The business world is brutal. Economic volatility and unstable markets create a less than level playing field littered with potential hazards. To create and sustain a business that can survive such unpredictability needs a great deal of forethought, planning and flexibility. Investing in areas that were once considered almost inconsequential such as employee engagement, have proven to be absolutely critical. Imogen Tear talked to three industry professionals about how they have built and maintained strong businesses and what they believe is the key to creating a sustainable enterprise.
Strong leadership, transparent communication, financial awareness and directors who are both visible and accountable are just some of the prerequisites for business success. Companies, both new start-ups and established industry stalwarts, need to constantly evaluate their systems to identify areas of vulnerability. Recruiters that set up on the back of a buoyant job market can often reap financial gain when times are good but without a well thought out and considered structure in place a downwards turn in the market can be disastrous. Many businesses discovered this the hard way during the GFC and those that survived learnt valuable business lessons. One of the most significant lessons was the need to recognise the value and importance of the workforce. Nurturing, supporting and empowering the talent within your company leads to loyalty and loyalty can pay huge dividends in lean times.
Jeff Doyle, CEO of Adecco Australia is genuinely passionate about looking after his staff: “our people are our primary customers”, he says. He believes absolutely that devoting time and energy to looking after his employees is essential for the business and Adecco have a long list of enviable programmes in place to support this. Doyle says the schemes have had a fundamental effect on the business. “The proof is in the results,” he says. “Retention levels have improved quarter on quarter since the schemes have been introduced. It makes sense not just from the perspective of the people but it makes perfect business sense too,” he confirms. With the costs of replacing staff well known, improving retention rates ultimately improves the financial bottom line of any business.
Doyle’s enthusiasm is infectious and it’s hard not to believe him when he says Adecco is 100% committed to providing opportunities for all staff to maximise their personal potential. There are a huge range of programmes and awards in place from health and well-being benefi ts, to lifestyle benefits such as flexible working arrangements; there are training programmes, an international exchange programme, interstate secondment schemes and a hugely successful mentoring programme. Staff are even flown in to receive awards that are presented at the annual Adecco conference. But Adecco is a worldwide business with a huge network and a long history which allows it to fully capitalize on the programmes it has in place; can smaller companies offer the same opportunities? Do young companies have the resources to invest in their employees?
Katie Knight, Founder and Managing Director of Respect, a niche recruiter specialising in the digital media sector, is equally as passionate about her staff and believes staff engagement is critical to building a strong business. Despite the small size of the company (Respect has six full-time employees) Knight has worked to create, “an environment for human beings … where people look forward to coming to work and feel rewarded for their achievements. We genuinely care about whether our employees do well – for their sake.” To this end the company also has a range of mentoring and training programmes in place, including a flexible return to work scheme for mums and a long list of staff benefits and incentive schemes.
One of the major lessons Knight says she has learnt is to “invest in your staff and keep learning”. “Respect is not just a name,” she continues “it’s how we operate as a whole to clients, candidates, to each other and ourselves.” Knight is also, “a firm believer in hiring people around me who are better than me in other areas.
I always ask advice and listen to my advisors,” she says.
Being aware and honest about your own strengths and weaknesses and being prepared to delegate and trust others is an indicator of strong leadership. And strong leadership is fundamental to a strong business.
Paul Lyons, Managing Director of Ambition, says, “I’m a big believer in trust and this becomes even more important when you have business operating out of remote locations where you need to sleep easy in that your leader, who is your representative, will act in the way you and their staff expect. This is especially so in tough or unexpected situations where they have to act responsibly, consistently and ethically. The last thing you want is a maverick an hour, or twelve or twenty-four hours plane ride away who can wreak untold damage.” Importantly, Lyons adds: “Of course, the reverse holds true too – your remote leader must have confidence in you and the organization to perform their role with confidence and clarity.”
Whilst trusting and investing in your staff ultimately spreads accountability across a business and encourages everyone to work towards a common goal, to institute this ethos involves strong leadership skills. Doyle, Knight and Lyons are all unanimous in their belief that strong leaders need to lead by example. “To me leadership is ‘being’ as much as ‘doing’,” says Lyons. “Being visible, being trusted and being followed because people believe in your values, in your vision and in your fairness.” He adds: “Consistency and equity are really important – especially in tough times – so that you can appeal to a wide range of people that buy in to what you stand for, where you want to take the organization and how they fit in. The base line is that people don’t follow leaders who are lazy dishonest or stupid and so we build from there.”
Having an unshakeable resolve and a belief in his vision, his people and Ambition’s processes is also important to Lyons, “We can’t affect the economy – good or bad – but we can affect how we think and act and that approach leads to results,” he states.
In a similar vein Doyle also believes strong leadership is doing rather than talking. “Lots of people talk better than they actually do,” he says. “But doing better than you talk is the key to success.”
Doyle, who was a professional footballer in his younger days had a lot success early on in his career but, he says, this success went to his head and consequently he didn’t make the most it. “At the end of the day, my work ethic didn’t match my talent and that’s where it counts the most,” he states.
When Doyle started out in business he had no experience and no formal qualifications, but hard work and determination coupled with “a fierce work ethic” has got him to where he is today. “It doesn’t matter how much talent you have it’s the effort you put in that counts,” he adds.
