Performance Controller

"However beautiful the strategy, you should occasionally look at the results"...WC Print

In business intelligence projects, assembling the data is large part of the deal as you go about building an independent data warehouse or set one up in Business Intelligence reporting software itself.

The Pareto theory to focuses on 20% of effort to get 80% of the value does not work in business intelligence projects. You need to get 100% of the data right and cleaned up before it can be mapped and reported consistently.

Even cutting corners by doing a departmental business intelligence may work for a while. But in the end if it is not linked to the published finance results it will be soon be undermined and will eventually end in the scrap bin of good ideas that did not fly; along with those who attempted to fly them.

Using an enterprise level business Intelligence project as a focus to clean up data in itself is a great way to go. The benefits are most often immediate. In fact to get those jobs done any other way almost never happens as the business continues to struggle on with hybrid decision processes that hinder progress.

Building a consistent data-warehouse in fact is the real job in setting up business intelligence reporting. The problem there is cleaning up is often costly and the perception is by most that there is no problem or cleaning adds no value, so it gets left out of the value discussion.

As a Finance or IT manager how often have you heard, “We already have a good data warehouse and all we need is a Business intelligence tool to do our reporting from it.”

As one who lives in both worlds and in my case as a consultant too it actually tells me to beware to do much more proving work on the business case. And do more project due diligence work before locking in on contracts. 

In the case of the CFO or Business Vice President  championing the work, this should also be done before seeking the budget and letting procurement loose to go find a vendor and a competent consultant. Finding the bad data story after the fact, when the installed team and software is on deck, is far too late. No-one cares by then as they know you are between a rock and a hard place with little or no way out.

And if the business is performing well and the goal is for faster decisions information to maintain momentum, then  time to delivery as goal is seen as the most critical project driver. Then things like consistency are automatically assumed to be there or must be dealt with regardless of other change impact considerations.  But of course in this type of case given performance is relative in terms of these constraints, problems that most often show up are on the enterprise’s source systems themselves. So then the paradigm shift as a goal is stalled and the project, which may get off to a great start, quickly falters as these issues surface.

So it actually does take a great deal of resolve, process change management and team work to agree consistent business rules at all levels to solve the issues. That is at the heart of it all. And it is what can trip you up if you don’t stay focused and get it under control. The rest of the work is really just technical and is quite straight forward with limited risk.

Hence in well thought through projects where the value of cleaning is recognized and the correct value focus is brought to bear, it can pay for the project many times over. In such cases this should be recognized as a business benefit to be targeted and not just left as a by-the-way or left out as a buyer beware tactic to get unknown issues solved and cost savings on the cheap.

And in the end who cares what BI tool we use. The truth is if you don’t use one you are foolish as the disciplines they bring alone are worth the money, I should quickly add that this only applies if they are setup by people who actually do know what they are doing. I have seen too many IT selves with software still its shrink packed box never opened. Or when it does it is badly used by installation novices. As one of my software vendor contemporaries said to me recently

“if you don’t have a competent data management team included in your BI project, then I hope you don’t choose my software as I don’t need the reputation”

As too often we aim for the utopian state to exploit what comes only after the hidden work is done. getting there is often actually where the value is as your conversations across the business sort-out the issues in a more natural way. So seeing it as a burden and a delay to project is folly. Doing this will invariably cause frustration and loss of focus and may cause it to even falter and/or fail.

More to the point business leaders who provide budgets for this work, who may also have been part of the evolution that unknowingly or otherwise create the issues, invariable underestimate what it will takes to fix them. They must understand it takes momentum and motivation to get the tough and dirty job of cleaning done. And that business intelligence is about their future and not just some fancy reporting process that sends emails on delinquent performance and helps cuts the costs of doing things in spreadsheets.

As sponsors entitled to see more visible progress to the end game solution that they approved the budget for, they  should call to account project managers to bring to attention any value that gets the money back earlier than expected. By simply enforcing standards and making data process improvements before the project is even completed will delver this.

Hence the value is in the understanding the secondary benefit of cleaning up data and continually selling the value of the process it takes to get that work done is vital.

It is not just all about setting up dashboards and dials to help focus and understand the data but also about having consistent data that has universal acceptance and integrity.  This combination in turns allow business intelligence to be used to create an intelligent business

For many of us doing this do we really need to rethink our mission and how we manage.

 

~000~

In a related post Failing-address-data-quality-and-consistency here are some very key points

Don’t fall into these traps. Don’t assume anything about the state of the data. The areas where data quality and inconsistency problems lurk:

• Data quality within systems-of-record applications may be “masked” by corrections made within reports or spreadsheets created from this data. The people who told you the data is fine might not even be aware of these “adjustments.”
• Data does not age well. Although data quality may be fine now, there’s always the chance that you’ll have problems or inconsistencies with the historical data. The problems can also arise when applications like predicative analytics need to use historical data.
• Data quality may be fine within each systems-of-record application, but may be very inconsistent across applications. Many companies have master data inconsistency problems with product, customer and other dimensions that will not be apparent until the data is loaded into the enterprise Data warehouse.

