The importance of succession planning

Recent global events have taken many of us by surprise, reminding us that planning and preparation for the inevitable must be taken into serious consideration. It goes not only for our individual lives but also, and most especially, in business. One of the things that business owners and HR managers must have is a viable succession plan and strategy in place for the longevity and sustainability of the business.

A succession plan helps prepare a business avoid any vacuum within the organisation that may be caused any eventuality. It is by being ready to fill in key positions with the right persons fit for the role. According to Rahul Kale, Director at Sunpower Renewables, “Succession is a layered approach for our business, and I am particularly on the lookout for the key positions that drive our business – Head of Innovation, Head of Strategy, Head of Business Development and Head of Engineering. We tend to hire accordingly for these positions and start right from the hiring process.”

It's not just in the hiring process, but Rahul and his team also look into their internal talents. “There are regular succession planning discussions during our management meetings, and we always have a plan A, B and C in place. I also ask the respective Department Heads to groom their key personnel and do trial runs when they are on holiday. You will be amazed to see what some people can do when you empower them and give them more responsibility. It is important to provide job security to the right people, so they want to groom people and are not threatened by succession planning discussions,” Rahul remarked.

Succession planning also enables entrepreneurs to work on the business rather than in the business, which can allow the enterprise to keep running even in their absence or with minimal supervision from the business owner. With this, Rahul added, “From a leadership perspective, my spouse and I do the same thing and interchange roles regularly. In doing so, you can also see where the company’s systems must be strengthened which then allows good people to work more effectively. We also have a succession plan for the company’s ownership to ensure the longevity of the organisation and brand that we have developed.”

Malcolm Bean, Director at Beanmkrgy, also shared their succession strategy in their company. "We talk to leaders about their departure from the business and how that looks like to them and when. Encouraging them to write a plan to move onto the next thing so we can assist. Often, this results in longer tenure and discovering other opportunities for A-players in the business. Ideally, the leader is part of the plan to build or source out succession individuals into the business as we work on the departure of team members or towards the next thing. As a team, we talk about talent or ‘rare needles in a haystack’ regularly. The point is that talent (opportunity) often presents itself over time, many times when we are not looking. So when we see it, we need to secure them into our business ASAP.”

For Meirav Ambar, Partner at Trendtrade International, it also starts from selecting the right people, whether as team members or third-party providers. Meirav expounded, “No doubt, choose the right partners – first and foremost, your business partners (the best in the world are taken by me!), and then everyone you work with. I do not work with suppliers, customers and service providers. I see all of us as partners, and I choose to work with partners that share the same values and whom I can trust.”

On the other hand, whilst Lauren Staley, Managing Director of Infolio Property Advisors, does not see herself taking a step back from her business anytime soon, she’s already laying the foundations to make her business ready while she’s still determining her next steps. “I’d like to say I’m super clear on this, but frankly, I’m not – currently I am building the rent roll as that is the most saleable part of my business. I’m working on the balance sheet and accounting to make it as clean as possible so that if a buyer did come along, I can be ready. I’m also currently grooming a member of my team to be able to take the driver’s seat for me.  Once I have these ducks firmly in a row, I will have the headspace to think about what next.  I love what I do so it’s hard to see myself out of it, yet,” she explained.

Succession planning is just one way to trouble-proof one’s business. Although we cannot predict and fully prepare for the future, it pays when one takes the necessary steps to lessen any negative impact that an unforeseen circumstance may bring. Have you given a thought to your succession plan? What actions have you taken to make your business future-ready?

Local (Melbourne) leadership quotes for your entrepreneurial journey

Food for thoughts. They are often needed to keep us going, especially in the entrepreneurial journey. And so, we gathered some leadership quotes – either new nuggets of wisdom or familiar motivational pieces you have encountered before – which will help you move forward when things become rough.

Let’s start with some motivational lines that have inspired some of our EO members.

Aaron Smith, Founder of KX Pilates, finds entrepreneur Jim Rohn’s quote something helpful to his journey, which is “Care more about your customers than you do about the money you make from them, and you will be successful.”

