Biz Bytes
The show for leaders who want their technology investments to work and understand that starts with fixing the operating model.
- We talk about the work that happens before the system gets switched on.
- We unpack the messy middle between “strategy approved” and “technology delivering value”.
- We teach the execution disciplines that make tech adoption stick.
Biz Bytes
Strategy Beyond the Whiteboard
Tell us what you thought about this episode
Getting caught in the strategic "messy middle" is a common struggle for Kiwi businesses – that uncomfortable space between having great ideas and actually realizing their value. Rob Erskine and Tony Rutherford, founders of Copper Fox consultancy, bring decades of commercial experience to this candid conversation about why so many business strategies ultimately collect dust.
The pair highlight several critical failures in strategic implementation: strategies that exist only in owners' heads, "drawer documents" created once every few years but never revisited, and the fundamental lack of execution planning – the missing "how" and "who" components that translate vision into action. With 97% of New Zealand businesses employing fewer than 20 people, many simply lack the bandwidth to simultaneously handle daily operations and strategic initiatives.
"Quite often strategies ask the question 'what do we want to do?' But sometimes the failing is 'how are we going to do that?'" Rob explains, pinpointing a key reason so many well-intentioned plans never materialize. Tony adds that relying solely on compliance-focused accountants rather than forward-looking commercial advisors further compounds the problem.
The conversation delves into the unique challenges facing New Zealand's business landscape – from our "batch, beamer, and boat" lifestyle mindset to the limitations of scale in a country of just 5 million people. For ambitious companies, looking beyond our shores becomes necessary, but brings additional complexities in navigating international markets and regulatory environments.
Perhaps most revealing is the discussion around risk management, with both consultants noting that while business owners intuitively understand their risks, they rarely formalize or systematically monitor them until crises emerge. This reactive approach leaves companies vulnerable, especially during economic downturns.
Ready to move your business strategy beyond the whiteboard? Rob and Tony's practical advice – building integrated teams with necessary expertise, assigning clear ownership of initiatives, and maintaining realistic resource planning – provides a roadmap for turning strategic vision into tangible business outcomes.
Today we're getting into the strategic challenges facing Kiwi businesses, particularly those in the messy middle, that space between having a great idea and actually getting value from it. I'm joined by Rob Erskine and Tony Rutherford, the founders of Copper Fox, a consultancy that specialises in helping mid-range New Zealand businesses get their strategic planning sorted. Rob and Tony bring decades of experience to the table, and they'll be talking about why so many business strategies fail, from the plans that only exist in the owner's head to the ones that are written down but never looked at again. We'll also be touching on shifts in the New Zealand economy and what that means for your business, especially if you're looking to scale beyond our shores. It's a straight-talking conversation about moving beyond the day-to-day grind and into the long-term planning that's essential for sustainable growth. Let's get into it. Rob. Tony, welcome to the show. Thanks so much for coming on board and thanks for your time, Thanks.
Speaker 2:Sam Great to be here.
Speaker 1:I do this to every guest just to put them on the spot, and you can fight amongst yourselves as to who goes first but spot and you can fight amongst yourselves as to who goes first.
Speaker 2:But to invite you to tell us a little bit about yourself, your background and where you're working now. Okay, this is rob first. I'll take the lead on this one, and yeah probably the last four years is it somewhere around there.
Speaker 2:Tony and myself got together to form copper fox, looking at a consultancy type operation where we're supporting businesses, particularly those mid-range businesses who often lack some commercial. Now You've quite often got owners that are specialists in everything but experts at not a lot, and they've grown their business very successfully to a point where now they just need some extra help. But they don't necessarily need that help full time, and that's where we come into play, and quite often those businesses are looking at quite a few changes. They just don't know how to bring those into fruition. So that's our space.
Speaker 2:We quite enjoy problem solving and dealing with challenges that are in other people's businesses hopefully not in ours and yeah, it's kept us busy for the last four years. Prior to that, going back to probably 1990, actually, I left New Zealand and went to the UK and spent 17 years there working, amongst other things, the banking environment over there, which was quite exciting and interesting, and then had a young family to come back to New Zealand sort of 2007, and did CFO type roles for mid-size businesses up until the point where I decided to go out on my own and then joined up with Tony. So now over to Tony.
