Business Innovation for SMEs

Gail MCEvoyinnovation

Following on from earlier blogs on SMEs,family business , exporting and entrepreneurship which can be viewed at the following attached link this latest blog is around innovation .

Thanks to the contributors to this blog namely Gail McEvoy CPA of McEvoy Accountants and recently appointed board member of IFAC.

IFAC is the worldwide organisation for the accountancy profession and comprises 173 members and associates across 129 countries.

Also thanks to John Mackey of Bibby Financial Services Ireland Ltd.

99% of all enterprises in Ireland are Irish owned SMEs which employ 70% of all people working in the state. Latest reports show that more than half of the people working in Ireland – some 56% work for indigenous companies which do not export anything at all .

More than 90% of people in Ireland work for a company that employs fewer than 10 people.

A lot of SME owners are already innovative and are constantly brainstorming to improve their business and processes and doing SWOT analysis regularly. From working with SME owners in the business advisory piece sometimes it is trying to implement the ideas that becomes the challenging part .

How do you create an innovative environment in your SME?

While I can’t prescribe how to make your SME innovative, these tips can help you breed a culture that contains innovation in its DNA:

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1. Innovation only comes by invitation. Invite people to bring forth their new ideas. True innovation takes place when people are free to raise ideas, take ownership of them, and then implement them. If people are required to ask permission for every step they take, they will stop asking permission.

2. Innovation is not a solo sport, it requires a group of players with skills specific to the effort. While an idea may come from one individual, it’s the cross-functional creativity, trust, and collaboration that bring innovation to life.

3. Encourage everyone to put their ideas to test fast, fail fast, and then reiterate. If people wait for perfection before they put the idea to work, the effort will lose steam before it ever gets off the ground. Implementation of ideas is as important as the idea itself .

4. Value the lessons taken from failure as much as your successes, and apply those lessons toward each new attempt. This makes it safe for everyone to innovate. The idea is not to encourage failure but to foster innovation that leads to winning success as rapidly as possible. A lot of SME owners have taken their knocks in the ups and downs of business which makes entrepreneurs more resilient .

5. Ensure this behaviour gets modelled at every level, from the very top down to individual contributor. That means the senior management must be actively involved, not just mandating the change.

6. Consult with your CPA and build innovation into your business plans for 2014/15 and look at doing things differently so you have a USP in your business. Do a review with your CPA and discuss your goals for your business and build them into your business plan and cashflows .

Cormac Fitzgerald FCPA

Entrepreneurship Report Published

Sean-O-Sullivan

The Report of the Entrepreneurship Forum was published January 23rd. The Forum was established as part of the Government’s Action Plan for Jobs 2013. Two thirds of all new jobs come from start-up businesses in the first five years of their existence. 69 recommendations have been put forward by the Forum. It is chaired by Kinsale based entrepreneur Sean O Sullivan of SOS Ventures.

These recommendations occur across four dimensions:culture, community,competency and capacity.

Included in the Report’s recommendations are:

Changes to law to support employee stock option programmes
• A national education strategy for entrepreneurship at all levels of the education system
• A mentoring network driven by entrepreneurs and tax incentives for investment in enterprise

How to unlock creative confidence:

Is your workplace divided into “creatives” versus practical people? If so, some inspiration from David Kelley, founder of IDEO. What matters to him is unlocking the creative potential of people and organizations to innovate routinely and let ideas fly. David Kelley suggests, creativity is not the domain of only a chosen few.

Telling stories from his legendary design career and his own life, he offers ways to build the confidence to create, to innovate (From The Design Studio session at TED2012.)

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Thinking outside the box – Innovation for SMEs

Innovation is the application of better solutions that meet new or existing requirements. This is accomplished through more effective products, processes, services, technologies, or ideas that are readily available. An excellent example of innovation would be the “sliced pan”, slicing bread was innovative as it was doing something different, adding a process that had a significant impact.

How do we as SME owners and Entrepreneurs become more innovative?

Innovation has to be the Ethos of the business, the ideal. It forms part of the values culture of the business, how the business operates and its conduct in relationships. Innovation must form part of your overall strategy. Examine your current strategic plan and see if innovation is at the cornerstone.

This culture cannot be switched on and off it must be encouraged and nurtured amongst all team members. As with all things in business this comes from the top down, as leader you must encourage your team to share observations and ideas and not to be afraid. Everyone needs to be on board with this, they need to have a “why not” attitude to ideas and new processes, to be constantly looking to improve and innovate. Some ideas to get that innovative attitude started;

• SWOT testing on a regular basis to include breaking down the existing processes taking a microscope to them looking for weaknesses and potential add-ons.
• Look at an “ideal scenario” – asking if money were not an issue what would we do?
• Include an “innovation” item on the agenda to every team meeting, encouraging all participation. This brainstorming with your team will help develop and encourage an open door approach to new ideas and new processes.
• Encourage everyone to be more observant of the competition, this will form the basis for new ideas. Also watch what businesses aligned to your own are doing, asking can we do something similar?
• Make it interesting, offer a prize to the individual whose ideas are implemented and also a special prize to whoever submits “the ridiculous” suggestion, this will encourage an open door approach to every idea.
• Look at what your customers would like, what would make their lives simpler? Asking clients/customers for ideas and suggestions. It might pay to reward these too.
• Market research can be very useful, asking the general public will give an unbiased perspective.
To stand out and to survive we need to innovate and we cannot do this alone. We need everyone on board and keeping an open mind is the key. Being fearless, not afraid of change is the attitude that will nurture and encourage an innovative attitude.

