Author: Pavlo Phitidis

Can remote work sustain, or do we go back to onsite work?

When Covid hit, the world shut down. Remote work became a necessity. Across all business, leaders are trying to evaluate the sustainability of it all.

Listen to the podcast of Pavlo Phitidis discussing this on The Money Show or read on…


In manufacturing it’s less sustainable as the means of production are plant and equipment. Unless its digital production like websites and software or even drafting and product design. The challenge there is the cost of technology to get the job done. Product and trade need people at site to lift, carry, make, pack, send their offerings to their customers. Hard to coordinate remotely with the business centred around a warehouse.

The service industry is where the greatest shift may lie. With people and rent being the biggest fixed operating costs, the motivation to shed the landlord is high. On paper it’s almost irresistible. But what is the cost?

  1. Culture

Beyond a job, beyond a paycheck, why do we work? Hopefully, we find purpose, meaning if we are lucky and a sense of value in that we count and matter to our colleagues and peers.

This manifests in the social elements of the work environment. Laughing at joke, raising eyes or brows at the remark made by a colleague commenting on their kid’s behavior, gossip about the boss’s new shoes, sniggering at the hung-over manager who had a rough weekend. All subtle, all social cues that evolve the character of that company’s workplace, that shape the culture through a series of unspoken rules of engagement beyond functional work ethics and norms. Playing, humoring, charm, interference, irritation, and celebration add further to the social environment, mimicking the character of the boss or managers or outspoken characters that every business has.

How does it work in the cold hard stare of a screen, cameras off, staccato communications, tones unattached to facial expressions and body language? It’s hard to get right. What does it say when your employees don’t want to come back…or do? Might this be the truest reflection of your company’s culture.

Culture is vital to create meaning and value beyond function. Work is a social engagement and the extent to which it can happen, how it happens has a tremendous impact on the wellbeing, happiness, and engagement of your team. This in turn impacts productivity, performance, and innovation.

  1. Innovation

How, where, and when does it occur?

A sales rep or BD comes back from a client engagement and needs to talk about the meeting. They had an epiphany moment, and the client is asking for a service that needs discussion. Getting it right gets the deal and might open a new market or competitive edge.

Operations is struggling to service a client’s expectations. Scope creep, eroding profit and time is moving out of control. The client is important, so is the time and budget driven project plan. Who has the relationship with the client to sort it out and who can ask?

An insight to a workflow comes to mind. The opportunity to improve a system is real. Quickly gathering a few colleagues in front of a white board to map it out makes it happen.

The impromptu nature of these engagements is lost and with that comes a cost.

  1. Problem Solving

In the flow of work, a problem arises. Leaning over the workstation or stretching across the desk, asking a colleague how to resolve it or whether they too have it is lost. How do we quantify that cost? Is it a function of time or worse, will it be ignored and what then follows on from it?

  1. Negotiation

How do you engage in a negotiation across a screen? Negotiation relies on cues, expressions, tone, body, and face language. Measuring its intent – taking a chance to being deathly serious – is normally understood through these human cues. How do you get it done with cameras off? And if the cameras are on, how much can you read beyond the words being spoken, losing out all the other cues. Getting it wrong comes at a cost and we have not yet begun to understand it.

  1. Ethics

How do figure out what’s right and what’s wrong in terms of behavior and practice. Would asking suggest you don’t know and what then would the company think of your question, answer or behavior. Especially if you are a new employee, who can you observe or ask casually at the coffee station or water cooler?

  1. Onboarding

Securing and onboarding future talent is particularly hard. Whilst it is the norm in multidisciplinary software projects, it is not in the everyday functions of a services business. How do you induct new recruits into the social dynamic of a business and weave them through the fabric of how, who, what makes the business work…beyond the function of their job? The goal driven and focused screen engagements get them only so far!

  1. Performance

Can you measure your team’s performance? What if you have a bigger team, can you still? How do you measure performance? The great majority do so through activity and action. Very few businesses have systems to measure through output metrics. Logging onto the ERP or CRM and then logging off 8 hours later does not mean 8 hours of work was done!

