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NEWSLETTER - 5 - 2011
 

SHOULD I OR SHOULDN’T I? By Derek Stockley

Sometimes it seems easier to just do it yourself

Most of us would have said to ourselves: "It would have been easier if I had done it myself".

Communication is a difficult process. It is easy to forget to tell someone a key piece of information when passing on information or giving them instructions. Consequently, people may not do exactly as you expect. So is this a reason to stop trying? No - I believe it is a reason to get better at communi-cating. Both parties should learn something.

I remember an incident very early in my career. I was asked to do an accounting task. Apparently I did not do it correctly. The manager concerned redid the task, without telling me. I found out from somebody else. The manager was angry. I was angry too because I had not had the opportunity to learn. I was also upset that I had made mistakes. I did not want to do that either. It was a no-win situation. I should have asked for more guidance. The manager should have had better controls in place. We both should have learnt from the experience.

The long term benefits

A useful parable is:

Give a man a fish; you have fed him for today. Teach a man to fish; and you have fed him for a lifetime - Author unknown.

Most of us have seen this parable before. Yet many choose to ignore it. Why?

As explained above, communication difficulties causing frustration can be a starting point. Another reason can be a lack of appreciation of what the parable is saying. Sometimes it takes a little longer to explain or train someone in a task or delegation. But if it is a repetitive task, the time saving in the long run can be very substantial. This increases personal productivity. It can also have motivational effect which also increases performance.

Recently, the power of this parable has been brought home to me. In a world where there is so much to do, it is essential that we pass on our knowledge and skills to others, so they in turn can pass on that knowledge and skills to others as well. The parable can be taken at face value as a story, but it also applies literally. We really should be teaching people how to fish.

Conclusion

Our time is such a critical resource. Failure to concentrate on the more important things is a waste. It is easy to work on the more straight forward tasks, but if you have people that you can delegate these tasks to - do so. Do it for their sake. Do it for your sake. Show people that you trust them. Allow them to develop their skills further. Take responsibility for your actions. Start doing it today. Make the world a better place.

Derek Stockley is a training, learning and performance consultant based in Melbourne, Australia.

BUSINESS RESCUE: THE DOCTOR IS IN

By Chio Sakutukwa - Junior Legal Advisor at RSM Betty and Dickson (Johannesburg)

The South African law of insolvency has recently received a massive facelift in the form of chapter 6 of the Companies Act 71 of 2008 (“the Act”). Chapter 6 introduces, for the first time in South African law, the concept of business rescue. Business rescue can be explained to the layperson as follows: when a person falls ill, they will seek the services of a doctor. The doctor will prescribe the appropriate remedy and the person will recuperate and live a long life to be appreciated by family and friends. Such a person, upon realising they are ill, does not drive to the morgue and apply to have their life brought to a swift end. This was just the situation prior to business rescue. A company, in financial distress and unable to pay its debts, would immediately and unceremoniously be put to death by liquidation to the detriment of owners, employees and creditors (the concerned family).

Choosing a doctor that understands your needs:

Business rescue provides a financially distressed company with the option to seek a remedy that will restore its financial health. The doctor takes the form of a Business Rescue Practitioner (“BR Practitioner”), a specialist tasked with diagnosing the source of financial distress and prescribing a rescue remedy. Much like most people on any good medical aid, the company can choose its own doctor as long as he is a person, or two or more persons appointed jointly, in terms of chapter 6 to oversee a company during business rescue proceedings. As it stands now, there is no list of BR Practitioners to choose from so a company should nominate an individual whom it believes qualified to treat it and approach CIPC (formerly CIPRO) in order to have the individual appointed. However, pending the production of a list, such appointment will be for that particular company and those proceedings only. It is not a general appointment to act as the company doctor.

Do you need the doctor?

Picking your doctor is fine but how would you know you need one? A company needs treatment when it is financially distressed in terms of chapter 6. Financial distress means that it appears reasonably unlikely that the company will be able to pay all of its debts as they become due and payable within the immediately ensuing six months or it appears reasonably likely that the company will become insolvent within the ensuing six months.

However, financial distress on its own is simply not enough to determine that the company needs a doctor. Section 129 of the Act adds that a company may voluntarily begin business rescue proceedings and place the company under supervision if the board has reasonable grounds to believe that the company is not only financially distressed, but there also appears to be reasonable prospects of rescuing the company. Terminally ill patients need not apply.

How to make an appointment with the doctor

To make a voluntary appointment with the doctor, the board of the company must pass a resolution to commence business rescue. The resolution must be filed otherwise it will be of no force and effect. All affected persons must be advised by way of a published notice in the prescribed manner. Affected persons include shareholders, creditors, registered trade unions and employees unrepresented by a trade union. Next, appoint your doctor of choice who meets the requirements set out in section 138 of the Act. Once again, a notice of appointment must be published within two days of the said appointment. All affected parties must receive a copy of the appointment.

Failure to book an appointment as prescribed means that the resolution to begin business rescue proceedings lapses and is a nullity. No further resolution may be filed for three months from the date on which the resolution lapsed.

What next?

Having made an appointment with the doctor, the question on a patient’s mind would generally be: “What is going to happen to me now?” Therefore, in the next instalment of “The doctor is in,” we will consider the powers of the BR Practitioner and the skills required to rescue an ailing company (“The Treatment”).

ARE YOUR STAFF TAKING NOTICE OF WHAT CUSTOMERS SAY?

