If you are a professional firm then the answer to the above question will almost certainly be yes. Whether you are an accountant, lawyer or from another discipline areas of your business are or will be commoditised. Accountants will be experiencing this with services such as payroll, whereas lawyers will be looking at conveyancing, for example. Anything that can be reduced to a process will be commoditised in the natural course of business.  The trick as I see it is to recognise this and then embrace technology so as to be able to deliver it. This will enable you to retain clients and have a captive audience to sell more value added services which can command an hourly rate, as opposed to being a fixed price proposition. Hourly rates are clearly subject to market forces but give the opportunity to demonstrate benefits more easily that offerings that have been commoditised by the market.

For non professionals the way technology is harnessed has for some become inseparable from their sales proposition. This is a lesson professional firms must also learn if they are to survive and prosper. This will inevitably involve the cloud which presents a great opportunity to use a collaborative model to deliver a seamless level of service to clients. Services that are invisible will still be valued by clients as long as they address their “pain”. Identifying where their pain is is key as in the case of all personal service businesses.

The current generation will also expect professional firms to engage on-line. Effective use of social networking will enable firms to expend quickly, in conjunction with a complimentary face to face networking strategy. To say that networking is the new marketing may be a cliché but is undeniable for personal service propositions where the meet,like, know and trust model is the status quo. Linkedin replicates this model on-line and gives firm the opportunity to establish creditability by contributing to on-line conversations. To use another networking model think about it as visibility and creditability as a route to profitability.

The opportunities are out there to stand above the crowd. Competitors such as supermarkets and banks may try to enter the traditional markets of professionals but as long as professionals are competitive, proactive and focus on where the value is for them (and their clients) the future is not all doom and gloom.

Ahoy there – Welcome Aboard!

We have all been there….. First day nerves, feeling worried about what     to expect from day one in your new company.

• Will everything be as promised at the interview?
• OMG can I do the job?
• Will they like me?
• What is the culture like?
• What will I be expected to do in my first week?

Research from Massachusetts Institute of Technology has shown that socialization techniques lead to positive outcomes for new employees such as higher job satisfaction, better job performance, commitment to the organisation and better retention.

This research has prompted some companies to recognise the benefits of implementing a formal on-boarding (Induction) programme to support new employees before they even start their new role.
The aim is to engage new recruits from the start, so why often does it go so badly wrong?

Remember counter offers do occur and this generally takes place ahead of your new recruit leaving their current organisation to join yours!

Sadly on-boarding is all too often overlooked; so please do remember new recruits are watching you very closely during this period, they are also assessing you it is of course a mutual thing! They’ll be challenging their decision making, did they make the right decision to join and also should they stay! Week one is the most important week, it simply boils down to “make or break”!

So how confident are you that recruitment and on-boarding processes are bringing about the benefits listed above?

Are you:-

• Confident that you are easing this transition for mutual gain?
• Making employment offers that are rejected?
• Facing counter offers by existing employers?

Clearly recruitment search and selection costs directly and indirectly, so you need your return on investment! Equipping new recruits post acceptance of employment will help engagement through understanding company values and priorities before they even walk through the door on the day one!

Why not take advantage of our free 90 minutes HR support, all you have to lose is 90 minutes! A fresh pair of eyes could add significant value to your recruitment search and selection practices so contact us! Alternatively see here for our handy hints and tips and the costs associated with getting it wrong!

