Why you need to improve your listening skills!

July 25, 2019 By Lesley Anne Rubenstein-Pessok

It’s not often that I write an article for business people telling them to do something. Typically, if someone tells me to do something, my urge is to do the opposite! Due to that fact, I avoid telling others to do something unless I feel very strongly about it. I feel very strongly about the importance of possessing excellent listening skills and have yet to meet someone who couldn’t improve theirs, however good they are (or think they are).

Why?

Because they are essential! Listening is the key to understanding, whether in conversation with a business partner, an opponent, a sales call, trying to close a deal, figure out why a staff person is unhappy or demotivated, or what’s really going on at your child’s school. It is all through your listening skills.

What isn’t being said?

It’s not just about what the person says, but what the person isn’t saying. There are clues in their word choices. Are they being evasive or direct? Are they hesitant? Having you used language that allows them to speak freely? What about the atmosphere?

Body language

If they are in front of you, what is their body language giving away? Is their verbal language saying one thing and their facial expression and/or stance saying another? Are their hands clenched or relaxed? Even over the phone we can detect a change in tone or energy – what does that say to you?

How does one improve listening skills?

Tip 1 – Awareness

Being aware that you want to improve your skills is the first step, because as you enter a conversation you will ‘switch on’ your powers of listening. As your mind wanders, you will need to bring your attention back to the speaker. The more you do this, the less your mind will wander during conversations, when the ‘switch’ is on.

Tip 2 – Practise

Like everything in life, practise makes perfect (or close to). I’m currently learning how to play the djembe (African drum) and am very aware of how I’m improving in sound and speed by practising most days (my husband might not agree with this statement!). It’s the same with listening skills! You will have plenty of opportunities to improve your skills in the various spheres of your life. The more you practise, the better you will become at listening.

Practise everywhere and with everyone – it will soon become a habit.

Tip 3 – External noise

Noise distracts from your powers of listening – it will either make you focus more intensely to hear your conversational partner, or it will overwhelm you and make you focus on the external noise. If you cannot hear your partner due to external noise, move to a better environment. Your partner will be flattered that you want to hear what s/he has to say. If this is an important meeting, choose the venue carefully to avoid this mishap.

Tip 4 – Internal noise

But what about internal ‘noise’? What happens when you daydream, possibly because the conversation isn’t attention grabbing or because you suddenly recalled something you forgot to do. Bring your focus back if you missed an important sentence and apologise, if necessary. The more you practise listening to your conversational partner, the more often the internal noise will disappear.

You’ll know you’re listening when you mind is empty of internal ‘noise’ and your total focus is on the person with whom you are conversing

Tip 5 – Leadership skills

Going back to the ‘Why’ improving your listening skills are important – can you think of a single, democratic leader whom you admire who didn’t have excellent listening skills? How did you feel when you are conversing with someone important to you who was fully focused on what you were saying? You felt respected? Appreciated? Interesting? What if you made others feel that way? I would argue that keen listening skills are essential if you want to become a leader in any area of your life.

Tip 6 – Emotional Intelligence (EI) or Emotional Quotient (EQ)

Improve your EI/EQ by following tips and exercises. See this article, for example, for more information on How to Increase Your Emotional Intelligence.

In summary

By raising your self-awareness of how you are being in your life and in every facet of it, improving your EQ/EI and empathy, and above all, your listening skills, you will become more effective and powerful in making a difference in every aspect of your life and the lives of those dear to you.

If you would like a mentoring session on this topic or others, contact lesley.rubenstein@lgbusinessadvisors.co.uk or call her directly on 020 8868 3163.

Is your business stuck at a crossroads? Time for a strategic review.

June 30, 2019 By Gordon Carmichael

Many businesses reach a stage when they are at a crossroads about the direction to take next or are “stuck” without a clear strategy. It may be a crisis point or it could be an opportunity to take a different path. Directors may no longer be aligned with the planned company direction, and this can cause friction.

