Leadership Lessons- Why Rudd Failed

It doesn’t take long to go from the penthouse to the outhouse for some, including former Prime Minister Kevin Rudd. In less than three years, Rudd went from immensely popular to out of work.

Rudd’s story is one that every business owner should take to heart. He had the people behind him, but once he got off message, he lost all integrity and the people stopped believing in him, leading to his leaving office.

Rudd came into office in December of 2007 with a public mandate. Following the debacle of the unpopular WorkChoices laws, Rudd’s labour party came into power as the people wanted change. Rudd’s popularity grew as he issued the Stolen Generation Apology and Australia’s economy continued to bloom.

So what went wrong so quickly for Rudd?

The first problem arose following the UN Climate talks. Rudd entered the talks walking the hard line, saying that climate change was the most important thing facing the world today. He said that he would work tirelessly to make changes not just in Australia, but the world over. And then… he changed his rhetoric.

Instead of universal reforms, the climate talks yielded non-binding deals in which governments could create their own goals and Rudd barely protested, which was followed by Rudd dumping his emissions program in April. This dropped his popularity to a level from which it would never return.

So what can a small business owner learn from Mr. Rudd’s story?

Leadership is about integrity and accountability. When he came into office, Rudd seemed to exhibit both. He promised change and delivered. But when things got difficult, he wavered on his message and the public began to lose trust. In fact, one commentator publicly wondered what Rudd stood for anyway.

That is a trap no small business owner wants to fall into. If employees are wondering what their employer stands for, that company has troubles. The story of Kevin Rudd is a cautionary tale for anyone in business, or in leadership in general.

The Customer Service Problem

The Australian economy is the envy of the industrialized world, but that doesn’t mean everything is perfect Down Under.

Despite the recent reports of incredible consumer confidence, Australia has fallen well behind the rest of the world in one aspect of business, customer service.

This customer service gap can be a big problem for small businesses, but it can also be an opportunity for companies that can improve in that area.

Small businesses become successful based on repeat business. As any business owner knows, referrals are the key and the best way to create a customer base that brings in referrals.

Many Australian businesses seem to be missing the boat in that area. According to a recent survey by American Express World Service Australia, 81% of Australians felt that businesses did not do anything extra to keep them as customers, easily the highest rate in the world.

Even worse, companies are missing out on growing their bottom lines by not improving customer service. In Australia, consumers said that they would be willing to pay as much as 8% more for better customer service.

Obviously this should be important news to any small business. The easiest way to get ahead of the competition is to understand and implement strategies for improving customer service.

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� ��working women found that scheduling flexibility was more important than perks like maternity leave. This can be important to small businesses looking to hire talented people and willing to work out a schedule to make the situation work.

In this day and age, small businesses need every advantage they can get. Don’t hire the wrong person just because they can work 9-5 while the right person can’t.

Hire the Right Person

The economy is strong, but private sector businesses are still missing out on a great opportunity to improve their production and service by hiring more women.

Julia Gillard just became the first female Australian Prime Minister and women make up more than half the population, so it would seem that women are treated equally. And in the public sector they are.

Almost 60% of the public workforce is made of women, with 34% of senior executive positions held by women.

But opportunities for women aren’t nearly as forthcoming in the private sector where women hold only 12% of management positions, despite owning more than 30% of small businesses.

More women are graduating from university than men, but a report by the National Centre for Social and Economic Modeling states that women in Australia are earning, on average, 17% less in wages.

One issue for women in the workplace is time management. Because women usually have more things to juggle than men, privately owned businesses may think work gets lost in the shuffle. They may be leery of hiring someone who they feel wouldn’t prioritize their job over their family. But businesses should not eschew hiring a talented person because of preconceptions.

A recent survey of working women found that scheduling flexibility was more important than perks like maternity leave. This can be important to small businesses looking to hire talented people and willing to work out a schedule to make the situation work.

In this day and age, small businesses need every advantage they can get. Don’t hire the wrong person just because they can work 9-5 while the right person can’t.

The 2- Speed Economy… Getting into the fast lane

To most of the world, Australia’s economy looks like the shining example for western nations to follow. But with a closer look we can see that not everything is economically rosy.

Australia is a great example of a two-speed economy.

The mining industry has sustained its growth despite recent challenges, but things haven’t been quite as positive in the retail and manufacturing fields, where most small businesses reside.

Thanks to a decline in stimulus spending and steadily rising interest rates, many small businesses are feeling the pinch in Australia.

Major Australian banks have been using small business loans to increase their margins, while taking a harder line on delinquent debts forcing smaller businesses to pay down debt before they are ready.

