Sluggish Start to the New Year: How to Get Back to Business!

January 24, 2018 Prenelle Rungan

Firstly, Happy New Year to everyone! Here’s to 2018 delivering growth, learning, success and joy!

Starting back into whatever it is that we do is always a challenge. Cricket on the TV, ice cold drinks, ice cream cones and just a general “sluggishness” make it all seem a bit too hard! Compound this 10X when you are your own boss!

I typically start back into the business the week after New Year. It gives me time to review the goals set last year, reflect on the wins and misses and understand how I’m tracking to the all-important budget numbers – that’s always a good motivator, especially when I’m planning winter holiday! Here’s a few tips that help me as I navigate back into a routine.

1. Understand you are in a different space

As an accountant, this is a really hard one for me! I’m used to having set deadlines and this dictated how I planned my time and goals. With having my own clients in a start-up business, I’ve had to understand that I’m in a different working environment, and my approach needs to change. I don’t have concrete targets that when achieved, gives you the satisfaction that you achieved something for that day. Also, when working in corporate, there was always something to do – whether an email from internal audit that you hadn’t got replying, or completing the head office learning module on Health & Safety, or even just tidying that cupboard in the corner that has files from the 80s! The “blank page” when it comes to your own business can be overwhelming and there is this natural instinct, to fill it up! However, as in life, we need to get comfortable with this new found space, and allow ourselves to sit with it. This is when our best ideas will come to us.

2. Look backwards… yes, I wrote that correctly!

Open up the goals/marketing plan you set up for yourself 12 months ago. That’s right, go to your laptop, and open up that document. Hopefully, you’ve taken good advice from consultants like myself (yes, obvious plug for BizSync!), and you will have a set of SMART goals. Review them, update the progress, understand where the gaps are and critically examine if this is still the way forward. For me, when I go through this exercise, it automatically gives me a chance to review, celebrate and focus. I can’t help putting notes on the learnings from a certain marketing strategy, or a bullet point to contact a client I had worked with or how I plan to get to a certain target. Despite this solitary and simple approach, this exercise gets the juices flowing again.

3. Look forwards…yes, now we are ready to do this

Understanding where we are, helps us plan forward! This is the underpinning of an accountant’s philosophy so I cannot emphasise this enough. So once the juices are flowing, and we’ve seen how we are tracking, it’s time to work what the options are: stay the course or change. Success in anything, I believe, is agility and adaptability. Are the goals still realistic/achievable – sometime they are not, and if not, we need to adapt those goals. If they are, how are we going to do this? Who do we need to contact? How do we go about doing this? Write down the hard/difficult stuff we may need to do – don’t take the easy way out! Do we need to look at a different type of client – lead in with a different service offering and then once established, showcase what we do best. We may need to cut down on spending so what is necessary and what is discretionary? The list goes on. However, the key is, the simple exercise gives you a renewed focus of what the next steps are. Conscientious planning in turn motivates you to keep pushing through the procrastination problem and gets you planning.

4. Start talking to people, with no expectations on the outcome

When I was in recruitment, the most difficult call was the first marketing call of the week. And it wasn’t the call itself, it was the actual act of picking up the phone and calling potential clients. For those of you who know me, that can come as a bit of surprise as I’m naturally extroverted and I can talk about anything. But it felt awkward – the words in my head were “I wasn’t a salesperson; I am a professional and people are going to know I’m trying to sell something and it’s going to be so embarrassing”. A good piece of training I received is don’t make the goal of the call/meeting to be getting a fee; instead, think of it as an opportunity to extract 5 pieces of useful information. This information could be that the person is interested in tennis, they have a partner who is an architect, they know a good lawyer… so, think of the call as just getting 5 pieces of information that you didn’t have at the start of the conversation. Of course, write it down on your client details so the next time, you have more information that will help the conversation flow easier and of course, if there are any leads, then follow up on it. If you are going to do lunches/coffees, be selective. However, again, this can be good and easy motivator to get back into the swing of things, and well, you can treat yourself to dessert and some sunshine! I also suggest logging into LinkedIn and connect with people. It’s a great professional network tool. Don’t be afraid to send invites to people you don’t know, but would like to meet with. If they don’t accept, don’t take it personally. One of my direct reports (and coincidentally, one of my best hires) reminded me that just as you are trying to build your dream and connect with the right people, other people are doing the same – believe in your worth and unique offering! (thanks to you know who!).