Rather than putting off hard decisions, it makes sense to face up to the challenges and opportunities, have a strategy review and then put an implementation plan in place.

Reasons for a strategic crossroads could include:

Change in market dynamics that impact growth or profit potential.
Increased competition forcing new approaches.
Loss of important customers or contracts.
New product or service opportunities possibly requiring research and development.
Recognition that the business is too reliant on a small number of key customers.
Macroeconomic/political changes such as Brexit.
Divergence of what Directors want from the business.
Planning for exit / opportunities to acquire.
Changes in key staff or skills that no longer reflect the needs of the business.
Falling behind in taking advantage of the operational efficiencies of new technology.
Lacking the funds to develop the business.
Measurement and reporting that does not give the right management information.

If there is a need for change or at least a need to review your current strategy, how should you go about it? A few businesses make reviewing strategy almost a continuous process. Others wait until there is a “big bump” to traverse or an unforeseen opportunity.

Smart organisations often involve outside help in the strategic review and implementation planning process. This helps keep focus on what is needed and ensures that an independent non-biased view is taken to maximise the opportunities. Our group of advisors have helped many companies achieve strategic success.

The following four step process works for most companies:

1. Big Picture – Step back and look at the big picture. Don’t get stuck in the day to day operational challenges. Take high level views about the elements of your business and the markets that you service or would like to serve. This phase is the time to re-examine your mission, vision and values – are they still right for your business. Try to define the big picture direction the business could or should take. Depending on the size of the organisation, there may be delegation of some tasks. There may also be research to validate potential options.

2. Implementation Plan – Once the direction of travel has been determined or options identified that need to be refined further, then it is time to get into more detail.

The company objectives need to be set or reset in order to reflect the chosen strategic direction. Real data and knowledgeable input should be used to define appropriate options.

Objectives should have supporting targets and measures defined. The chosen targets should be realistic and ideally include some quick wins. Measures should support what you are trying to achieve and become the Key Performance Indicators (KPIs) that are used to track and reward progress. A small number of well chosen KPIs makes sense as too many KPIs dilutes focus. Often it is beneficial to involve key staff that will be responsible for implementation in this phase. This phase should also make sure that the right reporting information is or will be available and that it is clear how progress will be monitored and reviewed. It is critical to have a clear picture of who is responsible for what and the timelines are understood and agreed.

Review and select long term initiatives that will support the objectives. Initiatives will need staff buy in and may have resource and budgetary requirements. Any resources and funding should be agreed along with the selected initiatives. A small number of big impact initiatives is usually best. Often it works well to have champions for specific initiatives as they can make sure focus is not lost. Initiatives should have well defined progress reporting.

3. Communication – This step is critical particularly for more complex organisations. Every member of staff should understand the big picture and more specifically be clear what their contribution will be to the objectives and initiatives. It may be appropriate to have a launch event(s). If incentives are linked to achievements, then the collective/individual measures should be very clear.

Regular ongoing communications regarding progress and any corrective actions is also very important.

4. Review and Adjust – What happens after the launch of a new strategy is where it can go off the rails. The planned review process should be rigorously carried out and actions implemented on time. Any corrective actions should be clearly communicated. Few strategic plans remain static and it is good practice to monitor what is working and what is not. Too many changes can cause confusion and loss of effectiveness. On the other hand, stubbornly sticking to a path that is not working does not make sense.

It is also important to recognised when most of the gains have been realised. It might be time to start the complete process again.

Unfortunately, strategic reviews and the resulting implementation plans do not always deliver the anticipated outcomes. Reasons for failure can include:

Unresolved internal differences of opinion or conflict.
Not truly stepping back and looking beyond the day to day business as usual issues.
Not setting aside quality time to focus on the process.
Poor communication to staff and lack of buy in to business transformation.
Initiatives that are not supported by appropriate funding.
Initiative fatigue.
Incentive schemes that are not aligned with the defined objectives.

We have the experience required to transform the performance of your business by helping you find successful paths to take while avoiding the pitfalls.