Speaker 3:Yeah, so a similar story. Actually, we were crossed over in the UK, although I was only there for seven years, but yeah, so essentially for the last four years almost four Copper Fox has been running and our target, as Rob says, is a sort of aspirational business owner that wants some commercial clout to help grow the business and turn that sort of value dial, and that's something that we're really passionate about working with business owners that want that sort of expertise that we have and that need in their businesses. And in that intervening period, in addition to doing CFO work, I've run some large procurement projects. I was head of the Alton Ferry project to replace the ferry network in Auckland, so I've done some big transformational projects as well. And, yeah, back in 2010, I'd be about to step out of the conventional CFO career route to be doing what I do, which I'm passionate about or was so passionate about doing.
Speaker 1:This ties in nicely to the broader theme that I've been focusing on this month with strategy execution and why strategy often fails. We've talked a little bit about the reasons that execution dies after the strategy has been planned. We've also talked about why it's not enough just to have a strategy. You guys, through your shared experience, have no doubt will have seen many examples of strategy gone, strategy not gone. So well, From where you've come from, what do you find? The most common reasons are that a strategy paper, pack, document, roadmap, call it whatever it is, but why it fails.
Speaker 3:I guess the first one is that quite often it just doesn't exist in paper. It exists in the business owner's mind and they're just caught up in the day-to-day stuff of getting ahead and paying their people and dealing with clients and suppliers. Often strategy is not documented, so you can't manage towards an outcome if it's not documented. That's probably the first point. The second point is that when it is done, it's often just done at length. Often it's sort of a 15, 20 page document and it's done once every three years or so and it just sits in a top drawer. So it's not shared, circulated or refreshed.
Speaker 3:And certainly in the environment that we're living in now, with our disruption being rife around every corner, strategy has to be reviewed during the year, as well as the business plan and the financials, and we'll come to that in time. But essentially often it's not documented and if it is, it's not refreshed. The third problem is often it's not shared. To me, business by its very nature is quite small, with 97% of the businesses in New Zealand employing less than 20 people, and those teams are small and often the information is either not shared with them or, even when it is, there's not the intellectual horsepower or the capacity to actually do anything. That's on the strategy, rob.
Speaker 2:Yeah, look, I think quite often strategies ask the question what do we want to do? But sometimes the failings is how are we going to do that? And that question is sometimes is not that? That question is sometimes not answered, and that really should be the focus of the end of a strategy session, which is okay. Now we want to do all these things.
Speaker 2:How are we going to play play that game, how are we going to change things? And, in in addition to that, who's going to do it? So it's a, it's aligning responsibilities to those that can actually bring into play whatever changes are needed to fulfill those strategies that they're looking for, and they could be five, 10 year strategies. That's fine. But quite often the failing is what are the small steps, what are the next steps, even to actually get us on that journey? Some of that is around what Tony was alluding to, which is engagement, engagement of the rest of the team. So, sharing that foresight, that strategy, with the rest of the team so that they can be just as engaging in that pathway that they're trying to follow.
Speaker 3:Yeah, and something else that sort of disoccurs me as well is that the strategy for a 25-year-old going into their first business is different to a sort of a 55-year-old who might be buying into something with a person to be quite different to a younger person. So that also comes into play as well. And just reiterating the point is that the strategy is all about the doing piece that has to be done in order for the business to achieve the right sort of goals financial and otherwise to support the business owner's lifestyle objectives. And going back to Rob's point, often it's like a big, heavy list of audacious goals rather than something that's built with sort of the required diligence and commercial rigor around it. Because taking this in the SME sector, these the exec teams you only call them that in fact the whole business for that matter. They've got day jobs as well as the sort of the business plan project piece which is where the value is created, that whole resource planning around people and money and time. It's really misunderstood. This is not thoroughly thought through at all.
Speaker 2:Yeah, that's a big point actually because quite often in these organisations you get excited about a strategy day. There's a lot of energy that goes into that day. Then you come away and then you confront it immediately the next day or the next week or whenever, with business as usual and that gets in the way of making any progress and that's got to be factored into the action plan and the list of projects and the timeframes. And, like Tony was saying, and the list of projects and the timeframes and, like Tony was saying, the resource planning, can it actually be done by those that are working currently in the business or do you need to bring in extra resources to do certain types of projects that are going to make those changes needed?