5. Catch up with your support network

I don’t have an official mentor. However, there are plenty of people in my support network and that works for me. Catch up with them as they will remind you why you are doing what you set out to do, but most importantly, if they are anything like mine, they will get you to get your “A into G” and get on with it. When you commit to doing something out loud with this support group, then you are accountable. As tempting as it is to watch the English beat the Australians in the cricket, saying out loud that need to get back into the business rhythm, forces you to turn on your laptop and email a client or write that blog!

Being goal orientated and time conscious are great attributes for success. However, when you are in your own business, these attributes have to play out slightly differently, especially as you kick start into the New Year. The playing field is different and success may mean adapting your expectations so that once-thought of simple approaches are what you need to get up and get back into it! Get started by doing the simple bits well! Hoping these tips help you kick start an exciting 2018!

Prenelle Rungan – 24 January 2018

Prenelle is a fully qualified CA and lawyer. She has held senior finance roles with global and local companies over the last 15 years. She is currently a Director of BizSync Limited, a consulting company that strives to start businesses on the right foundations. To contact her, please follow this website link www.bizsync.co.nz/contact.

Team Tactics – how to go from average to best in class?

June 26, 2017 Prenelle Rungan

It’s Monday morning and you’re about to go into your first team meeting for the week. You know the team has worked hard, delivered good results and whatever you need from them, they get it done. But something’s missing – while everyone is doing enough to get by, you know that it could be better. But how do you go about asking them for more, when what is being done, is still getting the job done.

One of my most memorable roles was leading a team in just that situation. These are some of my learnings that helped us take that leap from average to best in class:

1. Understand the individual profiles within the team:

Always bear in mind that we are always working with people. People who have their own dreams, goals, reasons for working, and an array of experiences that is unique to them. Spend time to really understand what makes them tick. Ask them what they enjoy doing, why that is the case. Analyse how they like to be rewarded, how they prefer feedback and let them know that nothing they say will be held against them but advise key messages will be shared with the team to enable growth. An important part is to also to share your goals and profile with them, but remember the session with them should be spent with you listening, and them talking. Ensure you are somewhere you won’t be interrupted and take the time to really get this information. Your HR business partner should be able to provide plenty of resources on the how/what and but the golden rule is always to keep it simple.

2. Understand the team profile as a whole:

Once you’ve got a got a good grasp on the individuals profiles, take it to the next step. What does your team as a unit look like? What are the strengths, the goals, and gaps when it comes to vision of the team’s objectives? Don’t forget to add yourself to the mix – I’m definitely of the management philosophy that manager is part of the team. A simple mapping exercise can demonstrate the individual strengths and opportunities as well as the attributes of the team.

3. Fit it together:

Once you’ve got a grasp on the individual and the team make up, get them all together and share the results. Advise what people like doing and what they are struggling with. Pull together all the information as a team and identify the talent and strengths of the team. Emphasise that the best in class is a team priority and is the sum of the individuals. Bring in the KPIs/objectives and how strengths of the individuals/team play into this but also what gaps there are. When looking at the KPIs, add a target level but also a stretch element. The 1st part of the session is to inform. The 2nd part of the session should be on the how. Let the team work on how the gaps will be addressed and what could be done to achieve stretch level targets. Your role as a manager during this last stage is to facilitate and let the team work on goals and possible solutions. Let them negotiate tasks and define success and accountability. Empower them to know that if tasks need to be re-allocated, then they have say in this. A key outcome of this meeting is to work with a few targeted goals over a set period and publish them, whether on white boards or graphs, and make review of these goals a mandatory requirement.

4. Practice as you Preach:

As I mentioned above, the team does include you! Learn to roll up your sleeves and get stuck in. Teams value that approach – it shows you are walking the talk! If there are tough deadlines, especially if you want to reach a stretch goal, let them know you are there to pitch in and work on deliverables. And when you say they have say in how work is shared and reviewed, stick to it. Step in if major issues arise, but trusting that the team are accountable to the targeted goals will, believe it or not, resolve most issues because the team are tied in given their personnel involvement in the goal setting.

5. Planning and Regular Catch up

There should be a “no surprise” culture within the team. Sitting down with the team on Monday morning is mandatory and attendance is compulsory – make sure the rest of the business know this, including the CEO/CFO. The meeting should start with what worked well last week and what didn’t go the way we planned. The team should reflect on why those items went well and what could be learned from those issues that didn’t. The team should advise whereabouts for the next two weeks and also if anyone needs to step in and assist so there is minimal business interruption. Next on the agenda should be running through what was supposed to be done in the preceding week and if any issues. Next, there should be focus on the week ahead as well a quick forward review of the next month. Finally, a status update of targeted goals should be done, and, if necessary, steps to be taken if there are gaps identified. Each individual should participate and all items should be on a whiteboard, or ensured it is saved on a shared drive. While it may seem like a lot to cover on a weekly Monday morning, once the team holds it a few times, it becomes part of the natural business rhythm.