Contact Gordon Carmichael on 01276 818125 or gordon.carmichael@hcbusinessadvisors.co.uk to discuss how a strategic review can benefit your business.

Gordon Carmichael is an experienced business advisor and strategy consultant who works with business owners and directors that are serious about achieving more with their business. He has managed successful businesses from small to £250m in a number of different industries and brings independent thinking with no baggage or vested interests. He is financially literate and understands modern marketing, people dynamics, the benefits of technology, effective business planning and business operations.

How to pick the best candidate for your Technology business C-Suite

June 30, 2019 By Mike Pill

With the current skills shortage in the technology sector and ever-increasing demand it is simply not enough to broadcast a role when you are recruiting for your leadership team. Placing an advertisement or hoping a quality candidate will alight upon your website will rarely succeed. You deserve and require the very best of candidates. Invariably, finding great people requires a more proactive approach.

The best candidates are not looking for your role

The best of candidates, or targets, are probably fully committed to working for a competitor, supplier, customer or possibly currently working overseas and not actively looking for another role. Alternatively, they may be restricted via a compromise agreement, garden leave or clause in their current contract – all of which can be the subject of further negotiation and equitable determination.

A discreet approach

A thorough, comprehensive, discreet and confidential first approach to the targets is required for a number of reasons.

You may not wish to disclose your plans to competitors, customers, suppliers or other key employees in the first instance only to suffer rejection.

Without disclosing your identity and plans, the target is open to considering an alternative offer and challenge. An opportunity can be taken to discuss what they are looking for. The target can assess the outline description of your opportunity and challenge. They can consider its appeal and see if it builds on relevant past achievements.

The missing link – Executive Search

In order to achieve this, the assistance of an Executive Search consultant (AKA head-hunter) is recommended. In the UK we have probably the best professional football league in the world which has been enabled to a large extent by professional search consultants. The profession has also assisted many of the most successful large companies and is available to the SME market. The cost is not prohibitive and can be negotiated to an acceptable level. It is worth developing relationships with these individuals so that they can become more familiar with your business and be available to contribute when required. The dividend from this investment can be considerable.

For a confidential chat on finding a new member for your C-Suite IT team contact our recruitment specialist advisor Mike Pill by email at mike.pill@hcbusinessadvisors.co.uk or call him on 01276 684007

Top tips to reduce business legal fees and prevent expensive disputes

March 3, 2019 By Tom Elek

Litigation should never be embarked on lightly. There is no such thing as a “clear-cut case”. Most lawyers will rarely give even the strongest case more than a 70% chance of success. There are a number of questions which you need to ask yourself before seeking to resolve a dispute by embarking on litigation:

Is the dispute one which you need to address? It is important to look at any dispute dispassionately and without emotion.
Have you looked at every possible way of resolving the dispute?
Can you afford to lose the case, which could involve you having to pay not only your own costs, but also a large portion of the other side’s costs?
Is there a significant disparity between the respective financial strengths of the 2 parties?
Will you be able to withstand the attacks you and your business will face from lawyers experienced in our adversarial legal system?
Can you afford the distraction that a lengthy court hearing could cause?

I will address each question:

