Trigger Point Budgeting is a simple tool that I’ve been using with clients for over 20 years. If you refer to the Coronavirus model we’ve discussed previously, your model is going to be around Surviving, Adapting and Thriving.
The Trigger Point Budget tool sits into the “Survival Phase” and is about the money you collect and about cash that you spend. Even if your business is going well now, I would suggest you use this tool now because we don’t know what changes are going to be ahead for us.
To determine your “trigger points”, understand the current cash costs of operating your business. Calculate a point where cash income starts to get close to your costs (see Decision Point #1 on the image), This is the income level where you will need to make decisions and implement actions that will reduce your costs. These could include: access to Government support programs, debt management, changing staffing levels, reducing services, etc.
Implementing actions at Decision Point#1 will reduce your costs and give your business “breathing space”. Calculate the next point where income starts to get close to costs again – this is Decision Point#2. Determine the actions that you need to take at this point to reduce costs and continue for other trigger points.
What this tool does is driving you to make decisions in the cold light of day rather than in the heat of chaos where poor decisions are often made. It’s about making decisions NOW and then when your income gets to a Decision Point level, you can ask yourself—what actions did we say we’re going take? Which of those are still relevant? Which ones can we put in place? Are there any additional ones we should be taking now?
The model shown here is not about a specific timeframes – it’s more for illustration purposes. The slope of the curve could be very steep and/or you could jump from Decision Point #1 straight past Decision Point#2 to Decision Point #3 quickly so it’s important that you think through what the potential options are NOW and at what point you’re going to need to do to make some changes.
The Next Steps
Download our COVID19 Business Guide at https://shifft.com.au/covid19-business-resources/. We’ve got lots of free resources to help you navigate this new environment.
Access our FREE Online Training. We’ve got 25 business topics where you can pick 2 business training courses to do for free in a 6-month timeframe. Valued at A$400. 100% free. No obligation. Sign up here – https://shifft.com.au/free-online-business-training-programs/
Book a call with Russ. If you’re really stressed and having some challenges with COVID19 and how to deal with it in your business, click on this link – https://calendly.com/russellcummings/30-minute-call. It will take you to my diary and we can find a time to have a phone or a Zoom chat—no cost, no obligation. We’re all in this together and I’m happy to help you out if you need a hand to get your head straight.
I hope you’re staying safe and that you’re managing to deal with COVID19.
I find that when we reflect on our business and personal performance, there are always areas where we could have improved. I’m sure there are plenty of times when things have gone extremely well, and it’s worthwhile reflecting on what the drivers were behind those, so we can improve and grow our business.
Understanding what causes missed opportunities, errors, and generally a low level of performance is also critical to developing our future strategies and plans.
If you stop now and reflect on the previous 12 months and the areas where you could’ve done better or where you lost opportunities, they often come down to things like:
I bit off more than I could chew. Often, we take on projects and opportunities that are bigger than our capabilities. As a result, we either fail to deliver or only partially deliver on the outcomes;
I didn’t move quickly enough. Too often, we are tentative in our approach and too slow to react which means we lose valuable opportunities that are snapped up by competitors, or the marketplace changes and the opportunities vaporise for the moment;
I didn’t have enough information. Too often, we enter an opportunity or a project without enough information for valid decision-making. This often means that we under- or overestimate the level of resourcing required or the expertise required, and as a result, we fail to take full advantage of that opportunity.
There may be other reasons why we’ve missed out on opportunities in the last year or two, but I find that these three are common and appear more often than not for most of my clients and in my business.
The challenge though, is when we start thinking about these factors that have caused us to miss out on opportunities, invariably we focus on actions that we failed to do. And in my experience, this often means that we are not looking for the root cause but rather just addressing symptoms.
We’ve got to look deeply into what stood behind our decision-making in these situations. We often find that there are some underlying drivers that cause us to miss the opportunities – but what are they?
In 2004, I attended a real estate investment workshop conducted by Peter Flanagan. The workshop was excellent, but one of the key things I took away from it is that there are 3 big enemies in property investment. And as I moved through my life, I realised that these same elements apply to business and to personal life just as easily as they apply to property investment.
The 3 key drivers of poor performance are:
• Greed;
• Fear; and,
• Ignorance.
Greed (noun) excessive or rapacious desire, especially for wealth or possessions.
