Understanding market changes

Coronavirus, stock exchange losses, countries going in to lockdown, businesses being shut down, stock shortages in the shopping centres.Market changes image

We live in unprecedented times with the business models of decades’ old organisations quite literally changing overnight.

The radical changes we have seen over the past few weeks have demonstrated the speed at which market dynamics can change, and the need for businesses to respond quickly.

Boards and management teams are needing to respond with urgency to scenario plan and make decisions with imperfect information as the situation unfolds.

The markets that we operate in and the customers we serve are always changing. Whilst the speed of change is not necessarily what we have seen recently, now is a time not just to focus on the immediate crisis at hand, but to think about how to structure management and board meetings so that market changes form part of the regular and ongoing conversation.

From our experience, we observe that management reports typically fall into one of three different categories:

  1. Activities completed or in progress in the week or month.
  2. Business KPIs which are typically backward-looking and reviewed to ensure the business metrics are on track, trends can be identified and corrective actions put into place. e.g. finance, HR, work health safety.
  3. Progress against the strategy which is often a table that lists out the: goals/objectives, comments on the status against them and an indicator (e.g. traffic light).

As part of aspiring to best practice, any discussion of the strategic plan and, in this case, progress against the strategy, is worth including an item to identify and (as required) discuss any changes to the market conditions.

The review of market changes can often be addressed simply with a few bullet points and identifies by exception, any material changes in the market environment since the last report. It is important to identify both what is going on in the external environment and the potential impact on the business.

Sometimes, where a significant change is occurring or has occurred, it might be appropriate to include a white paper or an article talking about the change, or set up a special meeting to consider those changes. A major technology change; action such as a significant merger or acquisition by a supplier, customer or competitor; or change in government/stakeholder funding might lead you to establish a separate meeting of the Board or a sub-committee like risk/finance.

Within the disability sector, we have seen changes every few weeks or months that impact on organisations. Changes to the NDIS price guide, the Royal Commission and new quality and safeguarding requirements are just a few recent examples.

Making a report on market conditions a regular part of the board reporting template can help to keep the Board and management team coming back to the important strategic matters, and not to just be stuck in the operational issues.

Next month we will share more about some tools that can be used to analyse and better understand your market.

If you’d like any assistance with reviewing your market environment, please contact Andrew for an obligation free consultation.

 

Andrew Ellis
Business Consultant
Email: aellis@cbb.com.au
Phone: 1300 763 505

 


Five steps to protect your organisation from cyber risk

Former Director of the FBI Robert S. Mueller, III, made the famous quote that:

“There are only two types of companies: Those that have been hacked and those that will be hacked.”

And others have since moved to suggest that the quote should now be: “There are only two types of companies: those that have been hacked and those that don’t know they have been hacked.”

It is unfortunate that not for profit organisations are sometimes the target of a cyber-attack. Given that not for profits often hold a lot of personal data, they can be seen as a soft target. Attackers also don’t need to have a lot of data about a person in order to perform identity theft, so the consequences can be significant if personal data is stolen.

Being the subject of a cyber attack can have wide ranging impacts on the organisation; including damage to reputation, financial losses and an inability to service clients during any downtime caused by the incident.

On 28 February 2020, the Office of the Australian Information Commissioner (OAIC) released the latest Notifiable Data Breaches Report on the period July to December 2019. A few key statistics and observations can be made from the report:

  • Nationally, there are approximately 80-90 data breaches per month which are “eligible”* and are reported to the OAIC
  • Malicious or criminal attacks (including cyber incidents) are the leading cause of data breaches, amounting to 64% of all notifications in the past six months
  • About a third of breaches are the result of human error
  • The health sector has the highest number of breaches
  • Most data breaches affect less than 100 individuals, showing the vulnerability of smaller organisations, including not for profits
  • The most common data which is involved is personal contact information.