Disputes can often be triggered by hostile personal relations. It is important to try and be objective and to avoid allowing feelings of personal animosity to influence the interaction between the parties.
Until fairly recently, commencing proceedings at the early stages of a dispute was considered a sensible strategic approach. However, the cost of issuing a Claim Form has increased significantly in Court fees alone with a claim in the High Court costing 5% of the amount claimed above £10,000(or 4.5% if issued online) up to a maximum of £10,000 for claims of £200,000 or over. Every possible way of resolving a dispute must therefore be considered before embarking on litigation.
The changes introduced by Lord Woolf in 1998 in the Civil Procedure Rules have also acted as a disincentive to anyone contemplating embarking on litigation. One of the cornerstones of these changes has been to encourage parties to a dispute to seek mediation at an early stage. Failure to do so can be penalised by adverse costs awards against any party refusing to consider mediation for no good reason, even in cases where such party has won his case.
Those with deeper pockets will not only be able to afford higher quality lawyers, although more expensive does not necessarily mean better, but more importantly have greater staying power. It is often difficult to predict how proceedings will progress and one has to expect the unexpected. Running out of funds in the middle of a case can be catastrophic, as one would probably have to pay the other side’s costs, in addition to one’s own, in order to pull out. It is also important to bear in mind that even if you are successful, it is unlikely that you will be able to recover more than 70% of your costs from the other side.
One should not underestimate the hostility that our legal system allows and to a certain extent encourages in our adversarial system. Being cross-examined by an experienced barrister is not something that should ever be taken lightly.
Being involved in litigation is time-consuming and distracting and can cause serious damage to small businesses where senior executives find themselves unable to give their companies all the attention that is needed.

Conclusion

Every dispute requires very careful consideration before embarking on litigation, whether you are the plaintiff or the defendant.
Every effort should be made to resolve a dispute at an early stage without resorting to the courts. This can often mean having “to swallow one’s pride”.
A carefully prepared letter can often nip a potential dispute in the bud. If this fails, try not to lose direct contact between the parties.
Sometimes bringing in a third party to act as a mediator on an informal basis can help avoid litigation.
Once solicitors become involved you must ensure that you receive a very clear indication of costs throughout the process and ensure that you receive regular progress reports. If possible give one person within your organisation the responsibility for acting as the point of contact with the solicitors on your behalf and ensure that such person has a clear understanding of how solicitors charge fees.
Always try to find a way to maintain contact the other side, either directly or through your solicitors.

The time when everyone was entitled to their day in court is long gone and the consequences of doing so now can have unexpected and damaging consequences. If you want to talk this through, why not contact Tom Elek by e-mailing tom.elek@hcbusinessadvisors.co.uk calling on 07768 772148.

Are successful business leaders born or made?

February 3, 2019 By Lesley Anne Rubenstein-Pessok

The answer to this poser invokes the old, ‘nature’ versus ‘nurture’ argument. Maybe we need to study twins who were separated at birth, where one became a business leader, and determine what happened to the other? In the real world, business leaders, like any other leaders, come in all shapes and sizes. If you studied a group of successful business leaders from various industrial sectors, I would hazard a guess that they would have different personality traits and backgrounds.

The variants are likely to be greater still according to discipline. Successful business leader in the financial sector are unlikely to have the same personality characteristics as one in the high technology sector or in the hospitality arena. An accomplished executive in the insurance sector, however, may very well have more in common with a leader of a banking institute. I’m making some assumptions here, but I wouldn’t be surprised if you are in agreement.

Are business leaders born or made?

Before we answer that question, let’s list some of the traits we would expect to find in a great business leader:

Visionary
Decisive
Motivational
Confident / Assertive (but not a bully!)
Likeable
Mindful
Collaborative
Inspirational
Great listener
Integrity
Intelligent
Respectful
Empathetic
Ability to prioritize
Create emerging leaders
Flexibility
Non-judgemental
Empowering
Optimistic

Can we learn to become a better business leader?

There is nothing in this list that cannot be learned or improved upon by a determined individual. One can read books, study, attend workshops, take drama classes, do mental exercises, etc. to gain many of the qualities listed. One can even be trained into ‘thinking big’. Mentors will often determine a CEO’s mental obstacles to growth and ask pointed questions to help him/her see what is holding them back. For example, now in its tenth year, the annual Women into Leadership conferences is a key event for all those interested in seeing leadership opportunities for women enhanced. Women into Leadership 2019 will examine how female leaders, at any grade, can enhance their skills to become the leader they aspire to be.

Acquiring listening skills

In my own ‘Effective Leadership’ business workshop, we spend time in an interactive exercise to experience both good and bad listening skills, and what it takes to become a good listener. Listening and empathy are crucial leadership qualities to my mind. The core skill is not just to listen but also to learn to interpret what is said, both verbally and non-verbally.

