coupons. In reality, this can be very unpredictable and in our experience the non-redemptions were closer to 10%.

Assess your cost structure

If you are a service business with high labor or material costs, this type of marketing may not be not for you (e.g., spas, nail-bars, laser hair removal service-providers and even some restaurants). On the other hand, products and services with low unit costs and the potential for upgrades will do much better (e.g., restaurants with a bar will do much better than restaurants without, gyms and yoga studios will do better as well because of the low marginal cost of each additional client who shows up to a class).

Designing the deal

Group-buy companies promise lots of exposure to new clients and the possibility of making money on upgrades. The reality is quite the opposite. The profile of the typical coupon-buyer is that they are cheap and they move from deal-to-deal. Most clients will not upgrade their services nor will they buy products.
When designing your offer, resist the pressure to discount more than 50%. Be sure to negotiate the marketing fee and push to get it down to 35% or 40%. There are other factors to consider:

the maximum number of coupons to be sold
the number of coupons a single customer can buy
the size of groups you are willing to accept at any one time (if applicable)

The more restrictions you put in place, the less successful the sale but you, as the retailer, will be better protected.

The bigger the sale, the more you will inundated with calls and demands for reservations after the promotion. The typical coupon-customer has gained experience with these promotions and is now more critical of retailers if expectations are not met. Remember that the coupon-buyer expects maximum value and superior customer service at the lowest possible price.

After the sale, the retailer will be faced with balancing the needs of regular clients as well as meeting the demands of the coupon-clients. It is a very fine balance. A retailer who accepts too many coupon-clients at any one time risks losing the regulars. If the retailer fails to meet the expectations of the coupon-clients who are social media savvy, then the reputation of the retailer can be put at risk. Keep a close eye on review sites such as TripAdvisor and Yelp.

Final thoughts

Why would a service/retailer do a group-buy promotion? These deals do drive new business to the retailer but they do not bring in new, loyal clients. Is an additional 1-2% of new regular clients worth the cost running the promotion? Instead, it can damage the image or the brand of the retailer.

The principal reason for running a promotion is to use up excess capacity and lower overhead costs. If the bookings and reservations are handled exceptionally well without any customer-complaints then this promotion will provide a short-term boost. But if anything goes wrong — if the design of the promotion is too complex, too expensive and the discount is too deep and sale is too large — things can go wrong very quickly.

Links

Groupon stock sinks as daily deal service struggles (Washington Times,, Nov 2012)
Rebound: Groupon’s share price has doubled since its record lows, rising 99% in 58 days (TNW, Jan 2013)
image courtesy of Indigo Fish

Elizabeth Lipsz is a Management Consultant at BluHorizons Inc, which provides general business consulting services for SME. She specializes in manufacturing with regards to business analysis, business planning and assessment of systems of operations and methods of work, particularly in context of ISO 9001, in order to reduce costs and improve efficiencies. You’ll find more on LinkedIn.

Identify And Leverage Your Key Performance Indicators

2013-02-13T10:00:00.000-05:00

by James Phillipson

Key Performance Indicators (KPI) are quantifiable measurements that reflect the critical success factors of an organization. They will differ depending on the nature of the business and its priorities.

Some KPIs should focus on short-term priorities and others on long-term strategic issues. So a typical business would have both sales for the current month and for the year-to-date period in its KPIs.

The Key Performance Indicators selected must

reflect the organization's goals
be key to its success
be measurable

The definitions of what they are and how they are measured do not change often.

Start With Financial Indicators

If a Key Performance Indicator is going to be of any value, there must be a way to accurately define and measure it. As a result, many businesses start with financial indicators that are based on the accounting records. Financial KPIs can include metrics based on both balance sheet accounts and earnings accounts. For example, a bank balance or days sales outstanding are very common indicators based on balance sheet accounts. On the other hand, where statistical data is maintained they are appropriate to be a KPI (e.g. volume of product manufactured, number of orders received, headcount, etc).