*Under the Notifiable Data Breach legislation, it is an “eligible data breach” where:

  • there is unauthorised access to or unauthorised disclosure of personal information (or the information is lost in circumstances where unauthorised access to, or unauthorised disclosure of, the information is likely to occur)
  • a reasonable person would conclude it is likely to result in serious harm to any of the individuals whose personal information was involved in the data breach, and
  • the entity has not been able to prevent the likelihood of serious harm through remedial action.

If an entity suspects that an eligible data breach has occurred, they must undertake an assessment into the relevant circumstances, notify affected individuals and the OAIC as soon as practicable.

Ensuring that your systems are secure is fundamental to data security, but human error also presents significant risk.  Human error can involve a staff member inadvertently opening a phishing email or clicking a link to a suspicious website. One of the other sources of data breach can be, for example, when a staff member accidentally selects the wrong email address and sends an email with personal details to the wrong person.

Cyber risks are often one of the risks that are identified in a risk assessment, but many organisations struggle to know what to do next to mitigate those risks.

Five steps to mitigate cyber risk

Not for profit providers can take these steps to prepare now and mitigate the risk:

  1. Ensure that cyber risk scenarios are identified in the organisation’s risk assessment.
  2. Look at your people and the role of training in mitigating the risk– it’s important that employees understand how to detect and report threats, protect their devices and the organisation’s data.
  3. Preventative technologies and processes – encryption, secure backups, multi-factor authentication and modern hardware/software will all help to minimise the risk of data loss.
  4. Review relevant policies and preparation – plan ahead by ensuring you have an up to date privacy policy, data breach policy and data breach response plan, and undertake simulation exercises to test management.
  5. Work with a specialised external consultant undertake an independent security review and penetration testing.

CBB consultants have had experience in helping organisations plan their risk management activities. If you’d like assistance with risk management, please contact:

 

Andrew Ellis
Business Consultant
Email: aellis@cbb.com.au
Phone: 1300 763 505

 

References:

  1. October 2019 AICD Magazine – What boards can do in the event of a cyber breach
  2. OAIC Notifiable Data Breaches Report: July–December 2019
  3. OAIC Notifiable Data Breaches Scheme 12-month Insights Report

Why not for profits need to plan the year ahead

 

man asking where next

At this stage of the financial year, the thought of planning the financial year ahead has probably crossed your mind. If your organisation has a formal planning process that is in place for the start of every calendar year, you may have started planning already.

Before we go into planning mode, or agonise about the mere thought of doing any sort of planning, is planning ahead even useful? Is it just a waste of time?

Below are three reasons that planning is not a waste of time, but a valuable exercise.

 

Opportunity to be proactive

In today’s connected world we are constantly being pulled in a million and one different directions. We receive endless updates about legal changes and Government funding; our clients have many different means to contact us and, of course, staff members have varying and changing needs to be addressed. All this to say, that in the middle of the working year, it is very easy, and at times difficult not to be, operating in a reactive state. This can be especially true of leaders of organisations.

The planning process however provides us the opportunity to be proactive. When beginning the planning process, particularly planning for longer periods such as a year or two rather than a week or two, our minds move towards exploratory, opportunistic type questions such as ‘what do we want to achieve’, rather than reactive type questions such as ‘what needs to be done’. After all, if you ask somebody what they plan to do in the next 12 months you may get a proactive response such as ‘achieve xyz’, whereas if you ask them what they plan to do in the next week you may get a more responsive type answer, such as ‘finalise our client report’, which is due the following week.

Planning allows us for a brief moment to put the day to day tasks, that form part of our lives, to one side and ask ourselves a handful of longer term, more meaningful questions.

 

Revisit what’s important

What is important to your organisation? Why does your organisation exist? What problems are being solved and what needs are being addressed?

These are the type of questions that are able to be asked in the planning process, when the day to day tasks are momentarily put on hold. These types of questions, with the big picture in mind, allow you to revisit what’s important to both you and the organisation.

When revisiting what’s important, there are two timelines in which we must consider. What is currently being done and what needs to be done.

