This week I was at the ‘Growth Summit’ in Sydney. I got to spend some time with arguably the best business writer over the last 30 years. Tom Peters. His first book “In Search of Excellence” sold 3 million copies in the first 4 years. Now on book 16 and 2500 speeches he is still going strong at 68.

What’s interesting about Tom is he doesn’t have any original ideas. He will tell you he does not either. All he does all day is tell stories to make a point. He is telling example after example after fact after fact on what is going on in the world – and all the stupid management decisions that are made.

It was a fascinating way to spend a day. He is also moving to NZ soon as well. My favourite quote:

“The bottleneck is at the top of the bottle”

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In another life I was the new GM of a company that just came out of a failed merger. The company had a loss of $340K versus profit the year prior of $1M. It had debt of $1.1M versus year prior of cash in bank. It had revenue of $3.4M versus $4.5M the year prior. A Complete mess.

My job was to turn it around and make it work. The upshot of 15 months work was:

  1. Profit went from $340K loss to $2.5M profit
  2. Revenue went from $3.4M to $6.7M
  3. Debt paid back in full
  4. Business got sold for many millions of dollars

Here’s what I did to turn it around.

  1. The general manager (me) was on very attractive incentive program
  2. We contained the cash outflow – put the cheque book in the draw
  3. all expenses scrutinised and reduced
  4. strict budget & cashflow – measured daily then weekly
  5. worked out what to stop doing, continue doing & start doing
  6. writing project plan of 149 initiatives – shared responsibility
  7. relocated the business – a breakthrough happens after a breakwith!
  8. hired above average people – total team of 17 FTE’s
  9. position descriptions, performance standards & career development process implemented
  10. non financial incentive programs implemented
  11. created a fun and success driven environment – people wanted to come to work
  12. involved team on decisions and shared all of the KPI’s
  13. increased training budget to 7.5% of salaries
  14. set up management structure with weekly “soft” & “hard” reporting
  15. hired a sales team with clear focus – sell
  16. invested heavily in IT to reduce downtime and speed up processes
  17. wrote extensive systems on “the way we do it here”
  18. increased client numbers by 11% with marketing initiatives
  19. increased price of one major product line by 36%
  20. created new product – responsible for $1m rev & $400k profit

I learned that a successful turnaround can happen if you have a plan, your are focussed, disciplined and the work you do is in the right area.

Recently a number of accounting firms have been telling us that they will run out of work this year. This is a good thing. So that you can fill the capacity you should do this with every client on every job – every year.

When you are doing the work for the client have your Accountants (or you) answer these 5 questions about the job they are working on:

1. What ideas do you have to help this client grow revenue or wealth?

2. What ideas do you have to help this client increase their profit?

3. What ideas do you have to help this client understand and improve their cashflow?

4. What ideas do you have to help this client protect their assets?

5. What ides do you have to help this client with succession planning or selling their business?

Add these 5 questions to your reveiw process, train your accountants what to look for, come up with some ideas and then take the ideas to every client. I did this exercise last week with a group of accountants (they brought 15 random client files to the training) and everyone of them (teams of 3) came up with ideas that once implemented would:

A) Get a great result for the client

B) Increase the average fee per client by about 50%

Think about your clients when doing the work – and then take the ideas to the client.

If that fails then ask every existing client for a referral.