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Business people, not IT, make technology work to focus the business. The general IT role is more strategic to maintain and improve competitive positions of the business infrastructure to make people’s lives easier, It is not the other way around. Ask any CIO, he knows that. especially when he asks for a sign off on what is installed.

So why when changing a process do people go straight to IT to set up technical processes. When they do IT have no choice to do it their way, Then  they give things names that are either functional, relate to the software or are way too obscure?

There is no way this should happen in the public domain as things like product names and branded access URLs are always cleared by marketing. Then image and branding are so important. But internally that does not happen as all too IT often gets little business help or involvement.

It is like having two standards, one rule for customers and other those who service them. And that make no sense at all. Setting the service delivery culture starts with teaching people the supply chain in not about them but their suppliers and customers. So why do we still insist being too lazy to put some effort into more marketing rather than functional or geeky names.

To paraphrase from another well-known idiom.

If you feed them peanuts they will look like monkeys.

So why not give internal process the same respect you give your customers and suppliers so they will be more likely to perform and respond the way you expect. That of course needs a business person to own and manage the change process. And all too often they are missing or busy.

Most often too as learning is done in the development stage where the die is cast. “A habit of one” it is often called. When you show people something that continues to work for them they may never change even if it is improved the very next day. The process and a systems life is therefore limited by the language and thought we give it when it starts. Never mind people whom may struggle later once the initial support is gone.

http://Image076/ or some such useless ellipsis name embedded in key process URLs is unlikely to move your business forward. So why use language that you don’t understand or is not service related?

As for IT infrastructure and everything upwards it is vital for management to get involved. Once instances are set and business teams take over any plea to start where we want to end up is then forlorn and lost.  It is often too hard and too detailed for managements to consider, especially in the “lets get it done urgency” cultures to have something working and adding value yesterday. So it gets underway without good thought on the impact of a later change.

Using and understanding how to set names and use aliases in not an IT role, It is vital for business managers to break this nexus so the language of technology more natural to focus the business.

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I had some interesting exchanges recently that took me to a UK  firm who specialize in data cleansing, They reminded of a survey we did some time ago that asked the question, How do Business Intelligence solutions provide value?

Of the 86 replies the answers varied in weight but it was clear Sales Growth and Operating Performance are the top issues.

In my discussion with Chris Johnson at CNM in the he said

Companies waste so much money and cause harm to the environment by not regularly cleansing their data. Data is one of our biggest assets. You wouldn’t drive around in your Ferrari or work in your high rise office block without getting it cleaned once in a while would you?

Clean data means happy informed customers and less environmental impact to our planet.

In my personal opinion it should be a legal/moral obligation to clean data regularly.

This was very sound advice which I was looking for to help me in my work in Business Intelligence that relies so much on clean data.

As I looked through the impressive product list at CNM, (Yes it is one of those coveted TLA names) it seemed to focus on these needs so well so I decided to keep it as a reference list of issues that people in business face.

For example in their How can we help? section it bring to the forefront familiar issues with some pertinent questions that just make think about the quality of your data.

Telephone Number Appending

Have you got a list of contacts without a phone number? We have one of the most efficient and accurate telephone numbering services in the UK. more…

TPS Screening

Need to comply with the law? Our TPS matching service can flag or remove TPS registered records from your data. more…

Tracing Services

Lost contact with your debtors? Our tracing service is second to none, we not only find new addresses for your debtors we can also give you an indication of how likely they are to repay their debts. more…

Data Supply

Need campaign specific profiled data? Then look no further. At CNM we have access to the most up-to-date data available in the UK. more…

Their full list of Core Services, in context also provides valuable insights about uses of data. A most useful resource.

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Disclaimer

I have no interest at all nor do I get any benefit from this firm aside from the value of having connected at an intellectual level.  I just like what they have to say hence I am sharing it.

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Here is an a open  letter I got from Stacey Barr who asked me a question.

Stacey Barr, who is widely known as a performance measure specialist, makes her living advising on how to measure business performance. She also publishes a regular newsletter, “Measure Up”

To answer her question, setting goals and achieving success is the best incentive to let me relax. On the other hand missing targets, underperforming or in-completeness makes me tired.

As someone who makes a living as a change agent I also know that success also comes by the very fact that we get commitment. That alone, as we continue to pursue a final project or campaign outcome, can see results much earlier than the expected completion aims.

I feel good reading Stacey’s letter as it reinforces this. I say we should measure and acknowledge this too as we are taking the journey. Take look for you self.

 

G’day Gordon,

I feel like I’m falling out of my groove a bit lately.