Update the KPIs regularly and incorporate them into the ongoing reporting and management of the business. Include them in the budgeting process and report the KPI compared to budget and compared to prior periods.

Ensure that you investigate and take action on any KPI that changes from expectation. Challenge your management to improve on selected KPIs each month. For example, next month challenge them to improve days sales outstanding by 10% (and then illustrate the success by showing the affect on cash flow).

Develop A Dashboard

In addition to monthly tracking, many businesses, develop a “dashboard” or weekly snapshot to monitor the status of the identified KPIs for the business. There are software tools that facilitate this. For most businesses this is a standard way for all those with access to the dashboard to see the status of the KPIs (Confidentiality usually limits the staff with access to some or all the indicators). Where the accounting system is an ERP system that is maintained in “real time”, it may be reasonable to maintain instant measures of the critical metrics that drive your business.

If you do not yet have a defined and agreed set of KPIs in your business, this is an area that your Controller (whatever their title) should be able to develop with input from management. It is not necessary to invest a significant amount in the reporting. If your ERP (Enterprise Resource Planning) system does not have a dashboard module, Excel be used and often is. If you have a weekly snapshot, this is a form of reporting of the critical data for the business and an alternative to the reporting of KPIs.

Links

Image courtesy of Joy Fera

James Phillipson is a Chartered Accountant and a Principal of Mastermind Solutions Inc. with over twenty years experience in large and small businesses. He has provided financial counseling to his clients since 1996, often in the role of a Controller or Chief Financial Officer, for both public and private corporate clients. James has experience in financial roles in a wide variety of businesses and industries. This includes several large corporations and many medium-sized public and private companies. James can be contacted at james@mastermindsolutions.ca or 905-731-8255. You’ll find more details on the Experion website and LinkedIn.

The Value of Pleasing Manners

2013-02-06T10:00:00.000-05:00

by Shannon Smith

“In the days of old, men made the manners; manners now make the man.”
— Lord Byron (Don Juan, 1824.)

Manners - Definition: deportment; social conduct; the style and custom of social intercourse; civility with polish; etiquette.

An individual’s manners are the index of his tastes, feelings, temper and usually indicate true character.

Haven’t you found that some people assume a kind of unconventional manner, an attitude of “it doesn’t mean squat”; or a superficial veneer, “a society cloak” on special occasions which is of little importance, no practical value, and as transparent as it is worthless? Artificial politeness is an attempt to deceive, an effort to make others believe that we are what we are not.

True politeness is the outward expression of the natural character, the external signs of the internal being. It must be born of sincerity and be the response of the heart for no amount of “surface polish” can be substituted for honesty and truthfulness. A beautiful character is simply a heart filled with honest intentions.

The “genius” of man, may hide many defects for a time, but the real individual is bound to come to the surface sooner or later, revealing his natural tendencies and personal character.

Good manners are developed through a spirit imbued with unselfishness, kindness, justness and generosity. When we realize that they are the outward expression of inward virtues, (like the hands of a watch indicating that the machinery within is perfect and true), we’ll then understand the power of applying the golden rule.

Unfortunately, we are often compelled to do business with individuals whose very presence is repulsive, who are void of noble qualities. On the other hand, we come in contact with those whose personality is like the warm rays of a June sun, warming and gentle.

Today, more than ever, the nobler qualities of mind and heart count. I like the quote by Harv T. Eker:

“How you do anything is how you do everything.”

History is crowned with examples illustrating the power of indefinable charm of style. Among the qualities which contribute to worldly success, true politeness takes first rank. It is the bearing of man towards his fellowman, more than any other circumstance that promotes or obstructs his advancement of success in life. We court and seek the friendship of an individual with genuine character, while shunning the one who is false, gruff or cold.

Pleasing manners constitute one of the golden keys which turn the bolts of the door leading to success and happiness. Good manners are simply the crowning jewel of a noble character. The great motivating power of our conduct is the heart; it is the foundation of all action.