  1. Team

How do you build a cohesive team? Especially true in the age-old battle between sales and ops. Tensions arise as sales ‘over sell and promise’ when ops ‘underdelivers to the client expectation’. Teams form, battle lines are drawn, managers resolve, learnings are gained and the physical engagement around it matters deeply. A great client meeting from an enthusiastic BD cannot be shared as she triumphantly walks into the office; the ring of a bell on a deal done is heard by nobody, a problem solved in administration is respected by no one. Team is built through the multiple, small, seemingly insignificant actions that create alignment, coherence, and loyalty. Is there a cost to not, having it?

We don’t know until we do. Understanding and interpreting the interactions between people is a dark science. Hard to measure, hard to notice often, hard to put a value onto until one day, things are different and not for the better. Truth is found in action and already some of the biggest service companies in the world are telling their team to come back to the workplace – Apple and JPMorgan count in amongst them. Why? And especially because they have worked remotely for years, well before the pandemic. Already, hybrid models are forming. Services organizing and reshaping to accommodate hybrid models are burgeoning as the race to find what works best is still to be seen!

Pivot

The art of a pivot

Pivoting is a jargonized word for resetting your business to be relevant. It’s used extensively in the start-up world and has become a buzz word as a response to the crisis wrought upon all businesses during the 2020 covid nightmare we have all lived through.

Why, when, and how do you do it as an established business? Listen to Pavlo Phitidis discuss this on The Money Show on 702 & CapeTalk:


Why?

To survive or thrive requires to you to be constantly adapting and adjusting your business. It’s a natural outcome of growth as well as a response to a change in the status-quo.

When?

When you face a threat or opportunity, an entire reset of your business, or part reset is a highly likely outcome. We call it the break-build period and it’s often the outcome of next-level-growth. When under threat, it’s driven by necessity to survive. A threat changes the status-quo of your and your clients/customers world. Persisting with a business-as-usual approach reduces your relevance and value to your customers….and that can be your death knell.

How?

Start with defining your value stack

This includes all your tangible and intangible assets, relationships and insights, sector knowledge and foresight and personal attributes.

Then peel your onion

Using the onion peeling method, you can allocate and categorize your value stack into the 3 layers of core-strategic, non-core-but-strategic and non-core-non-strategic.

Generate a cashflow forecast

Cash is king, preserve it, build it, hold onto it and invest it only to accelerate the generation of it until things stabilize.

Do not raise debt!

Finally Reset, Rebuild and Reignite

Reset is a re-definition of your value from the experience of your customer.

Rebuild is the ‘reconstitution’ of your business model and operating activities to create scale in your reset business.

Reignite is accelerating your growth through acquiring the customers, stock, plant, equipment, talent etc. of your competitors who have failed to reset and are losing their relevance and revenues.

resilience

BUILD RESILIENCE INTO YOUR BUSINESS TO TAKE CONTROL OF YOUR FUTURE

We often hear about being resilient to thrive and survive in business today. Why does this matter and what does it mean?

The pace of change driven by fragmenting political and economic ideologies, changing socio-political environments, accelerating access and advances in technology and increased competition is happening faster today than before. And this was before Covid dramatically shifted and accelerated change across the globe.

Staying relevant in this changing world is vital to ensure a future for your business. Think Kodak. One day they dominated, the next, gone. Think Nokia, BlackBerry, Sears, Studdafords, Commodore Comp and the list goes on! We know this, yet, every day I see established businesses facing similar fates.

On The Money Show with Bruce Whitfield, Pavlo Phitidis outlined how to build resilience into your business.

WHY DOES IT MATTER?

If you don’t get this right, your business will die. A business that is not growing is a business dying. Sure, one can blame a multitude of factors from the no-growth economy, aggressive anti-growth legislation and government policy, scarcity of funding and so on. Yet, in the exact same environment, businesses like yours are growing.

To not be relevant in the changing environment stalls growth and retards it generating a fateful future. Without growth you have a business that is hard to sell and further, you will not attract talent, new customers or funders compounding your no-growth scenario and blame.

Your years of sacrifice, investment and risk must turn into a successful exit and capital gain. That is your final reward and it is the pension that you need to care for your family and self.

