“After I looked at their accounts it became obvious they had to lose 30% of their cost base. I advised them they had to make immediate cuts or the future of the business was at riskâ€
Recently an accountant I know told me this was his response to a client who was heading into very difficult financial territory. Without immediate and significant changes a 22-year-old business would possibly have to close. He was right of course, drastic action needed to be taken.
Being an outsider though, I wonder did he understand the impact of this slash and cut approach? Unfortunately this is the first and sometimes only approach organisations are taking to making change in this recession.
Cost reduction is essential in such cases but what other options could the business have considered? What other actions could be taken to achieve this result without jeopardising the future of the business? Apart from an analysis of the P&L and Balance Sheet (which are just the symptoms) was a detailed and deeper examination of the cause of the problem carried out to seek more creative ways to respond and uncover new possibilities and directions to be taken?
Did this company miss the opportunity of enrolling its staff in the task of making change in the business, and of being a part of the recovery and perhaps take some short-term pain in the interest of long-term gain.
The business reduced its workforce by one third, and discontinued some parts of the service it offered. My accountant acquaintance tells me most of the people let go are now working with a competitor company offering the services that were discontinued.
He also tells me that in July of 2009 the business went into voluntary liquidation with a workforce of 18 staff. The main reason was that they lost some of their key customers to the same competitor, as they didn’t have the capacity to supply a full service. Three of the 18 remaining staff are in the process of setting up a new business in the same area together.
The obvious answers are not always the right one. There are always more options …!
Â
Reference: What got you here won’t get you there is a bestselling book by Marshall Goldsmith.
Â
We’d love to hear your views on this through our below Comments section…
Just less than 9 months ago we invited 12 people to a pilot programme called Negotiating and Influencing with Integrity and Effectiveness. It is a programme we had run in Spain and we wanted to fine tune it for the Irish market. We got a 100% take up of our invitation.Â
We made some changes to the programme in the light of the feedback we got and decided to run a second pilot in April. Again we sent out 12 more invitations. We got 4 responses!
Given that the course was free in both instances, it is unlikely the drop in interest can be due to financial difficulties. AND, it is a time where the number and seriousness of difficult conversations taking place between people must have quadrupled in recent months.
Maybe it is felt that there is no need to negotiate or influence people at times like these. It is a time for tough and hard decisions. It may be seen as out of the question to enter into negotiations when what has to be done is patently obvious.Â
Quite apart from any consideration of the rights people may have or needs they might have there is another reason why this mindset, IF it exists, is a dangerous one. It is simply the fact that at a time like this it is more important than ever to not only take decisions and take them quickly but to take good decisions. There is a grave risk that without any need or pressure to debate, discuss and yes, negotiate, many decisions will not be good ones, not good for people and not good for business.
While you might agree with this in principle it might not be immediately obvious how negotiating and influencing can help lead to good decision making. This comes from the traditional, unhealthy and very common understanding of negotiating that we have all learned and come to accept. It is for this reason that we have developed the Negotiating with Integrity and Effectiveness Programme – to move people away from getting what is best for them and them only to what is best. Best for everyone and best in itself as a way forward. This is a major shift and such a welcome one.
No winners and losers, no embarrassment, no guilt and no manipulation. And because it seeks what is best it nearly always gets there which would seem to be important in these difficult times. Â
But it is tragic that this critical debate is not seen as needed or valuable at times like this. Never was it more needed.
We’d love to hear your views on this through our below Comments section…
The Buffalo Theory
A herd of buffalo can only move as fast as the slowest buffalo.
And when the herd is hunted, it is the slowest and weakest ones at the back that are killed first.Â
While this is tragic in its own way it is part of the world we live in and this natural selection is actually good for the herd as a whole, because the general speed and health of the whole group keeps improving by the regular elimination of the worst performing members.
Â
Running shoes and Survival
Two athletes in Africa were out for a run and having run for 6 or 7 kilometers decided to take a rest.Â
They removed their running shoes from their tired, hot, sore feet and stretched out for a quick rest to regain energy.Â
After a while one of them sat up and shouted to his mate:Â
“Quick! Lions!†- Sure enough a lion had spotted them and was approaching them some 80 metres away.Â
One of the athletes got ready to take off while the other proceeded to put back on his spiked running shoes.Â
“A lot of good that will do you†- his mate said.
“You are not going to out-run the lion anyway!â€Â
“Maybe notâ€, his friend answered, “but maybe I will outrun YOU!â€
This is not intended to give a message of out-and-out competition or a “devil take the hindmost†mentality, but to simply point out that not every Company will survive in these times; some will fall by the wayside, disappear.Â
It is a fact, sad and tragic as it may be.
