Business tip 1 – The ‘Danger of Logic’ can stifle creativity

Every great business was once an idea in someone’s mind.

And it’s this continual stream of ideas that keeps a business vibrant and gives it a sustainable competitive advantage.

Too often though you’ll hear people say, “I don’t know what else we could do to improve this business” or “We’ve tried lots of things and found that what we do now is the only way for this business to operate properly.”

Edward De Bono, a world authority on creative thinking, points out the ‘danger of logic’ being that it allows us to justify our current ideas and thereby prevents us from implementing new ones.

Creativity, on the other hand, requires us to step outside our current paradigm and to apply a lateral approach to the thinking process.

The question that everyone running a business needs to ask themselves is – “How open am I to considering ways to improve what my business does?”

And related to that, “What do I do to proactively encourage people within my organization to challenge the status quo and continually seek to improve processes?”

Ideas do not need to be huge to have a big impact. In fact, more often it’s the little things that make a difference.

And that’s why experimentation and innovation are so critical to high performance.

An important closing comment

Creating an environment in which team members’ ideas are encouraged and listened to is not a chant for unconditional empowerment.

At the end of the day, critical decisions must be made by the CEO or by people who have been delegated to make the call.

Mastering the fine line between control and empowerment is probably the most difficult aspect of leadership and management.

Remember that clearly defined processes, responses and systems for approving and implementing ideas reduce the risk of anarchy and alleviate tensions.

The question you should ask yourselves constantly:

Do I encourage my people to challenge the status quo?

Edward De Bono’s ‘Six Thinking Hats’ is a powerful technique for looking at decision making from different perspectives.

It involves six distinct types of thinking, which you can do on your own or with your team. Each thinking style is represented by a different hat:

Blue Hat: organization and planning

Green Hat: creative thinking

Red Hat: feelings and instincts

Yellow Hat: benefits and values

Black Hat: risk assessment

White Hat: information gathering

By “wearing” each of the ‘Six Thinking Hats’ in turn, you can gain a rich understanding of the issues you face – and the best ways forward. You also encourage everyone to be fully involved in the decision-making process.

The green hat is often the hat that’s most fun to wear in thinking hats exercises. It’s the blue sky thinking hat, the hat that has the freedom to be creative and to challenge existing concepts. Innovation and Transformation are well used labels in health and care leadership, but this can clash with a culture of command and control, universality and efficacy. There is risk in trying new things, and so the norm is to implement tried and tested solutions. The green hat can help in two ways. One, it can give a group the freedom to think freely and be creative, testing new ideas and coming up with new solutions. If some of those solutions seem outlandish, why not get the black hat out again to poke holes in it? You might be surprised to see the new idea hold up to scrutiny. Secondly, by challenging existing concepts and thinking, you can reinforce and validate them. All the best ideas stand up to scrutiny, and transparent scrutiny builds trust. People are often wary of implementing best practice from elsewhere, why not use the green hat to explore other options.

Business tip 2 – Performing a ‘Break-even Analysis’ is critical to success

Finding out what sales volume you need to achieve to at least breakeven is critical to managing your business’s success. Breakeven is when profits equal costs, so the business isn’t making a profit or a loss. In other words it is square or breaking even.

Working out your breakeven point is a straight forward exercise once you know your variable and fixed cost figures.

Variable costs are those directly related to your sales levels in dollars or units sold. They include things like materials and supplies, commissions on sales, sales incentives or bonuses for employees and shipping costs.

Fixed costs are those that stay the same no matter what sales volume your business has.

Things like rent, insurance, licenses, wages for permanent employees, interest on loans and operational expenses fall under fixed costs.

To determine your breakeven point, follow these steps:

• Subtract your variable cost per unit from the sale price per unit
• Divide the resulting amount by the sale price per unit to give you a ratio-called your Contribution Margin Ratio
• Now divide your fixed costs by your Contribution Margin Ratio
• The result is the sales volume you need to achieve your breakeven point

This is great information to know. Every business owner needs to know their breakeven point.

Business tip 3 – What motivates YOUR sales force?

If your sales are slow, it may be time to evaluate your sales team and systems.

• Is your sales team motivated by the sell itself?
• Are team members compensated based on amount of sales and value of sale?
• Are salaries low and incentives high?
• Are commissions competitive?
• Do bonuses and commissions reflect a percentage of the value of the sale?

High salaries that aren’t commission-driven are excellent de-motivators.

While the most successful sales people are driven by the sell itself, the challenge and the reward are important to keeping people pumped.