BEING RESILIENT IS NOT ENOUGH

Most of the content on resilience focuses on human behaviour and psychological analysis of top-level sports people or rough and tough specialist soldiers. There is great value and inspiration in accessing this content. But reading it does not make it so. The human behaviour piece of resilience takes specific experiences, time and pain. Without it, you will suffer. But with it, you are only partly there. Resilience can be built, through design, into your business. When you tire from the ceaseless fight, when you fatigue from the constant assault on your business and future, you need your business to have resilience “baked-in” through its design and method of build.

BEING PROBLEM AND EXPERIENCE ORIENTED IS THE SEED TO RESILIENT DESIGN

Today, customers buy experiences that solve their problems. Being clear on who your customers are and what problems you solve for them is the single most important factor in designing a resilient business. Beware to let your product or service guide your business design and mindset. This means that your eye, ear and heart are all focused on the product and its features when in fact, the market is buying solutions to problems and experiences. Remaining “tuned in” to your customers and responding fast to their changing world builds a resilient business.

To get a clear message from the market, a resilient design is one in which the business does not try to offer everything to everyone. Resilient design means being super-focused, niched, a specialist in both the product or service you offer, as well as the customer groups you target and serve. It remains the single most challenging thing to get right.

INFORMED DESIGN LED BY YOUR CUSTOMERS

With clarity at hand, resilient design means that every activity in your business is developed to market, sell, deliver and enable response to that well-defined customer group. These systems need to orchestrate and act to create the right pitch and melody that your customer will hear and resonate with. Get the melody wrong, that customer switches channel or skips to the next tune on their radio. Get it right, and that customer will stick and stay. They will also lead the development of your business into the future. As their world changes, you will be able to understand what that means. That understanding leads to your actions leading to the investments and changes you make in your business to respond.

STRUCTURE DETERMINES BEHAVIOUR

Designed resilience means a team that is tuned into that customer and their changing world. In a service business making each and everyone’s bonus or incentive structure linked to customer experiences is a lot easier than in a product or manufacturing business. You may not like a member of your team but if your customers rate them well, they’re an asset and key tool to the resilience of your business. Remember, structure determines behaviour. Incentivise people against a structure that ensures resilience and responsiveness, and they will be true assets to the business.

RESILIENCE ATTRACTS GOOD COMPANY

It’s not simple to get right. It’s harder when you’re established. Without this design baked-into your business, it’s all up to you, 24/7. With this design in play, your efforts will act to deepen and ensure that the success you enjoy today, will be the success of tomorrow. Funders love it, buyers even more and your employees will thrive on it. Finally, your reward will be greater than you could ever dream of.

LET’S WORK TOGETHER

We work with established business to get to the next level of growth and value. That means resilience is baked-in, built-in and an absolute necessity in how we work with you. Get in touch and let’s ensure that your future remains brighter than your present day.

 

business exit

Creating an exit roadmap

We spend years building a business to generate economy for ourselves. Mostly, we are undercapitalized and learn to do things ourselves. It becomes a habit. Then, of a day, we decide we want out. Or circumstances change and we want out. This is brand new to us despite the 10-20-30-40 years of investment work in our businesses. All your experience is in generating an income through your business, you have no experience selling it.

Understanding your exit roadmap early will serve you well. Listen to this podcast of Pavlo Phitidis’ discussion about business exit planning with Bruce Whitfield on The Money Show on 702 and CapeTalk:

Elements of an exit roadmap:

  1. Salable vs non-salable business

94.6% of all businesses started, fail to sell. Even the well-established ones. Think of it like a share you would buy on the stock exchange – what would you want from it?
You want to earn dividends each year hope, and when you are ready to sell it, you want to be able to sell it – for a capital gain. Your business is the same, it needs to demonstrate to a potential buyer the following:

  • Income growth
  • Capital growth
  • Tradability
  1. The buyer personas

Think of your potential buyer as a customer: That buyer needs to have a problem solved and different buyers have different problems, different skills and competencies.

  • The private buyer – an individual who wants to buy a business. Typically they work through a business broker to find a business that fits their own abilities and resources.
  • Management buy-out – this is seen often in professional services, where you generate income and value by selling time – medical, legal, architectural firms etc.
  • Family – the first generation sells to the next generation.
  • A business – where a business sees value in acquiring you.
  • A JSE listed business – these form the majority of buyers of private businesses. They look to acquire growth in revenue, innovation, or skill and capability, which often means they want you in it.
  • A foreign owned business – a multinational looking to gain a foothold into Sub-Saharan Africa but these are few and far between until we welcome foreign investment.