Whether it is you or someone else who makes it is not down to fate or good or bad luck, it is down to you and what you do.
We don’t think you can afford not to be great… any longer!
We’d love to hear your views on this through our below Comments section…Â
Â
A fisherman walked along a beach at night.
He was waiting for dawn when he would have enough light to fish.
As he walked, he tripped over a sack.
He felt in the sack and discovered it was full of small stones of various sizes.
To pass the time until dawn, he began to throw the stones into the sea. He tried to throw each one further than the previous one, listening for the small splash as the stone hit the water as many yards away as he could fling them.
When dawn came, he looked in the bag at the three stones that were left, only to discover they were DIAMONDS!
All night he had been throwing away hundreds of priceless DIAMONDS!
… but he still had three left.
Â
We have all made mistakes over the past few years.
We have all thrown away many diamonds, opportunities, possibilities, values, resources, moderation, common sense etc.
But… we have ALL got a few left
To use, enjoy,  be grateful for and to  build on.
And… there are a lot more to be discovered in ourselves, in our people, in our situation.Â
Diamonds… of courage, resilience, creativity, generosity, resolve, solidarity.
Real treasures that were there all along but we are only seeing now.
NOT to be ignored or thrown away!
Â
We’d love to hear your views on this through our below Comments section…
I was once in an earthquake…
Quite apart from the shock and natural fear, I experienced a feeling of complete lack of control. Â
It was complete chaos, unprecedented in my experience.
Buildings danced, the pavement jellified, the world became one large bouncing castle. Â
The solid world I knew and trusted had become surreal.
People chaotically ran in different directions, some on their own, some with other equally lost groups. Chaos. Panic.
Some did nothing, reconciled to whatever came next…
(Recognise any of this?)
If you want to know more, just click here:
http://www.maybe.ie/presentation.ppt
We’d love to hear your views on this through our below Comments section… Â
Â
Dear Friends,
We would like to take the opportunity to wish you a very Happy Christmas…
Looking forward to keeping in touch with you during the next year,
The Maybe Team
Â
Â
Do you believe in Santa Claus?
Given the time of year this might only be a question those with children of a certain age are exercised about.
However as adults you have probably put aside such childhood beliefs along with those in the tooth fairy and the Easter bunny.
But what about all those other beliefs and especially those you hold about yourself?
Recently at a creative thinking session in a local primary school one young pupil was insistent that she wasn’t creative. This was based on the fact, as she put it, “I’m no good at drawingâ€
Perhaps it would be easy to dismiss this incident on the basis that after all it’s only drawing so it’s really no big deal.
However, what is a big deal is first of all the process by which such a limiting self-belief becomes a “factâ€, and secondly how such a belief may be retained and hold us back later on as adults.
Beliefs about our abilities are seldom based on a single instance. Rather they are built up by a process that involves such things as
Â
§      Feedback that comes across to us as a judgement. This is even more damaging when given by someone we look up to such as a teacher or parent
§      Confirmation of that judgement by friends, older brothers or sisters whose qualifications as art critics in this case may be based purely on the fact that three of their works feature prominently on the fridge door!
§      Self-talk, the proverbial voice in the head, consistently repeating a message beginning “I’m no good at…â€
§      Reinforcement, continuously looking for evidence of failure to back up negative beliefs and finally
§      Limiting beliefs and with them the refusal to further attempt anything you’re now certain you’re no good at. Â
Â
While such a process and its regrettable outcome may be understandable in the case of a child, what is even more insidious is that such beliefs are often carried on into adulthood, never questioned or challenged with the mind of an adult.
It is said that there’s only two things that men never admit to being no good at, one is driving, the other one is sex.
While this may raise a smile it also raises a serious question.
Are there really only two? What about all the other things? What are all the limiting self-beliefs that perhaps you have carried within yourself since childhood; beliefs that you continue to hold which are holding you back, affecting your performance, stopping you being all that you can and need to be?
Worth exploring?
Maybe… but, on the other hand, as you well know, you’re just no good at exploring!
Then again perhaps such a journey of exploration might just be the best present to yourself… or even from Santa, this Christmas!
Â
We’d love to hear your views on this through our below Comments section…Â
Somehow it seems to be human nature to put off making tough decisions until they really have to be made.
Quite often this can be too late and the benefit of the decision is lost or diminished.
Coming off the back of a time of boom and growth this is a problem all too common in many industries and organisations today.
This period of greater demand for products and services was supported by the disproportionate deployment of ever available resources from willing accomplices including Banks and [or] Governments. Get the job done was the mantra, and soon the job couldn’t get done without a new layer of waste. Administration and operating overheads, capital investment etc all increased and sometimes at a much greater rate than profitability, or in the case of Government, at the expense of the service provided.