That does not mean that people who are apprehensive about being seen as pushy, annoying or unsolicited will be poor sales people.

With the right systems, these people can overcome their apprehension.

Use your most successful sales person to create and document the system that works best for your business.

Share success stories with your team and offer praise consistently.

“Do not follow where the path may lead. Go instead where there is no path and leave a trail.” Harold R. McAlindon

Business tip 4 – What’s in it for me?

The first basic principle in effective advertising lies in understanding that its true purpose is to get a response.

And to manage these responses you need mechanisms for customers to respond, such as phone, fax or email, and systems to convert those responses, such as a series of questions to help your team identify the respondents’ needs.

And the easier you make it for a potential customer to respond, the better. You can never make it too easy for people to do business with you.

Some ways you can encourage people to respond might be:

“Call now for your free booklet full of hot tips on building a backyard pool!”

• In ads or flyers, include detachable coupons that encourage readers to send in for more information
• Create an enticing offer for the first ‘x’ number that respond to an advertisement (for example, a “Free set of steak knives to the first 25 customers!”)

As to the advertisement itself, remember to write it from the customers’ perspective of “What’s In It For Me?”.

Create a story – some of the most successful advertising campaigns have been those that actually engaged with their readers to paint a picture.

And remember, in advertising your business, focus on the value and the benefits, instead of just the price.

“We run like mad and then we change direction.” Bert Roberts, MCI

Business tip 5 – Calculating the ‘lifetime value’ of a happy customer

Follow this simple process to calculate the lifetime value of a happy customer.

And share the results you get with your team-there’s no better way to impress upon them the importance of loyal customers and the value of customer satisfaction and retention!

1. Identify an average customer of your business – if you serve different market segments, you may want to focus on one to start with and repeat the exercise for the other segments later.
2. Identify the number of sales you’d make to this customer in the lifetime of your relationship with them.
3. Multiply that number by the number of products or services they’d buy in each transaction.
4. Now multiply that result with the average price that customer pays per product or service.
5. From this, subtract the average cost of acquiring a new customer. This gives you the lifetime value to your business of your average customer.

A simple estimator for the cost of acquiring a new customer, in other words the above tells you how much you can spend to acquire a new customer.

Divide your annual marketing and advertising costs by the number of new customers you acquire in one year.

Try this exercise again based on a loyal customer.

Remember, they’ll be more likely to buy from you over a longer period, visit more frequently, and spend more with each visit. Plus they’ll refer other customers to you.

“The only way of finding the limits of the possible is by going beyond them into the impossible.” Arthur C. Clarke

Business tip 6 – Get to the 2025 Global Business Camp

Every business owner and their key people should attend the 2025 Global Business Camp. We will be covering off on all of the above tips and much much more. This event is NOT TO BE MISSED!

Did You Know?

• 88% of business failure is due to things we can control.
• Over 50% of Small to Medium Enterprises (SME’s) have no strategic business plan and 50% will change generation in the next decade.
• It costs 6 times more to get a new customer to deal with you than what it takes to get an existing customer to buy more from you.
• A 15% increase in customer loyalty can increase profitability by up to 80%.
• 80% – 90% of the success of any business ad, letter or communication comes from the heading.
• A fully systemised business is worth up to more than 86.7% more than an unsystemised business.
• The cost of employee turnover is up to 150% of their remuneration package.

Why are some companies able to achieve and sustain success through multiple generations of leaders, across decades and even centuries? At the 2025 Global Business Camp we will be focusing on the above points to give you the best chance of being one of those companies.

Event Date: 24 – 26 February, 2025

Event Location: Crowne Plaza, Surfers Paradise

Find out more and links:

Register Now and pay for the event, OR if you like, take up our amazing instalment offer – you can pay the event off over the next 6 months –

https://www.globalbusinesscamps.com.au/register-now/

Find out what people are saying about our event –

https://www.globalbusinesscamps.com.au/testimonials/

Download the information pack to find out more about the event and read the bio’s of our amazing speakers for the event –

https://globalbusinesscamps.com.au/wp-content/uploads/2024/07/GBC-Brochure-Pre-launch-discount.pdf

Download the Lead Presenter and Guest Speakers brochures to see who is presenting at the Camp –

https://globalbusinesscamps.com.au/wp-content/uploads/2024/07/GBC-2025-Lead-Presenter.pdf

https://globalbusinesscamps.com.au/wp-content/uploads/2024/07/GBC-2025-Key-Note-Speakers.pdf

Referrals are Important to us – please make sure you tell your friends, business associates, family about the 2025 Global Business Camp event.