6. Support, Support, Support:

This is crucial. Despite critics of this “emotional” management style, when your team knows you have their back, there is nothing they won’t do. And support doesn’t mean agreeing to everything and allowing team to bypass responsibility. It’s about being available to discuss issues, giving them encouragement, being patient and overall, championing the team! Finally, recognition and reward play a part in this support culture. Ensure that you put into practice your learnings from the individual sessions and understand how your team members like to be rewarded – don’t take for granted its money as some individuals appreciate a day off or thank you note. As with the first point, it comes down to listening, observing and being genuinely interested in the team and its members.

I believe when you decide to become a manager, you have a desire to want help people achieve their very best. With all the administration time and people issues, I can’t imagine wanting such a role just for the money! When you experience a team go a step above the norm, there is pride and joy in seeing people you care about achieve their goals and realise the potential you always know they had. The cherry on the top is knowing the team is delivering exceptional results.

On a final note: To all the teams I’ve had the privilege of leading: you’ll probably recognise some of the above – I’ve certainly have the teams to thank for some of these strategies! I am so proud to have been part of your careers and seen you all achieve both personal and professional goals. Thank you for all your hard work, loyalty, support and trust!

Prenelle Rungan – 26 June 2017

Managing Competing Priorities

August 11, 2016 Prenelle Rungan

It still surprises me that despite all the advances we’ve made in the 21st century, there still isn’t an easy, no-fault approach in managing competing priorities. However, maybe, therein lies the issue – with all the advances we’ve made, the list of priorities and stakeholders has risen and so what was once mastered, falls through and we have to figure out a new set of rules.

I’ve worked in the corporate world for last 15 years and the one consistent feature of every role has been the lists of projects and, of course, “URGENT” stamped all over them. Prior to that, academic and personal aspirations always seemed to compete for my time and attention. Here’s some ideas that worked for me and even though, I may still tweak them occasionally, they continue to help me work through current demands:

1. No meetings scheduled before 10am

And if possible, no meetings after 4pm. I learnt this trick from a CEO I used to work with. He used the mornings to review his list of things to do. He didn’t switch on his emails until after 10am – logic, if it’s was important enough, they’d call. Once he had his list, he’d prioritise his top 3. How did he prioritise? He’d look to the strategic plan for direction on the ranking order. The next 3 on his list, he’d delegate to appropriate staff. Anything else on the list would remain but would not be looked at until the top 6 were under control. This first 2hrs of the day would allow him to get started on the right track, and not be distracted. Now, you may think – it’s easy when you are the CEO and have the ability to delegate. However, the concept applies if you are sole-charge or starting out – I guess the only add-on is to check in with your manager to ensure that you both are on the same page and then go for gold! (apologies for the Olympics pun!)

2. The ones that make the top 3

These are the items you focus on. At the end of the day, you need to ensure you have made traction on these tasks. How do you do this? Break it down into sub-parts. What do you need to do get the task done – it may mean booking a meeting with the team, or reviewing work papers or meeting with HR. Use the morning session to sub-divide the tasks, and who the responsibility is with. I love whiteboards – it provides an excellent visual of tasks at hand, with priority attached and persons responsible. The whiteboard is positioned where my team and I had to see it every day. It gave us a centre point and certainly a sense of achievement when we crossed it out – in fact, we used to play this crazy loud $2 guitar when we were done. Also putting up your key focus areas means you let the rest of the business know your priorities and makes you accountable for them.

3. Communicate to stakeholders & business partners

When you let people know what you are doing and why, it is lowers the tension when you have to say NO. I’ll talk more about saying no in the next paragraph. By ensuring you are linking your order of priorities to the strategy/vision, you are coming from a stronger standpoint. And if there is tension around this, then this is a fantastic opportunity to engage the team around direction. If companies and business teams are not working on a common path to deliver the agreed strategy, well, then a very different conversation is required and quickly! Stick to your list. It’s easy to get pushed into different directions, especially when your business partner wants something done now. Discuss your current prioritisation with your business partner. It’s amazing how the conversation can change from confrontational to negotiation when they understand what will suffer if you need to re-prioritise. Remember, it’s not that the list is fixed in stone – if the IRD suddenly informs you of a review or the CFO needs analysis done for business acquisition, then go back to your list and re-prioritise. Like most things in the business world, the plan is a living document – it remains agile in this ever changing business environment.