WHEN THE HEART IS RIGHT, LIFE WILL BE RIGHT!

Links

image courtesy of Photl.com

Shannon Smith is a leading image strategist and founder of Premiere Image International, the foremost provider of personal brand training. Since 1983, Shannon and her team of consultants have taken companies and individuals from unnoticed to unforgettable. You’ll find more details on the Experion website and LinkedIn.

15 Lessons From The 2012 Global Leadership Summit

2013-01-30T10:00:00.000-05:00

By Cheryl Crumb

In the world of self-development, I’m like the proverbial shoemaker who is barefoot. My unoriginal excuse: “I’m too busy.”

I recently gifted myself 2 days to attend a telecast of the 2012 Global Leadership Summit sponsored by the Willow Creek Association originally held in Chicago in August.

I luxuriated in the wisdom of experts like Jim Collins, Patrick Lencioni, Condoleezza Rice, Carly Fiorina, Marc Kielburger, and Bill Hybels. My briefcase is weighted down with new book purchases and I’m still smiling and inspired as I write this.

For those not fortunate enough to attend, here were some of the messages that resonated with me.

Take responsibility for your own development. Don’t wait for your company to do it.
Leadership at its core is about character.
Every adversity brings gifts if you can allow yourself to see them.
Don’t resent or judge the next generation. Believe in them. The old and the young need each other. Honour what the old have done and what the young will contribute. Find ways to learn from each other.
Delegate authority, not tasks. Give freedom: “you’re bright … you’ll figure it out.”
Ensure your greatest legacy is making sure your organization is in good hands when you’re no longer there.
Many leaders incorrectly assume their most valuable quality is time. But it’s really energy. Be prepared to put out energy “bursts” against all challenges and opportunities.
As a leader in any journey from “here” to “there”, where is the vision most vulnerable? Divide the journey into three phases. It’s the middle phase that’s red flagged. You’re past the adrenaline rush of the starting line, but not yet near enough to the finish line to feel its magnetic draw. The middle is where everyone — including you — most needs your bursts of energy.
Leadership requires irrepressible optimism to see the possibilities of a better future. You must continually generate this.
We’ve all heard about company values, but it’s not a litany of all known qualities + the Boy Scout motto + the Ten Commandments + The Bill of Rights. Instead select a maximum of three endemic behaviours for which you’re willing to get punished. It’s not something you aspire to, but where a violation would be like selling your soul.
You are the most difficult person you’ll ever have to lead.
Two requirements for a success organization are its smartness (strategy-finance-marketing-technology) and its health (minimum politics, minimum confusion, high morale, high productivity, low turnover). The former gets 95% of the attention, but it’s only half the equation. A healthy organization becomes the multiple of its smartness. Focus on making your organization healthy. It’s not “beneath” effective leaders.
Be prepared … it’s what you do before difficult times, so that you can be present and strong when people need you the most.
Winners aren’t luckier than the also-rans, but they didn’t squander their lucky (bad or good) moments. Ask yourself and act on, “what do I need to do now to make the most of this event?”
The only mistakes you learn from are the ones you survive. Ensure your survival with discipline, creativity and paranoia.

Here are video highlights

Cheryl Crumb helps you get customers for keeps. She is an ISO 9000 accredited trainer, coach, transition consultant and facilitator who designs training programs to fit specific corporate needs. You’ll find more on her website, the Experion website and LinkedIn.

Two Instant Presentation Upgrades

2013-01-23T10:00:00.000-05:00

by Heather Stubbs

Do you want to upgrade the effectiveness of your presentations? The two most powerful actions you can incorporate into your delivery are a smile and eye contact.

Everyone you talk to is sizing you up emotionally and instinctively before they focus consciously on the content of your presentation. They can’t help it. It’s the way the human brain is designed. Neuroscientist Antonio Damasio said, “We are not thinking machines that feel; rather, we are feeling machines that think.”