When reviewing what is currently being done, consider the day to day tasks that are being undertaken, but that you feel do not necessarily align with the organisation vision and/or are not the most efficient use of resources. Tasks may include pursuing and completing work that at one time was in line with your organisation’s mission, but overtime has changed and is no longer as aligned as it once was. Other examples may include an inefficient use of employees’ time or archaic systems that unnecessarily waste time.

Are you happy with the current state of play? Are there things you would change in your own work and that of your organisation?

In looking to the future, questions can be asked about the type of organisation you want to be and what you’d like the organisation to achieve. This an opportunity for aspirational thoughts to flourish. It is difficult, if not impossible, for the mind to wonder and for you to imagine what your organisation could achieve, and the impact it could have, when you are in the middle of your day to day activities. Planning allows you to take a longer term horizon. The practical consequences are that you can plan actions for the year ahead, that lay the foundations for your longer term goals.

 

Improve performance

Planning has the potential to improve an organisation’s performance by providing an opportunity to focus on how best to allocate resources, how to solve key problems and by bringing improved focus and efficiencies to staff and leaders.

Allocation of resources

With the opportunity to be proactive and revisit what’s important, an organisation is able to review where resources are being allocated and determine if this is the most efficient use of the resource/s in light of what’s important. All organisations have limited resources, particularly in terms of time and money. Even slight reallocations of key resources can impact overall organisational performance.

Solve key problems

Without planning, you risk just doing more of what you’ve always done, without regard to external market context, or internal changes. As market conditions evolve and internal changes occur, problems are likely to arise. Planning provides the opportunity for key personnel to work through and solve problems affecting the performance of the organisation.

Improved focus and efficiencies

Planning allows for a strategic roadmap to be created in which staff and leaders can align to. With an aligned focus on tasks and functional activities, efficiencies are inevitably gained. Furthermore, leaders who are equipped with a strategic roadmap and direction for the organisation are able to make better, more informed decisions in a more efficient manner.

 

If you’d like any assistance with planning, please contact 1300 763 505 for an obligation free consultation with one of our Business Consultants.

 

Dimitri Matsouliadis
Business Consultant
Email: dmatsouliadis@cbb.com.au
Phone: 1300 763 505


Peer networking worth its weight in gold

If you’re someone who doesn’t have a professional online presence, you could be missing out on some valuable career or sector information. To keep in touch with the latest news, what your contacts or competitors are doing and to join discussion groups with like-minded individuals, consider having a LinkedIn profile.

LinkedIn isn’t just a place to find a job. Its importance goes further than that. It has been specifically designed for the business community, so if you’ve been hesitant to be part of it, here’s a couple of reasons why you should reconsider.

You’ll be amazed at what you can find out

It’s a great way to get the latest industry news. Your connections, generally from your current industry or sector, will be posting articles and updates, and sharing content from the people or organisations that they are interested in. These appear in your news feed so it’s an excellence source of current information.

More connections could mean more opportunities

The more people that you connect with, the more business opportunities can arise. A business may advertise a tender or one of your connections might post an article about a project they are working on or a training program they’re involved with.  Any of these could mean opportunities for you and your organisation.

Find out more about prospective employers

LinkedIn is also a great place to research organisations. Most companies will have a page where they post updates and company news. You can also find out from looking at their connections who is employed there.

Sharing your point of view and teaching others

There are many public and private LinkedIn Groups that you can join. Think of these as virtual meeting rooms (or forums). These groups are great for people with shared interests, so you can share and grow your expertise and extend your network.

We’ve put this into practice with the launch of CBB’s NDIS Success program. NDIS Success aims to increase the supply of NDIS services in communities and will be delivered via webinars and online resources.

The NDIS Success LinkedIn group will allow participants to share their thoughts and ideas, offer assistance and ask for help from their peers. Following each webinar during the program, registrants will also visit the NDIS Success LinkedIn group to ask questions and share ideas on what they’ve learnt or need clarification on. This peer networking is a very valuable way to progress everyone’s knowledge on the provision or expansion of their NDIS services.

If you’re now convinced you should have a profile, head to Linkedin.com and enter your email address and set a password. We recommend using your personal email address instead of your current work address. This will save you having to update your profile if and when you change jobs.