4. Learn to say NO

This is an interesting one, albeit uncomfortable. However, learning to say no is a powerful skill to master, in business and life. Now, I wouldn’t adopt an aggressive stance because, with most things, I believe, diplomacy is often the better route for success. My approach would be, ensure you have understood the requirements properly, given the requestor your full attention and evaluated how it fits into your current requirements/strategy fully. If you need to take time to consider, convey that. It is vital that the requestor knows and feels that you have completely understood their request – a good technique is to summarise the request back to the requestor and its requested priority. Assuming that the request doesn’t have enough importance to skip to your top priority, explain to the requestor, that at this stage, you are required to do XYZ and this is your top priority as it links to goal A. Suggest that you can add to your list and revert back when you can complete your current task. If appropriate, you can suggest an alternative solution, which may not meet all of his/her request. Stick to your guns. And then, go back to working on top priorities.

Balancing multiple and competing priorities is a facet of business and life. Even if we could do everything (and we really can’t), it doesn’t necessarily mean we will be achieving our highest potential. Taking a few key tasks, and doing it well, is what delivers success consistently. Focus and achievement in key areas brings a sense of satisfaction and energy to what we do! Ok, writing this blog was priority 1 for the day so I can now scratch that off my list – have you managed to do the same?

Prenelle Rungan – 11 August 2016.

Back to Basics – Budgeting 101

May 25, 2016 Prenelle Rungan

The number 1 reason clients approach me is to help them understand their financial position. The number 1 reason we have been successful in assisting them in this process is putting together a simple and manageable budget.

So the focus of this blog is to get back to basics – budgeting 101. Here’s some thoughts:

1. Put it down on paper

It’s easy to be swayed by not going after that dream because we know, in our head, we don’t have the money. More seriously, it’s even easier to believe there is no debt if it’s not written down because if it’s not written down, it doesn’t exist! One of my basic beliefs is that we can’t find a solution if we don’t fully understand the problem. In fact, the main premise of having a finance function or working with an accountant is he/she will provide all the possible information in an accurate, objective fashion so decisions can be made.

When I start working with a client, be it with a person or company, the first item I request is their budget for the next 12 months. If they don’t have one (which has been my experience), then the next step is to create one. Or one last point on this, while I say put it down on paper, I really mean, put it on Excel or something similar :-)

2. Keep it simple

While there are complicated forms and templates available, keep it simple. Split by month over a 12-month period and using a cash basis, start with expenses. Split your Interest Bearing Mandatory Debt (i.e. credit card, finance debt, loans) from other expenses. Then, list out living expenses, so rent, telephone, rates, electricity, food. List discretionary spend, i.e. holidays, yoga classes, coffee/lunches. Then, list any debt that is being paid on a voluntary basis, where there is no interest (i.e. loans from family & friends). Sum up this these expenses. WARNING: This may cause some people to go into hyper-ventilation so tread carefully!

Then list income. Split between established/regular income. This should be after taxes. List any other adhoc sources (interest on investments). Sum up the income.

Establish a net position, i.e. Total Income Less Total Expenses = Net Position

3. Review and ponder

Stand back and now analyse the information. Listing what the net position allows you re-evaluate decisions. That holiday in France may be affordable, but looking at local vacation spots may give the option of paying back some debt sooner and being in a position to start your own business or buying that new car. The opportunity exists to revaluate the discretionary spend. When you see the total year spend on coffee or bought lunches, it could lead to changing behaviour that brings you closer to the long-term goals, or even the short term ones.

The simple act of putting everything on “paper” allows you to “SEE” the spend and this impact should never be underestimated. Work with a professional, whether your accountant or business coach, in understanding what the numbers mean and how you can improve the situation for the better!

4. Rookie Mistakes:

Firstly, don’t assume you can live on $10 a week for discretionary spend. Budgets are about being realistic and should reflect normal living. If there are cuts you want to make, do it gradually and change 1 behaviour at a time. You are more likely to be successfully. Secondly, my dad always told me that when you get paid, always “pay” yourself first! What he meant, is invest in yourself or simple put, save! Around the 7th week of working with clients, I always introduce this line item into the budget – after Net Position, we incorporate the Savings section and this is usually 10% of net income. That’s another point – the budget is not a document you put all this work into, and never look at again. It is a living document that should be plastered everywhere! As you learn from your spending and saving behaviours, it should be updated. Keep old versions as it’s incredibly insightful to compare actual to budget. Finally, round up your numbers to the nearest $100 and put in a format that is clear to read! I normally use line fill colours to highlight main line items, with size 16 font and freeze panes on the month rows/details columns.

Someone wise once said, “you can’t change what you don’t acknowledge” Get the numbers written down and see the whole picture. While you should heed the warning in point 2, once the shock wears off, there is an exhilarating and intoxicating feeling of a way forward. Don’t let your fear rob you of this feeling and pursuing your dreams!