On the other hand, Meirav Ambar, Partner at Trendtrade International, learned an important insight from her experience. “There is no such thing as a journey (especially a disruptive one) without failures – both professional and personal failures. As long as you learn from them, you are fine. (I am still working on accepting that.)”

“Be firm, but fair.” Many have probably said this line, but it is something that Lauren Staley, Managing Director of Infolio Property Advisors, has found useful and helpful to her leadership journey.

For Malcolm Bean, Director at Beanmkrgy, he holds on to two guiding statements, both of which pertains more to team composition: "It's all about the people - with the right people on board, you can go anywhere" and  "You get the staff you deserve."

“The secret of leadership is simple: Do what you believe in. Paint a picture of the future. Go there. People will follow.”

- Seth Godin

Rahul Kale, Director at Sunpower Renewables, shares three inspirational quotes. The first one is “The secret of leadership is simple: Do what you believe in. Paint a picture of the future. Go there. People will follow” by Seth Godin. According to Rahul, “leaders that are entrepreneurs must first dare to dream. Yes, this must be backed up with significant and focused action, but they must be willing to create alternate realities that do not currently exist or are relatively uncommon. And for that, they must be dreamers.”

Another quote that keeps him motivated is Barbara Corcoran’s “My best success came on the heels of failures.” Rahul explained why he finds this inspiring, “Invariably, most Leaders in this space are relentless with their focus, discipline, drive, energy and ultimately faith in what they set out to accomplish. I have never met an entrepreneur who has not faced disappointment or failure in his/her career, but they don’t quit. Many have endured those instances multiple times, but they never let it faze them. It is an opportunity to return to the drawing board to re-strategise, examine or change course. It is an area I am proud to be a part of because I witness regularly how we use failure for what it's good for – a teacher to guide you onto your next achievement.”

Lastly, he finds Lisa Haisa’s quote very encouraging: “Great leaders don’t set out to be a leader…. they set out to make a difference. It's never about the role – always about the goal.” Rahul shared, “Our entrepreneurial journey started by wanting to make a difference - to provide energy independence and replace traditional fossil fuel consuming energy generators with clean, green, technically advanced, and economically cheaper renewable energy alternatives.  Today, we have been recognized as one of Australia’s Most Innovative Companies. We wanted to create an alternative for a better future; being a leader just happened along the way.”

Other popular leadership quotes that you might find helpful in your growth as an entrepreneur are as follows:

"Do not follow where the path may lead. Go instead where there is no path and leave a trail."
- Ralph Waldo Emerson

“Before you are a leader, success is all about growing yourself. When you become a leader, success is all about growing others.” —Jack Welch

"To add value to others, one must first value others." - John Maxwell

“A genuine leader is not a searcher for consensus but a moulder of consensus.” - Martin Luther King Jr

"One of the tests of leadership is the ability to recognize a problem before it becomes an emergency." - Arnold Glasow

“A leader takes people where they want to go. A great leader takes people where they don't necessarily want to go, but ought to be.” - Rosalynn Carter

"Leadership is the capacity to translate vision into reality." - Warren G. Bennis

“Innovation distinguishes between a leader and a follower.” - Steve Jobs

“A true leader has the confidence to stand alone, the courage to make tough decisions, and the compassion to listen to the needs of others. He does not set out to be a leader but becomes one by the equality of his actions and the integrity of his intent.” - Douglas MacArthur

“Whenever you see a successful business, someone once made a courageous decision.” - Peter F. Drucker

"The price of greatness is responsibility." - Winston Churchill

“Effective leadership is putting first things first. Effective management is discipline, carrying it out.” - Stephen Covey

The best way to make good use of these quotes is to place your favourite ones somewhere where you can always see them – to remind you every day of why you’re on this path in the first place and push you forward to achieving your goals.

Share with us some of the quotes that have helped you keep going on your entrepreneurial journey.