Speaker 1:And there's a good point. The who piece ties into what you're just saying there as well is can it be done internally or do we need to bring anyone in? It's not just who's going to own this or who's going to do this. It's a question in there that needs to be asked of do they have the skills or do we have the skills? Neither, or to actually deliver that. And, to your point then, it's a question of do well, do we train them, do we coach them on what they need, or do we poach them and find them from somewhere else, whether it's a full-time or a part-time role, correct, that's right.
Speaker 1:Agree, people plays a big part in this, and july's focus on this channel was really largely around people. You raised a good point in there, tony, about the size of new zealand businesses 70 have less than 20 owner-operators or the owner happens to be in the exec seat. How common do you think it is that that owner just tries to internalise their strategy and doesn't actually seek outside help, either from people in the company or from consultants like yourself?
Speaker 3:I think that's the default situation and then they can do reasonably well, certainly for the first few years that they're operating. You've still got the energy and often the age and the enthusiasm to carry it through. But going back to Rob's point from a scouting point of view, they had the wall when making decisions around. Do I hire that next person in my team? Do I buy a new distribution centre or map a, build one to tap the whole stock? Do I move into a new distribution centre or build one to hold stock? Do I move into a new geography? Do I move to a different service line?
Speaker 3:These are really important decisions that can make or break a business and that sits on business as usual. Then you get something like COVID hitting or an economic downturn than we've got at the moment and all of a sudden they're floundering and they're chasing deteriorating commercial results with plans. So they're being reactive to some quite confronting commercial realities in their business rather than front-footing it. The advice would be and I'm not just quoting yourself here, I'm quoting anyone that's working in the same space would be to get that trusted business advisor on board early so that you can anticipate these things and manage your way through them.
Speaker 1:Yep, yep, I absolutely agree with that. And yeah, business advice is not all created equal, is it it's? You will find there will be some advisors whether it's because of sector specific or domain specific within that sector that are going to be more valuable than others is. Would you agree with that?
Speaker 2:yeah, yep.
Speaker 3:Short answer yes but on things that we confront and I don't want to be disrespectful to our, to our colleagues of me andtered Accounting Procedure, because there's some very good commercial people within that area. But often business owners look to their Chartered Accountants to fulfil that role. But the reality is that whereas a commercial CFO is looking forward, looking at driving commercial outcomes, looking at KPIs, doing the whole forward-looking piece, the Chartered Accounting and public practice is reactive, statutory, technical, compliance-focused and they're not working in the business on a day-to-day basis. So whoever needs to be fulfilling that role with a business owner needs to be immersed in it during the good times and the bad.
Speaker 1:This just reminded me of a conversation we had recently, tony, with the difference between cost management and cost reduction, which, again not tarring all accountants with the same brush, but often when I've seen accountants working, their focus is on that cost reduction, trying to keep costs down as low as possible. It's a very different skill set to cost management, which is more about that forecasting and planning throughout the year as to what you need.
Speaker 3:That's right. You look at the Engines Island scenario, where they were kind of afraid and over during the COVID times and it took them quite some time to bounce back because they didn't have the sort of economic or the financial sort of strength that some of their competitors had I think you hear about Singapore Air and such. So those that had the right sort of scale and financial backing behind them turned around really quickly and reinstated what they were and our national airline was really floundering. That is really around putting money aside for a rainy day. It's around having that money to invest in the right sort of things and just having a very close eye on what's happening in the economy the local economy and internationally to make sure that the business is primed to bounce back at the right time. So looking forward rather than looking back.
Speaker 1:Yeah, yeah, any thoughts to add on to that as well, rob?
Speaker 2:Yeah, I suppose that even in difficult times, the attitude has got to be as you've got to try and be as agile as possible. And you've got to try and be as agile as possible and you've got to try and build that into the way that you operate so that, even if you do have to react, you can respond quickly to dramatic changes in the marketplace. And that's not always easy in a small business with an owner who has a fixed mindset. That's why it's always good to get people that are invested in the business but outside the business and sharing their views on how a business can better operate in those types of environments.
Speaker 1:You talked on mindset there and the joke for many Kiwi business owners used to be that the focus was on the batch, the beamer, and the boat, the beach house for anyone international not familiar with the term of a batch In your experience. Is that still true of New Zealand business owners or have they evolved their thinking a little bit more?
Speaker 3:I think they're focusing on getting that Tesla in the garage these days, but I think there's a lot of business owners that still are focused on that, rather than intergenerational wealth. There's a topic in itself around succession planning and we can touch on that another time, but I think the focus to answer your question, ant, is really around short-term and satiating those short-term desires, rather than what am I going to do with the business and who am I going to pass it to, and do I want to lump some or some sort of annuity amount out of it? Yeah, I don't think we've really moved on that much beyond that, to be honest.