P.S. if you would like any assistance or a working template, send me a message via www.bizsync.co.nz .

Prenelle Rungan – 25 May 2016

High Performing Teams…where to start?

March 23, 2016 Prenelle Rungan

High Performing Teams seem to be the current catch-phrase for organisations. It certainly has been a topic of conversation with my clients. It’s a logical conclusion. If people are your strongest assets, it follows to grow that asset, you need a high performing group of people. So how do you get to that stage. Here some thoughts :

1. Understand what the definition of high performing means for you:

As with any goal, precise definition of the end result makes it easier to understand, to know when you are heading off-course, when goal has been achieved and what the future looks like. High Performing could mean meeting every deadline on time in full. Or it could mean innovative changes. Or, what I personally believe, having a team that functions systematically and in synergy with each other and the rest of the organisation. Build this definition, whatever you hold true, into the vision and objectives of the team. Better still, build into the wider organisational culture and strategy. Final point, include achievement into measurable KPIs – join the dots from start to finish so that it is truly embedded in the culture of the organisation.

2. Recruitment/Talent:

People are an asset. You get the right people; you have the competitive edge! Get your HR business partner involved and critically evaluate your current team. As a team, is it balanced and ready to take on challenges facing the organisation? If not, identify those gaps and get out there in the market. Be innovative in how you recruit. Work with agents who are specialist in the field and who understand your vision. Have a conversation with specialists you work with, i.e. accountants, lawyers, architects and let them know your plans. How do you manage the “weak links”? Again, if your goal is clear and it is built into the culture of the team/organisation, these weak links will be pushed into change. Get on the front foot and work with team on that end goal. Before jumping the gun, make sure you see the balanced team – as what may at first seem as a weak link could actually add value when the team is looked at as a whole.

3. Set the challenge high and evaluate failures:

Don’t set the bar too low. High performing teams are motivated to achieve; to extend themselves, to take chances and be innovative. Part and parcel of this, is to see failure differently. If things don’t work as planned, go back to the drawing board and instead of attaching blame and guilt, look at the situation and as a team, evaluate where things could be done better. Failure should actually feel invigorating as team tried something different and is learning a new way forward!

4. Longer Time Horizon:

The focus of high performing teams is not to react to short term chaos but to look for forward and act! Spend 20% of your time on the now but the remaining 80%, you are looking forward. For a finance team, it’s what’s coming up, where are we as an organisation going and how does finance proactively be part of the solution? What do we need to be ready for and how do we get ahead of the game? The budget and SOP forecasts should lead this process and finance needs to be ready for that wave of change!

5. Mentor, not manage:

A key focus as any leader with the status of “being in charge” is to mentor the team/individuals. Believe it or not, there is a difference. Mentoring is more guiding, listening, challenging and more importantly, giving the team the tools and support to make decisions. One on one sessions mean more questions from you as opposed to a “to do” list. It means standing back at team meetings and letting the team work through their tasks, with natural leaders taking their role. This can be a difficult given the risk involved so get some coaching yourself on how to mentor!

When we hear the results of high performing teams, we all want to jump on the bandwagon. However, we need to recognise, as with any new idea or catch phrase, the same basic principles will always apply. Get the basics right, keep it simple and look forward!

Prenelle Rungan – 23 March 2016.

Prenelle is a fully qualified CA and lawyer. She has held senior finance roles with global and local companies over the last 15 years. She is currently a Director of BizSync Limited, a consulting company that strives to start businesses on the right foundations. If you wish to contact her, please visit her website www.bizsync.co.nz/contact.

Staying Focussed when you are following a Different Path

February 25, 2016 Prenelle Rungan

Every time you start something new, there will be lots of challenges. This is a fact. We’re told that these challenges are what make achieving the goal more worthwhile – success will taste so much sweeter! One of my greatest challenges has been to stay focussed on the task at hand when there was no one waving a stick. Before starting BizSync, I was employed in some key roles in global companies. Lots of perks and high profile. The last role I occupied before making the leap certainly offered me even more that I was used to – big name, strategic autonomous role, great package and confidence-boosting mentors. So why did I leave? Well, I definitely have asked myself that question a couple of times, particularly in the first 3 months of starting BizSync. And during those 1st few months, lots of different opportunities came calling – some could add to the business, and some definitely would mean a step away. When you are eating into the savings, those opportunities do seem like the answer. However, every time I looked and analysed these opportunities, one of which included going back to the afore-mentioned role, this voice within kept saying “but that would mean leaving the business behind….and I can’t do that; just keep following the path, it will happen!”