Gail McEvoy

MCEVOYACCOUNTANTS
10 Dublin Road, Drogheda, Co. Louth

Tel: +353 (41) 98 10 160

gail@mcevoyaccountants.ie
http://www.mcevoyaccountants.ie

Tips to give you the best start to the year that will help nurture an innovative culture in your business this year.

John Mackey, Bibby Financial Services Ireland

Bibby Financial Services logo - JPG

Conduct a review of 2013 and the cost of credit. Review what worked well over the past year for the business and what did not – did extending credit terms to customers or taking advantage of economies of scale reap the benefits it hoped to? What were the financial implications and were they worthwhile? Learn from mistakes -by looking at the successes and failures over the past year you will be in a far better position to plan effectively for 2014.

Encourage strategy – Many SMEs fail to see the importance of strategising and planning for the year ahead, including contingency planning, crucial in the current environment. The business will need to start by reviewing their objectives, or in many cases, construct for the first time. You need to prioritise everything you want to achieve in the coming year and work out the financial requirements involved in doing so; the business may be over or indeed under estimating what they can afford to do.

Seek new ways of financing – Be open to considering new and alternative ways to finance the business as traditional methods may not always suit the current circumstances.

New Technology – Explore and embrace new forms of technology in your everyday business systems that will bring efficiencies to the business and in some cases cut costs.

Consider new opportunities – Take the time to research new business opportunities. With clear minds after the business break, a brainstorming session with your internal teams may inspire ideas that could help move the business forward through developing new products and services, new customers and new markets. Educate yourself on the various finance options available– what worked or was available last year may not be the same for the year ahead. Look beyond the traditional finance options to more readily available alternative funding solutions which can provide additional benefits to traditional financing – Invoice finance for example, guarantees SMEs working business to business and billing in arrears a flexible and on-going supply of working capital

Explore potential for exporting – Irish exports remain the backbone of our economy and increasing numbers of our SMEs are reaping the rewards of their export activity. Yet entering overseas markets is still a minefield for many businesses. Variances in legal practices, lacking on the ground assistance, language barriers, foreign currency management and fluctuating exchange rates are key difficulties that Irish businesses face when considering exporting abroad. However, comprehensive credit management facilities with multi-lingual and culture experienced credit control teams can help SMEs overcome these issues and allow them to export with confidence that their cash flow requirements will be met and customer payments chased and collected on their behalf.

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Take control – Get a detailed view of the debtor days in the last year – is late payment an issue for the entire ledger or is there a number of repeat offenders who are causing problems? Every customer is vital to an SME, but some late payers could be causing more problems than they are worth – it is vital the business separate the wheat from the chaff, both for the current term and for the long term. Work with your CPA accountant to develop watertight debtor management systems, including their issuing regular statements and reminder invoices and calling customers if payment is late.

Harness people power – Assess staffing levels for the coming year and ensure staff holidays or peak season demand is accounted for – will extra staff be needed for these periods? How much over time from current staff will be required? At what cost? Or perhaps skills gaps within your workforce are holding them back?

Manage the cash – No matter how well inspired, prepared and organised, good cash flow is the lifeblood of any business. Make sure you take a pro-active approach to managing cash flow and aren’t waiting until it is too late to deal with problems. There are support mechanisms out there ready and willing to help and their doors are wide open for business.

Tel: +353 (1) 2974925 | Fax: +353 (1) 436 4598
Email: JMackey@bibbyfinancialservices.com | Web: http://www.bibbyfinancialservices.ie
Address: 4th Floor, Heather House, Heather Road, Sandyford, Dublin 18, Ireland

Thanks for reading !

Cormac Fitzgerald

Cormac Fitzgerald FCPACormac Fitzgerald FCPA is Managing Partner of Fitzgerald & Partners Accountancy Firm and Vice President of CPA Ireland .

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Entrepreneurs & SME Toolkit -Part Four

This month, I have asked some successful entrepreneurs to share their knowledge to help SME start ups and people considering starting their own business .This is the final part of this series . entrepreneur text

In our first post we had some interesting insights from Jorge L. Rodriguez, President & CEO of PACIV.

In our second post we had excellent tips by Joe Aherne – President CPA Ireland and Chairman of Leading Edge Group

In our third post we had advice about starting a new business by John White FCPA ,Managing Director of JBW Consultants

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Please find enclosed some start up tips for businesses in a start-up phase, that might be of interest :

  • To succeed entrepreneurs must experiment, be resourceful and maximise every situation in a very targeted way.
  • Recognise that the secrets of business are translating ideas and concepts and putting them in to action.
  • It is the hard, often boring work of putting an idea in to action that makes all the difference.
  • Young entrepreneurs often find the task of getting money in the door or finance raising to be very difficult. Finance raising is actually a well-defined process and it’s just like sales.
  • Question those decisions that involve money to avoid making bad investments . Consult with your CPA as your trusted advisor .
  • When running a business, follow the simple mantra and make sure you have more money coming in than you’re spending.
  • To compete for and retain talent, you must understand why people come to work for your business.  Leaders of SME businesses face a challenge in attracting and competing for human capital when it comes to pay, compensation and career track. It can give employees a good small business training however.
  • Trust your instincts when hiring .  A candidate may have a technical savvy but if his or her personality isn’t a fit, it may not work out.
  • Because people are interested in other people, use some human interest stories as a cost effective way to build your brand.  Small companies can become household names by grabbing opportunities and becoming arch rivals of their competitors.
  • Entrepreneurs turn obstacles and threats in to advantages.
  • As an entrepreneur one of the greatest challenges may be to steer a ship in troubled waters.  If so, don’t panic.
  • To succeed, entrepreneurs must not expand until the business can handle that expansion.
  • You’ll have a better chance of being good at what you do if you find joy in it.