Speaker 2:No, I think the fact that sort of 90% of New Zealand businesses are SMEs and it's probably, I was going to say, a way of life, but it's an income that they've sought and the standard of living like you say, the batch and the beamer and the boat that's a lifestyle that they aspire to and if they've got it, then there's not a lot. They're going to do extra because they've got themselves into a pretty good mindset and, like I say, standard of living, bringing up a family where they can go on holidays and this and that and the other thing. Very few of them are looking to take a business from three to five million to 25 million and beyond and creating a legacy for, potentially, their siblings or children to follow in their footsteps.
Speaker 2:There's not always a lot of that, so back to Tony's point. Succession planning isn't really something that I think about too much. Yeah, the average and scale does scale come into that?
Speaker 1:We're talking about a New Zealand perspective here, Country of 5 million people, as you said, 90% are small or medium, 70% are under 20 FTE. We just don't appreciate scale in the way that a European or an American market would even to some extent an Australian market, that they're only five times the population. But we're not appreciating that scale and what potential could be if we were planning boldly, are we?
Speaker 3:Correct. I think it's a very different mindset and a lot of it, I think, is just self-limiting beliefs and desire that sort of. I think the tall poppy syndrome comes into it as well. I think we as New Zealanders we're a little bit embarrassed about being too successful, yep, and there's the old sort of knocking machine where people wall quite often on the way up and even looking at some of our success stories who have really struggled with this, they applaud them and they get to global recognition, global status. But on the way up it's really hard and I don't think in the current environment that the banking sector are as supportive as what they could be, and there's a lot of businesses that are out there hurting and having to look to other family money and innovative ways of raising cash to just get them through this period. So I think there's a number of things that are working against us. But essentially, yes, it's very hard to grow a successful business in New Zealand.
Speaker 1:Which then leads to if you really want to hit that scale, your strategy should be looking broader than just New Zealand, shouldn't it? It should be who else? What I'm selling and I'm going to come back to a service-based economy in a minute but what I'm selling, creating, delivering to truly get that gross Potentially and we saw this with Rocket Labs, with Xero, there's a couple of other Kiwi success stories that fit the same, but Boj as well but potentially you've got to be looking beyond our border.
Speaker 3:Well, what do you do? And of course those are all successful stories that have done that, but it's obviously been a very hard route to achieve it. Yeah, I mean, I guess, for I'm into the mix of all this, certainly when you're moving product around the world. The thrown into the mix of all the certainly moving product around the world is the globalisation trend that we've had for the last 30 odd years, where there's a commercial hedge which is achieved by having different customers in different geographies.
Speaker 3:When COVID came in and toilet paper ran out in the Auckland region, it became abundantly clear that there's risk around there. There's, I think. Basically, the answer to globalisation is that it's still important as sort of the multi-gay that's worth the kindings of scale in your business, but it has to be done in a more of a balanced way. So you're focusing on not only the far reaches of the globe and maybe product, but also what you can do to cut the intermediaries out of that supply chain. So what you can do is to cut the intermediaries out of that supply chain, for instance, work more efficiently and to have some sort of resilience from the island if one particular channel causes it to break down.
Speaker 1:Yeah, yeah, rob, what's your take on it?
Speaker 2:Yeah, look, I agree, I think the New Zealand market is a small market and so if you've got ambitions to grow the business then definitely have to look offshore. Now the natural first port of call is Australia, because it's so close. So log there globally would be attractive to the types of products that you're selling. Then it's a case of how do you do that? Do you take the punt and you set up a business within those locations, and in Australia it might be across the various big cities. Likewise, in Europe it could be a number of locations in specific countries.
Speaker 2:But what do you do? Grant offices what do you do? Yeah, what do you do that? What do you? Engage in joint ventures with people that have maybe a network within those countries, and that's an easier way to tap into the end user. There's different ways of setting things up at the start, but I think there are definitely solutions for medium-sized businesses in New Zealand that have a product or a service that is attractive to a foreign market. There are ways, there are smart ways of getting that into those markets and then gradually establishing yourself in those countries and then gradually establishing yourself in those countries.