Dealing with unsavoury reviews of your products or services

Feedback is necessary for improvement, especially in one’s business. While positive reviews are always welcome, one cannot avoid getting unsavoury comments as it is not all the time that customers and clients have happy experiences with a service or product. When this happens, how do you deal with them?

Respond and acknowledge the remark

There may be various reasons behind every negative comment, but the best way to approach it is to face it head-on. Lauren Staley, Managing Director of Infolio Property Advisors, sometimes encounter situations where they receive feedback on issues beyond their scope.

“This is a tricky one and often frustrating as I operate a property advisory and property management firm, so we can get tenants frustrated with something and wanting to express frustrations on Google reviews and it's typically about the landlord or maintenance issues which are mostly out of our control.  My approach is to write back that we acknowledge their frustration, however, suggest that anyone reading the review contact me directly for a more informed and balanced view of the situation,” she stated.

Reach out to the customer

Getting complaints or unfavourable reviews are not uncommon in the hospitality industry where impeccable and quality service is of the utmost standard. Malcolm Bean, Director at Beanmkrgy, a company that is into hospitality consulting and investment, shared what they do whenever they get into this situation.

“We strive to recognise with a response from a senior manager as immediately as possible. The goal is for it to be a real response (not an obvious corporate robot type) addressing the specific issue/s and what the rectification/next steps are (sometimes to call out an untruth, too). I think being candid is appreciated by most. Often the response is a great marketing opportunity to let any reader know we are committed, will take action and also to lengthen the response to talk about our broader offering, too. In the hotel/hospitality industry, our goal is to then have the customer come back again and give them a normal experience. The most loyal customers are those who started as unsatisfied,” Malcolm explained.

Address the concern and resolve the issue

Similarly, Rahul Kale, Director at Sunpower Renewables, believed to tackle the issue as soon as possible by taking the first step in knowing the motive behind the feedback.

“Get in touch with the customer. Understand the reason for their unsavoury comments. Unsavoury feedback is not meant to hurt your ego and make you recoil - it is important feedback that benefits the company to get better, improve and grow. Ignoring the issue or defending your position does not help – instead, address the concern and work with them to resolve the issue. Nine out of ten times this has worked for us,” he remarked.

Learn and understand, then pivot if needed

Oftentimes, receiving feedback from a dissatisfied customer is an opportunity to step back, review your business and see if there’s anything that needs to be changed.

Meirav Ambar, Partner at Trendtrade International, take this as a learning exercise to know more about their customers and have a better look at their services. “It's very hard, especially when you are truly passionate about what you do. But by definition, a brand doesn't target everybody. I take the feedback, sometimes have a one-on-one discussion with that customer to understand more, learn from it and pivot if needed and move on,” Meirav shared.

Take as an opportunity to improve

Some feedback may affect a business positively or adversely. But even negative reviews can be turned into something positive by making improvements in the business.

Aaron Smith, Founder of KX Pilates understands this and makes it a motivation to better the offerings he extends to his target clients. “Productive feedback is the pathway to and necessary for continuous improvement, which is what KX is all about. Look at these reviews as a direct line from your customers on how you can improve, but make sure that this feedback is coming from a customer you want to retain. Remember, the customer is not always right, but the RIGHT customer is always right.”

In all these, discernment is key to taking whatever step you believe suits the negative feedback you receive. As shared by our members above, it is important to know where the comment is coming from and the details or reason behind them. If they are valid and justifiable, waste no time in taking action to lessen any adverse effect it may have on your business. Moreover, open communication can help in turning the situation around and resolving whatever issue was raised. Lastly, take it as a learning experience where you can further develop and improve your business.

If you have a similar experience, share with us below how you managed the situation.

How do you retain good employees?

This is a question that many business owners and managers often ask. It is because having good employees and retaining them are important to running a successful business. There are no easy ways to do it, so we sought the help of some members of EO Melbourne on their experiences and best practices that may also be helpful to other entrepreneurs.