By Derek Stockley

Story One - How not to handle a complaint

We stayed in a hotel last year. From the moment we walked into the room, things started to go wrong. In themselves, each little problem did not amount to much. However, by the time it came to check out the next morning, I had decided to spend some time providing some feedback.

Although we had filled out a feedback form, I asked the receptionist to write down the list.

My first comment was about the queen sized bed, a factor in choosing this particular accommodation. The bed was fine, it just did not fit the room (obviously designed for a double bed).

My second comment was about an electronic room key. One of the two we had been given did not work.

Although I had five or six more comments to go, at this stage I noticed that the receptionist was not writing my comments down. When I quizzed him, he said he did not need to - the hotel already knew about the beds and the key was "one of those things".

At this stage, I abandoned my feedback and made the comment "that I was wasting my time".

We completed the check out process. I did not receive any form of apology from the receptionist. I left with another article topic and story for this newsletter.

The receptionist felt my comments were trivial and unimportant. To me, they were valuable feedback.

I did receive a nice letter from management about the comments on the feedback form. Although the annoyance subsided, the negative experience was still felt.

Story Two - A customer complaint was justified

We stayed in another hotel recently. This time the room was fine. However, things were still not right, specifically:

  • there was insufficient milk

  • breakfast items were not delivered

  • the fax machine in the room did not have any paper and the ink cartridge needed changing

  • the hot water was cold by 8.00 am

  • Did I complain? No, I did not. Why? It took me long enough to have the breakfast bill reduced. I could not be bothered about the other things.

    Customer complaints are an important asset

    How many of us have bought small items that have malfunctioned or broken. It has not been worth the time and expense to take them back. I bought a small house brand stapler at a supermarket. It broke on the first day. Thinking it was a "once off", a week later I bought the same model again. It lasted a couple of days before it broke as well. I haven't taken them back. I wonder how many of these staplers are giving the supermarket house brand a bad name. The brand name itself is about reliability, the exact opposite of what I experienced!

    If customers take the time to provide feedback, we should listen carefully. I know from my own personal experience, I do not provide feedback every time.

    I do not know the exact figure, but I expect that for every complaint made, there are many instances of poor service that are not reported.

    Organisations should develop mechanisms for recording informal feedback as well.

    Summary

    Customer service staff should pay attention to complaints made by customers. If the customer is prepared to take the time, then he or she is entitled to receive full and proper attention. Organisations should have systems that gather formal and informal feedback, both good and bad.

    Personal reflection

    In your business, do you listen to the good and bad feedback you receive? Are you willing to fix the problems reported? Do you thank customers for their feedback, good and bad?

    Derek Stockley is a training, learning and performance consultant based in Melbourne, Australia.

    FERRET OUT FRAUD

    By Timothy P P. Hedley – CPA, PH.D. and Richard H. Girgenti – J.D - August 2011

    Fraud poses a critical risk to organizations. Management can help mitigate that risk through a number of strategies designed to provide employees with multiple ways to report concerns about fraud or other misconduct.

    Deploy telephone hotlines. A dedicated telephone hotline is the most popular reporting mechanism used by large organizations, according to KPMG’s Integrity Survey: 2008–2009, which found that 65% of such organizations used hotlines. The more successful hotlines are those with appropriate oversight and protocols that provide employees with confidentiality, anonymity and availability through toll-free, 24/7 and international service. Click here for a chart assessing how to implement a hotline.

    Establish a Web-based reporting system. A dedicated Internet reporting system typically provides 24/7 access for employees to report fraud and misconduct candidly and anonymously.

    Implement workshops or focus groups. These meetings elicit employee feedback on actions witnessed in the workplace and encourage brainstorming on what kinds of misconduct can occur on the job and how best to spot and stop it.

    Conduct employee surveys. Confidential and anonymous employee surveys can help management identify potential risks based on employee attitudes, perceptions or behaviours.

    Solicit third-party interviews. Soliciting information from customers, vendors, regulators, creditors, analysts or others who come into routine contact with employees can provide insight into business practices and risks for misconduct.

    Keep in mind that auditing and monitoring in high-risk areas are important tools that management can use to help determine whether controls are working as intended and can often identify issues that may otherwise escape attention. Such auditing (evaluating past events) and monitoring (evaluating events in real time) can be conducted in areas where there is a specific concern, a history of fraud and misconduct, high employee turnover or organisational change.

    Require exit interviews. Management can identify concerns through exit interviews with departing employees, who may provide input on issues they did not want to raise earlier.

    Enhance management accessibility by walking around. This philosophy encourages a hands-on management style of visiting employees in their workspaces, listening to their concerns, asking questions and listening to their suggestions.

    Create and publicize an open-door policy. This gives employees direct access to senior executives without having to go through multiple layers of bureaucracy. An open-door policy can help identify issues that may otherwise escape attention.

    Deputize “ethics champions.” Geographically dispersed organisations should not presume that their telephone hotlines will be successful at uncovering fraud and misconduct at all organizational levels and locations. Such organizations may consider designating local resources as points of contact for transmitting concerns and allegations from the field directly to leadership.

    —These recommendations come from the book Managing the Risk of Fraud and Misconduct in a chapter written by Timothy P. Hedley, CPA, Ph.D., (thedley@kpmg.com) a KPMG partner and global coordinator for Fraud Risk Management Services. The book is co-authored by Richard H. Girgenti, J.D., (rgirgenti@kpmg.com) a KPMG principal who leads Forensic Services for KPMG’s Americas firm. For more on this topic, see Managing the Business Risk of Fraud: A Practical Guide at tinyurl.com/43um8ka.

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