Greed manifests itself in many ways in your business decisions. It can be greed for money, power, influence or cash, but often it can be greed for attention or greed for something that feeds a part of your psyche – it could be attention or notoriety. It could be a whole range of different things but the underlying driver of all those things is basically greed.
In my experience, I find that greed is a basis for making poor decisions because the motivation is wrong. It’s not a balanced decision we’re making if it’s motivated by desire to acquire something or to hold something.
So where has greed impacted on you and your business in the last 12 months?
Fear (noun) concern or anxiety.
Fear is behind many decisions that we make in business, and often, there are two main areas of fear that impact on our decisions.
The first is fear of failure where we are so concerned that our project or opportunity won’t work out that we worry too much and it causes us to make poor decisions.
The second area is fear of success. This is more common than you would think and it’s where we “shoot ourselves in the foot” because we are scared that we are going to exceed our own expectations and sometimes our minds are not capable of handling that. Particularly, if you’ve been programmed by schools, parents and other institutions that believe – potentially, you’re not capable. Sometimes, we may have heroes or somebody that we aspire to be like, and as we start to get up to those levels and even exceed those “hero” levels, we think we’re not worthy.
So, it’s all about self-worth and worthiness. And often, people will make poor subconscious decisions that sabotage our success.
There are other fears that will stop us from doing things, but these are two of the main ones. Fear will often sit behind our decision-making in business.
Do any of these fears play a part in your life?
Ignorance (noun) lack of knowledge, learning, information.
Ignorance is also far more common than you think. Too many people embark on investment and business strategies with very poor sources or no information on what they’re about to engage in.
The challenge here is that we will never have the right amount of information to make decisions, but we should be looking at the amount of information we’ve got, the quality of information and the source.
Information quality is highly variable in this day of internet-based gurus. Just because it’s on the internet doesn’t necessarily mean that the information has been verified and validated. Too much information is based on opinion and some of those opinions are just outright wrong so ensure that you can corroborate the information you’re getting from a variety of independent sources to enable you to make powerful decisions.
The challenge here is “group thinking” where we’re making decisions based on information that everybody assumes to be correct but is often not. As a result, we miss opportunities and make poor decisions.
If you look at the model below which highlights the interactions between these three main drivers: greed, fear and ignorance – we can see that when they overlap, and they often do – there’s often more than one driver in play in many business decisions.
Where we have greed and fear combined, we tend to make tentative decisions. Simply because our motivation is wrong coming from greed but we’re also afraid. We’re shooting ourselves in the foot and therefore we often make decisions that are quite tentative, making us slow to respond.
Where greed and ignorance are combined, we make poor decisions. Because again, our motivation is mismatched because of greed and we just don’t have enough information. Our decision-making is skewed by our focus on the “greed element” as we don’t have information to balance this.
And where fear and ignorance are combined, we have inaction. We just don’t make decisions in that space because we’re fearful and don’t have enough information. So again, we make slow decisions but in particular we just often fail to make any decisions in that space.
So, what can we do to address each of these issues?
Greed
With greed, it’s important that we look deep within ourselves and try to understand our motivations. What is it that we’re seeking here? Does this decision align with my purpose in life? If we look at Simon Sinek’s work on “why” – what is my why and does this decision align with my purpose?
Similarly, does this decision align with our values? What are your personal values? These are the underlying set of principles that guide you in your business and in life. And how, does it align clearly with those values? If it does not align with any of those values, we’re in big trouble.
Start from that inner sense of yourself and determine whether greed is playing a factor here. Ask the questions – What are my motivations of doing this? Why am I doing this?
The other thing with greed is we don’t seek third-party advice because we’re afraid that the advice may disagree with what we’re doing. If we’re driven by greed, our motivation is very much around “well, I want it” so external validation or input may compromise that greed decision. Get an honest, independent, third-party validation on your plan and activity to help you overcome this greed.
Fear
Overcoming fear is a major issue for many people because it is driven by underlying elements of psychology that may be difficult for us to deal with. Sometimes an external counsellor/psychologist can help you in this space. I, personally, use hypnosis as a tool to help me overcome some of my fears and to maintain my focus on the right thing. Find something that works for you.
Try and isolate your fear and ask yourself the following questions:
What are the potential outcomes of this action?
What is the likelihood of this happening?
How would I know if things were going awry? Measure?
Also, look back at your track record – reflect and plan.
Ignorance
You can overcome ignorance by doing your research, asking external input, evaluating information thoroughly and being wary of “group think” or “running with the pack.”