Meirav Ambar, Partner at Trendtrade International, Malcolm Bean, Director at Beanmkrgy Pty Ltd., Rahul Kale, Director at Sunpower Renewables, Aaron Smith, Founder of KX Pilates, and Lauren Staley, Managing Director of Infolio Property Advisors shared some of the things they do on how to keep good employees within their team.

Build a healthy work environment

Looking after the well-being of your team members help in employee retention. For Lauren Staley, what she did is that “I created an office ‘Zen Den’ this is where staff can ‘zen out’, meditate, relax, etc. We also hold nutrition workshops for staff in this space, as well as yoga and mindfulness sessions. We have a masseuse come to the office once a month.” Apart from that they also provide clear feedback on staff performance and quality of work, regular training, and leadership paths.

Create a good corporate culture and path for growth

Culture is paramount in every organisation and it plays a significant role in the longevity of a business. It shapes the work landscape and the dynamics among team members. Aaron Smith shared that it is helpful to “create an amazing culture in an amazing environment through vulnerable and courageous leadership and be flexible with and care for each individual's circumstances. As the owner, it is your job to create a pathway for your employees to develop and grow. Give them ownership whilst providing accountability. And most importantly, have FUN! If people LOVE working for you and your company you'll retain them for the long run.”

Value your good employees

Employees tend to stay longer in an organisation where they feel they are being valued. Rahul Kale stressed the importance of this. “First, you must respect your employees and understand the value they bring to your organization. If you judge a fish on its ability to climb a mountain it will always disappoint you. You must value the individual’s skill set that they bring to the table and empower them to function at their optimal level.”

He added, “I like to ensure that the worthy employees are compensated well, both in terms of monetary benefits and job satisfaction, and give them their space to work. By worthy, I mean those who take on responsibility and like to see things through. Our process starts right from the interview stage where we try and understand the employees’ strengths and weaknesses and then give them the required support, training, and opportunities to excel in their role. Investing in our employees to upskill, train and motivate them is another great employee retention strategy as it works well for both – the employee and the organisation.”

“The company’s culture and policies play an important role in defining the working parameters for your team – once defined, it is important to empower and allow someone the space to do what they do best. I am not a big micromanager and prefer employees who take on the responsibility and accountability to go above and beyond. Understanding each employee’s learning curve and giving them the time to settle in truly do wonders for their self-development and overall team morale,” he iterated. Rahul also quoted Sam Walton wherein, “Outstanding leaders go out of the way to boost the self-esteem of their personnel. If people believe in themselves, it's amazing what they can accomplish.”

Put clear action plans and customise strategies for different employees

Meirav Ambar also discussed some of the strategies she does within her business in keeping good employees. “I do a few things, and of course adapt the strategy according to the specific employee:

1.)    The people we work with are the people we play most time with. While we manage a highly professionally driven environment, we also have a lot of fun.

2.)    Every employee has clear KPIs and a clear action plan which we regularly review. Clear KPIs are important for our sense of accomplishment and value.

3.)    Most importantly, I trust them. I truly believe that micromanagement is the worst form of management and is the main reason ambitious employees leave their place of work.”

Maintain a strong relationship with your employees

On the other hand, what Malcolm Bean usually does is that he "strives to have independent direct relationships with my team members, especially with the A-players, and work on these weekly. Each person is different, and a deep relationship results in a customised or independent career and life plan. Often, people don't leave the job, they leave you because there wasn't true mutual understanding and connection.”

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How about you? What do you do to retain your good employees? Share with us your tips through the comments section below.

Hiring the right person is not enough, then it comes the induction process…

Hiring new staff members is crucial because it takes a lot of time and effort in introducing them to the team and your corporate culture, as well as briefing them on how things are done in our organisation. It’s one thing to have a strong recruitment process where you ensure you select the right candidate and it’s another to successfully bring that person on board to be part of the team. The Induction training puts structure and system in making sure that nothing is missed in the process of onboarding.

Lauren Staley, Managing Director of Infolio Property Advisors, an experienced collective of buyer advocates, vendor advocates & property managers, and Miguel Donnenfield, Co-Founder of Creativa Videos, an animation and video production studio, share how they train new members of the team to make sure that the new hires acquire the necessary knowledge and skills needed for the job.