Hooray some heat in the UK at last!! Please see our employer’s tips to overcome the negative effects of hot temperatures in the workforce and the environment given we don’t have any legal maximum for working in the heat in the UK.
Suggestions to help keep things calm:-
• Invest in fans where needed and allow windows to be opened wherever possible.
• Move desks away from windows in direct sun light, draw the blinds or consider the benefits of reflective film on the windows.
• Allow staff to take more frequent breaks, especially those doing physical work.
• Provide a ready supply of cool drinks.
• Consider a flexitime system so employees have the option of avoiding the rush hour commute.
• Reconsider your dress code: for example are your male office workers still expected to wear a shirt and tie? And your female staff expected to wear tights? Consideration of a two-tier dress code, in-house and for external meetings. Don’t forget to be gender neutral, as you’ll have seen in the press claims have been won for discrimination in dress codes.
• For outside workers, don’t forget risk assessments. Involve your employees in reducing risks. For example hats and sun cream in very sunny weather, or ways of providing shade in areas where individuals are working.
• Keep an eye on your absence rates! Some maybe bona fide for example eczema and hay fever, however short-term absence rates can increase hugely during spells of nice weather… So don’t forget to monitor attendance, it’s very costly and can easily be managed through effective communication, monitoring and pro-active management.
• The cost of dehydration can result in decreased energy and lower performance. Being just 2% dehydrated can reduce concentration levels by up to 20%. The “Keep It Light!” health campaign aims to educate us and encourage healthy habits. For more details see: http://www.keepitlight.org
Working in hot temperatures can increase stress, irritability and reduce productivity. 1,500 employees employed by a recruitment firm, reported that not only does the heat stifle creativity (according to 78%), but it stops people from getting the job done, causes confrontation in the workplace and reduces concentration and productivity levels. 81% found it difficult to concentrate if the office temperature is higher than the norm and 62% admitted that, under hot conditions, a typical task may take up to 25% longer than usual to complete. – Source Office Angels.
Further guidance
If you’d like your company dress policy refreshed or created, or you’re in need of support then why not take us up on our current offer of 90 minutes free support? Are you ready to start? Call us on 01562 745747 or email us info@rapportstore.co.uk.

Every so often something happens which challenges our set assumptions about an important aspect of life. Remember the advert showing a ‘hoodie youth’ hurtling towards a person walking down a narrow street? The immediate assumption was that an attack was taking place but the camera lifted to show the youth was getting the person out of the way of something falling from a great height. Object of loathing to hailed saviour in a swift change of shot. Something similar is happening in the world of people management.

Remember that old chestnut of training providers – ‘Dealing with Difficult People’? Strategies are taught which aim to help the manager deal with those people they would really prefer not to have around. So what are the assumptions behind this situation?

• The employee has a negative attitude and needs to change?
• They have a dislike of authority and need to know their place?
• They are too cocky by half and need to learn some respect?

But, changing the shot, what if it was the company that had let the employee down? The failures might include:

• Failed to communicate clear expectations,
• Failed to provide a clear line of sight between their job and what the company is trying to achieve,
• The manager failed to provide timely and accurate feedback on performance,
• Appraisal focused far more on doing something about weaknesses than showing appreciation for the positive aspects of performance.

The sea change that is taking place is that many employers are waking up to the idea that their whole system of people management should be focused on the idea of ‘playing to strengths’. Moreover, it is part of running a company in a way that really energises and engages staff and leads to exceptional performance. Leading organisations like Tesco, Aviva, Panasonic and Santander are applying it in recruitment, learning and development, management learning and team development. Growing organisations, like Cougar Engineering, I-Spy Marketing and QVC, are using it to transform the way in which they organise their people to ensure that the company vision, performance aspirations and ‘a great place to work’ are achieved.

So what does break the log jam of moving from a way of managing people based on old assumptions to a more positive and engaging way? Many organisations have found that it’s helping people to identify their strengths or natural talents and then engaging in conversations about what they want to do more of.

Over the coming months we will be introducing you to different examples of applying this approach in practice covering the range of people management processes. One tool we have found effective in introducing ‘strengths at work’ is the Strengthscope assessment tool. If you would like to be one of a limited number of people to try out this tool for free, including administration costs and feedback, contact Roger Wythe at the Learning Connection.

I am currently looking at how service based businesses can leverage the value in their sales offerings:

In my view this can be achieved by taking three key steps:

• Productisation
• Collaboration
• Harnessing new technologies.