Speaker 1:Yep and this comes back to that advisory piece as well that we talked about before of horses for courses with the advisors, where Australia is not too dissimilar from a regulatory perspective with New Zealand. Obviously it's got some differences, but if you were trying to get into America, there's 50 different states and then there's the federal jurisdiction. You've got an entire body of red tape for want of a better word to jump through. If that's your vision and that's your strategy, then part of your roadmap needs to be we will bring in an advisor who has experience in offshore and into America.
Speaker 3:That's right. Yes, you certainly need that expertise in your business, but of there is a cost to service those opportunities before you even get to the yes, no decision. So you need to be realistic about I know there's models out there that price up the working in different jurisdictions, but you need to be very mindful. It's not New Zealand cut and paste. It is different. And if you say this in the case of Australia and the US, you've got federal laws and then you've got you've got the states as well, which have different certain laws as well around health and safety and employment and such things. So you really need to be well informed and have that money put aside, because it's not too necessarily and there's no guarantee for success either.
Speaker 2:Yeah, and it's a good point in there that there's no guarantee for success either.
Speaker 1:Yeah, and it's a good point in there that there's no guarantee of success. And even before you go down that path of bringing the advisor in, who's got the scale, you've got competitive lens, competitive analysis, you've got to be looking at the customer need and all of that. So it's a multi-pronged attack to go from we're selling out of our Auckland office to we have an American office and we're scaling because the competitive market might be very different over there. That's right. So I mentioned this before and I'm going to come back to it Service-based economy. In your view, has New Zealand evolved too much into being a service-based economy rather than a creation-based economy, and does that limit the potential for what our growth could be as well?
Speaker 3:Look, we've moved away from, yeah, the furniture question. If you're saying that the people taking our IP or our product and manufacturing it or building on it and creating value and there surviving that value further up the chain, as you question, is that happening? Yes, it's happening. I look back to New Zealand, my early 20s, going up in the 90s, and we still had a lot of expertise on shore and we built things and we manufactured things and as such, but yes, we've handled all that away. So our economy is an input-dependent economy. Yes, of course there are some amazing export stories out there and of course, swankeria is a story in its own right, but yes, we are, I think, handling a lot of our expertise at the VATI chain and others are deriving VATI from it.
Speaker 1:Rob anything to add to that?
Speaker 2:We're a country where we've struggled to create new products ourselves. Manufacturing is definitely not a strength, even though I know a few organisations that are doing very well in that space. We tend to import more than we export outside of the dairy or the farming sectors or the primary sectors. I should say that kind of tells you that we're reliant on other people creating stuff that we can then buy and then use ourselves either in business or in life, just to move on. Does that create? And we don't seem to have an appetite really to be that creative. Yes, we do see these hubs where you've got software that's been and that's probably one of the strength areas software that's been created by young guys and so I know science is another one. Yeah, they're small sectors, they're not really mainstream and it just yeah, I suppose. From a New Zealand point of view, we don't appear to have the incentives and the attractiveness to be giving people the opportunity to get out there and make stuff that isn't available anywhere else.
Speaker 3:Yeah, I think the current government and this is not a political comment, this is just an observation they are trying to do things around reducing the cost of compliance, reduce the barriers for overseas investment, for visas.
Speaker 3:There's new innovation hubs in the science, founding the new ground research entity that's just been formed. These are all good things, but we're getting back to the earlier point. We've really lost our way in the world, I think, since the late 1980s, early 1990s, and it's a big problem to fix, and successive governments not just the national government here, I'm talking about successive governments have just turned a blind eye to this, and so there's a big gap to fill, and really there needs to be some sort of cross-party agreement on the sort of investment priorities for New Zealand to get us back into where we should be as a first world country, because we're lagging so far behind. If we have a change of government next time around, with the Labour coalition coming back in, there's not going to be the same focus necessarily. So yeah, that is a concern. We're three steps forward, two back, and that seems to be the feel out in the real economy too, with the business owners that we speak to. It's getting easier, but it's not easy.
Speaker 1:It's a big catch-up too to achieve, yeah, and I'd say we could spend a whole other hour on the political side of things, but I'd say that we're right. We've moved from a can-do number-eight-wide she'll be right mindset to more of a fixed mindset. So we've gone from a growth mindset ultimately to a fixed mindset of change, and that's inhibiting a lot of the businesses that I'm coming across as well is they're looking at it as a there's a cost associated with this and I can't afford that right now, rather than actually the opportunity of doing this while it's going to cost now is exponentially greater.