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I hope you find this useful and thanks to all contributors for taking time to share their intellectual property online .

Cormac Fitzgerald - Fitzgerald & Partners

Cormac Fitzgerald FCPA is Managing Partner of Fitzgerald & Partners Accountancy Firm and Vice President of CPA Ireland .

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Jeremy Hayes – University College Cork  

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Many people say that entrepreneurs are born, not made.  I would agree with that sentiment to an extent, but I am also reminded of a quote from Hugh Mcleod that says “Entrepreneurship cannot be taught, but it can be unleashed”. In this part of the blog, I want to talk about a toolkit that entrepreneurs can use to unleash innovation in relation to their business models.

Alex Osterwalder (the leading figure in thinking on business model innovation) defines a business model as how a firm organises itself to create, capture and deliver value. He developed the Business Model Canvas (see Figure 1) which is a widely adopted tool that entrepreneurs can use to describe their existing business model and to brainstorm and innovate new business models.

Figure 1: The Business Model Canvas (www.businessmodelgeneration.com)

Business Modelling

From working with many companies, and facilitating workshops on business model innovation for them, I have found that the business model canvas can help people to think about their business models in a radically different way.

Too often, entrepreneurs can be focused on a much too narrow range of indicators – e.g. revenue, costs or technology performance. Of course, all these things are important, but there are many other aspects to the business model of an organisation that also must be addressed. Entrepreneurs need to start thinking about their business models in a holistic fashion.

Starting at the right hand side of the canvas, we have our customers. These are the users (or segments of users) that we offer value to. So, for example, a mobile network operator may have business customers as well as residential ones. The next most important block is the ‘value proposition’. This is the product or service offering (or bundle of products/services) that we make to our customer. Mark W. Johnson refers to this as the jobs-to-be-done, the offering that you make to your customer (or potential customer).

The ‘channels’ are how you reach your customer. This encompasses the physical or virtual channel by which you deliver value to your customer (anything from a high street shop to a website or even a mobile network or electricity grid). Channels also cover the ‘how’ you get your message to your customer i.e. your marketing channels (radio or print, TV or Social Media). The relationship box refers to the relationship that you have with your customers. This covers things such as; loyalty, trust, as well as the user experience (UX) that our customer segments have when engaging with the value proposition.

If you get these 4 boxes in that canvas to work like clockwork, then revenue will flow back to you. In order to deliver the value proposition to the customer segments, through the channels with good relationships, there are some issues we need to deal with on the left hand side of the canvas.

Key resources are the things we need to have in order to deliver this value. These include tangible and intangible resources (e.g. buildings, equipment, intellectual property or staff, as well as other resources depending on the nature of the business). The key activities are the things we need to perform in order to deliver the value. These could encompass activities like R&D, manufacturing, marketing etc. The partner network box recognises that businesses may not be able to form all of the activities required to deliver value in-house, and that we may need to partner up in order to deliver value. Activities that may be outsourced to a partner can include, but are not limited to, logistics, manufacturing, legal etc.

Finally, all of these things (resources, activities and partnership agreements) are costs to the business and are represented as part of the cost structure box in the canvas. Hopefully the revenues will exceed these costs and our business model will be sustainable.

Once the existing business model canvas for the firm has been created, the next phase is to carry out a detailed SWOT analysis on the existing business model to assess its strengths, weaknesses, opportunities and threats so as to identify areas where the business model can be improved in the future.

It is recommended that organisations engage in a process of continuous business model innovation so that they can continue to create new value for customers and prevent themselves from being ‘netflixed’ (i.e. replaced by a disruptive innovation in the marketplace.

Jeremy Hayes is a lecturer in Business Information Systems in UCC. He teaches Business Model Innovation on the Irish Management Institute Diplomas in Cloud Strategy and Data Business and has extensive experience working with firms to help them to innovate their business models.email: j.hayes@ucc.ie or phone 021 4903821

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Entrepreneurs & SME Toolkit -Part Three

EntrepreneurshipThis month, I have asked some successful entrepreneurs to share their knowledge to help SME start ups and people considering starting their own business .

Each week I will publish a different perspective from some valuable contributors .

In our first week we had a really interesting post by Jorge Rodriguez CEO & President of PACIV.

Last week we had a post about exporting by Joe Aherne CEO of Leading Edge Group and President of CPA Ireland .

I hope you find this useful and thanks to all contributors for taking time to share their intellectual property online .

Cormac Fitzgerald - Fitzgerald & PartnersCormac Fitzgerald FCPA is Managing Partner of Fitzgerald & Partners Accountancy Firm and Vice President of CPA Ireland .

