Podcast transcript
Velvet-Belle Templeman
Welcome to Boardroom.Media. My name is Velvet-Belle Templeman and I'm here talking to Tony Markwell, National Managing Partner of Private Advisory at Grant Thornton. Tony is an expert on family owned and owner managed business issues. Today we'll be talking about the light at the end of the Covid-19 tunnel and how we can harness culture and innovation to do things differently in the new normal. Thanks so much for joining us, Tony.
Tony Markwell
Thank you for having me.
Velvet-Belle Templeman
Now Tony, first off, there's a tension between government policies to ensure the health of the community such as restricting mass gatherings and some businesses and supporting the economy, including stimulus to employers to encourage them to keep workers and their doors open over the next coming months. In some cases we've seen how these policies inadvertently counteract each other. It's a difficult time for employers, their people, and the wider community. So, Tony, you've been talking a lot to your clients around the country, most of them family owned and owner managed businesses, what are you hearing from them?
Tony Markwell
I'm hearing a lot of interesting messages and bear in mind, this is interesting because we've got 4,500 business clients that we've been talking to; myself, I've got about 300. These customers and clients are telling us that what they're experiencing now is unprecedented. And what we're seeing of course is a health crisis that's having an economic flow on in the restrictions. So our clients are really into uncharted territory and what they’re finding is for the first time in a long time, they've got to make a complete evaluation of their business and decide what's really important to them right now and what's important to them when the recovery comes and the restrictions are lifted.
And what I find they’re telling us more often is it the first time in a long time they're really looking at what the assets of their business are and their people are one of their number one assets. A lot of our clients have invested heavily as good organisations do, in training and building a really good group of people to work at their organisation and this culture and the people that they've built up, that's what they're really valuing and that's what they’re really keen to protect to make sure they make it through to the other side.
Velvet-Belle Templeman
Now Tony, you mentioned culture. I'd like to explore this a little bit more. How important is good culture at times like this and what does it look like?
Tony Markwell
So I think a really good way to explain culture is the feeling that the organisation has and everyone in the organisation feels when they work there and very often the culture of an organisation extends out to their service. Most people who deal with an organisation will have an inkling of what the culture is like by the service they receive. So a good culture is really important in a lot of ways at the moment and I'll just explore two of them at the moment. One of them is you're going to need a lot from your people and you're going to need support from your people and they're going to need support from you. So having an open and honest, transparent culture where you can discuss where you’re going with your business plans and what you need to do together is really important.
So people who run a business that have a great culture of transparency and communication, they’re going to be the ones who are going to be able to adapt very quickly internally. The second big importance about culture is it actually drives that client experience. So the ones who are able to reach out to their customers or clients and actually make sure that their customers and clients are getting the extra support from them to get through are the ones who are going to be able to recover quickly. So internally and externally, culture is incredibly important to the organisation.
Velvet-Belle Templeman
So Tony, as you say, people really are at the heart of businesses. So what can business owners do to support their people during such a difficult time?
Tony Markwell
Okay. So there's a lot in that question because people in organisations are looking to be led by strong leadership during a difficult time. So what businesses can do, I think fundamentally is assure their people that the business has a plan, because a lot of people will be looking up going, am I worried that my employment this week, next week, am I worried about whether the organisation can withstand this disruption? So the first thing business leaders can do is really get a good plan, have it tested, and then make sure their people understand there is a plan, there is a strategy that the people who lead the business are in control of that business. And on the other side, they've got a plan to get people across. That's such an important part is to assure people that they don't need to feel afraid because you're going to want, as I said before, you're going to want people to do a lot during this time.
You might be, for example, wanting them to work extra hours, but you might not be able to pay. You might want them into do extra things to reach out to customers and ensure customers that you're going to be there at the other side and you might have problems being able to afford all of that right now. You're going to get them to lead their teams underneath them. Remember most of the people in organisations might have a team they lead so they're going to need to lead their teams. So you need your leaders in your organisation to be strong and confident as well. So really the big thing I think business owners need to do is lead during this. The worst thing they can do is let the people feel unconfident, nervous, uninspired, or lacking direction. So business leaders, this is the time to step up.
Velvet-Belle Templeman
Now Tony, counterbalancing this, business owners are also responsible for the health of the business. Many are reacting and are focussed on immediate impacts. What's your advice to business owners at this time?
Tony Markwell
I think you need to have a short, medium and long term view of everything you're doing. There's nothing wrong with understanding that there's immediate impacts right now you need to deal with. And you will have those impacts whatever they are in your organisation. You might be someone who’s experienced a revenue drop. You might be someone who's experiencing, people can't come to work. You might be having custom to change the way you're doing business. There could be immediate impacts to what you're doing now. I'll come back to that later, in changing the way we do business.