Speaker 3:And that's a good point. The business planning piece sits under the strategy which Rob and I, as experts, are around that whole resource planning and prioritization. It's all about that. It's around recognizing that there's a cost of doing something but there's an opportunity cost of not doing something. And certainly those businesses if there's 10 in a sector and five are struggling, lots of five that aren't struggling that will be gaining market share by taking that risk and spending the money, although the economy probably doesn't support it at the moment. So what are we seeing at the moment? We're seeing big corporates in the government starting to spend money, including in the regional government side of the economy. It's starting to filter down. So those means that they can see the opportunity that are out there spending money investing on IT infrastructure or building IP in their own business, whatever it might be. Those are the ones that are going to succeed and thrive over the next three to five years.
Speaker 1:Yep, yep. Three to five years, yep, yep. You touch on IT there, and there's an interesting paradigm shift that's come through in the last five years or so. It is accelerating, there's a swing back, and what I'm meaning here is the shift to more of a cloud-based operating model.
Speaker 1:So if we pick on the MSPs, the managed service partners, who tend to operate in the middle between a technology provider and a customer, once upon a time they had their margin. They sold hardware, they sold servers, they made margin on those servers and that was a business model for them, as their client base has moved away from being infrastructure-led and is more cloud-led. We're moving to Microsoft 365, we're moving to Google Workspace. The cost has changed from the server purchase, installation, support, maintenance to just licensing, managing the throughput of licensing and that's hit their margin, and so they're needing to evolve as well, and I guess we come back to what we talked about with the. We don't know what's around the corner, but for some of those companies they could have been planning for the. What if our customers stop buying hardware from us?
Speaker 3:Yeah, I agree. It's the sort of thing that there's some things that, in terms of a risk matrix or the impact from likelihood, the sort of the risk mapping, some of these things, really should have been on there and should have been like right up there as part of the advisory or statutory board review on a monthly basis, ensuring that there's a game plan. Not just we'll deal with it. It becomes a problem, but actually this has happened and it's triggered this sort of outcome. Therefore, this is the plan that we agreed on and we're going to do. That's the sort of thing. That's how that really needs to be done across all business, not just the big guys.
Speaker 3:Of course, there's always going to be things from the business risk that they do around step changes and global events such as COVID, that nobody could have anticipated the severity of that or the duration of it. There's some things that you can't plan around. The things that you were talking about you can plan around and there should be an action plan attached to each of those risks An open question for you both here In your experience, how good are New Zealand business owners at having risk matrices and managing risk?
Speaker 2:Look, I think the owners in their heads are aware of the risks associated most of the risks associated with their business. Do they formalize that? Are they disciplined around managing those risks or identify them or monitoring them? No, my experience is they're reactive as opposed to proactive. They'll deal with something like okay, health and safety now is at the forefront because directors themselves were personally liable. I've definitely seen owners pick up the baton there and be more proactive and engaging and bring those types of standards up to where they need to be. There's probably an overkill on those standards in some areas, but they've still got that director liability associated with not doing stuff or having people hurt because they haven't got the right standards in play where they operate from.
Speaker 2:But even outside of that financial risks, market risks, internal, external, even resource risks they don't necessarily look at that.
Speaker 2:Even risks associated with them as the owner, there's not a lot that.
Speaker 2:Look at what happens if I get hit by a bus, what happens to the business and with SMEs, owners think they're bulletproof. So, yeah, I think there's a lack of engagement in that space and that puts businesses at risk. And when we've got a downturn in the economy and the risks associated with their business. It's often too late before they react to those, and we're now starting to see a government department and the IRD starting to put the boot in for certain organizations that owe their money and going we're going to cut our losses and we're going to put these guys into liquidation because we can't see them paying this back and we don't want them to owe us any more than what they do now. Yep. So there's those types of situations that they aren't foreseen, they aren't even thought about quite often by these smaller organisations, even some big ones, and I think that's a weakness in business generally across new zealand yeah, no, I definitely come across the same thing and you're right about the personnel risk that that isn't well it managed, or even managed it well visualized.
Speaker 1:For many of them and I even think back, to draw back to your point, tony, earlier, about a 25 year old's strategy is going to be vastly different to a 55-year-old's strategy, and it's not just from where they're trying to get to with their business, but there's a time of life piece. So if you're trying to start your business up and you're 25, you've still got other life milestones that will come through and cause disruption marriage, house kids maybe they might not be on your strategy. That's entirely up to you. House kids maybe they might not be on your strategy. That's entirely up to you Versus that 55-year-old who. All of that's behind them, and they've got a different outlook on not just even an outlook, but they've got a different road in front of them as to what's going to come up and disrupt them. Correct?