 

John White FCPA ,Managing Director of JBW Consultants – on starting a new business .

Planning Starting a new business is simple – You just have to sell something to someone for profit!

Or at least that’s what most fledgling entrepreneurs’ initial thoughts would seem to be.  But when you break down those three “simple” activities into smaller pieces by asking the: “Who?; What?; Where?; When?; Why? and How?” questions, for each activity, you begin to see that planning your business start-up is actually the key.  Get out a pen and paper (or whatever device you prefer) and write down how you are going to “sell something to someone for profit!”.

You know what the business idea is, but what about getting if from an idea to the stage where you get to keep the profit?  Consider your customers, location, competitors, finance, human resource, suppliers, logistics, technology, capital investment, taxation, legal issues and ownership structure.  You’ll be surprised by what you don’t know.  Identify your weaknesses before you start your business and decide how you are going to cover those weaknesses.

People don’t think you know it all – because you don’t!  Surround yourself with experienced people that understand you and your idea and are not afraid to guide you with critical analysis.  Listen to what your “advisors” have to say; consider what they have said and then decide to either ignore their suggestions,  act on their suggestions or explore their suggestions a bit further.

Experienced entrepreneurs got their experience by making mistakes along the way.  By not repeating their mistakes your business will get a head start.

Seek out professional and experienced advisors that you can work with and who have a track record with your industry.  Ask them about their experience.

With staff, don’t waste time trying to bring on the weak employees.  Move on with finding the right people for the right roles.  When recruiting staff, give a weighting to the hunger they show for your business and for their own career development.  This is more important that picking the genius, because a start-up needs dynamic and enthusiastic team to do what is needed to be done, not just what they were asked to do!

Profit find out what financial assistance is available to assist start-up businesses in your area.  Governments want start-up to flourish as they have the potential to employ people who pay taxes and spend their wages!  The first three years of any start-up are critical.

You have to invest significantly in Capital and Marketing without any certainty of a return on your investment.  If you can find financial support to get you over the initial years this will be invaluable to the sustainability of your new business.

Don’t strip all of the profit out of the business for yourself.  As a rough guide (depending on the sector you are in and the level of borrowings you have) try to aim to leave 4% of your turnover in the business each year.  This is needed to support growth and to finance your working capital needs while growing your business.  But don’t be totally distracted by profit.  The real lifeline of a business is cash flow.  Make sure you have full sight of and control of your business’ cash flows.

John White- JBW ConsultantsJohn White, FCPA is the Managing Director of JBW Consultants ( www.jbw.ie ) , a multi-disciplined professional services firm which specialises in support for SME and family businesses.  John also serves and a non-executive directors on a number of internationally trading companies.

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Entrepreneurs & SME Toolkit -Part Two

Innovation

This month, I have asked some successful entrepreneurs to share their knowledge to help SME start ups and people considering starting their own business .

Each week I will publish a different perspective from some valuable contributors .

Last week we had a really interesting post by Jorge Rodriguez CEO & President of PACIV.

I hope you find this useful and thanks to all contributors for taking time to share their intellectual property online .

Cormac Fitzgerald FCPACormac Fitzgerald FCPA is Managing Partner of Fitzgerald & Partners Accountancy Firm and Vice President of CPA Ireland .

 

 

 

Joe Aherne – President CPA Ireland and Chairman of Leading Edge Group

joe Aherne

6 Tips for SME’s entering a new Export Market:

  1. Identify the market most suitable for your products in relation to market potential, ease of access, language and cultural barriers
  2. Engage with Enterprise Ireland and discover other Irish companies exporting to that market. Meet with these companies and gather market intelligence and conduct a competitor analysis.
  3. Build a solid client contact base with potential clients and strategic partners in the market place by for example using social media tools such as LinkedIn; targeting subsidiaries of existing Irish clients and by procuring data mail lists for targeted sales campaigns. Build relationships and secure appointments for future visits.
  4. Visit the export country as part of an Enterprise Ireland Trade Mission
  5. Initiate a 6-month online marketing campaign to adequately test market and set pre-defined sales targets
  6. Visit market regularly to monitor and track progress

Joe Aherne, FCPA

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CEO Leading Edge Group, Charter House, Cobh, Co. Cork, Ireland.

Leading Edge Group – Ireland, Canada, UK and Australia www.leadingedgegroup.com

Want to find that business idea? Get started? Looking for some inspiration? I Saw this great clip Entrepreneurs can change the World… which was part of a presentation by Gerard O Donovan , Head of School of Business ,CIT ,Cork .

CIT

CPA Ireland – Supporting Entrepreneurs .

Finally, CPA Ireland launched its new look website this summer and it has lots of helpful, freely available resources aimed at the Irish business community.

You may be familiar with the CPA Ireland’s  excellent report on entrepreneurship, released late last year . It makes for very interesting reading with some proactive recommendations for much needed support in this area.

The CPA Ireland Business App , the CPA Business Tracker is worth checking out and available to download for free directly from the website. It allows businesses to input key finances and automatically calculates financial ratios to measure their company’s performance.

Entrepreneurs & SME Toolkit for business-Part One

John Herlihy -Head of Google Ireland

John Herlihy , head of Google Ireland with Eamonn Siggins CEO CPA Ireland and Joe Aherne President CPA Ireland

This month, I have asked some successful entrepreneurs to share their knowledge to help SME start ups and people considering starting their own business .

