Management | Teik Oh

How to Create a Resilient Business

Dec 15 2015

Whether you are about to start a new business or running an established one, whether you are looking to expand your business or consolidate or even deal with some contraction, whether your business is micro, small, medium or large, whether you hire 100 people or none, at some stage you will want to ensure that your business is resilient.

Resilient from what?

You know, it almost doesn’t matter.

You might want to create a resilience in your business that will shelter you from national or international economic woes; you might want your business to be resilient against loss of key personnel; you might simply want your business to carry on undiminished forever.

Many entrepreneurs start a business by investing themselves, along with their money, into the business because their business is an extension of themselves – and do you not want to be resilient yourself? More than skills, experience or training, a person’s level of resilience will determine if they fail or succeed. Intuitively you know this is true whether you are playing a sport or building a business empire.

In this two part series of articles I will deal with how to create a resilient business. This first part is on identifying the characteristics of a resilient organisation. Part two will be about creating a cultural climate for organisational resilience.

So before we start to create the climate in which your business can become resilient, let’s first identify the characteristics of a resilient organisation. Read More

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Does my small business really need a Board?

Dec 08 2015

Last week I wrote about establishing a governance framework in a family business. If you missed it, look here.

Just to refresh ourselves, the difference between governance and management is that governance is about strategic direction, overall policies, establishing a vision and mission, whereas management is about caring for the operations of the business, the “how’s” of running the business to meet strategic direction and policy.

The decisions correctly made in governance are about the really big things in the business that will affect the long term future of the business.

Appropriately these governance decisions are made by a Board of Directors while the CEO and other managers look after operational management.

In a small business, whether a single owner-manager business, or one with a number of family or unrelated partners, both governance and management decisions are often made by the same people wearing different hats, and more often than not, the decisions are made smoothly and efficiently.

So, why would you need to put a Board in place?

I believe a number of issues make the establishment of a good Board beneficial to your business, at the right time. Read More

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So you manage your family business, but do you govern it?

Dec 01 2015

I’m going to talk about “governance” in this and next week’s posts.

What is “governance”?

Governance and Management are two different things. Managing is what you think it is, where you manage the operations of your business, manage the finances, manage the staff ensuring they are given responsibilities and rewards, manage purchases and sales and quality of product and service. Managing is what gets things done in the business, in the most efficient and productive way, providing the results you want.

Governance on the other hand is about the oversight of the business, not the operations. Governance is about strategically setting the business’ direction, goals, limitation and borders. The best example of the difference I can give you is a practical example of when the business’ founder “gives up the reins.

Imagine the family business where the founder, perhaps the Parent started the business years ago. Typically he or she started on their own, doing everything from sales to purchasing and inventory. In that simple start-up he or she managed the business and the staff of one as well as set direction and decided what the business should and should not do overall. The Parent decided what markets and products they got into and what they would not and why; they started hiring staff and worked out what type of people they would hire and how they should be treated; and, in time, they worked out what were the “right things to do” in the business.

Then, as they expanded the business they brought in family members, sons and daughters, to help in the business. These offspring worked in the business to learn the ropes (even if they might have gone to university or college to learn new and more professional techniques). Eventually, sons and daughters took up management positions, they managed the sales team; or looked after the finances and investments; they hired, fired and fired and trained and rewarded staff; they looked after inventory and production and service.

Then one day the Parent decided to take their hands off the day to day business, while still being involved. The eldest daughter was appointed in charge of the business – they might have given her the title of CEO or MD or General manager, or just “Boss”.

At this point the governance of the business and the management of the business diverged. The Parent represents “governance” while the children are “managers”.

And the difference?

Can you imagine what would happen if eldest daughter decided to hire cheap labour against the business values of quality staff and quality rewards? Or decided to buy cheaper materials from overseas when the business had always worked on supporting local quality suppliers? Or how about if she decided to branch out from selling hand-crafted toys to cheap plastic toys? Read More

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Category - Management

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How to Create a Resilient Business

Does my small business really need a Board?

So you manage your family business, but do you govern it?