Identify who the most likely kind of buyer would be for your business, and think about what they would want, and how you should build your business to suit their wants and needs.

  1. The hurdles

It is very rare to get an outright cash offer for your business. Pavlo shared the story of an American business owner he worked with, who got this right. He did medical assessments for insurers and over a period of time he realized it wasn’t scalable as he had to do each patient visit. So he harnessed technology through Amazon, Instagram, Facebook, Google and used all of that data to create a risk profile for individuals, which he provided to the big insurers. When he was ready to sell he got a once-in-a-lifetime offer of $180million. But that was extremely rare. Most of us will not secure such a simple payment.

So who is buying what?

  • Private money – if you are selling to a private individual, how much can they put down and how much can they borrow from the bank? The need to borrow, especially in our current economic climate, caps these buyers at around R15 million for private money.
  • Business money – Between R12 million to around R30 million, a private business could leverage funds to buy you.
  • Corporate money – given the compliance, risk and legislation around transactions, one that doesn’t give them a business that generates at least R50 million plus, is not going to justify the pain of acquiring you.

This leaves a no-mans land between around R25 million and R50 million where there is no-one who wants to or can buy your business. And it’s important to know that, as you grow your business towards an exit

 

Captain

What is the job of a business owner?

If the purpose of the entrepreneur is to create an Asset of Value, how do we get from where we are to the Asset of Value? What is it that the entrepreneur actually does? What is the “job” of the business owner?

Let’s break down the business. No matter what sector you are in, every business works utilizing the same basic functions: marketing, sales, supply, operations, human resources, money management and general management.

If you look at any one of these functions, you’ll see that it is made up of many activities that are performed on a daily, weekly and monthly business.

Take marketing. The intention is to generate leads. To that end you do hundreds of different activities, from analyzing customer data, to briefing an ad agency, to updating your company website. The sales function has to convert these leads into sustainable customers. Again, many different activities are performed every day, week and month, in order to do that.

And so it goes, for each of the core business functions mentioned above. That’s one heck of a lot of activities! The job of the entrepreneur is to organize these activities and functions into coherent business systems and then find the right people to run the systems with you managing the results.

Here’s an example of what happens when you don’t organize those activities into a manageable system. I’ve been working with a client, Kevin, who has fantastic technology to sell. It’s really better and smarter and cheaper than anything you’ll see internationally. His business should be growing in leaps and bounds, but it’s not. Why?  Because Kevin can’t let go of the idea that his job is not to sell the technology, but rather to organize all the activities of each function into business systems that point him towards his ultimate destination – building an asset of value. Kevin is absolutely consumed by the daily, weekly, monthly activities. He’s over-involved in the minutia. His staff finds his nit-nitpicking infuriating and so his staff turnover is high. You would think that his obsession with his technology would be an asset in the sales arena, but in reality it’s not. He’s scornful of the customers who don’t understand how brilliant his products are, and he lets them know it. He even manages to alienate his suppliers with his interfering and correcting.

When business owners don’t create systems which allow them to take a step back from the hundreds of activities that every business performs every day, month and year, they eventually hit a ceiling. They can only do so much, no more. They get exhausted. Their entrepreneurial energy is depleted, and with it, their passion, their love for the business and their joy in what they are doing.  They lose sight of the vision. They doubt themselves. They alienate staff and customers.

Only through realizing that your job as a business owner involves organizing the building the activities of your business functions (marketing, sales, HR, supply etc) into organized systems, and then delegating the management of systems to your staff with you managing the results of the systems, will you progress!  This is a vital change needed in any business that is going to grow and non-negotiable if you are building an asset of value. This will allow you to spend less time working in the business, and more time working on the business. Get out of the engine room and up onto the bridge of your ship to sail it in the direction you want it to go.

If you are not consumed by the day-to-day activities of your business, you have a better perspective. You have more time. And what do you do with that time? You lead the creation of value by introducing new products or by finding new customer groups that your system of delivery can deliver products and services to.