Each week I will publish a different perspective from some valuable contributors .

I hope you find this useful and thanks to all contributors for taking time to share their intellectual property online .

This link might be useful to you  ( http://cpa.newsweaver.ie/conferences/1gwgawc5kbn – a link to the CPA Ireland Budget Bulletin )

Cormac Fitzgerald - Fitzgerald & PartnersCormac Fitzgerald FCPA is Managing Partner of Fitzgerald & Partners Accountancy Firm and Vice President of CPA Ireland .

 

Guest speaker at this year’s Institute of Certified Public Accountants in Ireland’s Annual President’s Dinner was John Herlihy, Vice President of International SMB Sales and Operations and Head of Google in Ireland (L), pictured here with Eamonn Siggins, CEO CPA Ireland and Joe Aherne, CPA Ireland President.

John’s address was very insightful and gave those in attendance much ‘pause for thought’ in terms of the accountant’s role as strategic business advisor in helping our client companies take advantage of the digital opportunity. As the National Digital Strategy for Ireland reveals, digital currently contributes 4.4% to Ireland’s GDP. The digital part of the economy in Ireland is growing at 16% per year – that is more than 10 times the rate of growth of the economy as a whole. This growth is reflected across Europe – The EU Commission Digital Agenda for Europe claims the digital economy is growing at seven times the rate of the rest of the economy.

A Global Engineering firms perspective ……Case study in success

Jorge - PACIVJorge is the Founder, President and CEO of PACIV, a control system engineering firm. PACIV has offices in Puerto Rico, United States and Europe. PACIV provides operational efficiencies for manufacturing processes utilizing instrumentation and control systems to provide process automation. PACIV clients include the largest Biotechnology, Pharmaceutical and Medical Device companies in the world and other multinational clients in related industries. PACIV has over 80 associates world-wide and has sold over $135 Million over the past 14 years. www.paciv.com for details .

SME Tips – “First things first”

Twelve years after founding PACIV, a specialized service firm in the area of industrial automation, instrumentation and regulatory compliance, I went back to the university to do an Executive MBA, this after already having done an MBA 12 years before.  For some reason, I felt that the business practices of today where outgrowing my knowledge on them, I felt behind.  I was not only correct, something I confirmed during my first year of courses BUT I was surprised as how little did I know.

In this column and hopefully future ones, I will share with you some of the major learnings of this new renaissance.  Our classes included leadership, strategy, innovation, global markets, controls (accounting), finance, and marketing.  I draw at least three critical learnings from each topic and most importantly, I drew one main learning from the fact that the “alignment” about each of these topics to the others. The glue, called “alignment”  that holds them together independently is critical to be able to derive the most value through their synergies.

On this edition I will start with Strategy.

The three (3) main lessons for me were

(a) you cannot delegate strategy.  Strategy is the #1 responsibility of the CEO, owner, principal partner,

(b) strategy is as much about what you decide to do than about you decide not to do,

(c) strategy is about defining where you are going to play, how you are going to play and with whom you will play.  These are extremely complex matters for any business leader.  At the core of these subjects resides without a doubt the most important learning of the entire course for me, that “who you are” must be very clear to you before you start addressing any of these questions

Defining “who you are” as a company, probably as with us as individuals, has been the most difficult and painful activity to define in the process.  There are many Fortune 500 companies that as of this day do not have clearly stated who they are.  As such, the clients are confused.   Great examples of knowing who they are very obvious to you.  Companies such as IKEA, Coca-Cola, Doctors without Borders, and others are known to many not necessarily because they are international brands but because they are so clear in knowing who they are that they can sustainably and clearly communicate it to their stakeholders.

I encourage you to spend the needed time defining “who you are”.  I caution you that if you are an existing business, who you are is probably established already in the minds of your customers so prepare a survey and make sure you listen to who they believe you are.  Without reading the surveys from the client, do your own internal exercise defining who you think you are as a company and then compare.  If there are significant gaps you have a long road ahead – but at least you have identified the root cause of many of your problems.  If the gaps are close, congratulations, you have been sending a clear message even when not knowing it.

The definition of “who you are” was presented by my strategy professor; Cynthia Montgomery (read her new book “The Strategist”) in our class as follows.  Imagine you are in the funeral of your company, it is being “buried” and you go there and ask those present to describe to you what do they think they will miss the most.  Whatever they tell you they will miss, that is who you are.  Plain vanilla.

The best tool to come up with a clear definition of who you are is what I call the “OAS Statement” (Objective-Advantage-Scope).   In an OAS statement, define the following:

  1. What our goal is (specific objective bounded by time) and Goals (inspiration, open-ended, motivational)
  2. Who we serve (customers and segments, where you will serve channel and geography)
  3. What sort of products and/or services
  4. Why they should buy from you  (the drivers of the corporate advantages, the firm’s unique configuration of activities and resources that enable it to realize its competitive advantage)
  5. How we do things differently in delivering that product or service (what the firm does uniquely, differently, and better than competitors)

PACIV OAS statement is as follows:

  1. Be a value-driven company by being a one source provider of instrumentation, control systems and regulatory compliance services for our global clients’ manufacturing sites in the pharmaceutical, biotechnology, and medical device industry by applying our unique combination of technical expertise, turnkey services and commitment culture.
  2. We achieve customer trust through honesty, integrity, and accurate responses to clients’ needs with cost-effective and reliable solutions while being a great company in which to work and a valuable corporate citizen to our communities.