Even people who seem unemotional base their decisions on their feelings to a vastly greater degree than we might imagine.

The path of information

All information that reaches us through our eyes and ears travels along nerve paths that go first to the instinctive and emotional centres of our brain. When you speak, this part of your listener’s brain pays close attention to how you look and sound. Based on that, it develops a feel for whether it’s safe to open up and trust you, or whether it needs to be on guard against you.

It’s no secret that when someone trusts us, they are more likely to be receptive to our ideas, but someone who is on the defensive doesn’t really hear what we are saying. If a person feels even slightly uncomfortable with you, to that degree they are on the defensive against you, and will not be responsive to your message.

Why so powerful?

Why are eye contact and a smile so powerful? Because they link to our deepest and most primitive desire – to survive. Scientists believe that the process of screening information through the instinctive and emotional parts of our brain appeared very early in human evolution. The perceptions we develop are sometimes buried so deeply in our unconscious that we’re not even aware of them. We think it just feels better when someone smiles.

But why? Because it makes us feel safer.

As far as our unconscious brain is concerned, a person who smiles is more likely to be friendly and safe than an unsmiling person, who might be hostile and a threat to our survival. Instinctively, we all know that the quickest way to make someone relax is to smile at them. Even if you must be the bearer of bad news, your message will be more effective if you can find a way to ensure that your listeners don’t feel you are personally hostile toward them. Focusing on solutions and wearing even a slight smile will increase your listeners’ receptivity.

The need to be acknowledged

Everyone, from the most introverted to the most extroverted, has a need to be acknowledged as someone who matters. When you look someone in the eye, you fulfill that need. You show them that you see them and care about them. This harks back to our need to feel safe, doesn’t it?

Someone who cares about you is less likely to be a threat. When your direct eye contact shows you care about your listeners, the instinctive and emotional parts of their brain feel it’s safe to relax and respond.
We think we’re so modern, don’t we? Yet we all still function from a part of ourselves that is deep and primal. When you look your listeners in the eye and smile at them, you get that deep, primal part of them working with you, instead of against you.

Brand You Successful

2013-01-16T10:00:00.000-05:00

by Shannon Smith

You either create a brand that is distinct …
or you become extinct.
— Tom Peters, author of In Search of Excellence.

Humans think visually. The saying “I hear what I see” is true. The visual you has the most impact.

The personal brand (image) you project affects others’ decisions about

your intelligence, character and ability
whether they want to do business with you
how they treat you

The way you dress (and act) has a remarkable impact on the people you meet professionally and socially. Clients who dismissed the importance of personal packaging (their personal brand), tell me they have lost promotions, deals have fallen through, memberships were denied and friends have disappeared.

Is your personal brand (image) professional, congruent, attractive and attracting?

Before you sell anything — your product, company or service — you sell yourself. Shift the balance of power in your favour. When you brand yourself, you are perceived as more desirable and in demand. Brand Status increases the bottom line, both personally and corporately.

Large, successful companies understand the power of branding. They spend a lot of time, money and energy to create a brand for their product that is eye-catching and appealing enough to sell through to their market. They want to ensure that the buyer builds a strong connection with that brand.

Do you think of yourself as a company of one?

How much time, money and energy have you spent in developing a personal brand that is unique enough to sell through to your market? Chances are you haven’t even given it a thought. Perhaps, like many of my clients, you too, dismiss attention to personal branding as frivolous, fluffy and superficial until you, like them, hit a brick wall, lose business, that big contract falls through or you fail to get the next promotion.

An individual with a well-defined personal brand has more status and a tremendous advantage over the competition in the marketplace. When you are well-branded, you are pre-sold. That gives you a huge advantage over others selling themselves.

When you want someone to date you, for example, you don’t just stand in the street naked. Instead, you put on the outfit that reveals just enough and covers up just enough to make people want more. To get someone interested in you, just give away a few pieces of information. You want to tease them, wet their appetite and make them drool for more. In the beginning, it is simply style. Substance comes later.