Speaker 3:That's right.
Speaker 1:So let's come back to execution. We've covered a lot here, gone over some interesting ground, but have let's come back to execution. We've covered a lot here, gone over some interesting ground, but have you got any examples from either of you where companies you've worked with have had that clear focus on execution? The strategy's been done, they've had the offsite, they've eaten all the mints and the lollipops, indeed, but they've actually come back with a proper plan and they've executed. Have you seen this done? Well, you don't need to name the companies. Broad examples will be fine.
Speaker 2:A recent example this year a company I've been involved with for probably five or six years now. We had a strategy session earlier in the year and it was focused on what do you want the company to look like in five years' time, if not 10 years' time, and and that was fine. So it was a little bit pie in the sky, but but there was. There was certainly some good, good stuff to come out of that, but the important thing that come from that was half half the session was around right, how, what do we have to do, how do we do it and who's going to do it? Around getting creating that pathway and taking small steps and then gradually building momentum towards that ultimate goal. And we're four months down the track.
Speaker 2:They deliberately picked three relatively achievable projects to kickstart it. One of them included engaging the rest of the staff. They employ about 30, 35 people across a few locations and so they're bringing in, they're changing the culture somewhat and showing both visually and through actions that they're serious about making the changes. So it's not just the senior management team, they're getting all people involved in that pathway and in some of these smaller projects. So I think, in that case at least, we're not five years down the track, we're only six months, but they're definitely shown positive signs at executing on some principles that come out of the strategy that will help them get to where they want to be Nice.
Speaker 1:Nice. Thank you, tony, anything you'd want to add or any other thoughts?
Speaker 3:Yeah, without knowing the agency, I did a large piece of work. I was a business plan for a very large government agency it was a household name and their project piece was around $100 million that they had to spend on internal OPEX projects and my role was working between finance and procurement and the planning function around assessing the criteria, determining the criteria, applying the criteria to all the projects, and then you know what was above the line, what was below the line. So above the line is yes, green light. Below the line is orange or red.
Speaker 3:We're not going to do this and anyway, use this prioritisation software called 1000 Minds which I think the World Health Foundation and some of the largest hospitals using New Zealand collect the sort of the views of you for the executive team and key clients and suppliers and staff and everyone has a sort of view which is harmonized, and then you end up with a green light of what's going to be done and what's not going to be done to spend that $100 million.
Speaker 3:Of course, the lesson from that is the more people you consult although in best practice that's the right thing to do the harder it actually gets to be to land on consensus and actually get the green light on what you are actually going to do and in this particular case, the CEO just had enough said oh bugger, this, this is what we're going to do. We have these six projects and that's how we're going to spend the money. Going through this process I guess it was a very robust process. In the case of this agency, it didn't guarantee success, even though they had a lot of managed spend, that we had project teams and everything else. It just essentially came down to the CEO's private wish list and there you go. That's the way I think sometimes.
Speaker 1:Executive warrant I think we used to call that when I worked at the bank. Executive warrant who calls the shots gets to call what the shots actually are sometimes. Yeah, so, just as we start to wrap up, what advice have you both got for those business owners who are struggling to embed that culture of execution and struggling to go from strategy, from the whiteboard, to actually delivering on that? Have you got any advice or any frameworks that you'd recommend they follow?
Speaker 3:My sort of advice, I guess, is an obvious one that I mentioned earlier on, which is essentially you can't do everything as a business owner. You've got so many demands in your personal and professional life and you're getting pulled in every which direction. Yeah, so build the sort of team, the integral team, as far as you can with what you can afford, but do get that trusted business advisor on board to help you separate the weak from the chair and help provide that thinking. And that can be just an individual or it can be a fuller advisory board. The roles of a consultant slash doer in your business is different to a coach, different to an advisory board. Just find somebody you can trust to give you some direction on there, and that might be your accountant, your private practice accountant, it might be your banker or your lawyer. But get that sort of experience on board and build that relationship with that person and it's sort of a deep partnership and that's right throughout the last cycle of your business.