Kevin is someone with a great idea, a brilliant product – and a not so brilliant business. Why? Because Kevin has not got his head around the fact that the job of the entrepreneur is to niche the business, build systems of delivery for the product or service, and lead the creation of value. Don’t let that happen to you!

blind spot

Shining a light on the business blind spots

Smart and successful businessmen have faith in their vision for their companies, but they need to be aware of their limitations and see themselves and their situations in the proper light.

A failure to do this leads to the business blind spot, a place where we can’t see what is going on around us. It’s also a place where we see things not for what they are, but what we perceive them to be. It grows from a history of how things have always been done in the business and a narrow view of what the business needs going forward. On The Money Show with Bruce Whitfield this week, we discussed business blind spots, how they develop, what they cost your business and how to prevent them.

Recently, I met two business owners in their late 60s. Both started their businesses from the ground up, work hard and earn their success. But what perplexed me was that even with their wealth of experience, both were plagued by glaring blind spots preventing them from putting succession plans in place.

In fact, the global status of successful succession is bleak – 28% of businesses survive it and only 3.4% make it there.

Keeping it in the family

However, blind spots are extreme in the family context. Founders in their late 60s and early 70s don’t admit to their fallibility easily. They can’t tolerate change, but argue that they don’t want the next generation to change the way they’re running the family business because it’s too risky. The successors can’t see that the founders are fearful of risk simply because time is running out and change means risk. This cycle places both in a deep, dark circle of despair – and both generations know it, but feel helpless to change it.

We all suffer from them

Many successful businessmen overestimate their capabilities and have an infallible view of themselves. They surround themselves with a team that seldom disagrees and mostly offers opinions that support the boss’s views. They listen to reply, not to hear and they talk to an outcome but don’t back it up with a plan to act. They seem convinced that what and how they are doing things is the best course of action to grow their businesses even though the numbers don’t agree.

Luckily, there are some blind spot antidotes that we can embrace such as:

  • Have a big vision for the business and one you believe in. The vision then becomes more important than your ego, your being right rather than effective and it will require you to surround yourself with co-creators rather than subservient implementers. The different views on getting things done will shine lights on blind spots for the business.
  • Annually, do the turnaround steps to keep fresh, in the present and relevant.
  • Don’t surround yourself with yes-men. A few contrarian people whose views differ from yours is a good thing. Diversity in a team will bring on contrarian views for certain. Create a safe environment for people to intelligently contribute opinions. That means listen to hear when they are offered and be sure your team knows why the business exists and what its goals are.
  • Increase your self-awareness – understand that the way you project yourself might be viewed by your staff as bullying behaviour in your efforts to retain the status quo. A message will go out that even though you ask for an opinion, you never really engage with it.

As a business builds over time and as growth comes in, the complexity of the operation increases and your ability to change your way of working is crucial. Don’t allow your business to be sabotaged by blind spots. They can lead to a misplaced commitment to a selected course of action that can cloud your vision and stunt the growth of your business. If the destination is clear and there is a clear vision, you can get past the problem and deliver on the promise.

Aurik Business Accelerator will work with you to build, implement and manage a family business succession plan.

marketing

Why (and how) to develop an effective marketing strategy

If you can’t and don’t get potential customers to know that you exist, they don’t care and you die. They don’t care because there is very little special about you. Should you not be there, they will get what you were selling from the next business selling it. This is the mindset of a successful marketer.

A Bit of History

In 1870, Ralph Waldo Emmerson said, “build a better mousetrap and the world will beat a path to your door”. In 1870, he was right. There were very few products so simply having one led to success so long as the product held together.

Henry Ford applied this thinking and he made a great success of it in the early 1900’s. His offer was “you can have any colour Model T Ford as long as its black”. Then in the early 1970’s Philip Kotler, referred to as the ‘Father of Marketing’ argued that products aren’t good enough to draw your customers.

Market Segmentation

Kotler proposed that you must divide your customers into groups of customers with similar needs and wants. You must communicate with your segments rather than rely on “spray and pray” marketing. This is where you communicate with anyone and everyone in the hope that you reach someone who becomes your customer. The business world loved it. It held the promise of bringing customers to your door and it beat mousetraps.

Today’s environment is different but not

In 2020, very few business owners that I meet and work with have progressed beyond a hybrid of these two positions. They have identified their segments and impose their products features on them!

What’s missing?