Follow the prompts to setting up your account. It’s not an arduous process and won’t take long to set up.

LinkedIn community of users illustration

When your profile page is activated, it will start prompting you to more information about yourself and to build your network. Depending on the information you added when you first registered, LinkedIn will make suggestions about who to follow. It’s up to you what to include.

LinkedIn’s research has shown that some people chose not to include a photo because they are worried they will be discriminated against, however their data shows that profiles with a photo are more likely to be viewed by others. If you’re looking to promote yourself, a photo is a good idea.

Hot tip – when you click to view someone else’s profile, they will be notified that you viewed it. You can turn this off by going to “Me”, Settings & Privacy, and Profile Viewing Options.

And now you’re set. This is a basic introduction to LinkedIn and Groups and their purpose, but there are many different options for privacy and viewing so log in and look around. Visit your home page regularly (news feed) to see what your connections are up to. The more you use it the more beneficial you’ll find it.

Don’t forget to register for NDIS Success and join the NDIS Success LinkedIn Group to get expert advice from our Business Consultants.

Kirsten Tait
Marketing Officer
Email: ktait@cbb.com.au
Phone: 1300 763 505


How to measure ROI with a zero-based marketing budget

man thinking in front of boardThe simplest and easiest way to set next year’s marketing budget is to take last year’s budget and simply add the percentage that you want to grow by.  Within 60 seconds your new marketing budget is set, but this doesn’t allow for external market factors like new providers, changing government policies or the needs or wants of customers.

Alternatively, you could adopt a zero-based marketing budget. This will take longer to put together, but it will make you ask the hard questions about the outcomes you want, how much you need to spend to achieve them and the different options available to you

 

Where to start with a zero-based marketing budget

The most daunting thing about having a zero-based marketing budget is staring at a blank white board or empty spreadsheet.  The good news is, if you look at your marketing strategy, you’ve already got a starting point.

If you don’t have a marketing strategy and plan, a good place to start is by reading one of our previous blogs – Planning for future success

In your marketing strategy you would have identified your strengths, weaknesses, opportunities and threats, the market and your marketing funnel.

Use this to start writing down the high-level things you think you need to do to attract new customers and retaining existing ones to either existing or new services.  For example, it may be that your existing customers only use one of your services and don’t know about the other services you offer. It’s always cheaper to cross-sell to an existing customer who knows you than to acquire a new customer.

From here you can list all the communication options that you think you could use to solve that issue.  At this stage the more ideas the better, as there’s no right or wrong answer. You can, and will, logically reduce the list down later.

Once you’ve written everything you can think of, walk away and revisit it the next day. This will give you time to reflect on your ideas and add in any new option(s) you’ve thought of.

 

Reviewing your options

With all your options listed down it may seem like an impossible task to decide which ideas to keep and which ones to delete. By researching the cost and comparing it to the possible result of the activity, you can logically eliminate ideas.

For example:

During the analysis you’ve realised that hardly any existing customers visit your reception, so the cost per result of doing the activity is very high compared to the other options.  Therefore, you’d decide not to do it.

However, the other two ideas come at a relatively low cost compared to the potential gain: a combined cost of $1,800 vs the potential of an additional $100,000 in revenue (20 enquiries at $5,000 potential revenue each), so you decide to add them as lines to your budget.

Measuring the ROI

Not only does this analysis help you decide what activities you should do because you have looked at the potential results, it also allows you to measure the return on your investment. By measuring where your engagement, leads or customers have come from throughout the year or per campaign, you can measure which of your marketing activities were effective.

Here’s the same example but we’re measuring the ROI:

As you can see, the results you expected weren’t the actual outcomes but if it’s your first year of doing this or if there are changes in the market, then your expectations are unlikely to match the results exactly. But what it does do is give you a benchmark for the next year so when you go into the planning phase again, you use the data from this year to refine your predictions for next year, to be more accurate.