But what you’ve got to do is also take a medium and long term view and not wreck your business in such a way that you can't grow out of this at the other side in a rapid pace. You might find that restrictions could be lifted slowly, gradually or quickly. And therefore, how quickly can your business gear up at the other side, if there's pent up demand, you know is waiting for your product or service at the end, how do you make sure you can grab hold of that when you need to and not let your competitors get it. So the short, medium, long term view is what needs to be considered when you're looking at the immediate things you need to deal with now.
Velvet-Belle Templeman
I understand you're hearing from businesses that are doing things differently, pivoting what they do and how they do it in response to these challenging times.
Tony Markwell
Yes. What I'm hearing is that people are being very innovative. Even today I would have used a number of different platforms to connect with people. Skype, Zoom, Microsoft meetings, all these extra technologies that people are using to adapt to carry on with their business. And I'm also seeing even our own organisation, a lot of WhatsApp messages and subgroups going on to help people stay committed and connected. But also, in addition to that technology, a lot of businesses are having time to evaluate how they actually do their business and they might be thinking that some of the things they’ve done before might not be the way to go forward. So it's a good time for you to actually evaluate your business model. And if you were afraid that some things weren't really delivering the results, but you always did it that way, now's a good time to evaluate that and think about what you might do differently.
We're all going to be practising and trading in a new normal for a number of weeks, or however long this lasts. So the businesses that adapt fastest and innovate fastest are the ones who are going to survive. Also, I've heard it said quite a few times by clients they’ve found that their people are very heavily engaged when they've got a good plan in front of them and they're very quick to innovate and they're saying, gee, if only we can capture this innovation and keep that feeling when we're back to normal, we're going to be such a different organisation on the other side.
Velvet-Belle Templeman
So clearly agility and the ability to remain fluid is key right now. You mentioned innovation. How can businesses innovate when it comes to their customer base?
Tony Markwell
I think a lot of businesses do business with people that they've traditionally done business with and they haven't actually paused and said, is that the right customer base I really should have? Or the other question, am I doing enough to make sure that customer stays loyal to me and doesn't go elsewhere or are there things I'm not doing that customers would really value or are there things I'm doing that the customers don't value? So I think people who actually sit down and first of all, evaluate your customer base and decide whether they're the customers that will take you forward or are going to struggle. They're the ones who are going to be very successful and if you find you've got a customer base that you really shouldn't have is now the time to go and chase the customer base that you need to have and bear in mind your competitors might be a bit slow to move to shore up their customer base.
The second thing I think that people who are running good businesses now are doing is how do I value add to my customers now so they'll stay loyal. How do I make sure that I'm part of their recovery and that I'm helping them get through this? So it could be, and we are all having to deal with cashflow and liquidity problems. Am I doing enough to really support that customer in terms of payment terms? Am I doing enough to support them in terms of innovation? Is there value add or I could do to our relationship to make sure that they know that I'm part of their business and I'll be there for the recovery with them.
Velvet-Belle Templeman
Some great advice. Now, Tony, what's your take on the next six to 12 months? Is there a light at the end of this tunnel and when will we see it?
Tony Markwell
The when will we see it? That's the question I'd like everyone to answer for me. There clearly will be a light at the end of the tunnel. There clearly is another side to this and there clearly will be pent up demand for customers and services and products. The question is how long is that and how do we get there and make sure we're in the best shape when we get there? That's the question for business owners. I think the recovery might go three weeks, six or nine or 12 then that'll make me make some decisions now about how quickly I can recover. I think the thing that people need to be thinking about is, yes, there will be a recovery, the question is have you got recovery plans so you can gear back up to take advantage and react quickly.
We've been very quick on the slow down, it's been very quick and taken people by surprise. If suddenly we find that there's a lift in restrictions and business starts flowing, how do you make sure you're ready to ramp it back up? One of my clients said it really well this morning, he said, “At the moment I've got people in my organisation, it feels like they're on ice. I've got them trained.” And in fact in his case he's training them heavily during this time because he feels this is the time to get them across some of the training platforms he hasn’t been able to get across because people have been busy. He's got time to train his people. He wants to be able to unleash them as soon as we can and that's what he's doing. He's saying the real weakness I have is in this area. I'm going to train these people now. So when the recovery comes, I'm ready to go. And I think it's a really, when I hear people talk about that, I think that is the way to approach this. Which parts of my business do I need to protect? Which parts do I need to change? And how do I get going again?
Velvet-Belle Templeman
Tony, thank you for your time.
Tony Markwell
Thank you very much.