Fewer and fewer banks are giving loans to small businesses as well. That lack of choice combined with rising interest rates and inflation, have left many small businesses feeling squeezed.

Low unemployement has been great for the general psyche of Australia, but it has led to six recent interest rate hikes as well as inflation that is predicted to reach as high as 2.75% this year.

The good news is that consumer confidence is high, thanks primarily to the fact that most Australians have jobs. The bad news is that, for all the work to be had, fewer retail and manufacturing companies are thriving, leading to concerns about Australia’s long-term economic prosperity.

From Global Partner to Domestic Powerhouse

Australia has enjoyed the benefits of a two speed economy with the mining industry driving the nation’s growth. But as world- wide demand for raw materials slows, the need for stronger small businesses to drive the domestic economy is very real.

Our economy has been blooming. The most important factor has been our proximity to Asia, specifically China, and their seemingly unquenchable need for raw materials.

The rugged landscape has served us well, as the mining industry has profited, leading to our being able to stay clear of the world wide recession plaguing virtually every other G-20 nation.

But recent reports show that China’s desire for our raw materials has slowed, which may cause trepidation for Australians.

China’s GDP slowed 10.3% growth to the June quarter, down from 11.9% to the March quarter. The price of iron ore fell 10% in the 2^nd week of July alone.

China’s factories are looking to slow production and cut their inventories which could seriously damage the commodities industry over the next year or so.

So what does this mean for your small business?

First, there is little to be immediately concerned about. Commodity prices are contracted out through September, so there will not be an immediate drop in revenues from that industry.

But now is the time for small businesses all over the country to take the lead, become more profitable and keep Australia in the solid position it’s in today.

Reports issued in the middle of July revealed that Australian consumer confidence is as high as it’s ever been and unemployment is expected to be an incredibly low 4.5% by the end of 2012. This can be seen as a sign that now is the time for small businesses to grow and become a force for prosperity within their communities.

Last quarter was better than expected in Australia, but with China’s growth beginning to slow there may be tougher times around the corner. It’s up to small businesses to find their niche and grow so we, as a nation, don’t have to rely on foreign wealth to create prosperity.

Branding- Don’t destroy your niche

Building a brand is what any business wants to do. From Coca- Cola to McDonalds, every major business success has a brand recognizable to its customers. Of course, there are times when trusted brands need a makeover, but what happens when the makeover goes too far?

The University of Sydney is currently going through just such a situation.

Looking to upgrade their look and stay competitive with other top universities around the world, the university appointed a management branding committee to upgrade the university’s appeal. One of the first things the committee did was insist that each department within the university lose its unique identity.

No longer would each department use its own letterhead. A fortune was spent on replacing department letterheads with the new standard university letterhead featuring the new, unpopular insignia.

Departments were also subject to increased paperwork, higher costs and little accountability for those costs thanks to other branding recommendations.

Handbooks were issued explaining how faculty and other staff should speak to students, a useless expenditure for a university that has been able to speak to students for more than 150 years without help from a management handbook. More importantly, class size rose and educational quality has gone down accordingly.

Ranked as one of the top universities in the world, The University of Sydney did not need to undergo a major change to its brand to service its community and students as it had always done.

The university had a major flaw in its vision. Rather than looking at ways to lower costs for students, who have seen tuition rise exponentially, the University made a decision to try to fix something that was already working, their brand.

Was the brand really the problem? It wasn’t before, but it is now, as the university losses part of its historic appeal and pays for the right to do so in the process.

This is an important lesson for business owners to understand. Remember, if it ain’t broke, don’t fix it! Always test and measure any marketing campaign before you start. Don’t dive into a strategy that will cost you money, productivity, quality and, possibly customers, like the University of Sydney did.

Youth Hiring- What small business owners can do for their country

The economy is bustling, but certain groups of job hunters are still on the lookout for the right opportunity. Among the most underused segment of the Australian population are young people.

According to Mission Australia, unemployment is four times higher for 15-19 year olds and twice as high among 20-24 year olds than it is among those aged 25 or older. So how is this relevant to small business owners?

Young people are a great source of relatively inexpensive labor. They learn faster and are often more ready to learn than older employees. And finally, the younger generation knows things that older business owners may not. Need someone to work on a website or understand social media trends? The youth of the nation are hardwired for just those things.

Most importantly, you can help your country by giving young people a chance. Unemployment can be hard for anyone, but for young people it can lead to a treadmill of unemployment and poverty that can last their whole lives.

Teaching someone how to do a job and how to be a productive, social member of society is not only important but can provide businesses, and the people that own them, with untold benefits in the long run.

There are many organisations in Australia that can help businesses find young people to hire. What do you think about hiring young people?