Despite my training having gone so well this year, I recently missed my goal for the 10km run at the Mooloolaba Triathlon by 25 seconds. And despite the rapid increase in subscribers to Measure Up (there are now 11,241 active subscribers), I’ve missed a couple of my revenue goals. Plus, I wanted to reduce my working hours down to 28 hours per week this year, and the trend is actually going up instead!

In all honesty, I’m feeling some of my passion and enthusiasm waning right now.

No doubt you’ve felt the same way too – when you keep missing your goals, no matter how hard you work to achieve them. In the field of performance measurement, we’re so much more aware of when we fall short of our targets.

But is it reasonable to set targets with the expectation of meeting them every time? I’ve recently been wondering if measuring performance adds most of its value to the journey (continuous improvement), not the destination (hitting targets). Measuring performance helps us stay focused on what we want, every day, and enjoy the adventure as we pursue it.

So when targets are set in the spirit of continuous improvement, perhaps pursuing them is more important than achieving them. What do you think, Gordon?

Gordon, If It’s Broken, Fix The Root Causes!

In the last issue of Measure Up I gave you a list of the typical problems that go wrong in performance measurement processes, and I promised that this time around I’d share some tips for how to fix your performance measurement process.

That’s exactly what’s in store for you, in today’s Practical Tip.

Stacey Barr, the Performance Measure Specialist

Follow me on Twitter: www.twitter.com/staceybarr

 

By the way if you think is Mooloolaba funny name for a place, if you ever go to this paradise spot on Sunshine Coats in Queensland, it will not sound funny any more.

In the meantime let Stacey know what you think too. And if you subscribe to her newsletters she will update you directly. If you forget her site it is on my Bog roll

 

Disclosure Statement

I  have no financial interest at all in Stacey Barr, her business or her offerings and I do not get any or rewards for promoting her. I am just  a fan who not only likes what she says and even on rare occasions when I may not agree, I always like the way she says it.

And being a fellow Aussie in the performance management business too, one day I will be pleased to meet her.

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Referring to the Eastman post Larry Who, that included video of the lampooning by Larry Ellison (Oracle) and Marc Benioff (Salesforce.com) on CLOUD computing, it occurred to me to look back at our ideas of less than 2 years  ago when we were digesting what the cloud was about.

I made this comment on that post, which i will repeat here for the record and any challenge.

It seems we have come quite a way since we posted on this subject, with is-your-thinking-in-the-clouds”, less than a couple of years ago  “

The big element that is fast changing in that equation is the computer as we all know it.

By the 2020 or even earlier there will be no laptops or desktops in homes and offices will have whole new environment devoted to business intelligence to make us all transparent and reshape privacy as we know it today.

Like airlines now that are just reservation systems who share equipment servers will be too. And they will be in places like Antarctica or Afghanistan or even outer space and owned by giant global alliances.

One thing I am sure of is Larry Ellison and Oracle along with Steve Ballmer, Bill Gates and Microsoft will be long gone having been replaced by the globalsoft corporations based in places like India and other emerging nations in the unprecedented mass markets like Asia.

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It seems finding the best KPI is done by first taking a look at performance. If it is good the job is made easy by simply asking the CEO the secret then check the poor performers for a match. And taking a look at the competition that is doing well to see what measures they focus on that work better also helps.

When performance is poor then armed with C levels comments which themselves may differ, if you then ask operations you will see there where you have miss-matches that need to be fixed. And in every case you should go and ask the customers and see what the match is there too. In all case you must check the three standard KPI’s are in place called “Consistency” “Teamwork” and “Focus”, that actually always work.

As most people know, in any organization getting agreement internally on one or two key measures that give the business momentum to drive and sustain itself, make the best KPI’s.

Getting the business KPI going takes work to commit to a focus and cut to the chase. And keeping it there it is not just about just making a dashboard. It needs much more to maintain it, with action and plan conversations to match. And it then only works with timely, consistent and reliable reporting, so it becomes the language of success.

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Here is a poll we have being running with clients and prospects. The questions are about the value of business intelligence. You may like to ponder them too and cast an anonymous vote.

If you want to know more about BI please visit us at Shernox Group, business performance and business intelligence specialists.

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As the downturns kicked in last year for a while it seemed the music may stop. But then someone said ” Play it again, Sam?”. In our company this has seen some rapid growth in e-demand for our services. This is especially so in support area as customers had deferred investments in favor of making things work a bit longer while things were tough.

As one who literally works daily in 3 continents and in as many languages, I am a fan of the idea that I can collaborative simply with pervasive communicational tools. These days we can also all use then at an easily affordable cost.

For me and my colleagues was are able to do this using our versions of Beam Me Up Scotty communicator to keep in touch on a far wider surface than the conventional quarter mile of traditional business. Hence as the demand has changed we are always in touch and  contactable with this capability we now continue to service long standing customers often without the need to even leave home.