Productisation at the micro level can be simply moving from a time based pricing model to a fixed fee pricing model. This will give the attribute of certainty to sales offerings, which is more important than transparency in my experience. For bigger businesses it can be a software offering based on a consultancy process. The advantage of software in this context is its ability to generate recurring income, particularly using the software as a service model.

Micro business must form collaborations with professional partners in order to extend their sales proposition and compete with their bigger competitors. Team building and outsourcing is more important as the business grows. Micro businesses should focus on collaboration initially, particularly if they are service businesses, in order to generate new work and develop a stable sales proposition. This can then be delivered with in-house staff or outsourced, as the business grows.

Tailoring sales propositions to match the perceptions of current and future customers is important and businesses must be clear whether they are offering what I call “commodity based services” based on price or more bespoke services based on a value model. If the latter, then services must have demonstrable  benefits for customers.

Micro businesses have the advantage of being able to adopt to new technologies quickly. The cloud enables rapid growth to be achieved and lack of infrastructure is no longer a barrier to launching new business ideas if they can be delivered via the internet. The need to put infrastructure in place should be growth driven so that costs can be controlled.

All the above should be leveraged by small businesses in order to achieve growth. I like to practice what I preach to my clients and am currently setting up a Professional Panel to help leverage growth within my own firm and enhance the services I can offer clients.

Are you leveraging all the value in your business? If not please contact me as I am always happy to have an informal chat to see if I can help.

Robert Bradley

There has never been a better time for owner managed businesses to prosper – why? Because they have all the attributes necessary to growth and suceed, namely:

• The ability to change their sales proposition as their marketplace changes
• An awareness of ow to gain business through networking and how to integrate it with social media
• The ability to quickly employ cloud technology and make the necessary changes to their business model

The cloud will change many businesses models going forward. This in turn will give smaller businesses th e chance to compete with bigger ones as they are potentially able to regulate their cost base more easily.

Marketing is increasingly more about endorsement by testimonial and this is where small personal service businesses can capitalise. They can also leverage the trend to brand their businesses based on their personalities as owners, not unlike Richard Branson, who was surely the master of this.

Smaller businesses need to take action as new opportunities arise.. the Americans do like to say that “the action takers are the money makers” and this is hard to dispute.

“Action” in this context may mean developing added value or fixed price propositions, profiling clients, developing new products, developing cloud based business propositions or harnessing technology to improve operational efficiency.

What is certain is that smaller businesses must take advantage of their agility and  employ proper processes and strategies. There is no room for “self-employed” thinking only “business thinking”.

This will be a recurring theme of mine I will be elaborating on this year so please revisit my blog for more on how to take your business forward in 2011.

The scope for leveraging the internet technologies that are now available seems daunting and exciting both at the same time. Increasingly though technical knowledge is no longer a limiting factor. Instead the ability to harness the technology effectively has become the challenge.

My view is that video and webinar technology is the area which should be exploited. E-commerce websites often show their origin as off the shelf template solutions and miss the opportunity to tell their story through video and audio. The owner is effectively hiding behind the website whereas he should be highlighting his or her business experience and success to give confidence to customers.

Some sites have chosen to do this through facebook fan pages but why not do it through your website as well? Products need “personality” as well as services and customers will respond well to a transparent approach aligned to the goals of business owners. This will generate brand loyalty and interest in future products and services.

Webinars give personal service businesses the ability to effectively “productise” their offering by making their expertise available to more potential clients. The technology is inexpensive but requires imagination to see how it can be applied. The interview technique can work particularly well as a way of highlighting business “journeys” and subliminally promoting goods or services.

The technology is out there now and all businesses need to look if they are harnessing it effectively because if they are not the likelihood is that their competitors will be. I had a discussion with a member of the Bradley & Associates professional panel today and he agreed that being small can definitely be beautiful in terms of being able to brand your yourself around your personality in order to engage your audience and attract business. This is actually getting more difficult for corporates, despite their best efforts, so the ball is definitely in the court of smaller players in the professional services market who can act quickly to collaborate and create new sales propositions.

