Did you know that business as we know it is about to change significantly?

Sometimes Bad is Good

In our main story today, the bad news is bad, but before we go there I have some good news first and then I have some bad news which is not bad. But don’t worry after the bad main story I have a Malema story to cheer you up. He is the funniest person in the country after all!

Good news for investors

According to home loan originator ooba’s oobarometer a year-on-year (y/y) nominal house prices increase of 11,4% from R803,642 to R895,031was measured end of February 2010. Capital growth is back in double digits again!

Bad news for developers, but more good news for investors

According to ABSA’s senior property analist, Jacques du Toit, new houses built declined with 52.6% and new building plans with 55.1% from a year ago as at end of January 2010. This means supply is dropping fast and it is not going to recover soon. You know the story … when demand exceeds supply the prices will go up. It is looking good!

Bad news for Directors

Your role as owner, director and/or manager is on the verge of a “makeover”!

Business is still the easiest, fastest and most effective way of making money, but then you should know what you do. Not just in terms of the type of business you do, but also in terms of what you are allowed to do and how you are allowed to do it.

You may not know it yet but South Africa is about to receive a New Companies Act together with a revised Code of Corporate Governance that will effectively change the “rules” of the business game. While much of this is extremely positive, all businesses must ready themselves to face a range of challenges brought about by these changes.

In particular some of the key things that are changing include;

- The exposure of directors and decision makers. The New Companies Act, for the first time in legislation, actually puts on paper in a very clear way what the roles and responsibilities of directors are –to act with due care, skill and diligence in the best interests of the company they manage and control. Because, in essence, all a business is really about is the making and implementing of decisions. The new act clearly puts those who have the ability to make decisions in the spotlight;

- The impact of your business on all its stakeholders is becoming very, very important. The New Companies Act is changing the way businesses need to report, financially and otherwise, away from a “tick the box approach” towards a “stakeholder impact” approach – the bigger the company the bigger the impact. This means that as your business grows, more and more is going to be required in terms of accountability and transparency and reporting;

- The need to better understand the “different hats” you wear in your business – especially if you are owner, shareholder, director or member of a close corporation or all together … in fact if you are able to significantly influence the decisions of the company, it puts you directly in the spotlight. .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2010/03/18/danger-for-directors/feed/ 2 http://www.lightminded.com/2010/03/13/hidden-skeletons/ http://www.lightminded.com/2010/03/13/hidden-skeletons/#comments Sat, 13 Mar 2010 14:14:43 +0000 Coert http://www.lightminded.com/?p=958 Ethics

Last week while having dinner with my friend, Dr John C. Maxwell, the great man said something that made me think. After I thought about it a lot I decided to share it with you.

Dr Maxwell told me that he was once asked by a business group in America to write a book about business ethics. When he said to them that it is not possible, they wanted to know why not? He said to them that “there is no such thing as ‘business ethics’. People either have ethics or they don’t. If they do not have personal ethics, they will definitely not have ethics in business and if they have personal ethics, they will definitely have it in business too”.

What Dr Maxwell said is clear and easy to understand, but how will it be applied in practice?

Every time when I expose an injustice in my newsletters some readers accuse me of been unprofessional and unethical.

Should all of us shut up about the things that are wrong? Or maybe not all of us see these things I write about as wrong doing. If so, they think;

1. It is not wrong to take contributions for a pension fund and then not provide the promised pension at retirement.

2. It is not wrong for attorneys to break the rules of the Law Society and pay referral fees on trust and conveyancing work.

3. It is not wrong for a youth leader to speak hate speech.

4. It is not wrong and stupid to burn property and strike at the very government you selected and then to select them again at the next election.

5. It is not wrong for ex employees to steal your clients by spreading lies about your company.

6. It is not wrong for ex associates to break agreements, steal your staff and abuse your clients.

7. It is not wrong for an accredited financial advisor to provide his clients with fraud tips that can end them up in jail.

8. It is not wrong for the authorities to allow abovementioned advisor to continue with his malpractice.

9. It is not wrong for an attorney doubling as accountant and acting also as independent trustee to allow his client’s trust to overexpose itself.

10. It is not wrong for an attorney to refer to his clients as seals and doing business with them as “clubbing seals”.

11. It is not wrong for the banks to take your house, sell it on an auction at half price and hold you liable for the difference.

12. It is not wrong for employees to expect pay for no work.

These are some of the things I sometimes write about and every time some readers accuse me of all kinds of ugly things. Goodness gracious, what is wrong with you? Do you think that these things will disappear if we keep quiet about it? Do you think people will not do to you what they do to others? Do you think you help others by not warning them?

It is not so much the topic I write about that disturbs people it is the naming of the guilty parties. The moment I attached a name of a person, company or political party to a wrong doing I am seen as unprofessional and unethical. Some times even as a racist!