So how do you stay focussed on what you want, when there can be so much pulling you in different directions? Here’s some tips:

1. Remind yourself why

It’s always easy to the believe the grass is always greener on the other side. When you feel that you are being dragged into different options or feel disillusioned in what you are pursuing, find a quiet corner, grab a pen and your journal and write down why you walked away from that “heavenly role”. For me, I had to remind myself, that while on the surface, my previous role and other opportunities looked fantastic, in reality, I was bored, restless and always thinking of owning a business. While the regular income was a good feeling, I wasn’t doing anything long term with it – I always found some excuse to not take that next step and, particularly in this market, no job is guaranteed! I had to go back to the vision behind the business and as silly as it may seem, look at my budget. The truth is a I had a plan and while the 2nd month wasn’t eventful; it was going as expected.

2. Be Realistic

One of my fundamental beliefs is always forecast out and plan realistically. Anytime, you start something new, it takes time to build momentum and get back to the same stage you were at before you started! Whether it’s going back to study, or saving for a car, or starting a business, it will take time to realise that investment. Most research indicates that in the first 2 years of a business, you run at a loss and then, by the end of the 3rd year, you start to break-even or show a slight profit. Remember this initial time is an investment – it’s time to gather knowledge, to understand the market, to know how you are positioned in this wider environment – as a good friend and very successful entrepreneur once told me, enjoy the time while you can as when it takes off, you’ll wish you had it again!

3. Surround yourself with People who get it!

Not a lot of people like change – in fact, most do whatever they can to avoid it! Particularly in field of finance, people follow the path and any deviations cause fear and an absolute need to redirect the individual/organisation to get back on the path. I’ve seen many of the people I’ve study or worked with go down a pre-calculated path and they have stayed focussed and worked hard. I admire that they have used focus to get what they want! And I take nothing away from them. However, there are also people out there – those rebels that follow their passion, who have this buzz factor and also, achieve their goals. These people also champion others and when you with them, you know that you too can go after what makes you happy. Surround yourself with your cheering squad, or even 1 person, who gets it. They can remind of why you are doing what you are and can also, ensure you get your “A into G” and get on with it.

4. Life is short - redefine success

Finally, remember, life is short and there are no guarantees. I always say to people I work with, particularly graduates, if you don’t get up in the morning, buzzing and excited about what you do that day, then find something that does. Learning that the definition of success is not universal. We have seen so many examples of the outside personifications of success and what that does to people and organisations. However, when you feel what you put out there is an extension of yourself, where you go beyond what is right path and find something that makes you feel in synergy with your environment, that for me, is success.

Going down a path that is different means that you are always being challenged on whether you’ve chosen correctly. However, if you can step back, away from all the noise, and observe, you will find your focus. It is focus with a natural synergy and you know you have chosen what’s right for you.

Prenelle Rungan

Prenelle is a fully qualified CA and lawyer. She has held senior finance roles with global and local companies over the last 15 years. She is currently a Director of BizSync Limited, a consulting company that strives to start businesses on the right foundations. If you wish to contact her, please visit her website www.bizsync.co.nz/contact.

Are you an employer – some simple tips to ensure you are meeting your tax obligations.

February 17, 2016 Prenelle Rungan

One of the first areas you need to pay attention to, when you start your own business and engage the services of a third party (“TP”), is to determine whether your relationship between you and the TP is one of employer/employee or is the TP is self-employed. This is an important distinction as an employment relationship imposes an obligation on you, the employer, to deduct tax on behalf of the employee and remit to the IRD (either PAYE or Withholding tax/” Schedular payments”). If the TP is classed as self-employed, then the TP is responsible for all tax payments/declarations to the IRD.

On the surface, the characteristics of the employment relationship may seem simple. However, as is the case in most principle based jurisdictions, it is the characteristics or the substance of the relationship that is important. Additionally, the TP may be self-employed with some of the work he/she performs, but considered an employee in other areas. The IRD offer some assistance on the website, in particular IR 336 Self-employed or an employee? http://www.ird.govt.nz/resources/8/f/8f04cd004ba3d516afd6bf9ef8e4b077/ir336-apr09.pdf). A useful summary is contained below:

Characteristics of self-employment

1. The TP controls how the work is done, i.e. TP determines the hours worked, when to take holidays

2. TP invests/takes on the risk of the work done, i.e. TP has invested own funds into the business/can sell the business

3. TP provides all the major assets to perform the work

4. TP does own training

5. TP responsible for getting the work done, i.e. TP can sub-contract the work, TP is free to do work for other people.

Characteristics of employee

1. TP has do the work you instruct them to do, as you say, during the hours you say it at, at any-time you request it.

2. TP is entitled to overtime & penal rates

3. TP has a set amount of hours per week/month

4. TP is prevented from doing work for others, i.e. they can only work for you.

If the TP satisfies most of the self-employment characteristics, as mentioned above, the TP is responsible for their tax filings.