I often talk about the difference between self employment and being in business. They are often incorrectly perceived as being the same thing. My blog thoughts are focused on personal service businesses.

So what is the difference? Well the clue lies in the risk and reward attached to each. If you are self-employed there is a significant risk that you will not realise your true earning potential. Why? because your reward will be limited by the amount of work you can produce. A true business should have more more than fee earner and a portfolio of services and the main risk is failure. The reward is correspondingly unlimited.

If you feel trapped in a self-employment you can take solace in the fact that you are not alone. A self employment can become a job you can’t escape from without a proper growth strategy. A simple model I use to illustrate the path from self-employment to running a business is “STEP”.

S = strategise

So how to you transform your self-employment into a business?: Well think about how to STRATEGISE, and determine the direction you want your business to take.   If you don’t have a strategy then the danger is that you haven’t properly considered your customer needs. Look at the profile of your services…are they value based or commodity based?

There is a place for commodity services but they are likely to be marketed through a fixed price model and by larger organisations who can benefit from economies of scale. This will require input from staff rather than fee earners, whereas value based services will capitalise on the skills of fee earners.

Commodity based services should be delivered using a separate business model to ensure that they are not subsidised by value added services. Caution is required as the market value of commodity services will inevitably be driven down towards their cost. High street law firms are facing a big challenge as they prepare to streamline their offerings to compete with the likes of Co-op Legal Services, as the true impact of the Legal Services Act and Alternative Business Structures is felt.

T = test

Strategy is theory and financial performance is reality so what is the connection between the two: Answer = your Business Plan. The business plan is your route map, once you have determined your strategy and decided on your courses of action. The important attribute of a business plan is that it lets you TEST your financial performance against your strategy as long as your financial forecasts fairly represent your strategy.

If you are consistently not hitting your sales targets then you need to be honest with yourself about the causes. It is easy to blame market conditions but often it represents a misunderstanding of customer needs and perceptions. Financial advisers have a tough task in remodelling their businesses around fixed fees when the Retail Distribution Regulations come into force, if they have not profiled their practices around value added services. The market value of their traditional commodity services such as the sale of pension and protection policies has been disguised by traditional commission based sales models. Clients have often been oblivious to the charges being taken from their policies as commission despite their right to enquire about them. Paradoxically they are likely to object about equivalent charges presented to them as a fixed fee. Clients perceptions need to be managed as well as their needs.

E = evaluate

The process of rationalising your service offerings is a call to EVALUATE what you do. Commodity services have their place but Value Added Services are the holy grail of personal service businesses.

Why? because the value of them is something you can influence. An accountant who promotes a tax structure scheme can charge a contingency fee. A stamp duty scheme could save £50,000 and a fee of £25,ooo may not seem out of place in this context. This fee is determined not by time spent the seniority of the fee earner completing the work or the market conditions – it is determined by value. Look at what you do and think about how you could develop services which could generate contingency fees. And whenever possible develop recurring income as well, particularly those that have a value added content such as support contracts offering clients peace of mind for an appropriate cost.

P = productise

Professionals can no longer price their commodity services based solely on hourly rates. The price they can charge is increasingly determined by the amounts charged by their competitors and the need to offer certainty.  They are effectively being forced to PRODUCTISE their offering where they are compliance based services such as small business accounts and tax returns. In the case of accountants, for example, the market value of specialised services such as auditing is easier to maintain than other compliance services as  increasingly rigorous standards are imposed to protect consumers and smaller firms leave the market.

Specialisation can be a good way of enabling you to productise what you do. This may take the form of a cloud based service which replicates or supplements your service offering and going forward customers will be looking for more services to be available in the cloud. Alternatively it may simply be an increased awareness of differentiating what you do from your competitors through fixed pricing or personal branding. You should not be frightened of specialising in terms of the services you provide on the basis that you may limit your potential customer base… rather you should welcome it as a way of protecting your future income streams.

A final thought..