I hope this first task provides you with the needed clarity of mind to tackle the many challenges of the organization (processes, structure and systems), its resources and its clients.  Upon completing it, you will embark with better tools to tackle other complex issues in the journey to achieve the needed alignment and exploit to its maximum the limited resources that we have.

For more information on this subject or any comments or questions, do not hesitate to contact me.

Kind regards,

Jorge L. Rodriguez | President & CEO

Email: rodriguezj@paciv.com

“A Harvard Business School Case Study”

CPA Ireland – Supporting Entrepreneurs .

Finally, CPA Ireland launched its new look website this summer and it has lots of helpful, freely available resources aimed at the Irish business community. You may be familiar with the CPA Ireland’s  excellent report on entrepreneurship, released late last year .

It makes for very interesting reading with some proactive recommendations for much needed support in this area. The CPA Ireland Business App , the CPA Business Tracker is worth checking out and available to download for free directly from the website. It allows businesses to input key finances and automatically calculates financial ratios to measure their company’s performance.

The app is accompanied by some background information on ratio analysis and a brief tutorial clip. Also accessible via the site is a free series of webinars called Taking Charge of Your Business . This initiative involves a series of short twenty minute presentations covering a variety of topics including Cash Flow Management, Recruitment, Marketing, HR and Risk. Similarly, the Institute’s long running initiative the  Simple Facts of Accounting Bulletins, help business owners understand complex accountancy and regulatory issues and how these impact day-to-day business.

The site has a host of articles providing advice in the areas of marketing, social media, technology, business planning and more. Finally, for job seekers, CPA Ireland JobSearch, lists jobs for qualified and part qualified accountants in companies around Ireland. The CPA Ireland JobSeekers function allows employers to browse CVs of potential employees for any vacancies they may have. Lots to see and learn so take a look around.

 Next week we have the perspective of Joe Aherne President CPA Ireland and Chairman of Leading Edge Group

Budget 2014 – The impact on the SME sector .

Budget 2014 - Michael Noonan It was positive to see that the budget recognised the SME sector .While there is a lot to be done yet in terms of helping SMEs , Entrepreneurs and Start Ups there were some positive initiatives in the budget.

Ireland has come a long way since 2008. The 2014 Budget saw the Government announce a €2.5bn fiscal consolidation and achieve 95% of the original EU/IMF savings target of €32bn.

Budget 2014 looks to continue the progress Ireland has made and to create an environment which will stimulate growth in the economy as we exit the EU/IMF programme at the end of the year.

Within the constraints in which the Minister was operating this budget is a deliberate attempt to support entrepreneurs and stimulate innovation with the purpose of protecting and growing employment which is a positive for the SME community .

Particular measures of note include:

The Home Renovation Incentive which will provide an income tax credit to home owners who carry out renovation and improvement works on their homes in 2014 and 2015. CPA Ireland have called for such an incentive previously, which challenges the fiscal damage meted out by those operating in the black economy, acts as a stimulus for self-employed trades people and will release money into the domestic economy.

The Start Your Own Business Scheme (SYOB) which is a positive signal of intent to support entrepreneurs, particularly those that have been out of work for a period of 15 months.

– The removal of the Employment and Investment Incentive (EII) from the high earners’ restriction is a practical measure to stimulate investment

Capital Gains Tax Entrepreneurship Relief encourages reinvestment in business and will stimulate entrepreneurship.

Additional welcome measures include improvements to R&D Tax Credit and the increase in the VAT cash accounting threshold. These measures constitute significant support for small and medium enterprises by improving cash flow, fostering innovation and supporting entrepreneurship.

Corporation tax rate internationally

The Minister reaffirmed the Government’s continued commitment to maintaining Ireland’s 12.5pc corporation tax rate.

R&D

We welcome the positive endorsement of the R&D tax credit contained in the Department of Finance’s published review of the regime. The endorsement is significant as it is a clear statement to the FDI community that Ireland remains open for R&D business and will support innovation through its tax policy. This clarity was needed to counteract the uncertainty created by the review process itself and the recent negative media commentary regarding perceived abuse.

The Minister has increased confidence in Ireland’s ability to retain and attract R&D mobile investment.

The key findings of the review are positive. The scheme has been acknowledged as a significant driver in attracting FDI and stimulating increased domestic R&D activity. On foot of the review, the Minister has introduced a number of favourable amendments to enhance the scheme.

CGT exemption

The CGT relief for property owned for seven years and purchased between 7 December 2011 and 31 December 2013 introduced in Finance Act 2012 is being extended by one year to include properties bought before 31 December 2014. This extension will be welcomed by investors, both in Ireland and abroad, and will help bring further stability to the investment property market.
VAT

Retention of the 9pc reduced VAT rate
As part of the Jobs Initiative launched in 2011, a temporary reduced rate of VAT (which was due to revert to 13.5pc on 31 December 2013) was introduced to certain supplies, mainly within the tourism and hospitality sector. However the rate reduction has proved to be very successful having played a key role in both job creation and job retention in the sector and as part of the Government’s pro-business budget, the Minister has confirmed that the 9pc rate will be retained.