Reflect on where you sit in the cycle on this action and ask the hard questions – Why? What? How?
Summary
There are three major drivers that underlie many of the decisions we make in business and our personal life. There’s greed, fear and ignorance. The first step to overcoming these challenges is to recognise that they may be already part of your decision-making. And second is to start taking corrective actions to minimise their impact on your decisions.
If you’d like more detail on this topic, please feel free to watch our recorded webinar at https://shifft.com.au/biggest-barriers-to-your-success/ or our short video on “The 3 Barriers to Success”.
And if you’d like to discuss how you can start to eliminate these drivers from your decision-making, book a 10-minute phone call with me using the following link https://calendly.com/russellcummings/10min-call
In this new environment with lots of people now working from home and coming to terms with what that means, there are some good productivity hacks for remote workers.
Productivity is about 3 things – attitude, focus and then the right tools so let’s just quickly work through some of those.
[HACKS] Top 10 – Working from home productivity hacks
1. Attitude – With this new environment, approach is everything and your attitude is critical in helping you get the most in being productive.
“Present is not productive” is one of the big things. Take regular breaks, be social, do some of the things you would normally do at work and remember, just sitting there all day staring at the screen doesn’t mean you’re productive.
Establish routines that keep you focused. If you need to get dressed for work, drive around the block and drive back in the driveway and then go into the workspace, then do it. If you always get a coffee in the morning, still get a coffee. Have your coffee, have your tea breaks, your lunch breaks, and regular team meetings. Think about virtual coffee and lunches with your co-workers. If you’re normally caught up with a couple of your friends from work, then do it online—it’s easy using Zoom or FaceTime to have a quick connection with them and a coffee while you do it.
Claim your space. Designate a workspace even if it’s temporary. If it’s the end of the dining room table, set it up like it’s your workspace and do it. Create rules for your family. I’ve worked at home for the best part of 20 years and my 2 young children knew that if Daddy was in the office with the door closed that he was at work and weren’t to disturb him. I know other people have things like a dinosaur toy, and when that dinosaur toy was out the kids knew that Mum was at work and they don’t need to be there.
Use noise-cancelling headphones for privacy and/or for confidentiality so you don’t have your speaker blaring out some confidential information around the room. It can also just help you focus.
2. Focus – Stay focused on what you need to do. A couple of techniques here:
Use the 4 Things model. What are the 4 areas of activity that you must focus on to be successful in your business or in your role? In my business, my 4 Things are: client work, sales & marketing, strategy & planning and personal development to grow and sharpen the tool which is me. I tick off something from the list every day so if I take 15 minutes to do sales, at the end of the week I’ve spent an hour and a quarter on it. What is the framework for you? For more details on the model, watch the video here – https://www.youtube.com/watch?v=2wRFjvzBaXs
Use the Stop Doing Matrix. For all the things that don’t fit into your 4 Things model, what are you going to stop doing? My coach, Chris Mason says to me every year, if you want to increase your productivity by 20%, what are you going to stop doing? Now, if you can’t stop it then delegate it to someone internal to you in the business or outsource it from someone external to you in the business. Following that, what can you do to re-engineer the process, so it takes up 10% of the time? More details here – https://www.youtube.com/watch?v=x1v3-jJn-54
Have better meetings which is a combination of face-to-face and online meetings such as daily huddles or transactional catchups from 5 to 15 minutes, or circuit breaker meetings monthly for 15 to 20 minutes and quarterly performance reviews for 30 minutes. It is important in this current environment that you have better meetings to understand how your people are going and how they’re faring. If you need more details on meeting structures, I’m happy to discuss them with you.
3. The Right Tools – Most people think productivity is about tools but if you don’t get your attitude and focus right first then the tools are often a waste of time.