How important is it to have empathy as part of your leadership skill-set?

A simple way of describing empathy is when we can visualise, identify being in the other person’s situation, and being able to communicate our feelings to the other person. Sometimes, to show understanding, we need to show vulnerability and describe something we have experienced which may not be showing us at our self-assured best. Think back to the last time you were upset about something you felt was important, and you expressed your feelings and the person you were confiding in understood and empathized. How did that make you feel?

What about confidence?

Listening and empathy are important, but confidence is also an essential leadership trait. As mentioned above, there are mental exercises to acquire several of the traits listed and practise does make perfect. ‘Fake it till you make it’ is another way of saying this, although I’m not sure I particularly advocate that saying as I don’t like anything fake. But if we take ‘confidence’, for example, and practise acting confidently in a drama class, it would be something we could pretend even if we aren’t feeling particularly self-assured. No-one will take direction from a dithering leader in a crisis, and the ability to hide one’s emotions where necessary and appear confident, is a crucial quality in a great leader.

Born leaders

Some people, however, will be perceived as ‘born leaders’, either because they make it look easy, and/or because from an early age they presented leadership qualities. I’m sure we can all summon up a picture of a child in the playground telling the other youngsters what to do and how to do it, and envisage those children following the instructions. Does that mean the child is a born leader? I would argue that some traits may come naturally but many will be determined by life experiences and education in both home and school environments. If a child is bullied, for example, that same child will often become a bully; though this will not apply in all cases. Chains can be broken. Note: not even great business leaders are infallible, and no-one always gets it right and, on occasion, we may mistake luck for great leadership.

In conclusion

Whether or not you are fortunate to have been born with some, most, or all the leadership qualities mentioned in this article, you can work on, and exercise, your leadership skills your entire life.

So, are business leaders born or made? It is not possible to give a conclusive answer, but either way, you can strive to be a better leader and never stop improving. Being a great business leader will serve you well in all walks of life. It’s up to you!

About the author

LGBA Associate Lesley Anne Rubenstein-Pessok, has spent her whole career in executive roles, working with and training start-ups and SME businesses, helping them to become more efficient, increase turnover, improve profitability, cost effectiveness and create strategies that pay off. She is an approved mentor for the London and Partners’ Business Growth Programme, as well as for other public funded programmes. To find out more about Lesley’s mentoring and business advisory services contact her by email at Lesley.rubenstein@lgbusinessadvisors.co.uk or call her on 020 8868 3163.

How to design a robust profit-sharing bonus scheme for 2019

January 24, 2019 By Stephen Cowburn

In the last newsletter we talked about what to do about awarding a Xmas bonus. [If you missed it click here to find it] Now we talk about putting a bonus scheme into place for 2019.

If your financial year-end is say March, the next few months could be a good time to develop and trial a scheme before launching it in April.

What should l incentivise people on?

The profitability of the business is a simple way to measure business success. If there is a large minority of support staff then you might also consider cost-savings/efficiency savings as being the other side of the profit coin.

You might be tempted by the achievement of individual objectives. Our general experience in the SME space is that staff appraisals don’t happen consistently enough so we wouldn’t recommend a performance pay system based on the achievement of individual objectives, as MDs usually haven’t the infrastructure in place to make this watertight.

What do l need to do first?

You will presumably have a business plan and a budget. Interrogating the likelihood of achieving a sufficient profit to be able to afford a profit-based bonus is the first step. If your assessment is that the profit figure is going to be insufficient consider the criteria for your top people as a pre-cursor to offering a wider profit-sharing scheme.

You need good data so you need accurate monthly management accounts to monitor profitability and to be able to communicate progress easily, to your management team and then staff, post launch.

You may have bespoke software if you run a sales based, or project-based, organisation enabling quick assessment of profitability if looking to incentivise individuals.

If you don’t have either of these, this is the immediate focus. Inaccurate data is guaranteed to lead to issues later on – employees will think one thing, you as MD will think something else and trust and credibility will dissipate in the event of misunderstandings or disputes.