At Adecco the leadership style is also about getting involved and reallyunderstanding what is going on in the business at ground level as well as in the boardroom. For Doyle this means visiting every branch in the region. “It’s a lot of travel but is so important and I enjoy it,” he says. “The global CEO, who visits twice year, also does the same thing. He makes it his priority to visit branches and meet the clients.”
For businesses that operate across states, countries and even continents sending a message of strong leadership presents different challenges to those based in one office. “It permeates through the organisation through your clear communication and through your first line of staff following your lead and communicating the same vision in the same way and handling issues and opportunities consistently and fairly,” says
Developing practises that enables communication to travel through an organisation is important. “We try and over communicate rather than under communicate and in different ways (one to one meetings, group meetings, through our intranet, internal magazines, blogs, forums etc). I think the keys are the headline messages – where are we going and how are we doing – delivered honestlyand consistently with the knowledge for staff that if more information is required you can ask for it,” says Lyons.
”You have to communicate formally and informally,” adds Doyle. “Adecco
Australia has a variety of ways of doing this. Biannual visits to every branch is one of the most important things – sitting down with your staff in their environment so you can really get a true picture of the good, the bad and the ugly. Recruitment is a people business so you really need to know your people,” he adds. In addition to branch visits Adecco arranges formal quarterly presentations in major cities to present the numbers and results for that quarter. On a more informal basis there are monthly online chats where Doyle talks to his employees and recognizes birthdays and anniversaries. Staff are invited to talk directly with Doyle and the conversations are published on the intranet the next day. Despite his initial reservations Doyle says these discussions have proven to be very popular across the business. “You have to balance communication,” he says “provide messages and take outs and have a bit of fun.” Adecco also releases a quarterly video on different topics, “where we do not take ourselves very seriously,” he laughs.
Knight stresses it is also important to communicate your brand in the marketplace to gain greater recognition, particularly for newer businesses. Respect has employed a social media strategist who is utilising the social network of Respect “to bring our brand to life and gain more reach,” says Knight. “Digital is a smart and cost effective way of communicating to an audience,” Knight continues. “And as a digital media recruitment agency it’s the one of the best ways to communicate to the people we work with everyday. I invest a lot in our online presence,” she adds.
There is no denying the fact that communication remains one of the keys to the success of any business but it remains evident that ‘traditional’ methods of communication still have a place.
Knight says, “I believe the traditional ways of communicating such as picking up the phone and meeting face to face should never be redundant – despite the younger generation preferring to only speak through a computer or hand held device. Also the power of word of mouth marketing will never be lost … bad news travels faster than good.”
The characteristics that differentiate the good from the bad, the organisations that are strong and sustainable irrespective of the state of the economy, are many. But the quality of the leader, the understanding they have of their stakeholders – employees, candidates and clients – is fundamental.
Trust, accountability, the courage to know when to make difficult decisions and a vision for the future is what makes some leaders stand out from others and allows them to sustain if not grow their businesses in difficult and unpredictable economic times. Finance is also critical, particularly for businesses in the early stages of growth.
In a slightly unconventional step Lyons and business partner Nick Waterworth listed Ambition on the ASX three months after they had established the business. Alongside the funds Lyons and Waterworth already had, the listing allowed them to secure more money in a shorter timeframe, which in turn enabled them to develop Ambition both organically and through acquisitions much more rapidly than they would have been able to without listing. In theory this sounds a good idea but it is not without it downsides. “If you ‘dilute’ your shareholding you spread your risk and return but you lose some control and you increase your accountability,” says Lyons. “It’s a balance. Also, it’s not easy – especially if you’re unproven – to persuade the general public to invest.” For Lyons and Waterworth the move was a success but Lyons suggests that start ups requiring capital are more likely to acquire funds from venture capitalists or private equity firms who specialise in seed capital.
Running a business that has remote office is a “balancing act” according to Lyons. “You try and ensure that each business is self sufficient and profitable but if it’s not then the group will support it with resources (cash, people etc) for a period of time. If it doesn’t turn round then we close it and move on,” he says.
For young companies such as Respect cash flow is often an issue and needs close monitoring. “I now have an in-house accounts receivable team who keep on top of our debtors,” says Knight. “Cash is key in a small business so having a dedicated ‘squeaky wheel’ helps keep us on top of our clients’ creditors list. I keep the business very lean and debt free. In the last recession I was lucky not to have made a redundancy, we were a team of six and I used the time as an opportunity to train, work hard on customer and client care and keep adding value so we were ultimately prepared with a loyal and motivated team for the upturn.”
In addition Knight adds that she doesn’t draw a huge salary – “everything that goes into the business is allocated to operational costs and the future. This is a protection method for another economic downfall and for future expansions,” she concludes.
Regardless of size, financial robustness and years in operation all the people interviewed were extraordinarily committed to their company. Their passion was genuine and infectious. “I love what I do and the people I work with and it interests me every day,” says Knight. Lyons agrees, “I love what I do so it’s easy to have the passion, the drive, the ambition.” To build a robust business in any economy involves many factors but having a leader who loves what they do and, as Doyle confesses, “still jumps out of bed every day” has to be a huge advantage in what is invariably a tough game.