Somewhere at the back of all our minds through these times was the thought that waste is being generated and it will need to be eliminated at some point in the future!
That point has now arrived!
As talk of recession and indeed depression monopolises the News programmes and the Banking crisis brings wave after wave of uncertainty upon us we need now to concentrate on making our organisations stronger by eliminating unnecessary waste. Those tough decisions need to be made and serious action needs to follow to eliminate the waste generated during the good times. It is in the interest of every member of every organisation to achieve this result to bring real value back into the economy through our goods and services.
Looking at my book shelves I see ageing tomes on the once newest techniques and philosophies on eliminating waste and altering cost structures, from Total Quality Management (TQM) to World Class Manufacturing (WCM) from Business Process Reengineering (BPR) to Just in Time (JIT) and many more. Great titles like Pathways to Progress; BPR – A Manifesto for Business Revolution; The Performance Breakthrough; and dare I mention In Search of Excellence, most of the companies quoted in its pages are now either defunct or bought out. All were and are viable strategies, each with their own key principles that bring insight and purpose to the efforts of the organisation to change.
One such area I worked closely on was another acronym – ABCM, or Activity Based Cost Management. ABCM promoted a different way of looking at cost, as an investment in customer needs. Its core tenet is that activities are the core of all products and services and activities consume valuable and scarce resources. Deciding which activities add value from the customer’s perspective and which activities are non-value adding from that perspective is a key step. Having decided that (through detailed work with your customers as to the elements of the product or service that they saw as value adding), it then set out to eliminate or reduce the NVA (non-value-adding) activities.
But is cost management enough? What about maximising value?
Of course both are needed and this is where we at Maybe… have encouraged, promoted and worked this dual strategy with our clients through our LSVA (large scale value analysis) programme. Sorry about the acronym!!
The LSVA team is made up of key people from each function in the organisation (identified from within) and we train them in two things – facilitation skills and creative problem solving – so that they can work with all departments and customers to identify potential cost saving and revenue earning areas.  Â
There are huge benefits to the business in going this dual route quite apart from the obvious ones of cost savings and revenue generation.
The LSVA programme engages people at every level and captures their ideas. Activity Based Cost Management works hand in hand with the LSVA approach; in fact it is greatly enhanced by it, benefiting greatly from the valuable skills of facilitation and creative thinking provided.
One of the greatest benefits I saw from this large scale project (across 50 manufacturing plants) was the way it involved the customer and people throughout the organisation. It wasn’t a top down, command and control operation. Managing activities depends heavily on the people working at the activity level both from the knowledge and the acceptance perspectives. No one knows the operation or the activities better than the people who perform them.
Facilitation is essential as it plays a key part in keeping the all important reasoning behind the need for change centre stage. If people understand the importance they will want to be a part of it. I have seen operator led change bringing about 20% improvement in outputs along with increased quality. In an accounts payable department by identifying that Pareto was alive and well and that 20% of the suppliers were generating 80% of the invoices and payments, it was possible to reduce invoice processing massively by agreeing with the key suppliers to prepare a summary invoice at month end. This further developed into an Electronic Data Interchange (EDI) initiative where further savings were made. A Mechanical Fitter came up with a suggestion that avoided the necessity to make a capital investment of hundreds of thousands of euro in a water treatment system. He subsequently took his very good idea outside the business and became a very wealthy individual. There are many more examples, which illustrate the power of people involvement and the necessity of it.
So whatever “big†initiative you use, ABCM, TQM, BPR, Lean Manufacturing or none of these, the key thing Maybe International would advocate is that you invite all the people in the organisation to contribute. A partnership role will bring better results, it reduces fear of change and misunderstandings around the intentions of management. Everyone wants to work in an environment that is meaningful for them at whatever position they hold in the organisation.
We’d love to hear your views on this through our below Comments section…Â
Â
Â
Some people might say that creativity, or too much of it, is the cause of the current economic crisis. That certain people in the financial sector became just too creative around wealth generation and lost the run of themselves. I actually feel that it’s the absence of creatitivy or not enough of real creativity that is the cause of the problem!
It really comes down to what we mean by “creativity†and what true creativity really is.
Creativity can sometimes be associated with being slick, being loose with the truth, taking risks, removing ourselves from reality in order to achieve certain outcomes.
I want to argue that Creativity in fact is about being true to reality.
Creativity is a very big word – maybe even the biggest there is if only because of its historical connections to the divine and the origins of the universe.Â
So what does it mean, what are its different levels, and where does it fit in today’s business?