Anything else pre-launch?

Test the model you are proposing. Does the maths work? Are there any unintended consequences? Are there grey areas? (if so tighten the scheme up). Will it clearly drive the behaviour you are looking for? Test it with other Directors or advisors to ensure the outcomes you seek and that the wording is clear with no ambiguity.

Plan the communication – what are the goals? What are the rules going to be? (For example, is there to be a hurdle rate before any bonus is paid out? What are you going to offer joiners or leavers within the period of the bonus scheme?)

Use worked examples so people can see what needs to happen to qualify for a bonus and how the scheme is going to work in real life.

Rather than say there will be a predetermined formula for distributing a fixed percentage of profits, we would suggest an approach where there is a company profit threshold below which no profits will be distributed and that there will be maximum limits set on the proportion of profits that will be distributed (say 5%) and/or the percentage of salary that will be distributed as a profit share (say 10%).

Having launched, what do l do then?

Regularly communicate performance at monthly management meetings and provide a general status update (verbally) to all staff on company performance ideally quarterly. The purpose here is three-fold:

To manage expectations if performance is below expectations
To give people a steer as to what needs to be done to get back on track.
To encourage staff retention by communicating the likelihood of a bonus pay out

Ensure that you pay the bonus when you say you will.

A chunk of our work comes from resolving disputes between employees and the Owner. It usually comes down to poor wording or a misunderstanding on how to get a bonus. The scheme rules are important but they need to be watertight pre-launch. You are likely to run into trouble if you try and change the rules midway through the year because of ambiguous wording.

So wherever you are in your business cycle, and whatever you want to do, if you feel the need for a fresh, neutral pair of eyes give us a call for an initially free consultation.

Contact stephen.cowburn@lgbusinessadvisors.co.uk or 07974 425361, for a focused discussion.

Excel automation

March 23, 2017 By bob.basson@tvba.co.uk

Not more spreadsheets to analyse and chart…

Always a regular cry in the office. Reports produced on a regular basis need to be embellished, with charts that involve some fairly complicated calculations – cross-reference look-ups, previous month comparisons, and all that sort of thing.

Probably, now this is done largely by hand. The data sits in several spreadsheets and/or databases, and is extracted, filtered, pivoted and everything else that was necessary to get it ready, before feeding into a chart. When the chart was ready, it is pasted into the report.

Wouldn’t it be great with the data is all in one place, and with a single front-end, the necessary criteria set from drop-downs. Once these selections have been made (locations, benchmarks, which dataset to use, and so on) you click a button and go and make coffee. Actually, you haven’t really got time to make coffee as the process takes just a couple of minutes – if that.

In this instance, any number of queries can be run; sometimes one query, sometimes several to generate the data. Each one automatically loading a into an Excel workbook, in to the right columns, in the right order to aid presentation. Then, your screen explodes into a fresh multi-coloured set of charts based on the information just collated! And is that the pivot table I slave over every month appearing before my very eyes!

In the past that has meant spending anything between a couple of hours to a couple of days for more complex reporting every period. Multiply that by twelve, and it becomes a not insignificant amount of time in a year m to get these twelve reports, graphs and charts prepared.

Say it was half a day of someone’s time, at the average salary of £26,000 – that’s a cost of around £60+ to the business for each report, or chart. Each and every time.

If reporting is weekly, that’s going to be more than £3,000 every year – more likely a lot more than that. If it now takes 30 minutes to do the whole job, that’s a total of just over 4 days for the whole year’s worth (at one report a week). The four days will cost under £500. So you get to keep £2,500 to do something else with.

What would you like to do with it?

Excel automation by Bob Lewis-Basson – 0780 244 1728

Data Protection

March 22, 2017 By bob.basson@tvba.co.uk

Under the Data Protection Act 1998 (DPA) you must:

use personal information fairly and lawfully;
collect only the information necessary for a specific purpose(s);
ensure it is relevant, accurate and up to date;
only hold as much as you need, and only for as long as you need it;
allow the subject of the information to see it on request; and
keep it secure.