 

Benefits of a zero-based marketing budget

Not only does a zero-based budget help you justify your marketing budget recommendations, it also helps you prove the ROI of your investment; something a lot of organisations struggle to articulate.

Whilst you can argue for hours whether to use a first touch or last touch* attribution method to decide where to credit the win, the truth is, unless you have sophisticated systems reporting and analysis, you’ll never know.

A zero-based marketing budget will get you to challenge why you are doing some of the existing marketing activities, and whether they are still worthwhile.

The important thing is by using the zero based budget, you are planning for success and learning to monitor your results which will help you improve your future activities and lead to marketing dashboards that help drive your organisation forward.

 

If you’d like any assistance, please contact us on 1300 763 505 for an obligation free consultation with one of our Business Consultants or book an appointment here.

*First touch – where they first found out about you, the new service etc. OR Last touch – what was the final thing they saw before they acted.

Andrew Ellis

 

Andrew Ellis
Business Consultant
Email: aellis@cbb.com.au
Phone: 1300 763 505

 

 


Digitising systems without losing human interaction

A range of factors, not least the realities of operating in the NDIS market, are prompting many of our clients to look at how they can make better use of digital systems to reduce their overhead costs, create efficiencies and improve data integrity. These drivers are often counter-balanced with concerns about losing connection with clients (because digital is less personal) and the anticipated reactions of staff. Sometimes this is because experience tells organisations that some of their employees are active resistors of digital. There’s also the sheer workload – any digital introduction or change requires a change management approach, staff training and active line management of employees to ensure that they are using the technology as intended.  If resources are released from process work, there’s also an opportunity to redeploy employees to more valuable activities.

There is no shortage of cautionary tales about failed digital implementations, so not for profits need to make sure that you are putting your limited assets and capacity for digital investments in the right place.

So when is it appropriate to digitise and when should you keep it human?

Predictable, repeatable processes

Digital systems – such as CRMs – generally work on a workflow model, with a structured, step by step process of if x, then y. They are ideally suited for a predictable, repeatable process. Depending on the process you are digitising, you may be able to automate significant parts of the process – for example generating reports, invoices, payment claims. You can also use systems to drive consistency in employee implementation of processes, such as client intake. In these circumstances, workflow and validation set up can offer efficiency, consistency and improved data accuracy in following internal processes.

Dealing with volume

As soon as you try to scale something, any existing inefficiencies in your business just get multiplied. If you’re working off spreadsheets and paper folders, you’ll very quickly run out of road. If you want to scale up, you’ll need those predictable, repeatable processes to be automated as far as possible, and to drive efficiency and data accuracy.

Dealing with data

We’ve mentioned data a couple of times now, and digital really is the most reliable way of collecting and managing data. This is particularly important when you need to share data within a team working across diverse sites or in the community. Digital systems that can be accessed by your staff whilst working with a client allow for information to be shared between shifts. As well as managing risk in relation to client care, this can also improve the customer experience, as they should not need to repeat the same information across multiple members of your team.

Reporting

Digital systems also allow you to analyse and report data much more effectively. As well as retrospective and real time reporting against KPIs or other business measures, once you build up a good body of data, you should be able to identify patterns or spot trends that inform business and operational planning.

Audit requirements

For any organisation operating under NDIS or Aged Care standards, digital systems allow you to record information that will be required for audit and reporting purposes. Many of our clients have implemented digital systems for incident reporting and management.

Dealing with distance

Videoconferencing services such as Skype, FaceTime and Zoom are free and easy to use, as long as you have a decent internet connection. Internally, they allow for employees to engage across sites, reducing lost time in travel. If your services do not require physical presence, they also allow for services to be delivered into rural and remote locations. Telehealth services are one example of this.