To be extreme – Do you think a child molester whose name is kept secret will not molest other children? Or do you agree that it .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2010/03/13/hidden-skeletons/feed/ 6 http://www.lightminded.com/2010/03/11/no-work-no-pay-2/ http://www.lightminded.com/2010/03/11/no-work-no-pay-2/#comments Thu, 11 Mar 2010 03:52:05 +0000 Coert http://www.lightminded.com/?p=950 Performance-based Remuneration

The recent recession once again emphasised the value of an excellent and well-known old business principle. In the good times, when businesses are making plenty of money, they don’t worry too much about this principle; but when the wolf is knocking on the door they’re suddenly very sorry that they ignored it. Then they diligently want to try and put it right, but in most cases it’s too late. The principle I’m talking about is performance-based remuneration.

Plenty of people know exactly what it is, and a lot of people even use it in the good times; certain professions will always stick to it regardless of the state of the economy. These include professions like estate agents and insurance consultants, who usually always work on a commission basis. That’s exactly what performance-based remuneration means in its simplest form, but most people think that it’s something that applies only to salespeople. Definitely not.

Other situations where you’ll find performance-based remuneration fairly regularly in all circumstances include, for example, directors’ performance bonuses at the end of the financial year. If this system works well for salespeople and directors, why not for other staff and managers as well?

It’s not always practically possible to apply it to each and every function in the business, but if we could, we would have staff who are worth every cent that they earn – and that’s what will make the difference for the company in tough times. In good times everyone looks good, but in tough times you can easily spot the passengers. And if they look like passengers in tough times, then you can believe me when I say that they were even worse in the good times. You just couldn’t see it amidst all the prosperity. Now they stand out like sore thumbs, and it pains you to pay them a fixed salary that they “aren’t earning”. The good staff who also didn’t get noticed in the good times are now shining like diamonds, but they’re also now suffering under the financial burden placed on the company’s limited reserves by the passengers.

What companies then usually do is start time-consuming and expensive staff layoffs in order to get rid of the passengers. It’s all so unnecessary and could be so easily avoided if you always handled your staff’s remuneration exclusively on a PERFORMANCE-BASED REMUNERATION BASIS, regardless of the economic conditions or the company’s financial position.

The philosophy behind performance-based remuneration or paying for performance is to reduce any job function in the business to measurable units so that you can then pay a pre-determined fee for that unit of work to be done.

Think about it like this:
If someone is paid for the time they work versus being paid for the results of that work, they are incentivised to do as little as possible per hour as they know that they need to stretch the work load to fill up the hours in the day. If however they are paid for the completion of a task at a certain quality standard, then they are incentivised to do as good a job as possible in the shortest possible time.

Performance-based pay links remuneration to individual achievement (or non-achievement) of predetermined outcomes and/or the performance of the company. It takes several forms, including performance-based changes to base remuneration and the provision of bonuses and other one-off type rewards.

Think about it: if your business had already switched over to a performance-based .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2010/03/11/no-work-no-pay-2/feed/ 5 http://www.lightminded.com/2010/02/23/one-man-businesses/ http://www.lightminded.com/2010/02/23/one-man-businesses/#comments Tue, 23 Feb 2010 06:13:07 +0000 Coert http://www.lightminded.com/?p=916 Why one-man operations remain one-man operations forever

Most small businesses remain small because they are one-man operations. However, there are exceptions: some one-man operations get quite big, with various people working there, and on the other hand, some small businesses are by no means one-man operations. But wait, let’s just stop there for now, because I know you think I’m contradicting myself. How can a small business not be a one-man operation, and how can a one-man operation have a number of people working for it? Of course it’s possible for a number of people to work for a one-man operation, and in reality, that’s always the case. Think of the butchery or doctor in town. The owner isn’t the only person who works there, but it’s still seen as a one-man business.

Why is it called a one-man business then?

There is only one man who makes all the plans, accepts all the responsibility, provides all the sureties, has all the knowledge, and so on. These aspects do play a role in determining whether it’s a one-man operation or not, but to me it’s actually about the mindset of the owner instead. If he has a one-man operation mindset, then as far as I’m concerned it’s a one-man operation, regardless of how big or small the business is.

Not all one-man operations remain small, but most do, because it takes an exceptional person to make a huge business out of a one-man operation. As far as I’m concerned, Sir Richard Branson’s Virgin Group is the most successful one-man business in the world. Have you ever wondered what will become of Virgin when Sir Richard is no longer there one day? I’m sure they’ve thought about it a lot already and have their plans in place, but I’m just wondering.

Few of us are in Sir Richard’s class though, and I think most one-man operations come to an end when the founder/owner dies or is no longer around. I’ve seen the evidence of this when businesses like this get sold. Many of them collapse shortly afterwards. I even saw it happen with a successful business that I sold years ago. It could not continue to exist without my skills. I learnt a lot through that and started making sure that my other businesses would be able to continue without me. How does one do this?

Duplicate yourself. Appoint people who can do the work as well as or better than you can. This sounds easy, but for most one-man business operators it’s the hardest thing on earth. It’s easy to make the decision, and you know you have to, but it’s not going to work if you don’t get rid of your one-man operation mindset.

As long as your mindset is not right, you’ll take one step forward and appoint people to do the work and then the first time that they get stuck you’ll take the work back again. So the person you’ve appointed is not being utilised, but is still getting paid. This means that you’re still doing all the work, but you now also have a paid spectator. So you’ve taken a few steps backwards, because the business is in a worse position than before. Your staff numbers are growing and the value of your business is decreasing.