What are you doing?

In the current economy, competitiveness has increased dramatically. Business is more serious and conservative --- not only in attitude but in business attire, business etiquette and leadership skills as well. Companies are concerned and hiring us to train their employees in acquiring the soft skills that lead straight to success. Of course, intelligence, experience and education count. Today, the whole package counts

The hallmarks of successful individuals in a fast-paced global marketplace are their confidence, ability to communicate effectively, manners and poise. Mediocrity is dead — and it’s about time. It is not acceptable to dress inappropriately or do business with the wrong fork. There is a return to formality, elegance, manners and sophistication.

It’s been my experience that an individual who understands the power of perception will make the changes necessary to ensure that he/she creates a powerful, congruent personal brand. To be competitive, have greater influence on others, attract more business and be more successful, it is critical to pay greater attention to personal branding.

Be a smarter marketer. To attract the best, you need to be the best.

How To Start Blogging

2013-01-09T10:00:00.000-05:00

by Promod Sharma

Blogging is writing an article with a touch of personality. You're not writing for a newspaper, magazine, journal or book. There's no rigorous editing process (which has pros and cons).

This post explains how current Experion members can write for this blog. The process is much simpler than starting and running your own.

Why Blog?

In this short clip, Seth Godin and Tom Peters give the reasons for blogging.

The Topics

You have considerable leeway in what you write about. Since this is a business blog, you probably want to show your expertise in your field.

Please be original. You can build on content you've written before which is not already online. If you’re referring to other content that’s online, provide links.

The Process

The blogging process is meant to be simple for you.

Write

When blogging, the length of the content makes a difference. An article that's too short may disappoint readers looking for detail. and rank low in Google searches.

Target a minimum final length of 500 words. There's no maximum limit but a longer article might work better as two related articles. A shorter article can often be extended or used as a segment of a longer piece.
Consider using subheadings to help readers skim.

You can write in your usual word processor or text editor. If you have an iPad and like writing, consider getting iA Writer. If you use Windows, consider using Windows Live Writer. It’s free from Microsoft and gets used to finalize each blog post here.

Distill

Editing makes your message clearer and more concise. The challenge is being objective. For better results, leave a gap of at least one day between writing and editing.

Twitter is the extreme form of blogging (called microblogging). Here you’re limited to 140 characters. Can you summarize your article in that length? The result might make a great title for your post.

Find Visuals (optional)

Your article will have more impact with visuals. Here are free sources. Better still, use original photos or graphics. It's important that you have permission to use the visual. Include a link to the source as a form of thanks.

Submit

When you’re satisfied, email your article to the Blog Editor. Light editing and posting will be done for you. If more extensive changes are needed, you’ll be contacted. Once ready, your article will be scheduled for publication.

Format

Each post will show

Title (catchy to attract readers)
Author’s name
Article (can include photos, audio and video)
Author's byline with a links to their Experion page and LinkedIn profile. Links to Twitter and a website can be added too.

This post is an example.

Frequency

Plan to write at least once a month. To keep on track, consider submitting your draft in time for monthly Experion meeting.

Subscribe to receive blog updates automatically. Invite others to subscribe too. The process is quick and free.

Patience

Traffic builds. Old articles continue to get read year after year. There's no way of predicting what will be popular. That’s why having lots of articles is important. Each visitor has the opportunity to read other articles, subscribe and follow on Twitter.

If you have questions, please post them as Comments below. That lets others participate.

Writing From Experience

2012-08-27T20:53:00.000-04:00

The Experion Group has members with vast experience in diverse fields. We currently have 33 members, which helps you locate an advisor with relevant skill and the will to help.

We will share our expertise here on this blog.

In the beginning, we'll experiment with the layout. You may not find much content here as we develop the posting frequency.

Stay tuned.