For 15 years and more we have been able to connect in some way like this. Both informally and formally alliances and colleagues do business this way and more recently we also do it directly with customers.

Even as they move around when I turn on our computers each morning I have maintained a strong presence that has kept me in touch personally with key contacts and customers on a daily basis.  Daily habits are also subliminal as people come and go online with an in touch awareness that keeps us connected. And once trust is established we are generally all happy to be available to each other at any old time.

But of course the face to face activity will never be totally replaced. For example selling  is a contact process that requires continual reinforcement of trust, and capability. These  credibility assurances are vital to maintain ongoing connections. The ability to listen and anticipate needs is the real key that provides the quality in the dynamics of business. This cannot be done without physical presence so salesman and supply chain players must continue waking around. And without that best laid plans for automated process supply will also fail as competitors exploit any gaps that appear and move in on your patch.

That is why, even though systems give us great contact presence online now, we must never forget to call in on our suppliers and customers from time to time.

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In my work I recently presented some ideas on the maturing state of business intelligence and performance management applications for business.

But choosing the right software to add value is only part of the game. For such change it also needs a plan and commitment.

Making sure your project is well defined, well resourced and well sponsored is the art a PM project success.

The bottom line for making a change to add value to a business is to make sure everyone with a stake in the outcome is involved, is accountable and can win.

In this presentation I was able to share some ideas and from our real life experiences. In the detail I have included some boiler plate steps for success in managing projects.

Here are the slides to look through or download.

 

The recorded sound on the day was not good. I will redo it and update the slides for you when I have some spare time. Please let me know if you want me to make that a priority?

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Can you imagine the now indispensable fridge magnet that is so much a part of our lives, with your notes, kids pictures, shopping lists and other important odd and ends. being relegated to the rubbish to be replaced by a screen? 

Well, that is what the giant European supermarket chain, Tesco, have in mind for us with their Extending Ecommerce strategy.

The idea that digital photo frames, with integrated magnets would be attached to your fridge, not long ago seemed farfetched. But now the internet will be there soon too so your shopping choices can be made right at the fridge as you look to see what’s missing.

Nick Lansley, is Head of R&D at Tesco In this video he talks how about this and how Tesco recently released their  API to the developer market.

Like the IPhone where developers develop smart phone applications for the phone users, having access to Tesco’s backend product information will allow markets to develop demand based applications for households and more. Providing on tap such things as  product diet options availability and cost with such access to influence buyers choices in their home as it further extend to enhance the consumer buying experience.

With this type of wide reach, real time access to core business information means we will soon see the evolving value of business intelligence extended directly to the end consumer for practical use in their daily lives .

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On December 1 2009. tough new internet disclosure compliance was mandated by the new US Fair Trade regulations that came law there.

Earlier this week I had posted a you-tube video to talk about the implications. While I was researching others opinions on this I found most informative seminar circulating the web, entitled Easy FTC Compliance Seminar – What You Need to Do, Step-by-Step. It is lead by Robert Skrob.

Sanitizing testimonials and endorsements is no longer a moral obligation. The bottom line is there is now no option, when it comes to disclosing of interests.

If you think this only applies to the US think again. Counties around the world are watching closely as the largest economy takes on these far reaching consumer protection laws aimed squarely at internet marketers.

Precedents will quickly kick in very everywhere else as US litigation explodes punitively against defaulters who hold out to be third party endorsers.  With the new laws taking root and being tested in the commercial world,  your sales practices may need to change to ensure you comply.

Suddenly all this more important than ever. Some of the areas to look at include:

• How documentation is organized for testimonials you use in your marketing.
• The content in your sales pages and presentations.
• the relationships you have with people who make third party endorsements
• The words you can use in seminars to comply with endorsement rules.
• Liability you now have from affiliate’s actions.

Countries like Australia and across Europe have similar discloser laws in place or in the making. And in places like Asia they are not far behind. Asia is also largely a self regulated market so we will will quickly see consumer protection repose kick in as they move to compete.

At the practical level as buyers get more savvy to hoodwinking lawbreakers, or even ignorant ones who actually believe their own unqualified sales bull,, they will be mistrusted more and more. And anyone who makes unqualified outcome statements or does to not have their interests stated up front will get a nastily surprise. Like avoiding taxes it is just not an option.

With Internet based trends to leverage affiliate programs and endorsements to entice buyers. the  US Lead will be significant for everyone across the globe. If you make money via blogs and social media such as twitter face book and so on you must be aware of the rules.

To quote from a Peter Hoppenfeld one of the layers participating in Easy FTC Compliance Seminar – What You Need to Do, Step-by-Step lead by Robert Skrob.

It reminds me of the expression “Do you want to pay now or pay later?”