If the TP fit most of the characteristics of an employee, then you, as employer, are required to deduct the appropriate tax and remit this to the IRD. You will need to register as an employer on the IRD website (http://www.ird.govt.nz/online-services/service-name/services-r/online-register-employer.html). To determine the appropriate tax, all employees should fill in the IR 330 Tax Code Declaration http://www.ird.govt.nz/resources/b/f/bf9db1804ba3cfc08a6ebf9ef8e4b077/ir330.pdf). This form runs through two main forms of tax – PAYE (salaries/wages) and WT (independent contractors). Essentially, if you fall into specific categories (listed on page 4 of the IR 330), then you need to pay Withholding Tax (WT) or what is now called Schedular Payments. If the TP does not fit those characteristics, the employee should follow the flow chart to determine the tax code for PAYE (page 2 of IR 330). Ensure you retain the IR 330 in the employee's file.

While the above will seem complicated the first few times, once you get into the flow, it is fairly simple. Furthermore, when you have registered with the IRD, the online prompts guide you through the monthly disclosure and payment requirements. If you are struggling with any of the requirements, contact the IRD on 0800 377 772 (have your business IRD number ready) or your accountant.

Prenelle Rungan

Prenelle is a fully qualified CA and lawyer. She has held senior finance roles with global and local companies over the last 15 years. She is currently a Director of BizSync Limited, a consulting company that strives to start businesses on the right foundations. If you wish to contact her, please visit her website www.bizsync.co.nz/contact.

What you need to know before starting your own business

February 10, 2016 Prenelle Rungan

It’s something you’ve always imagined. Being your own boss, making the decisions, being the person who is in-charge of saying yes, but more often, saying no! But’s it’s more than that, it means allowing yourself to be more creative, to put your ideas in front of clients and make a difference. Finally, it’s also getting the right balance between personal and professional …well, better than it is now!

Everyone has thought about starting their own business at one point in their career. Furthermore, most people have also thought about what it is they want to do, probably done some initial scoping and most definitely, imagined what the name/logo will be. But, there are a few other things worth noting before plunging in:

1. Do a Proper Budget

The majority of all business only breakeven after year 2, and start making a minimal profit in year 3. So before you quit that full time job, put together a simple but proper budget that spans from Year 0 to Year 3. List all expenses – split between absolute and discretionary. Be as specific as you can with the type of expenses – using your credit card/bank card statements can really assist in identifying main items. When doing the budget, remember you’re not going to be a monk living up on a mountain – be realistic; particularly at the start-up phase your own business, doing things you enjoy will be a motivator and will help on those days when you feel like you are going nowhere! Use round numbers and estimate. Remember a budget is a living document – you update as you know more. (Note: If you require a template, send me a request via www.bizsync.co.nz/contact). Then, look at what dollars you have to support the absolute expenses and a portion of those discretionary items. Once you’ve done this, (again, it doesn’t have to be perfect), it will give you an idea on what your next steps can be.

2. Stay Put, Part-time or Full Throttle?

The budget will allow you to understand what your options are. You may need to save a lot more before you can go into business. Don’t be disappointed if this is the answer at this point. It can give you a great opportunity to have the conversation with your manager on what you want more training on or types of projects you want to work. A second option may be changing your type of employment – contracting and part-time options will allow you a fixed income and at the same time, gives you the option of working on the business (note: ensure you check the IRD website as there are different tax rates that can apply!). Finally, the last option is going into the business full time! You feel secure that your savings will give you the opportunity to develop and grow your own business. With all these options, there are pros and cons, so take time on this part and don’t get disillusioned, as this gives you a reality check as opposed to vague dreams.

3. Administration

The next step is to get onto the NZ Companies office website and ensure the company name is not taken. Furthermore, it is definitely a must these days to ensure the domain name can be registered. Finally, in this very brand focussed market, you should also look into trademark registration. In NZ, it’s relatively simple and congratulations to NZ Companies office for making this a simple one-step process. The website is https://www.business.govt.nz/companies/onecheck and gives simple instructions on the steps required. You can also follow the links to the different sites to set up, including IRD requirements. (Note: Setting yourself as a company does provide protection but there are administrative requirements so check with your accountant to ensure it is the best structure for you.)