Good information handling makes good business sense, and it provides a range of benefits. You’ll enhance your business’ reputation, increase customer and employee confidence, and by ensuring that personal information is accurate, relevant and safe, save both time and money.

Your business has established an appropriate Data Protection Policy?

A policy will help you to address data protection in a consistent manner. This can be a standalone policy statement or part of a general staff policy. The policy should clearly set out your business’s approach to data protection together with responsibilities for implementing the policy and monitoring compliance. The policy should be approved by management, published and communicated to all staff. The policy should also be reviewed and updated at planned intervals or when required to ensure it remains relevant.

Your business has nominated a data protection lead?

It is good practice to identify a person or department in your business with day-to-day responsibility for developing, implementing and monitoring the data protection policy. Allocating these responsibilities to a data protection lead will help you effectively manage and co-ordinate data protection, and make your business more accountable. The lead should be appropriately skilled and have the necessary authority and resources to fulfil their duties.

Your business provides data protection awareness training for all staff?

Any data security breaches are accidental and result from insider actions. You should brief all staff handling personal data on their data protection responsibilities. It is good practice to provide awareness training on or shortly after appointment with updates at regular intervals or when required. Specialist training for staff with specific duties, such as marketing, information security and database management, should also be considered. The regular communication of key messages is equally important to help reinforce training and maintain awareness (for example, intranet articles, circulars, team briefings and posters).

If you are not sure where you stand in respect to DPA (Data Protection Act) or the forthcoming GDPR (General Data Protection Regulation) call me now …

Bob Lewis-Basson 07802441728, or email bob.lewis-basson@tvba.co.uk

Power up your business with a Virtual Non-Executive Director

March 6, 2017 By Gordon Carmichael

The benefits of Non-Executive Directors are well understood by many successful business owners. They bring an independent view and additional experience that enable better decisions to be made by the management board. Our Home Counties and London Group Business Advisors have developed a Virtual Non-Executive Director (VNED) service that offers Managing Directors and business owners the same independent view and advice without the complexity of shareholdings, appointing legal directors and director’s service agreements.

Every company is different and yet there are many similar and transferable aspects from other industries and markets. Our experts are able to utilise their broad business experience and extensive network of contacts to support companies to achieve their strategic objectives. An independent view that challenges existing or new strategies can substantially enhance the robustness of a company’s direction. Sometimes difficult decisions are required to deal with business problems and the VNED can act as a sounding board to provide guidance and help the decision making process.

Our approach recognises that established and start up businesses have different needs at different times in their life cycle. New businesses often have a need to demonstrate credibility externally to customers and investors. Appointing a Virtual Non-Executive Director can enhance this.

How does it work?

The optimal Virtual Non-Executive Director approach varies with the needs of a business, the existing in-house skills and the “personality” of its MD and management team. Our experts are adept at engaging with companies to strike a balanced approach between coaching, practical advice, strategic input and holding the management to account where appropriate. Prior to engagement, we offer a confidential, no obligation, no holds barred discussion to establish what is actually needed and to establish priorities. A flexible approach is adopted to accommodate the practical time constraints of running a business, the need to react to short term opportunities or threats, planning for growth, the changing needs of the business and potentially planning for exit.

Businesses need to get things done but don’t always have access to the in house skills or expertise required for projects or specialist activity. If appropriate, our business experts can introduce trusted resources from their network that can jump start new requirements.

What does it cost?

The VNED service is charged on a monthly retainer basis with no long-term commitment and no surprises. The service is designed to deliver on-going value to the MD and the company. The monthly cost depends on the level of engagement agreed and will be tailored to your needs.

Contact Gordon Carmichael on 01276 818125 or gordon.carmichael@hcbusinessadvisors.co.uk to discuss how our Virtual Non-Executive Director service can benefit your business.