Robert Skrob is a business blogger who’s stated his mission is “Help More People, Earn More Money”.  He leads his recorded a seminar to alert marketers about theses new of US Fair Trade Commission rules, He discusses them with his guests, Peter Hoppenfeld and Michael E. Young who are both experienced lawyers in internet marketing and related fields.

Practical discussion on rules that now apply to disclosure by affiliates and other third party endorsement are of great value not only for buyers but also as an extremely informative call for experienced marketers  You can listen to his seminar by visiting his site. It is free to download so I added it here too: 

Audio clip: Adobe Flash Player (version 9 or above) is required to play this audio clip. Download the latest version here. You also need to have JavaScript enabled in your browser.

His site is also an excellent resource that  I also recommend you subscribe to:

Robert Skrob

“Help More People, Earn More Money”

http://robertskrob.com/

 

Disclaimer

In making this recommendation I may now be obliged to make a disclaimer such as:

Views expressed in this post are my personal opinion and should not be relied on without corroboration with an authoritative source. I am in no away associated with Robert Skrob or not do I get any financial or other compensation by endorsing or recommending his website, his views, services or his credentials or those of any of his associates. I further disclaim any obligation or responsibility or benefit of an action people may take from any advice they get from this or any related post referred to here.

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Being able to contact people within real time and get responses back from all different locations no matter where, is truly priceless 

In 1998 I was in New York and used the hotel phone to make some calls back to my home base in Australia. I also used a dial up account to get my emails. That used what seemed like a short time but I got a bill of over US$400 for the service. Ouch!! And believe me that hurt!!

After the first day after I checked my bill, I then went on the net and found a free service at AOL that I could use with my Yahoo account to make voice calls. At that stage we had already learned about VOIP with emerginng internet phone carriers, albeit you did have to take pot luck on the quality. It was mostly social net work tools like Yahoo and AOL we used them, but it worked.

Then with only a $US30 internet charge each day (still steep) at the Marriott, my calls cost me next to nothing and I was happy to relax and do my business.

In 2000 I was in Kuala Lumpur. In my Hotel again I just plugged into the phone for what I thought would be 30 seconds to get my mail. I was wise to the hotel charges but also prepared on this occasion to pay $US20 for a minimum 3 minute call, as it was convenient. In was soon to discover after I returned from my shower that the machine was still downloading a picture someone had decided to send.

From that moment I decided to investigate alternatives like phone cards and so on and we extended the use of Microsoft Net meeting and so on for conferencing

It was not until 2003 when in Singapore one of my team sent me a link to Skype. That was moment we truly went global as we were instantly connected in real time with a service that ranged free to cheap.

Since then we have added Skype accounts for all staff and often have web cam lines open all day between offices in different countries so we can see and be in touch with each other.

The big benefit I get out of Skype is the Video. It brings a lot of the people that I work with closer into my office and we are able to get a lot of things more effectively done that way.”

Now we can not only do calls, conferences, chat and video calls we can also send files an show lives screens to the other parties. In addition we can also record it all as a useful record of our working sessions. Now days we even have SIP enablement so the familiar phone can do its job again only better and cheaper plus it releases us from the computer.

One of the great benefits we are now finding is a recent feature added to the Skype stable is the show my screen feature. Combined with the camera provides exactness and clarity when studying an issue or resolving a problem on one side of the conversation. It one step it also removes the need for complex tools such as VNC Remote etc to do this.  Brilliant!!!

Here is an interesting video case study Skype have on their site:

http://www.skype.com/intl/en/business/case-studies/maxim/

 

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When Kate Wood was retuning from her summer season buying  trip in India for her business “The Dancing Feather“. I met her en-route in Bangkok.  Having agreed to be interviewed by me, there was no better time than as we travelled together to Melbourne together .

I was especially interested to hear how she is able to stay tuned in to the fundamentals of her business. She has many common sense ideas on what many see as complex issues, especially on buying and dealing with multiple suppliers in Asia.

My interest in Kate was not just paternal. The youthful enterprising approach she and her peers take is always refreshing and interesting to hear about. On this occasion i was also keen especially keen to hear about her approach in her business to financial management.

As one who has made her name in her own right,  my Kate wanted to cut right to the chase and dispense with any preliminary questions, such as why and how she began.

So here is the text of our conversation that began with.

To kick this off, Kate  can you tell me what is so special for you about fashion business?

Well when I think about it, the fashion business is no different to any other business I guess; You have to understand the product, the customers and your ability to match them to meet their needs and make a reasonable return on you investment.

Actually in any business where customers come to you, first needs a well sourced product that is in demand. With this needs an ability to package it with service value and then position competitively.

One thing I believe that may be special about fashion is an industry of risk at all levels as it deals at the high end of the retail consumer intangibles. So you need to understand what is changing and how to constantly re-think and re-model it. Only then you can you have at least some assurance that you can be on track to get a return on your investment. “

Ok, so what about the selling approach in the fashion business? How can you do that effectively and complete with the big guys?

