I read a great story about Kobe Bryant over the Xmas break about the power of doing the basics well.
Bryant is an American basketball great famously renowned for his unequalled work ethic and competitive drive, something that lead him to 5 NBA championships, and even an Oscar when he turned his hand to directing soon before perishing in a helicopter crash early in 2020.
The story goes back to a basketball camp that Kobe ran for aspiring basketballers in the early 2000’s. One of the coaches in attendance asked if he could attend one of his individual workouts and was informed that he could, but would need to be in the gym at 4.00am! Looking to impress, the coach turned up at 3.30am, only to find the already 3x championship winner already amid a full-on session.
Other than the time of day, what really stood out to the coach was the content of Bryant’s workout. Expecting to be wowed by drills and exercises befitting a man of his abilities, the coach instead witnessed a workout focused on drills and skill work that he would have taught a 12 year old.
Inquiring of Bryant once he was done why he would work on such simple elements of the game, his reply was that without continuing to execute those basics on a consistent and high-level basis, he would not have the base he needed for anything else he may wish to attempt.
So, let’s broaden the net a little into your business.
At a time of year when you are likely to sit back and reflect on the past year and the one ahead, I thought it was a great lesson in focusing on the simple things. Like many of you I’m sure, I’m prone to long lists of the things I want to achieve in the year to come, some simple, some more grandiose!
But it’s easy to forget the basics, the fundamentals of what we do at a base level that make ourselves or our businesses successful as we look to chase the things that look far more exciting or hold much greater rewards. But unless we nail those basics, no lasting or sustainable growth and success is going to come.
So, as we embark on a New Year, one that will bring challenges and opportunities both seen and unseen, what are some the key things to be focusing on that will form the base of a successful year?
Rather than stick with some of the more obvious factors, I’ve tried to broaden the net a little.
1. Trust Management
Most businesses we see have some form of Trust ownership in place, either as a direct owner of an asset, or as the shareholder in an asset owning company.
Changes to the Trust act in early 2021 put a much greater focus on effective trust management, most particularly the disclosure of information to beneficiaries.
Alongside good trust management there are other factors to focus on too. These include ensuring you have an up to date will, that you have a Memorandum of Wishes in place to guide your trustees, and that you have appropriate life insurance in place.
2. Tax
In general, returns across most industries are currently as good as they have ever been. Profitability is strong, and (touch wood….) looks sustainable.
The only downside is the increasingly larger tax bills that have or will continue to be incurred. That puts the focus on really good tax planning and a proactive approach to managing tax liabilities. Stay close to your accountant and ensure you have a clear picture of profitability, potential tax liability and your cashflow.
3. Personal development
A fundamental of any good business, personal development so often slides as other operational elements take precedence.
But whether developing yourself or your people, it’s at the core of driving long term engagement and sustainability both personally and as a business.
The start of the year is a great time to sit down personally or with key people in your team, mapping out the areas you want to focus on over the next 12 months, the resources you need to do so and who is going to provide support and drive accountability.
4. COVID response
Having glided largely unscathed through the last two years, New Zealand now stares down the barrel of an Omicron outbreak.
What is your plan should COVID strike your business? What contingencies do you have in place? Can you operate with a large chunk of your team unwell or isolating? And do you have plans to manage the inevitable impact on supply chains as the virus spreads?
5. People and labour
The hot topic at most tables we sit at.
New Zealand has record unemployment, no immigration and booming industries looking for good people. The pool of talent has never been so shallow, and the demand so deep. And its hard to see that changing, whether it be the ongoing impact of COVID, or simply demographic shifts that will continue to influence labour supply, or its demands.
So, what that means is being an employer of choice is becoming more and more important. Having a clear strategy around your management structure, thinking laterally about what you can offer good people to come and to stay, how you build a culture and reputation that people want to be a part of and how you can get people to buy into what you are trying to achieve.
6. Plan for the next 12 months
Have you mapped out the year ahead of you?
Contemplating another year of the challenges and issues and requirements of being a business owner can be a little intimidating at this time of year. That’s why mapping out the “big rocks” you need to address, the key decision points through the year, your financial or personal goals or your key strategic aims is so important.
7. Financial management
Not to be forgotten!
One of the core basics of any business. This means having a clear picture of the current and next year’s forecasts and profitability, having a clear plan around how cash will be used, a capital budget for the next 1-2 years and as covered above, what might your tax position look like?
It also means having a plan around your engagement with your Bank, and an understanding of their expectations.
8. Independent advice
Last but not least!
Whether it’s NZAB or someone else, we continue to see the value of good, structured independent advice. Whether at a management, governance or personal level, having the right people around you, people driven see you succeed, is one of the simplest ways to move your business forward.
Nail the basics and the championships will follow
The basics might not be sexy, but they are the bedrock of success, whether you are one of the greatest basketballers to have played the game, or piloting a business that will support your own, your families or other families ambitions.
Champions are brilliant at the basics.
Who is NZAB?
Farming’s very complex and you can’t be an expert in everything. That’s why the best farmers gather a specialist team around them. Our specialty is better banking outcomes for our clients.
There’s no one better to work alongside you and your bank. With a deep understanding of your operation and our considerable banking expertise, we can give you the confidence and control to do what you do best.
We’ve been operating for four years now and we’re right across New Zealand, For an introductory no cost chat, pick up the phone and talk directly to one of our specialists on 0800 NZAB 12.
Or if you prefer, Visit us at our website or email us directly on info@nzab.co.nz