1.       Have an induction plan or process in place

According to Lauren, the induction training they do in Infolio comes in two parts. “The first one is an overview of the administrative details, while the second part dwells more on the practical side of the business,” she explained.

On the other hand, Creativa has been through different stages when it comes to inducting its new personnel, “which we learned along the way and kept improving,” as Miguel would describe it.

He elaborated, “We ended up with a solid induction process, which never stayed still and was refined every single time. Our tool for the induction process included:

• A plan with the usual steps depending on the role

• An internal comprehensive tasks sheet

• A Learning Management System (LMS) with a series of videos and documents

• Reviewing the "Prism" Behavioural tool and showing them the one from their peers

The LMS had a series of videos that allow the new person to be familiar with the various aspects of the company, such as the company’s purpose, why the company exists, the company’s Values, Vision and Mission, and its corporate culture. It also covered the tools that the company uses, which included emails, internal phone, Slack, and how they are utilised in the organisation. Their LMS also had specific videos depending on the role the new person is taking with options for freelancers and interns.”

“We make sure we follow a process and a checklist for their induction.”

- Lauren Staley, Managing Director of Infolio Property Advisors

2.       Create a task list and training manual

One of the important things that Lauren cited is having a task list for the new hire. “We make sure we follow a process and a checklist for their induction. We spend a whole day completing the induction, which has a task list that requires signing off before they can be handed over for practical on-the-job training. Both the inductee and the inductor have to sign off on each task to say they have adequately explained and understood the learnings.”

Similarly, Miguel stated that the tasks sheet is within their project’s process. “These tasks were grouped depending on the topic. The technical details included were creating a new email account, the signature, giving access to different platforms and accounts and other people's calendars, creating the alarm code, the access code, buying licences, etc. We even had a list of what needs to be done when an employee leaves the company.”

Apart from the checklists, Lauren also finds training manuals as an invaluable tool in the induction training. “Training manuals and checklists for staff are important to ensure they have accountability. But apart from that, they will also feel they have something to lean on when they need assistance before coming to you,” she said.

3.       Spend time with the new member and connect them with other members

“The most import thing I have learnt is to spend ample time with the new staff, ensure they understand the business, ensure they know what resources they have and give them the time to learn properly,” Lauren noted. “We now have our staff spend a morning or afternoon with any of the other teams within the office so that they understand the connection and importance of each role and division within the organisation,” she added.

Meanwhile, Miguel described how the first two weeks of the induction process goes. “We would usually plan a series of internal meetings with different people, going over the content of the LMS videos and explaining them in-depth. Other meetings would include people from the role's team, where we go over more specifically into the role, the position description (PD) and what is expected from the person.”

And it doesn’t end there. “The initial month or so would be in close contact with the person to ensure it is clear what needs to be done. It is also to check how the person feels and how they are adapting to the company culture and the team. Then we will spread out the meetings to a monthly schedule for the initial probation period, which is usually 6 months,” described Miguel.

“From the moment the decision to bring a new person on board is there, you have to start planning.”

- Miguel Donnenfield, Co-Founder of Creativa Videos

4.       Other tips and key learnings

For those without an induction training yet in their organisation, Lauren suggests getting outside help from experts. “If you don’t have a process in your company, find someone who does. Find someone who does it well and get their advice.”

For Miguel, the key is having a concrete plan. “From the moment the decision to bring a new person on board is there, you have to start planning. Ensure that the PD is correct, succinct and doesn't have hundreds of tasks and responsibilities. Sometimes, we divide them into the Main/Most Important Tasks and regular tasks. Start planning right from the beginning where the person will seat, what computer will use, etc. Who will be assigned as the buddy to be there when needed? How much time does this person have? Maybe we need multiple people? Start blocking time on their calendars, even though you might end up moving it once you know when the person will start.”

Let us know some of your best practices when it comes to training your new personnel. Share your tips, too, through the comment section below.