Well in this business there is a saying, “The  day you buy is the day you sell” So basically it all starts at that point. And if you get it wrong there is nothing you can do about it.

But once you have a good product landed you must also have a good place to consolidate and sell from. It is all then matter of scale. Customers build up habit and loyalty and want a familiar place to do that with easy access. Be it the internet or a physical  location it is all the same. It  can be anywhere as long as it is well located and consistently on view and promoted.

In the end people buy on two bases, being need or impulse and fashion is more the latter. So being a niche player with personally imported quality product that is different from the way the mass market works. Then as I said it is just matter of being in the right place at the right time.

Is it that simple or does it need anything else?

Of course.  It is a business so you need all the pieces to work. One of the most critical pieces, not only in selling but in the whole business supply chain,  is good people who empathize with the business philosophy and its culture to deliver the product and service well, They are the ones who make customers experience such that keeps them coming back.” That also takes some leadership, which can be very hard especially when it is your money at risk.

What about advice to a newbie, especially on financial planning?

she smiled as she responded with. “I  made all the classic mistakes but somehow have managed to survived so far. But I do know now that to set up in business needs conservative thinking when it comes to money.

One ting is for sure, you always overestimate income and underestimate costs.

What about help. Do you ask your friends or get professional help?

Well I thought I was unique of course because I could do it all it alone and just get some friends to help when I needed it. But I learned that lesson the hard way. You of all people as a consultant know that is a huge mistake.

For a starter ideas have no place to go an test them and be held accountable.

Someone told me once that if you are working hard it is probably because you are not delegating. Being a hero and not delegating naturally limits you doing the more valuable work that cannot be done by others.   

I also needed to find a mentor for my business ideas. And despite a coming  from a business family, I needed some independent way to get a financial advice without paying an arm and a leg for it.

As for friends, well as they say there are no friends in business. But I don’t believe that My truth is I make my customers my friends by never letting them down Everyone else is basically a supplier, partner or an employee. You’d be surprised how many partners and employee are also my customers so i do get a lot of help from my friends.

As for personal friends a good rule is to keep that that way and don’t be tempted to help them out or get them to help you on any substantial basis. Like borrowing or lending them money it is a sure ay to lose them. For Family of course the rules are quite different again.

Now that you have some experience how would you advise someone on funding a start-up. Knowing what you know now would you  borrow or just start small and go incrementally or do something else like finding a  partner?

Ok, that a bit of a tough one. But  to start with unless you have a kindred spirit and good timing together partners are just not there for a start up so most times you have to get out there and just do it yourself and learn before you can get a following.

And the only funding you are likely to get is cashing in some perfectly good investment or by getting a loan from your  family if they are wiling. That will get you started with upfront establishment costs and fund working capital items such as stock, advertising, premises staff costs and so on.

The bank for sure will not lend to any old startup or of they do not without seeing a business plan that shows how the loan can be repaid . I found also found this includes projections on ability to grow and refinance internally  things like increased more stock from profits and surplus.”

What about setting a vision. How do you that?

“Well when you start it all seems so simple. Just start and magically it will all happen. The notion it is easy to just go buy something and then with people will just buy would mean I would be very rich with a great life. Well  Isn’t that so far from the truth? In reality you must have least some idea of what you want it all to look like even in two or three years out. And how it will works on a day to day basis to at least  get your money back, Then grand plans to acquire Louis Vitton can then take their place as can the holidays in the south of France”

On money, where is a good source,  the Bank a partner or where else?

“Well to start withy forget the venture capital person who underwrites niche startups with potential to grow rapidly. Unless you dream there are such fairy godmothers and I don’t, they are not likely to invest in fashion.

But for a newbie there are choices. One is to buy small business already established so you have some cash flow and a base to build on. There are people out there with life style businesses that have a good following. Getting one may bring immediate  experience and goodwill to allow you to go to the next level.

Another approach and take a domino approach to building a brand in small steps until you have enough impetus to push into the next level. Even then you have someone support you like a partner with a regular job. But no matter who helps you with cash support, you must always account for it properly and do the ROI sums.

I was lucky my family helps by making me made me go though the rigor to justify to my self my financial plan was sound and I could meet my repayment obligations. Not passing muster on a that means you must always re-think. Don’t take a short cut and ignore this step as many do. And don’t let pride keep you going when even blind Freddie can see it does not stack up .“

You mentioned stock, and recurring costs How would fund this working capital?

Oh that is a real can of worms for sure, especially stock. Things like timing, packages getting lost, stealing, damages, obsolescence quality control returns all combine to destroy the margin. And picking the market right and making sure it is there on time can mean life and death for a season. 

