There’s no doubt that 2022 was a tough year for many Australian businesses with the ATO cracking down on unpaid tax debts, rising inflation and interest rates, soaring fuel prices and the cost of living continuing to spiral. So how will you manage your business better in 2023?

It’s unlikely we’re out of the woods yet and businesses need to plan carefully for the next 12 months particularly when it comes to cash flow and making their operations as efficient as possible.

It’s important to embrace these changes in order to remain competitive, relevant and to keep on top of finances. The most successful businesses are continuously evolving and adapting to the circumstances they’re confronted with.

Here’s how to manage your business better in 2023:

Establish Your Goals

Heading into the new year make a list of your short-term and long-term business goals. What do you want your business to achieve? Who will your customers be tomorrow or even next year? What type of organisation do you want to become? Be specific, measurable, achievable, realistic and timely (the SMART principles) when you’re establishing these goals. Make sure you communicate them with your employees as well so they know how and what they need to focus on.

Update Your Budget

The last few years have been a rollercoaster for many businesses and it’s important to update your budget to reflect the changes. Sit down with your accountant and assess the opportunities and risks that are ahead for the year. Focus on how you can do more with a lower cost base. Have a close look at your expenses and limit new costs unless you can see they’re going to drive a meaningful return or benefit your returning customers.

Consider Automation

Automated operations can benefit your business in many aspects. Around a third of businesses have at least one function fully automated as it can increase productivity, performance and reduce operating costs. It also guarantees quality and the same level of service across all your clients. Anything that can help your business run smoother and more efficiently 

Data is an Asset

The most successful businesses focus on a data-driven culture. Data is an asset that can help you understand what works for your business and what doesn’t. It can help you understand who your customers are, what products they like and how effective your marketing strategies are. Data also helps create a cash flow forecast so you can track cash movements and make a plan for the year ahead.

Rethink Marketing

A new year is a good time for a fresh look at your marketing strategy. What’s worked in the past may not always be the best for the future. Customers and their attitudes change rapidly especially in a new post-pandemic world and businesses need to stay on top of the shift. With increasing costs, this year might be worth a rethink on your social media campaigns and low cost’ value-giving content such as videos, blogs and entertainment.  

Reconsider Financing

It’s a tough time for businesses to get finance at the moment and that’s likely to continue for the next 12 months. The start of the year is a good time to consider flexible financing solutions such as invoice financing which uses your current accounts receivable ledger as security to turn your outstanding invoices into cash within 24 hours. It’s a solution that can transform the cash flow of your business without you having to borrow. Think of it as giving an early settlement discount on an invoice to a client that is willing to pay you in 24 hours instead of 30-60+ days later.

It’s a competitive environment at the moment so you need to consider new financial strategies that will position your business for growth.

Be More Flexible

The best way to position your business for success in 2023 is to make sure you’re adaptable to change. Look at fresh ways to satisfy your clients needs and take advantage of new technology to improve your business operations. Consider cloud-based platforms to improve operational efficiency, shift your communication to digital channels and adopt new management strategies that foster collaboration. An agile business is better placed to succeed in the long run.

A new year brings with it new challenges but also new opportunities. Stay in the game, manage your business better by reinventing and reviewing your business strategy and embrace what lies ahead!

By Angus Sedgwick, CEO of OptiPay

Answering the questions of how to attract and retain the right people are high on many small businesses’ agendas. Jody Blinco MAIPM and Petria Paynter MAIPM from Proximity look at what businesses can do to fill the skills gap and win over the right people to fill the skills shortage.

The changing ways of work

Many people in the workforce are considering more progressive modes of work and questioning the conventional values that were once at the core of the way we work. There is an increase in people leaving traditional employment structures and either going to non-traditional work (temporary, gig/freelance, or part-time roles) or starting their own businesses. This has led to an overall reduction in the workforce, helped by issues such as the immigration shortfall due to barriers for entering Australia.

According to the Australian Institute of Project Management’s (AIPM) recent report with KPMG, The state of project management in Australia 2022:

● 73% of project professionals said their projects experienced staff shortages

● 52% suffered from delays in sourcing key roles or skills shortage critical to projects.

Organisation culture matters

Organisations need to understand what motivates employees today. We are seeing – in our recruitment of people in general, not just PM roles – that aspects such as flexible working options and Environment, Social and Governance (ESG) policies are what candidates expect employers to have; they are not differentiators. According to McKinsey, up to 55% of employee engagement is driven by non-financial recognition. Sure, there needs to be a financial reward given the cost-of-living pressures, but it’s being weighed heavily against being felt valued by the organisation and delivering meaningful work.

This research also showed that the strongest indicators of a positive work experience came from aspects such as quality relationships with leaders, trust, caring teams, and the overall social climate.

Recruiting needs to change

It is crucial for organisations to create a more complete employee value proposition, and this includes employees looking for non-traditional work options, such as freelancers. Organisations should adapt their recruitment strategies to encompass both the customary and non-traditional approaches to work. Using freelancers or contract project managers for example, allows you to scale your project quickly and gives you agility when things need to change. But it will be important to integrate these people into your organisation, not just the project – just as if they were an employee. The focus should be on promoting an atmosphere of inclusion.

Interviewing in reverse

The notion that companies are doing the interviewing has faded, with Australia’s unemployment rate at 3.4%, a 48-year low and over 470,000 job vacancies, according to the most recent data release (August 2022) by the Australian Bureau of Statistics. Good candidates now have the upper hand, with the dynamic almost shifting towards interviewing the organisations.

Skill-based recruitment

In looking for new people, carefully consider what you need in an employee to deliver your project. We have seen a trend towards skill-based recruitment. Glassdoor reports that companies including

Google, Hilton Hotels and Apple, are offering well-paying jobs to those possessing in- demand skills but lacking a degree. We have also seen a shift to the practice of setting specific skills and competency requirements for a job rather than only looking at a candidate’s credentials. This shouldn’t be seen as devaluing a formal degree but to increase your options while ensuring you have the right skills to meet your project needs.

Encouraging mentoring

Another driver behind the skills gap within the project management profession is the 13 million people that are predicted to retire from the profession over the next eight years, according to Project Management Institute’s (PMI) 2021 Talent Gap Report. The wealth of knowledge and experience stored in the top-tiers of the industry has become a valuable asset to a business. Yet, in the AIPM’s recent report with KPMG, The state of project management in Australia 2022, 42% said their organisation wasn’t doing anything (or they didn’t know what they were doing) to attract and encourage emerging project professionals.

The transfer of knowledge down to new entrants should be leveraged in learning and development frameworks in addition to increasing stakeholder engagement in training processes. Finding the right people is a challenge at best, but shifting towards valuing a new entrants potential can broaden the candidate pool.

‘Micro-credentialling’

All employees expect learning and development, including freelancers and part- timers. But despite companies spending an average of $1,308 (USD) per worker on learning and development activities, only 12% of employees can apply these skills to their jobs, according to the Harvard Business Review.

Traditional learning and development frameworks have become stale in today’s skills short climate; we have already seen changes in learning delivery with online and AI models available.

Research shows that industry, vocational education, and university providers should be considering ‘micro-credentialling’, which are qualifications that can target skills gaps, in a short term, focused manner. This is especially relevant in the project management space, as the practice is upheld by a framework of principles and methodology.

It’s now up to you to fix the skills shortage

The workforce is thinking differently, so organisations need to also think differently if you want to be an employer that the new workforce want to work with and fix the skills shortage.

So, what kind of organisation are you? Will you follow the same path, or become a leader in this new paradigm?

By Jody Blinco MAIPM and Petria Paynter MAIPM