The Pomodoro Timer – Work in 25-minute bursts and then have a 5-minute break and then in every 4 cycles, take a longer break. What it does it increases focus and concentration, reduces interruptions and maximises output. Use the app Pomodoro Focus Timer or Focus Booster to keep you focused on the things you need to be doing. I’ve done a short video of that here – https://www.youtube.com/watch?v=3DO9T27-JKo
Task Management – When you’re in a distributed network with some in the office and some working from home, use a software system that you can integrate with your Team. I use Trello.com for my small Virtual Team in the Philippines and we’ve used Trello for the best part of 10 years to communicate. It’s functional, easy, it syncs with all my devices, and best of all it’s FREE. Watch some tips on how to use Trello here – https://shifft.com.au/videos/#oArrfgSv-gQ
Use Zoom/Skype – There’s a whole heap of video conferencing solutions to choose from but I use Zoom predominantly. It’s easier to use than Skype and Zoom maintains video quality better than Skype. But one thing Zoom doesn’t have is the capacity to call people like a phone call so Skype is a really good option for that. There are heaps of resources on using Zoom and you can find it all here – https://shifft.com.au/using-zoom/
Audio and Video Messages – Respond to complex emails and phone messages with either an audio message or a short video message. My experience is that it takes you 20% of the time to complete an audio or video message and you can often provide a far more detailed response. Just remember to plan your response, make dot points so as not to ramble. Use desktop tools such as Loom, Snagit, Zoom, Camtasia, Screenflow or some smartphone tools such as video and voice memo.
Email – This is a major productivity drain. Don’t view it first thing or last thing. You don’t want someone else setting the agenda of your day. Set up “Rules”to allocate your inbox to specific mailboxes and check emails in time with your Pomodoro breaks. Turn off notifications so they won’t distract you with what you’re doing now but make sure you check your email regularly. And if you’re doing similar responses, set up some templates.
So, these are my tips on how to work from home productively. And if you want some more help, you can check out a whole heap of free resources on the website – www.shifft.com.au.
Also, if you’re really struggling with this COVID-19 situation and not sure how to handle it, please use this link – https://calendly.com/russellcummings/30-min-meeting and book a call with me at no charge. I’m happy to help you navigate this process. It’s important that we all help each other out so I’m more than happy to do my part to help you and your business move forward in this difficult phase.
As we move to a period of less face-to-face contact, there is a growing need to make better use of video conferencing tools like Zoom. However, I’m finding that there is a large number of people that are unsure of how to make the best use of Zoom or even how to use it all.
The following documents and videos are aimed at the Business Owner who would like to use Zoom to communicate with clients, suppliers and/or remote team members.
DOCUMENT #1 – A simple guide for using Zoom for remote communication.
DOCUMENT #2 – Logging onto Zoom for the first time [This is a document that you can forward to external parties with some simple instructions and links to instructional videos].
VIDEO #1 – Using Zoom for remote communication. This is a video summary of Document #1
VIDEO #2 – How to use Zoom for the first time. Watch this short video from Russell Cummings, Business Coach, if you’re a first time Zoom User.
VIDEO #3 – How to use Zoom with slow speed internet. This is for users who may have slow internet and will help them have better meeting.
VIDEO #4 – How to log onto a Zoom Meeting using your mobile phone.
Marketing is one of the most important and time-consuming activities of business owners as we all want the right image for our business and more of the right clients. We want them to not only see but to also understand what our business offers and how they can differentiate us from our competitors.
That’s what Marketing is all about. It is creating specific brand images in the minds of our target customers and advertising is the mechanism used to communicate these images to them.
Unfortunately, most businesses do not have a formal marketing plan and their marketing and advertising becomes a series of uncoordinated events. Businesses are often talked into advertising programs that are not linked to any marketing plan.
So how do we avoid falling into that trap? It is important to note that the secret is in coordinating a sequence of activities targeted at clear customer segments and that there is no magic one event in a marketing campaign that works all the time, every time. It is a process of trial and error.
American advertising guru, Ian Ogilvy, made the famous remark “I know that 50% of my advertising budget is wasted; the trouble is I don’t know which 50%”. So with that, here’s a process that will help to ensure that you do not waste your money.
Step 1 – Set Objectives
Set clear objectives and start with your Business Plan. Decide whether marketing activities are for the purpose of “brand awareness” or a “call to action”. Take note that both have different response times. Highlight tangible benefits that make your products, services and you different.
Step 2 – Test
Test your message before committing to it with a sample size of at least 30 responses. Gather responses and build in a response mechanism to your ads. Google Adwords can be a cheap & effective method for doing this.
Step 3 – Do It
Run the ads, conduct the promotional workshop, use the script, put up the sign, make the offer, etc.
Step 4 – Measure Effectiveness
After implementing Step 3, determine following:
Was the communication received and understood by the target market?
Were the sales objectives achieved?
You may never fully solve Ian Ogilvy’s dilemma, but follow this process and you will do much better than he did.
![[TOOL] Trigger Point Budgets](https://shifft.com.au/wp-content/uploads/15-apr-trigger-point-budgets.jpg)