On the money side find I must must always have enough funds to carry me through until you get to the breakeven point. In retail with imports the norm,  buying and selling has quite long lead times as you need to pay up front for season shipments that sell many months later. Very few traders will extend credit to a new business, so it is unlikely trade credit is an option. Once you get going it can change and then you have some leverage.

The problem is in any business growth is a drain on cash. Contrary to the pipe dream theory.  One rule I have is the money I need for working capital must be generated by the business. In other words aside form the initial investment, to grow I use only the cash from profit to buy more stock

Also don’t try to pay the initial  investment back in one  season unless you are very lucky with windfalls on high margin stuff. It does not make sense as you cannot generate the same cash twice to both pay back a loan then fund the second season without borrowing part least of it again.

If it is possible that piece should be funded from you own equity so it does not have to go back.

The other rule is dump any stock that is not moving and quick. That is where you cash is and if tied up it will kill you quicker than a speeding bullet

What do you do if opportunities come your way for a quick buck?

I found very quickly that before you start getting any money back from sales it is a one way flow. You must be very stoic and monitor the plan well to maintain your confidence. So above all don’t panic or an buy something silly that is not in your plan. And buying something outside that guideline will leave you poor for sure.

Did Murphy’s law. ever  apply to you and if so how did you stop him from doing damage?

Woe, I am not sure about Murphy but in India yes it is the norm for things to go wrong with great regularity, especially when you are not watching.  It is so easy just to count the cash and think you are doing well. But as with any business with time lag, be rest assured the devil lurks in the detail. Calling the ostrich to help is bad. A head in the sand style of financial management may feel like a good approach, but believe me it rarely leaves you in good shape”.

Ok that’s great. You have the stuff and a process to sell it so what about measurement.

“That for sure is one thing I did not understand well that I need  need a good transactions system to satisfy tax and regulatory needs and a good reporting system to measure results, Then you can could control things like sales and gross profit, expenses and cash and see how they ate doing against their plan.

Kate, as someone who lives by intuition I guess you have learned by seeing what is missing? Even for a YGEN some fatherly advice must have stuck.

Fatherly advice or not as you well know the XY generation do not listen and we are selfish. Which means we learn by stealth and watching and doing what others do. That is often not so good and we have to learn the hard way but you learn not to make the same mistakes twice and when you find something that works and is proven you stick to it. In my case being a complete individual who goes where angels fear to go, some dumb luck and some naive politeness has seen me through so far .

Ok so back to practical stuff . What about taking money out  of your business, What is your criteria. Do to just take some when you need it, or is there a discipline to it?

There is one rule of thumb I have that one of my friends told me. He said you can only spend the profit and then not all of it. Otherwise you  have nothing to buy more stock and grow.

So what I do is draw a reasonable regular salary that I must justify in my plan for the business and I never break that rule even when we have a load of cash.”

One thing your mention constantly, was a plan, what is that and is it formal? If so how do you do it ?

Well at first  I did all my planning in a book at high level. You know ideas with a few sums. But even in the first season when I bought up a lot as I found re planning and modeling the outcomes at category level was vital. I found the category level is the best way keeps it going under control so I moved it into a more detail spreadsheet to track the sales and line items. It actually make my life eerier too. But when I realized I needed to copy and model my buying it was not enough to manage things that change.  I have now moved it all into a database system with more analytical reporting  tools. I find now I can model understand and control product and margins so much better.and my buying is much more focused on what works

I can also do much more clever stuff like work out who is buying what for a range of over the categories with nearly 3000 items that we sell through several channels including markets and wholesale.

As I  have also begun to move into accessories and joint ventures on things like jewelry. So a good process for category planning and monitoring is vital to see impacts on things like bundling and so on .It also helps me a great deal on confidence as I see the numbers come in.

What about the cost of your systems and how do you afford them?

Well I having such advisory skill in the family meant I was lucky to save me the agony of learning what I needed. But I have to that the cost of the software and a computer to run it is nothing compared to the investment I had to make to get my business properly organized so it can work.

And frankly not even with all your help and advice it did not  help me with what I had to myself. And that was to go through the pain and rigor to understand and properly define the processes and controls for my own business.

One ting I know for sure is without it I would not talking to you this way now.

So what about Lifestyle. I remember when you started out you said you wanted a lifestyle business Many people also have the notion that being in business is a way to get independence. What is your positions on that now?

Yes  mine too as you quite rightly state and I wanted independence to design. Then I  realized the thrill and challenge of growing the business itself.  Once on I was on the sharp end, even though success does not come easily, the alternative choice was obvious not for me.

I now see that an owner’s perspective must be, lifestyle must be seen not as the purpose but a benefit. And  that only comes from the results of business success, So to that end I am still committed. That is my get out of jail recipe so I can have my cake and eat it too.