Micro and small enterprises are a central part of our economy, and their ability to succeed and grow underpins our future potential for jobs, growth and prosperity. 98.5% of all firms are small and employ over 650,000 people throughout the country.

What were the positive measures for business ?

  • Retention of the 9% VAT rate for the hospitality sector – to support and encourage growth in small businesses in the tourism sector;
  • Air Travel Tax reduced to 0% from 1st April – to encourage the development of new routes and therefore lead to more passengers and the creation of additional jobs in the tourism sector;
  • VAT anti-fraud measures – to protect compliant business from unfair competition by tackling the shadow economy.

As well as the reliefs already mentioned Minister Noonan also announced a package of measures aimed at supporting start-ups and growing businesses, including the following:

  •  Start Your Own Business Scheme (SYOB): This measure is being introduced to encourage individuals who are long-term unemployed to start their own unincorporated business. A two year exemption from income tax up to a maximum of €40,000 per annum is being provided for individuals who have been unemployed for at least 15 months prior to starting their own business;
  •  Increasing the threshold for the Credit Review Office from €500,000 to €3 Million;
  •  Supporting cash-flow in the small business sector by increasing the VAT cash threshold from €1.25 Million to €2 Million;
  •  Building Business Capacity – A training and mentoring programme consisting of 2 days dedicated off site training tougher with export mentoring support, to enhance SMEs business and financial capacity in relation to understanding and utilising a broader range of financial products, as well as equipping them with the necessary tools to make a strong business case when applying for credit. The programme will be launched on a pilot basis with 1,000 SMEs taking part next year;
  •  SME Communications Strategy – to increase awareness of State supports amongst SMEs. This strategy will also ensure that there is a greater awareness amongst businesses of the soon to be re-launched credit guarantee scheme;
  •  A package of improvements in the R&D tax credit aimed particularly at small Irish companies.

entrepreneur text

Hopefully more can be done to support the SME sector and encourage Business start ups to create employment , innovate their business , and grow their exports in International markets . SMEs need more support having come through a tough five years in business those how have survived are our new business heroes and should be supported and encouraged to grow , innovate and employ

Cormac Fitzgerald FCPA is Chairman of the SMP/SME Committee and Vice President of CPA Ireland . He is also the owner of Fitzgerald & Partners Accountancy Firm in Kinsale , Co. Cork .

SME Business Tips – Different Perspectives

sme tips

Something which I’m asked on a regular basis from my clients in the SME sector is what would your top five tips be . 

So I’ve asked this question of a number of business leaders recently from all different backgrounds with a focus on SME and innovation to give their top five tips for SME owners to help them succeed. 

CPA Ireland, one of Ireland’s leading accountancy bodies is focused on SMEs, entrepreneurship, innovation and has a number of business tools available to SME owners to help them in their business .

Please find attached a link to the department of Finance which shows what supports are available for SMEs which is an interesting spread sheet.

SME Matrix Dept of Finance

An Education perspective ….University College Cork 

JB McCarthy - UCCJB McCarthy – Development Director
Financial Services Innovation Centre, UCC, Cork.

You might want to let people know that the Enterprise Ireland call for €5K Innovation Vouchers is open at present. Companies can apply for a voucher to help explore a topic with a university, the only cost for the company is that they pay the VAT which they should be able to re-claim.

We have done several small projects for companies where they want to explore or innovate on their existing business model or explore new business models or see how social media might be able to build their profile.

A Legal perspective ..

Virgil Horgan, Solicitor – Hegarty & Horgan

At Hegarty & Horgan our clients come first. Our personal service ensures that we take time to listen to and understand our client’s legal requirements. When you need professional advice we are there for you. Along with the areas of practice listed on as in any General Practice there are a myriad of other problems and issues that clients require advice on and we use our experience and expertise to advise and assist our clients to find the best solutions.

1. Hire a business coach or accountant  .A third party or ‘outsider’ can help you work on your business from an objective point of view. Share your ideas and concerns of the business with a good mentor who has business experience .

2. Review your cash flow or budget plan. Very  few SME owners recognise the importance of a cash flow plan. Cashflow is critical to business survival and success .

3. Regularly review your business strategy. Identify what you want to achieve and where you want your business to be in one, two and five years’ time. Do an offsite SWOT analysis on your business with your advisor.

4. Develop a networking strategy. Most businesses benefit from networking and word-of-mouth, however, very few SME owners have a networking strategy. Be it online or attending events appropriate .

5. Make a commitment to learn more this year take the time to identify areas of your business that need work. Where do you need to improve your performance or learn new skills .Broaden your skillset .

A banking perspective …AIB Bank

Sinead O Connor-Aib KinsaleSinead O’Connor – Branch Manager of AIB Kinsale Co Cork.

Sinead is a Qualified Financial Advisor.  Given her wealth of experience, Sinead along with her team at AIB Kinsale can offer SMEs advice and guidance in relation to their financial needs from the beginning and right throughout the lifecycle of their business.

My top 5 tips for SMEs are:

1.  Know your Bank Relationship Manager and proactively engage with them throughout the year, inviting them to visit your business premises to ensure they fully understand how it works.

2.  Conduct quarterly reviews of your Business with regard to sales performance, competitors, industry analysis and the people working in your business.  If appropriate engage with external consultants to support you in this task.