Speaker 2:Yeah, and I think added to that is, if you go back to your strategy, depending on what you're wanting to do, you've got to get the numbers right and realistic around what it's going to cost to make these things happen and quite often you've got to. The cost will be bringing in the experts when you need them to come in, because you just don't have that knowledge or expertise within the business, or you don't have the bandwidth, or your staff don't have the bandwidth. They might have the knowledge, but you've just got no capacity to be able to move forward. So I think that's important. They've got to be realistic about what day-to-day commitments consume your internal resources versus what you're trying to achieve. And yes, they might be able to to to push through a project, but they might have to be taken off what they're doing on a day-to-day basis, and that means maybe looking at backfilling certain individuals.
Speaker 2:The other key thing is, as you break down the strategy into various action points, each one of those has to have an owner. They have to be internal because they have to have skin in the game, and that doesn't mean that they have to do the doing, but they're responsible for what actually takes place, including how much it costs to get from start to finish. So little things like that will help. But I think there's got to be a reality that if there's quite a bit of change that's to be made, it's pretty much likely that you're going to have to bring in external resources to make things happen.
Speaker 3:One of the things that's occurred to me as well, which is in relation to a work I've done with quite a large client recently where they were going through a refinance process, which is, in their case, having to monitor cash flow really closely on a day-to-day basis and there's someone sitting over that because things really were that critical and it's important to maintain three views of your cash flow your day-to-day most likely scenario, when your client's most likely to pay you. When do you have to meet your payroll? When you're most likely to pay your suppliers. But also, on either side of that, doing that best. And in that worst scenario and certainly in the current climate where there's been, I guess, quite a low degree of confidence in the economy, that's that worst scenario that might be 70% of your most likely Be able to trade your way through that timeline and be quite clear on what your business model is at that, so you can sustain your business.
Speaker 3:Actually saying, if it is at worst, this is what we're going to have to do. We're going to have to reduce our headcount by this. We're going to have to defer this capital. We're going to have to put our supplier terms. We're going to have to renegotiate our customer terms that are paying us earlier. What does that look like? And just following on from there, not having a short-term focus which is what Rob was relating to as well, having a sort of that long-term focus, if you're going to go to your bank or to your equity partner and say, look, we need some more money, things are tight Don't look at the projection through the end of the current year and see for financial year 31 March and say this is what we need to do at worst scenario in order to transfer it to there.
Speaker 3:Where's the money going to come from? What additional investment can we do? What can we get from the bank? What can we get from the second tier lender? Actually have that sort of in place so that you know what you're going to do in order to get through those difficult times. Nice, in place so that you know what you're going to do in order to get through those difficult turns.
Speaker 1:Nice, great tips there, guys. Thank you for that Final thought, easiest question of the day. If people want to find out more about you both or about Copper Fox, where do they go?
Speaker 3:Well, we've got websites. We wouldn't be very professional without one. So that is wwwcopperfoxorg. We've got our contact details there, rob and I, robeskin at copperfoxorg, tonyrutherford at copperfoxorg. Our mobile numbers are on the website and there's an 0800 number too, if you want to get hold of this.
Speaker 1:Nice Thanks to both there. Any final thoughts from either of you, Rob or Tony?
Speaker 2:or Bo. Look, it was enjoyable chatting about this sort of stuff. This is what we do. I wouldn't say every day, but we get involved in the sort of conversion from strategy to action plans all the time. It's stuff we enjoy because it's you get involved in owners who are energized, they want to make some changes. They've got, in some cases, high ambitions and it's nice to be able to convert that into reality through simplification of that strategy and working with them and helping them just make things happen.
Speaker 3:Yeah, I agree with that. I coined the term which I had recently with a fellow colleague. It's around deep partnership. That's something that Rob and I really believe in. It's tied into our sort of copper fox values, which are also on the website too, but we like to be there through the good times and the bad. Now, the reality is that probably 80% of our clients come to us when they're in some form of distress. It doesn't just have to be there. If you're aspirationally minded, you've got a little bit of cash and you want someone to talk to on a short-term basis, a few hours a week, we can accommodate there. So we'd like to be there for businesses that are aspirational and that just want to be guided along the way, not to those that are struggling and need some last minute help. It's good for us to be in early and be in for the long term, nice.
Speaker 1:Thank you for that, both of you, and thanks for your time today. I really appreciate it, tony and Rob.
Speaker 3:Yeah, thanks, anthony, that's been great. Thanks, aaron.