Customer experience

The reasons we’ve discussed to date for going digital largely relate to improving the efficiency and accuracy of your back office processes, but digital can support the customer facing end of your business too. Often we hear concerns that going digital will remove the human interaction and alienate clients, but you shouldn’t assume that everyone wants a one to one discussion with another person for every transaction. 86% of Australian households have internet access and, according to Deloitte we’ve reached ‘peak smartphone’. Online banking and social media are two of the most popular uses of our domestic internet connections (at 80% each) and in 2016-17 over 50% of households used the internet for health services. This should be evidence enough that a significant number of people are happy to manage personal aspects of their lives online, at their convenience. So, if you are thinking about how to make your ‘front of house’ activities more digital, here are some things you should consider:

  • Who is your target market, and what’s their access to and comfort with digital? If you are going to implement a digital solution you should consider your customers access to technology, and – particularly in remote areas – to a decent internet connection. You should also think about their digital literacy and ensure that you design your digital solution to be accessible to your client group. When answering this question, beware of making inter-generational assumptions about the use of digital.
  • Offer choice: it’s unlikely that all of your clients will fall on one side or the other of the digital divide. Pushing everyone to a digital solution is likely to result in customer frustration if they can’t get the technology to behave as they want it to. So, offer people the option to engage in person or via digital. But don’t just assume you can lift your offline processes and apply them to an online solution – you are likely to need to make some adjustments.

We’ve been working through some of these changes at CBB. For example, we have digital options for appointment booking and are increasingly using webinars and videoconferencing to connect with our client organisations and their employees. These offer our clients greater convenience and ensure our salary packaging and consulting services are accessible to clients who work across multiple sites and operate in remote areas.

Whilst we talk about the digital revolution, none of these changes have to be revolutionary. Instead they can be managed as a series of incremental changes as part of an ongoing commitment to continuous improvement.

 

Jane Arnott
General Manager, Consulting and Business Services
Email: jarnott@cbb.com.au
Phone: 1300 284 364

 


Financially, which way ought you go from here?

“Would you tell me please, which way I ought to go from here?” “That depends a good deal on where you want to get to,” said the cat. “I don’t much care where…” Said Alice. “Then it doesn’t matter which way you go,” said the cat. – Lewis Carroll, Alice in Wonderland

Your organisation is in a current position. It has a certain level of revenue, a certain number of employees and makes a certain impact.

From a financial perspective you need to know where you ought to go from here. Asking this question allows the following:

  • It forces key stakeholders to consider the future of the organisation
  • Multiple parties can be brought into an overall vision, including board members and third-party stakeholders
  • Realistic operational and strategic goals can be set
  • Potential pitfalls can be identified before they happen
  • An actionable road map for the organisation can be developed

As we move into 2020, the question arises, financially, which way ought you go from here?

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Do you feel that you are paid fairly for your job?

The topic of salaries in not for profit organisations is a sensitive one. To a certain extent, we’ve shot ourselves in the foot with some of our messaging about ‘every cent you donate’ going to the cause, creating an expectation that employees in the not for profit sector should work for the love of it, rather than drawing a market wage.

The truth of it is that we are dealing with some of society’s most complex issues and it takes skill, experience, perseverance and long hours to lead and manage organisations that deliver social impact, meet stakeholder expectations and generate sufficient profit to keep your organisation afloat, and to invest in the necessities of new technologies and innovations. The move to consumer-directed care models in aged and disability services has pushed the sector further towards commercial business models, broadening the range of skills and experience needed to operate effectively.

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Three financial ratios to instantly assess your organisation’s health

When analysing your organisation’s financials it can be easy to get caught up in an array of numbers and hard to know the financial health of your organisation. Key financial ratios can help you focus in on particular financial areas and highlight any potential risks that may be present.

The three ratios below highlight keys areas that all organisations should know and monitor. These three ratios and categories help indicate the financial status of an organisation and can be used to very quickly assess financial health.

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Rebranding? Know before you go

You might think about changing your brand name or logo for many reasons. Perhaps your logo is looking a little tired, or your organisation’s name no longer reflects the value you offer or the market you service.

Changing your brand is exciting – it’s also a lot of work! Executed poorly, a rebrand may have little effect or even worse, send your organisation backwards… Done well, and supported by a solid strategy, renewing or refreshing your brand can be just the trick to drive your mission forward.

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