Get your mindset right and accept that other people cannot do things as well as you can, but that there is no other option than to push through; or else make peace with the fact that you will have to work until you die and are doomed to eternal mediocrity.

By the way, no investor will invest in a one-man operation. Investors invest only in businesses that can operate successfully without their founder. That is value!

Business Seminar

The week of 8 February 2010 was a crazy one. On Monday the .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2010/02/23/one-man-businesses/feed/ 0 http://www.lightminded.com/2010/01/22/the-profidend-solution/ http://www.lightminded.com/2010/01/22/the-profidend-solution/#comments Fri, 22 Jan 2010 08:51:09 +0000 Coert http://www.lightminded.com/?p=798 Hi Guys

We received a lot of interest on the Provider Trust. People see the potential it has for a personal retirement fund that will be far better than any of the redundant insurance products.

Due to all the questions I am now considering a mini seminar to explain the Provider concept. What do you think? I am even thinking about a road show where I explain the Provider to people all over the country in school or church halls. Nothing fancy. Just a two hour slide presentation to explain the pros and cons of this specific trust in detail and trust law in general. This way we can keep the cost low and maybe a R50 entrance fee will be sufficient. Then it will also be possible for beginners, students and even high school kids to attend. Should we do it during the mornings, afternoons, evenings or even on Saturdays?

If “dominees” and headmasters can become involve and they can make their facilities available for free, I will also do it for free. Let me know what you think and please become involve.

However, while you think about it, please allow me to announce a brand new business seminar at a very low price. Business owners should not miss this one!

Rather let Marina Short tell you about it:

From the desk of Marina Short, MD of Profidend (Pty) Ltd.

Dear Reader

The PROFIDEND Business Seminar

My name is Marina Short and not all of you know me yet, but I am sure you already know Coert Coetzee. Many of you know him as a property investor and seminar presenter on property topics. Many of you know him as an author. Many people also know him as a businessman and that is what this letter is about. Coert made his first business millions long before he became a property millionaire and long before he wrote his first articles and books.

Since Coert started with the Treoc property seminars in 2003, he received numerous questions about his business principles. Especially during the recession of 2009 people wanted to know how he manage his businesses. They wanted to know the recipe because it was very obvious that his companies were doing well during the worst recession we had in 80 years. Coert is frequently invited to conferences as a keynote speaker where he speaks about his unique and popular business methods .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2010/01/22/the-profidend-solution/feed/ 0 http://www.lightminded.com/2009/01/23/coert%e2%80%99s-business-background/ http://www.lightminded.com/2009/01/23/coert%e2%80%99s-business-background/#comments Fri, 23 Jan 2009 05:06:12 +0000 Coert http://www.lightminded.com/?p=820 Coert Coetzee is not only a successful property investor and author; he is also a successful businessman. He views property investment as a business, and this is the reason that he is so successful at it. Coert’s property successes can be directly ascribed to his solid business principles, which he has developed over the years across a number of successful businesses. These are principles that work in any business, regardless of whether it’s a hairdresser or doctor’s practice. And these principles don’t just work, they make the difference between enormous success and dismal failure. As you will see below Coert has had many businesses, most of which have had one thing in common: they were successful. Some were more successful than others, and this caused Coert to continually revise and adjust his methods where necessary, until he could make any business successful. His friends say he has the Midas touch; everything he touches turns to gold.

Coert’s unique business principles have always allowed him to manage his businesses successfully on a part-time basis, because he always makes use of working partners. Coert is a master of macro-management, while his partners are masters of micro-management. This principle is one of the pillars of his methods and one of the main reasons that he has been able to achieve so much in just thirty years.

Coert’s business background:

1. In 1976, at the age of twenty, he and a friend started a taxi business. On weekends they transported construction workers from the Sishen/Saldanha project to their houses in the homelands and back. It was one of the first of its kind, and this was long before minibus taxis existed!

2. In those days Coert was a construction foreman and lived in the single quarters at Sishen. He saw an opportunity here, and true to his nature he took advantage of it immediately. The residents of the single quarters were extremely bored at night, with nothing to do. Coert hired a projector and some movies, and offered film shows at night. It was easy money in a captive market.

3. In the late seventies he took the entertainment business further, expanding his extremely profitable business, Star Entertainment Promotions, to the rest of the country. As part of this business he held dances as well, hiring bands and halls.

4. In the early eighties Coert had an active construction business doing diesel installations in the then Eastern Transvaal. The profits from this business put Coert in a position to buy his first few houses in Springs and to get his property portfolio underway.

5. In 1989 he started a part-time video hire business and soon had five branches.

6. Up until this point all the businesses had been part-time undertakings, while he pursued a successful career in the risk management business. At thirty years of age Coert was the regional marketing manager for a national risk management company. He was responsible for the areas then known as Transvaal, Natal and Eastern Free State. That’s where he got his .........................

To read further, please log in. If you do not have an account, please subscribe]]> http://www.lightminded.com/2009/01/23/coert%e2%80%99s-business-background/feed/ 0