Impending Employment Law Changes for 2017

February 6, 2017 By

As MDs think about the New Year or start planning for the next financial year there are a number of forthcoming employment law changes that may affect you and your business.

Gender Pay Gap

True this applies only to large employers (employing over 250 employees) but it is likely to be cascaded down to the SME sector in coming years. So why do something about this now? Gender pay gap reporting applies both to bonuses and pay. If there are discrepancies between male and female workers on either score when employees are doing the same job, there are likely to be fines, the cost of immediate remedial action and potential claims for back pay equalisation going back 7 years.

The reporting requirement for large employers will be to publish:

the difference in mean pay between male and female employees;
the difference in median pay between male and female employees;
the difference in mean bonus pay between male and female employees;
the difference in median bonus pay between male and female employees;
the proportions of male and female employees who were paid bonus pay; and
the proportions of male and female employees in each quartile of their pay distribution.

This should be a relatively quick job for the SME to see if there are any discrepancies and, in any event, is good practice to check that there is no unconscious bias creeping into pay decisions. Unless there is objective performance criteria to explain the difference, MDs might well consider putting in place a remedial action plan where appropriate. Given that SMEs are unlikely to be affected for several years, it gives MDs the opportunity to manage any discrepancies over a number of pay rounds.

Apprenticeship Levy

SMEs will be able to receive government funding towards the costs of apprenticeship training and assessment through co-investment, with the likely date of this new system of funding in England coming into effect from 1^st May.

The Government will pay 90% of the price agreed with the training provider, up to the maximum allowed by the funding band for the relevant apprenticeship standard or framework.

Employers with fewer than 50 employees will not be required to pay a contribution to the cost of the apprenticeship where the apprentice is aged 16 to 18 inclusive, or aged 19 to 24 inclusive if he or she has previously been in care or has a local authority education, health and care plan. The Government will pay 100% of the training and assessment costs in these circumstances.

Changes To Rules Employing Foreign Workers

From April 2017, an immigration skills charge will be introduced, so that SMEs that employ migrant workers under Tier 2 of the points-based system of immigration will be subject to a levy of £364 per certificate of sponsorship per year. The immigration skills charge will be in addition to current fees for visa applications.

In April 2017, the minimum salary threshold for “experienced workers” applying for a Tier 2 visa will increase to £30,000. New entrants to the job market, and some health and education staff will be exempted from the salary threshold until 2019.

National Minimum Wage

Cycles for national minimum wage increases – including the National Living Wage – will be aligned, with the next round of changes taking effect on 1 April 2017.

From 1 April 2017, the rates payable will be as follows:

For workers aged 25 or over, the rate will be £7.50 per hour (the National Living Wage).
For workers aged at least 21 but under 25, the rate will be £7.05 per hour.
For workers aged at least 18 but under 21, the rate will be £5.60 per hour.
For workers aged under 18 who are no longer of compulsory school age, with apprentices excepted, the rate will be £4.05 per hour.
For apprentices aged under 19 and apprentices aged 19 or over but in the first year of their apprenticeship, the rate will be £3.50 per hour.

Interns

Not a change but linked to the previous point about the national minimum wage, we often get asked about what an intern should be paid, if anything at all. Whether an intern qualifies for the national minimum wage depends on whether or not he or she satisfies the definition of a “worker”. Where, under an agreement with an organisation, the intern is obliged to work for it personally, the definition is likely to be satisfied and he or she will be entitled to the national minimum wage. However, if the intern is only observing or shadowing employees of the organisation, without undertaking any work him- or herself, he or she is unlikely to be a worker and will, therefore, not be entitled to the national minimum wage. If the latter applies we would recommend that you consider paying travel expenses and subsistence as a gesture of goodwill and a way of promoting your company for the future.

There are quite a range of employment law changes coming up this year. If any of these may affect you, then give us a call for a confidential discussion to talk these changes through. I can be contacted via stephen.cowburn@hcbusinessadvisors.co.uk or by phone on 07974 425361.

Navigation