The ability to see and hear messages from a business has become increasingly difficult. There is more advertising, products, options, voices and choices today than ever before. There is greater access to information, more economic pressure and a massive increase in competition. The environment has changed. But the way most business owners understand and see marketing has not. This new environment means that a product-centric and market-segment approach is no longer working. Both these strategies rely on broad messaging as opposed to customised, contextual messaging.

What’s Messaging?

Messaging communicates your offer and value to a prospective client. It includes :

  • Format
  • Message,
  • Design,
  • Distribution
  • and a result.

Think of an email campaign as an example:

Campaign – this is the programme of communication. It includes the various formats and messaging as well as distribution. It has a beginning, an end and should be measured in terms of impact.

Format – this is the mechanism used to communicate. In our example it is an email, it could be a radio advert, an advertorial, an event etc. There are many formats right down to fridge magnets and coasters.

Messaging – In our e-mail this is the copy. The words that communicate what the offer and value of the product is. It should also include a call-to-action.

Design – this is wrapping of the format and messaging. An email might include a picture with the copy. The copy includes colour, fonts, spacing and more. Design should illicit the ideal emotive response to the message. Red means act now, blue means trust, orange means creative and energetic etc.

Distribution – this includes the method of communication. Distribution is managed off a platform. It includes radio, TV, billboards, websites, social media. It’s also that guy, standing on the side of the road pleading with you to open your window and take the flyer.

How do you get your messaging consumed above the noise?

The evidence is there – people don’t buy products. They buy solutions to their problems. Problems are experienced on a personal level, that is, an emotive “lived experience”. Messaging must resonate with your “lived experience” or you blank it out or look past it.

Beyond Segmentation towards Personas

A persona is a personality, character or identity. It changes over time and its change is led by many aspects from the environment to the body and the mind. Excellent writers have the ability to present the physical, emotional and lived experience of their characters. In reading about these characters, you immediately understand them, and think of people in your friends and family circles. You further knew exactly, based on their description, how to delight and annoy them. Personas are just that.

Persona Messaging

Understanding your customers as personas enables your messaging to emotively connect with them. It makes a person feel heard and understood and that builds familiarity and trust. What you have is a potential customer who feels safe with you. They warm towards your communication and hold the promise of high conversion.

Effective marketing builds messaging that is based on a deep and sound understanding of what problems you solve and for who. It is this understanding that lets you build consistent marketing campaigns that can be measured and improved.

 

ship

Building a business is like sailing a ship

Analogies are very useful to simplify thinking and action. As a business owner, building a business in a challenging environment creates noise and chaos. Gaining clarity, certainty and confidence helps manage the noise and emotion to provide right action and timing in your journey of building your business. A good analogy helps you get this right.

Building a business is like sailing a ship. Here’s how and why.

  1. A ship sets sail with a clear destination in mind

Like a business, you start and end. The end takes one of two forms: A sale or closure. For most, its closure. In fact, 94.6% of all businesses started close at great cost to the business owner, their family, their staff, suppliers and customers and the economy in which they operate. To succeed in your journey, you need to set a clear destination. You then need to ‘chart your course’ to arrive there safely and efficiently.

For example, you set sail from Durban to get to Mumbai. It’s a 12-day journey at sea. Being smart, you take 15 days of food, fuel and water in case things go wrong. A business too, should have a resource plan to get from where it is to where its going. This means a clear destination and a plan to get there supported by a budget.

  1. A ship has a crew with specific skills and roles

A ship has a crew made up of people with varying skills and responsibilities. There’s the Captain, first and second mate, navigators, engineers, cooks and deckhands and so on. Each has a specific role to perform and is trained to perform it.

A business is made up of people too. If well organised, the team includes people best suited and skilled in marketing and sales, operations and procurement, human resources and finance. At sea, every crew member knows what to do and when to do it. The safe passage of the ship depends on it. In a business, the same applies. Failure in any one area of activities stalls your business growth and lets all your team members down.

  1. A ship is organised in three distinct areas: a bow, midships and stern

The bow of the ship is like the ‘front-end’ of your business. It breaks new water and directs the ship along its course. The stern is like the “back-end” of your business. It propels the ship forward. The midships is the control centre of the ship located between the bow and the stern. It’s like the “middle” of your business and controls the finance and human resource administration and management activities. Each area must perform its role for the ship to function well and sail successfully to its destination.