You will note that I have referred to “clients” not “customers” in this blog. Is this a mistake? well it could be. It has been suggested to me that professionals perceive clients as an ongoing source of income and should instead think of them as  customers who require a constant review of needs and requirements. All I can say to this is ..fair point, I agree. Have you got clients or customers?

Is your business offering a commodity or value added service? In the current business climate you need to know the difference. Any business service that can be reduced to a process will be subject to market forces driving it’s value down towards cost. Value added services on the other hand will have a sustainable value. In practice some will fall in the middle. The important thing is to know the difference and to decide the business model which needs to be applied to each.

Commodity based services should not necessarily be discarded in favour of value added propositions but need to be delivered by a business model which has economies of scale and a suitable cost base. In other words it’s a predominately volume based model. The achievable price will be based on the market rate which is often set by the bigger players in the marketplace and the volume of sales you can generate will determine whether it is worth you joining or maintaining a position in the marketplace.

Value added services are not so constrained by the cost base required to deliver them but still need an auditable process to ensure quality and maintain their value. Pricing value based services can be based on time spent or a contingency fee. In the context of accountancy services this could be based on tax saved, for example. Professionals usually keep time records but this is increasingly for management purposes as fixed fees become the norm for the majority of work they do.

Law firms need to look at their contentious and non-contentious issues. This will generally require value added and commodity based pricing policies respectively, particularly as the legal services market is opened up by Alternative Business Structures. The chargeable hour is already largely extinct in the smaller accountancy practice and small law firms will find them difficult to implement for contentious issues going forward.

Contractors with specialist skills and experience will need to demonstrate value through performance and maintain premium charge out rates. Other professional services will have to evaluate their business models. A challenging time lies ahead for all those looking to grow their businesses in the current economic climate. The rewards are there for those with the correct business model.

It is a truism to say that a business only exists to market itself and grow to protect its future income stream. This will in turn keep the shareholders content. This assumes that the business has resources and marketing expertise. An owner managed business may have neither but  small business owners still need to work “on” their business asw ell as “in” it. Employment may be ”just over broke” but self employment can be just as unfulfilling, in so far as it may become a job you can’t escape from. The key is to look at the risk and rewards of employment and self employment.

Employment carries the inherent risk of being able to lose all your income due to circumstances outside your control such as redundancy. The reward is the ability to directly effect your earnings if you achieve employer defined targets which is usually only possible with a sales role. The risk and reward of self employment is in a sense the same – the risk is not growing and the reward is the achievement of growth. The line between success and failure is sometimes fine and often depends on a correct appraisal of customer needs and the ability to develop processes to satisfy them at the correct price point.

Processes can be usefully categorised as inbound such a s accounting systems or outbound such as marketing systems. Inbound processes provide financial information to help plan for growth whereas outbound processes help provide a flow of new customers. I often think of the growth process as a stack of cards. Each level of the stack has to function or the growth model will fail. Good processes are essential to support growth. Residual income is a also a vital part of growth as it provides cash flow and a base of customers to up sell to.  Some businesses finance growth purely through  retained profit but this will in most cases limit the rate of growth and businesses should be careful they don’t overtrade by growing too quickly with insufficient working capital. Bank lending can be a suitable source of finance for growing businesses but this is often difficult to obtain until a business has stabilised.

The other necessary component of grow is perhaps the most important, the ability to build a team that has the interest of the business as a priority and not their position within it. Organic growth relies on committed staff.  Growth success is not necessarily about sales or volume driven by processes though. Businesses need to audit the value they provide as they grow. There are drivers in the market to strip the value out of professional services in the current economic climate and other business sectors should be aware that over time perceptions of value change and competition can reduce one businesses sales proposition to another businesses process .  Look no further than the effect Alternative Business Structures  are going to have on the legal profession.

Growing businesses build on value are more likely to prosper than those based on services that can be commoditized.  The effective use of technology to support growth is also going to be important growing forward. Many business challenges lie ahead in these uncertain times. The only real certainty is those which businesses try to stand still will go backwards.