Ok that’s great but doesn’t doing design conflict with doing the business

Yes for sure and I need to be careful on the mix. Working in the business is not the same as working on the business and I also know  being in business is for one reason only and that is to take care of customers to make money. To think any other way means we should go and work for someone else.

But let’s face it, working for customers directly is still one of the best jobs on the planet. So I combine them both by making quality and good design the base of my products. Be-it mine or someone else’s I figure why not do my customers a favor and run my business well so i can be there for them in long term too.

 

I had that discussion with Kate’s some time ago and her advice continues to resonate with me as I also consider her ideas for customers of our advisory business. As one who likes to quickly deal with the fundamentals of vision and mission and the various venture execution models I can use this well to cut to the chase. Her experience gives me great confidence do do that.

Kate despite getting started during the recession and being new at your business it is doing just fine. It would seem your labels are doing well and The Dancing feather distribution outlet is doing fine too.

My final question to Kate was

With your success now, given all that you have learned and have been through to get there ,  is there anything you would have done differently if could start over again?

 

“That is an easy one, I would never have started”

http://thedancingfeather.com.au/lookbook.php

For wholesale enquiries
please view our online Look Book and contact
kate@thedancingfeather.com.au

For all other enquires contact
info@thedancingfeather.com.au

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Short video on some things organizations find when trying to make some sense of their data.

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In the world of best practice it is not being best that matters!

Did you know sliced bread, which was invented by Otto Rohwedder around 1910, was a complete failure as no-one bought or used.

It was not until 15 years later when "Wonder" came along and saw a way to spread the idea. The rest of course is history giving rise to the now famous throw away line.

Ideas that spread win is a theme that Seth Godin discusses frequently  This master marketing guru asserts that being very good is average and does not sell. He says what is needed is to be “Remarkable”. Or put another way to be “Remarked On”.

His 2007 talk, a favorites of many entertains and educate on ways that work now how to make ideas go viral.

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If you want to achieve but think you can’t, then take a look at this man who can.

Nick Vujicic has no limbs but is able to do more in a day than most people can do in a lifetime.

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Craig Schiff, this week in his blog has an excellent piece that goes to the heart of the value of busi8ness performance management  (BPM).

The significant value important in the way BPM is implemented comes with the focus it brings to make changes for a culture of greater shared thinking.

Skunk projects using free software are just not the way to do that. For it to work it must have buy in at the grass roots. This starts with the step of internal selling and going thru the organizational pain of doing proper evaluations. IT or Finance should not take short cuts if they want to champion such initiatives.

In the end the technology and choice of software is the least of the issues. As Craig expands on, what is more important is the scope of business change to use BPM and understanding what needs to be measured and who it is deployed to and so on.

I agree too that offers of free tools and services must be questioned. Alternatively there is value in offering to review to have fixed some of the very poor implementations that have come from ill founded scuttle approaches that result from freebies. This exploitation phase in such expedient cases is so often never done.

In the end the value extending the use of a BPM system brings with it the greater value to justify investment in more licenses. That makes for better reference sites for vendors and everyone wins, especially the customer.

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A first shot has been fired in battle that is sure to be interesting to see customers get real benefit of the competition for the massive communication and self organized collaboration services market that drive business.

As broad based bandwidth speed has evolved, communications have also developed to a high level of acceptance of the quality of Voice Over the Internet Protocol (VoIP) services now being be used widely to conduct business. People like Microsoft Yahoo AOL and others have had this technology long before Skype came along. Microsoft who I believe made a tactical error in 2003 when they began to charge for their net-meeting conferencing tool that were previously embedded in messenger, They were quickly overtaken as Skype timed its unbundled move to popularized their free alternative phone service that also did free video conferencing too. 

Microsoft however have continued to invest massively in their VoIP stack they aim at the enterprise level  Evidence of the value of their perseverance came with the released of it Unified Communications (UC) server suite. Now in its third market year It is now paying off well making a large dents in traditional PSTN and IP commutation carrier domains.

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I recently had a chance to join a Kickoff meeting of a very interesting BI project.

Normally stakeholders and key players are invited to join such meetings as they share an interest in the outcome of the project.

Stakeholders also bring a unique value to the project, especially in the beginning, aligning together to support it to get off to a good start.

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I was privileged to be a speaker at Victoria University Logistics and Supply Chain Conference in Melbourne on Aug 25th 2009.

Matthews Steer Chartered Accountants and  leading business advisory firm, were the gold sponsors of the event entitled “Logistics Insights – Strategic Information for Strategic Decisions.   

Having been a transport man for many years, I was happy to engage with many transport & logistics providers and others present. Participants were mainly from the Small to Medium Business (SMB) community. The session, was entitled Financial Management for Logistics and Supply Chains Post the Global Financial Crisis. In the backdrop of the economic climate it was a discussion around solutions to issues that come up when the question is asked, “Have you got a handle on your numbers?”

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