4. Support

Going into business is fantastic. However, it takes time to realise the vision. Customers don’t pay. Suppliers are late. You may have a great idea but the market may not be ready. And these are only some of the issues. So ensure you have support. Whether this is family or friends, ensure you have people in your life that you can talk to, that can keep you motivated and remind you why you wanted to do this. As important as it is to have people as your personal advocates, I would strongly recommend that you sign up with a professional mentor. Now, you may know someone, which is great. If not, www.businessmentors.org.nz offers professional mentoring and is supported by the public sector. A mentor can guide you and provide his/her own personal experience in developing a business, and the really good ones, make you accountable for decisions.

5. Networking

This is the bit that is slightly tough, hence I’ve left it to last. You need to get out there and meet with potential clients as part of your business set-up. This is just another opportunity to gather information, particularly what potential gaps there are in the market and how you can align your vision/values to what the market needs. Get in contact with your old bosses, tax/accounting advisors and lawyers. If you’re part of a professional network, go to those training events and alumni meetings. And how do you network? You practice! Every opportunity you get, ensure that you are LISTENING and extracting 5 pieces of information – information can be a name, position, organisation, etc. You’d be surprised how quickly you start to build a database of information that will become useful. A lot of professional organisations do offer networking courses, but my personal opinion, is that every time you talk to someone, if you are listening for new information, that’s networking! And the good news is, the more often you do it, the more natural it will feel.

Starting your own business is an exhilarating experience – it’s you saying to the world, here’s something I can do that is unique and I believe it makes a difference. However, like anything in life, and certainly in business, you need to take a step back, evaluate and gather as much information as you can so you are prepared! The points above give you some guidelines. If you need any more information, please message me via www.bizsync.co.nz/contact. Best of luck!

How to get back into business mode…keeping motivated

February 2, 2016 Prenelle Rungan

One of the hardest challenges I faced when starting my own consulting business was getting back into it after a break. When you own your own business, it takes a different motivation to get back into a routine. Working for a global or private shareholders, there are set deadlines, compliance requirements and projects coming up and down the chain. So while, you might struggle to get out of bed after lazy days on the beach, you know you need to get done what needs to and well, it helps that the pay check in the middle of the month is required to settle those summer purchases. However, for when you work for yourself, how do you work out when to start back as you’re the boss and well, part of why you went out on your own is so you could do what you wanted, when you wanted. How do you get motivated?

Here are some pointers that helped me:

1. Review your expenses to date

It’s like splashing your face with ice cold water! I always recommend to my clients, no matter how small you are, always ensure you keep your accounts up to date. Yes, it’s boring and administrative, but keeping your accounts up to date lets you know how you are doing, and you only know where you can go by knowing what your position is now. Part of this process will allow you to see the state of your expenses (both business and personal) and therefore, give you the jump start you need to get back into the routine! Even if you are a good net position, my recommendation of reviewing your accounts means not just preparation, but review against your budget. By reviewing your budget and where you need to go propels you to start thinking about next 2 months and reminds you of the plans you have, which can’t begin to happen until you start.

2. Look at your strategic plan

Reviewing your strategic plan is a continuum from the budget review process. I define a strategic plan as the evolving living document that sets out the “what/why/who/when and how” of the business. It’s normally a 3-year view but can go up to 5years. The budget is a section of this document and sets the financial foundation. However, the strategic plan contains the vision, mission, SWOT analysis – essentially, to me, it’s why you went into this business. Review of the plan gives you an opportunity to reassess the plan, serves to remind you of why you did this and allows you to break down the next 1 year, in particular, into manageable portions. This will then lead onto ideas generation, customer focus, areas of risk/reward and frankly, gets you in front of your laptop/notebook and gets you the “business-thinking” mode.

3. Get in contact with your mentor

As I’ve mentioned in previous blogs, having a mentor can be a real support, advocate and more so, a mentor forces you to do something! A good step as you start the new year is to book a meeting – in fact, I’d actually suggest that at your last meeting for the year, you ensure your mentor and you book the first meeting in the new year – this gives you a target date! Meeting with your mentor gets you into ‘business mode’ and focusses you on key goals/tasks with a set timeframe. Finally, this first meeting gets you into the natural business rhythm so get on the phone/email now!

At the end of the day, you started to get into your own business because you had this passion and determination to do something different – something you knew that working within the confines of working for someone else prevented you from achieving. With any road we choose in life – personal or professional, there are always challenges – most of which we wouldn’t know until we take the plunge and do it. However, as they say, the first step is always the hardest but if we have the courage to take it, the next steps become easier! And you know the best part, after reading this blog, you’ve actually already taken that first step so well done! – the rest of the way should be easier.