The same applies to your business. The front-end of your business: sales and marketing, leads the business direction. The back-end of your business delivers in response to sales made. The midships holds and coordinates everything together with hopefully, good metrics and data to be sure that there are sufficient resources to get to the destination.

  1. A ship has a bridge and engine room

The engine room of a ship is below deck and houses the diesel engines that drive the propeller and move the ship forward. Its mostly a dark and dingy place. The loud noises of the engines smell of diesel, it’s poorly lit and the constant issues that a sea faring ship experiences make it a tough place to be. The bridge of the ship is located above the deck at a high point on the ship. It has windows wrapped around it giving you a 300-degree view. It has a dashboard with instruments and navigation equipment. It controls the direction of the ship, it deals with speed and communications and has a Nespresso machine. It’s a great place to be.

As a business owner, where do you spend most of your time? In the engine room putting out fires or on the bridge guiding the direction and growth of your business?

Most business owners I meet are spending most of their time in the engine room. They are driven by the business and everything that makes up their business. Staff, customers, suppliers, landlords, government and more. They spend little time on the bridge because their businesses are chaotic and poorly built, requiring them to be constantly fixing and rejigging the engine room. Yet, they are the most expensive resources in their own businesses. They should be spending up to 70% of their time on the bridge. There, they can direct the ship, set the course, ensure that they get to the destination to off-load their cargo and get paid. There, they drive the business and are not driven by it.

  1. A ship sails alone in the open sea to get from A to B

The open sea is full of surprises. The waves, wind, currents and storms bash the ship and threaten its safe passage. The business environment is no different. Every day we face political regulation that hurt business, volatile currency, uncertain energy supply, bad behaviour and hectic competition. It’s a rough sea indeed.

  1. A ship is regularly maintained

A ship is an asset that if well maintained, earns income for many, many years. Regular maintenance from scrubbing the hull free of the barnacles that create drag on the ship’s momentum to removing rust and replacing the lifeboats and distress flares all improve the performance and sustainability of the ship.

In any business, the systems you build will have to be partly broken and rebuilt as you grow. The software and computing you have will need to be upgraded. It’s a process of continually ensuring that your business, as it grows, is shaped and tweaked to deliver continual performance.

  1. Build your business like a Captain sails a ship

Using this analogy, be sure that you have a clear, well-defined destination to sail to. In my view, the only port you should be sailing to is an #AssetofValue. That is a business that’s well-positioned, driven by business systems operated by a well-organised team. Importantly, an #AssetofValue can be successfully sold at any point. Importantly, it releases time for you, the Captain of your business, to be on the bridge.

The shape of your business from the front, middle and end should be well designed to ensure that your ship sails successfully and efficiently. That design coordinates the activities in the business for your crew to play their role. That crew should be well-selected and trained, only possible if the destination is clear and ship is well built.

The sea you sail through will have surprises and your being on the bridge of your business lets you look ahead and keep a clear mind to cope with them as they batter and bash your business.

Finally, you, the #businessowner, should be on the bridge. Its only there that you can grow your business beyond yourself, organise your team, coordinate the building and functioning of your business to ensure that, when you reach your destination port, you have an #AssetofValue. It’s at that destination port you can unload your cargo, or in the case of your business, you can exit with a successful, clean sale.

Working with Aurik we have a structured approach to help any established business owner build their business like a ship. We work with you from the bridge to set a clear destination, build the ship of your business to get there and with the right crew. With us you will get to the bridge and remain in it to take control of your destination and secure your eventual, successful exit.

Pavlo Phitidis

Book review: Reset Rebuild Reignite, how to build a business to thrive in a crisis

There’s nothing like a crisis to expose the cracks in a business, and there are reasons why some rise to the challenge and others can’t or don’t. In his new book, Reset Rebuild Reignite, Pavlo Phitidis shares stories of those businesses that successfully weathered a storm, as well as practical insights and strategies to build your business to do the same.

He was interviewed by Bruce Whitfield for the Business Book review on The Money Show on 702 & CapeTalk. Listen to the podcast from that discussion:

The book is now in stores and you can get your own copy to learn how to build a business to thrive in any crisis. https://aurik.com/pp-books/

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