Feb 13, 2013 | Governance, Management, Operations, Small business
Ever put off a difficult decision? asked for more information that you know will not change the outcome? shuffled the responsibility elsewhere?
Most of us have, at one time or another, but we generally tell ourselves that we delayed the decision, sought a greater level of certainty, or something else when deep down we know that we have decided not to decide, or at least, used an artifice to enable us to not to act on the decision.
If all you have done is to kick the “pain-point” down the road a bit, you also generally realise that the pain when it comes will be worse for the waiting. In putting off the pain point, you have actually made a decision, one that will often come back and bite you.
I was reminded of this reality recently when the owner of a small business I work with failed to take a hard decision in relation to one of his employees. The inevitable conclusion to that employees departure was repeatedly put off because it is a small business in a regional centre, and sacking someone is hard, it becomes everyone’s business. It has become clear that the employee concerned realised the position, and rather than behave honorably, has committed the company to expenditure that is unnecessary, wasteful, and possibly terminal.
The price for deciding not to decide can be very high indeed.
Feb 8, 2013 | Branding, Small business, Social Media
Like most bloggers, I watch how many people visit this site, how many pages they access, how long they stay, and how many “likes” the posts get, and it feels good when the numbers go up.
However, these superficial measures do not really mean much.
What make the real difference is how much I write gets amplified, by reposting, commenting, and the number of click-throughs to the links included that occurs.
“Likes” are generally just passers-by, casual visitors, or “like-counters” who want you to reciprocate and “like” their site, when what you want is engagement, people who are touched or motivated in some way by the posts.
I would rather have one of those engaged visitors than 10 who just visit and leave. In Australia, there is an old expression, ‘Wombat”. Calling somebody a “wombat” is rarely complimentary, as a wombat is a slow, sometimes destructive native animal that eats roots and leaves, not complimentary when you add comma’s. Most visitors to your site that just tick the “like” button without thinking about what you have written, often not even reading it, are just “wombats”
Jan 30, 2013 | Change, Marketing, Small business
I wonder how anybody could be in the slightest bit surprised that Coles and Woollies are raking in the profits from petrol retailing, as has been reported recently.
We have allowed a virtual duopoly to emerge and duopolies behave in pretty predictable ways, for the benefit of shareholders, that is the way the system works. Oh, you will not be able to nail collusion, or any of the other nasty anti competitive behaviours on them, probability is they will not be happening, as they are not necessary with a duopoly, simple self interest will drive profitable behaviour. The opportunities to cross merchandise, cross promote, and leverage operational logistics costs that exist just enhance the attraction of it all.
The scale of the major enterprises makes competition from local businesses a huge challenge. Pundits like me can wax on about the opportunities the small agile enterprises have, how the net has given them the flexibility and transparency to take on the big guys, but when it truly is David Vs Goliath in a local market, the little guy will rarely win. He will be swamped by the “man” who can simply ignore as a short term irritation the slower traffic, lower basket value, squeezed margins, and any resident reaction that occurs, that would mean death to the smaller operation.
I feel for the small guys who have made a huge effort to compete, but being in a commodity market means that scale counts, and in the petrol market, Coles and Woolies now own it, as they do groceries and hardware, with office supplies evolving down the same path. I bet they cannot wait to get their hands on the still regulated pharmacies and newsagents, where the regulation has enabled a cosy club for small businesses to exist.
Jan 29, 2013 | Marketing, Small business, Social Media
Groups, networks, friends, and even loose 2nd and 3rd party connections via social media all have similar characteristics when viewed from a distance. Groups of people interconnected in some way.
However, the real value of a group is its density, how close they are, and how mutual are all the links, how much they share, and of crucial importance, how much they contribute rather than just being conduits.
A small group is able to self regulate easily, there is little tolerance of free-riders, there is a high degree of “density” among the members. However, a large group is poor at identifying and excluding free-riders. The number and strength of connections between individuals in the larger group are much less, and weaker, there are those in the group who have no connection with each other beyond membership of the group: the density of the group is much lower.
A high density enables stuff to get done, the group can co-ordinate the actions of its members. But there is a paradox here, a large group can also co-ordinate, and in a short time, but only in the negative, it can be somewhere to stop something, to protest, a very simple, single purpose, but it cannot map a course of action and follow it. A dense group can map a course, follow it, and if dense enough, accommodate changes in direction.
Consider how easy it is for a group of three friends to agree to go to the pictures next week.