Â
Creativity at its most basic and fundamental level is the reality of or belief in a creative process in the universe that lies at the heart of everything. It is this that keeps things going, spinning, in dynamic balance, evolving, growing, straining for perfection. We are consciously or unconsciously part of it
The areas where we use the word “Creativity†with greatest comfort is in the Arts. Here are the truly creative people. We say this because it is here that the creative process is seen in its most visible and purest form. What we see happening here is the person responding to the world around them through creative expression.Â
This is what all creativity is and this is where it fits in organisations and business because it is this same process at work – an individual or group of people responding to a given situation or reality and bringing into existence their concrete response to that.
Â
In Maybe International we believe that Creativity is the life blood of every organisation. This is not a throw-away cliché. Out of this current crisis organisaitons will die, survive or thrive based on the quality of their thinking and their response to the circumstances they find themselves in. It will take courage to get out of this situation, the courage to think in new ways and to do things that may appear very strange. As with all creative ideas, they will eventually look perfectly logical with the gift of hindsight but for now they will require courage. Creativity and Courage go hand in hand.
More and more the need for Creativity in every organisation and in every sphere is being recognised world-wide. Japan for example, a country that has given us many advancements in technology in recent times, has incorporated creativity into the curriculum for primary school children. The official reason given was: “we must start early if we want to keep up with the creativity raceâ€. One Japanese computer company calls managers who are trained in creative techniques “certified thinkersâ€. They are used as a resource across the company to help in various types of idea generation and problem solving sessions.
Â
What we need to do if we are to get out of this recession and prevent another one is to look at making creativity part of our working lives. A significant level of everyday creativity should apply to everyone in an organisation and become part of their normal thinking skills. Training in Creativity should be an essential part of staff development interventions. This would inculcate the belief and form an attitude that anything can be done in a better way than at present. By knowing more about creativity, the extent to which it is valued and used within the business, it is likely to increase its use in the day-to-day operation.Â
Organisations can learn new ways, better ways of thinking, relating and responding to their particular situations. This calls for constant questioning of everything and a resolute tolerance of uncertainty. It is often not so much about coming up with smart answers, but about asking a better question which may enable a closer and more creative understanding of the problem. True creativity demands patience.
We need a new perspective on creativity which recognises it as an essential part of every organisation and part of a successful manager’s repertoire, at least as important as the logical analytical abilities that are so highly prized in our business culture.
Â
So, while it was NOT creativity that got us into this fine mess, there is no doubt that it is real, courageous, resolute creativity that will get us out of it.
We’d love to hear your views on this through our below Comments section…
Â
You may know the story of the person who was unfortunate to be involved in a car accident, but while in hospital he (more men have car accidents!) hears that an avalanche destroyed his house and so he was fortunate and happy he was not in the house at the time.Â
Unfortunately his lotto winning ticket was also in the house and was destroyed.
No money, no house… but fortunately a brother from whom he had been estranged for many years visits him and offers him his house as his new home and the whole family is reunited.Â
Unfortunately… and so on.
Life is like this; we don’t really know what is really good for us and when we are fortunate… or unfortunate!
The present downturn is one such example.Â
Maybe you see it as unfortunate. Maybe it IS, or Maybe it is NOT…
Â
1.               Maybe it gives you the opportunity to clear out some waste that has been accumulating and dragging your business down.
2.          Maybe it will “force†you to face up to some things that otherwise you would not have faced.
3.        Maybe it will get you to look at new options and directions that you would otherwise not have even considered.
4.         Maybe it will sharpen your whole business.
5.       Maybe it is an opportunity to get your people really with you and united around the fresh challenges you are all facing.
6.         Maybe you at last have the time and resources to look at those ideas you have never had the time to go after.
7.          Maybe you can become leaner and healthier and better as a Company.
8.          Maybe it will do more damage to your competitors than it will to you not just by sitting out the lull period, but by handling it better than others.
9.          Maybe it can lead to a better balanced and less crazy way of life or way of doing business.
10.      Maybe you can use it to take a fresh look at your business, how you manage, how it is structured, what you want it to be.
11.       Maybe you have been taking your customers just a little for granted and now is the time to really give them attention… and you may have the time to do so.
12.            Maybe because things have been good you were more focused on your own products and services and neglected to find out real or new needs that your customers –and potential customers– have. What a great time to do that now!
Â
So Maybe these are not bad times at all. Maybe, like our unfortunate… sorry, fortunate friend above, there are all kinds of good things waiting just around the corner.Â
However, the difference between you and our (un)fortunate friend is that in your case it is mostly within your control whether this is actually good or bad fortune.Â
It is almost entirely up to you and to how you handle it, and you can handle it really well if you really want.Â
There are all kinds of exciting possibilities hiding from you just behind this cloud.
You must agree! If you don’t agree and think it is all bad news we feel confident we could prove you wrong!!!! Fortunately!
We’d love to hear your views on this through our below Comments section…