3.  Review your financial statements with your Accountant/Financial Advisor to obtain a full understanding of the financial data.  In particular, establish how profitable your business is, and how much cash does it generate.  Work on areas of the business where greater efficienices can be achieved, or where margins can be improved.

4.  Consider your “unique strengths and weaknesses” and how you can use them/deal with them to your benefit.  Outline these to your Bank/Accountant to maximise the Partnership that you have with those specialists.

5.  Visit AIB’s website regularly at www.aib.ie to avail of the full product and service offerings available to you.  In addition throughout our Branch network there are specialists available to assist you either at your place of business or at the branch in the areas of Financial Planning, Leasing and Hire Purchase, Credit and Internet Banking.

A political perspective ..

Aine CollinsAine Collins TD

1.Seek Mentoring Support – look at all the options that are out there…. ie. Enterprise Ireland, leader, etc.  “I know that  the various supports available can seem complicated  to wade through but this is something I’m working on with the Department of Jobs, Enterprise and Innovation.

Hopefully we’ll have a more streamlined approach to state supported mentoring services by the end of this year.  However I can’t stress enough how helpful mentoring can be for a business.  It’s so useful to have someone who knows the ropes and has the expertise to act as a guide and confident.

2. Review Yourself – are you doing  what you are really good at for your own business?  Often entrepreneurs set up a business because there’s a certain aspect of it they love and are really good at – they then end up doing things that go with running a business that they really don’t like.  Do what you are really good at – and make sure you’ve really good people to do the other bits!

3. Review Your Business – make sure you’re really clear where you want your business to go.   Develop a business plan if you don’t have one & if you do, then take it down from the shelf, dust it off and review it objectively.  Then you’ll probably need to re-write it or at the very least modify it!  A plan must be reviewed and adjusted regularly – we need to plan, but as they say ‘the best laid plans….’, so review and monitoring is also key.  Keep the vision clear.

4. Messaging – what is your message, are people hearing it and do they understand it?  And review this both internally and externally.  Do you really know what your own message is?  Do your staff?  If you’re not all really clear on what your business is all about then you’ll all find it difficult to communicate this to your customer.  And the message also needs to be reviewed regularly to incorporate new changes within your business, be it new products or services, or changes in external market forces.

5. Be Brave.  Sometimes its really easy to stay in our comfort zones and be wary of taking a risk.  So every so often we all need to take a deep breath and jump!  This could be anything from taking on new staff, delegating more or deciding to expand your business.   Again, on this one, I’d really recommend a mentor – its great to have someone else to bounce ideas off.  And they can help give us the confidence and focus on the priorities to achieve the goal.

Áine Collins TD
Fine Gael, Cork North West

A Branding perspective …

Gerard TannamGerard is CEO of Islandbridge Brand Development

Branding is all about relationships. These are the five things you can do to make your mark with customers:

  1. Meet Regularly With Customers: Spend time with those who buy from you to find out more about them and what part they want you to play in their lives (but make sure there’s no selling agenda during those meetings / conversations).
  2. Network: Get out there and meet people. This can be face-to-face at industry seminars, general business events or dedicated referral opportunities or via the wide range of social media that is now available to the business owner.
  3. Be An Expert: Customers love to deal with people who really know their stuff. Be generous with your knowledge and experience. Become the go-to person in your area. If you can, publish.
  4. Gather Testimonials: Nothing succeeds like your prospective customer knowing that someone else happily bought from you. Invite your customers to offer testimonials and include these in exchanges with prospects and elsewhere in your market when you can.
  5. Engage The Right Team: It’s vital that everyone working for you plays their part and is consistently on-brand. Gather the expert resources you need and check that they have the right attitude as well as the know-how to work closely with you to deliver your brand.

A Regulators perspective…

Muireann O NeillMuireann O’Neill – CIT

Muireann O’Neill is employed by Cork Institute of technology, lectures in accountancy and is recognised as one of Ireland’s leading auditing and management accounting lecturers. Muireann also holds directorships in Inland Fisheries Ireland (‘IFI’) and the Irish Auditing and Accounting Supervisory Authority (‘IAASA’).

My approach to Business is a follows:

1. Ensure compliance with Law and Regulation. If you don’t know what is needed, engage an expert and don’t leave it to chance. You never know who may come knocking if you are not compliant.

2. Pay attention to RISK. Failure to do so can cause irreparable damage to the reputation of a business. Reputations take years to build and moments to lose. Risk awareness should be embedded within an organisation’s processes, culture and systems. Organisations should have a risk policy statement and maintain a risk register.

3. Successful business people view TIME as their most precious resource. Each day they list what’s most important (rather than just most urgent) and make sure they do it. Bill Gates has said that being acutely aware of the value of his time is one of the most significant factors in his success

4. Set goals in writing and then remind yourself of these goals every morning. Research has shown that this approach can make you over 30 times as likely to succeed.

5. Don’t be one of life’s best keep secrets. Be noticed and create a bit of noise.

What are your 5 Tips?

Cormac Fitzgerald - Fitzgerald & PartnersCormac Fitzgerald FCPA is the owner of Fitzgerald and Partners and is Vice President of CPA Ireland

Fitzgerald and Partners are SME Business Advisory, Accountants and Auditors located in Kinsale in Cork