They agree a time and film to see that suits them all.
Now consider the added complications of adding an extra three friends to the party, all that extra schedule matching, as well as the varying tastes in film. How much more difficult this would all be if the added three are just acquaintances of one of the original three, unknown to the others.
Density, not numbers is the key to social success, in media, as well as in life.
Jan 12, 2013 | Change, Management, Small business
Below are 10 predictions I made at a meeting this week of owners of SME’s in Sydney’s inner west. It is a quick list I jotted down in the 10 minutes before the meeting, but on reflection, I actually thought they were OK, therefore I am prepared to live or die by them.
So, here goes:
- Marketing is digital and personal, mass marketing is dead! Get personal and get digital, they are complementary, not mutually exclusive.
- Social media will overtake traditional news dissemination channels. Just look at where the news about the current fires came from, those on the spot with mobiles and net connections. The rest of us get the dramatic pictures a few hours later if the cameras can get in, but the real “news” is reported by individuals on the spot using twitter et al. (Just think about that as evidence of empowerment for a moment)
- A few smart SME’s will do very well, but the rest will at best struggle, and many will fail. The scale of operations necessary for success is relative to the size of the niche occupied, and most SME’s try to be all things to all people, and fail at being relevant to enough to ensure success.
- The new “cool” for our kids is to train as a “tradie” as there are insufficient fulfilling jobs left for those with modest, non vocational degrees, to fill demand from the aforementioned graduates.
- The shortage of willing and able workers will continue, as we no longer train people to work, we train them to “expect”.
- The 40% of SME’s who do not have web sites, or have sites that act only as an electronic brochure rather than as a magnet to their target customers need to realise they are missing the opportunity to grab the lifeline. Failure to grab the lifeline, well, refer to prediction 3.
- “Big Data” the combination of traditional data bases and the behavioural and attitudinal data scavenged from social media will become the next big thing during 2013.
- Mobile will take over from fixed line, comprehensively, and across all communication channels.
- The economy will continue to slow, consumers are cautious and risk averse. We are caught between a European economy that is truly stuffed, a US economy that whilst showing some signs of life, is extremely fragile even after the dills kicked the “fiscal cliff’ down the road a bit, a Chinese economy that is still robust on paper but is turning inward to meet domestic demand rather than exporting manufactured goods, and so needs less of our commodities. These things together with the very high $A, and a determination by our “leaders” to continue to say how well we are doing while denying the caveat that we are doing well relative to the rest, who are really crap. (compared to blokes on crutches I am still a fast runner, but compared to anyone who can really run, I am nowhere near where I was 40 years ago). This is notwithstanding Bruce’s optimism, and correct assessment that his industry is a “canary in the mine” but look where the housing market has been in the last couple of years.
- Around July/August, the economy will stumble into a really nasty hole as we approach a Federal election. Never in my memory have we been “led” by two such unpopular leaders. Unpopular they may be, as have been others in the past who have in fact been successful leaders, but the flip side, respect, is not there either, and being unable to respect your leaders, even if you do not like them is a real problem.
There you go, my 10 predictions.
Hold me to them as we progress through the year, it may make for some lively debate at some point.
Jan 9, 2013 | Collaboration, Operations, Small business
We all negotiate every day, from the small mundane things in our lives to once in a decade decisions.
Two simple considerations play a key role in the outcome:
1. Controlling the environment in which the negotiation takes place, and
2. Constructing the conversation such that the other party nominates their expected outcome first.
A successful negotiation is one that has all parties leave the table happy and prepared to execute on the agreement, but consider the impact at something like location can have on the behavior.
Imagine you are negotiating a major deal, and the other party nominates a 5 star location as the venue, compared to going to their plant and conducting the negotiation in the factory lunch-room. It is likely that the differing locations will impact on your expectations?.
Anchoring is the psychological process underlying the point from which a negotiation starts, and generally dictates the region in which it finishes.
Research by Daniel Kahneman, the psychologist with a Nobel laureate in economics, displays this anchoring behaviour in experiments using a roulette wheel. He asked subjects to guess the percentage of African nations in the UN after spinning the wheel. Was the number greater or less than the number on the wheel?. Subjects who saw a low number on the wheel consistently guessed the percentage of African membership lower than those who saw a high number.
Clearly the roulette wheel has no impact on the number of African UN members, but the number at which the wheel stopped played a significant role in anchoring responses to the question.
