The recent and continuing tide of negativity that has surrounded News Corp after its phone hacking scandal is once again testimony that it never pays to build a castle on quicksand.

The mighty News Corp came crashing down faster than lightning speed after the scandal was made public. It resulted in shameful closure of the once popular newspaper News of the World and ruined the credibility of news publications across the UK, perhaps further still.

Journos are at best a mildly trusted bunch of professionals. They are not exactly the most favoured of all people in the eyes of the masses. Sadly, it appears that a bunch of scheming and corrupt journalists used unsavoury methods to get a story.

Senior executives at News Corp apparently never saw it coming, despite previous police and internal inquiries…

How to Avoid a Murdoch-ian Disaster in Your Business

You don’t have to have an empire the size of News Corp. A disaster like the phone hacking scandal can strike anyone at any time. Unless you come prepared.

If you employ people in your business; whether that is in-house or by means of outsourcing certain business tasks, you must practice absolute transparency to avoid potential lawsuits.

Here are ways to do this in style.

• Create a mission statement and make it the foundation of doing business
• Have everyone sing to the same tune, try and simplify your business to make it understandable by all staff; what is your primary objective; how will clients be handled; who is responsible for XYZ; how will you handle complaints, etc.
• Prepare a MO (Modus Operandi) is by far the best way to detail your business across all departments: from marketing to sales to client management.

Any rule is useless unless it is somehow controlled and enforced. No one expects you to stand by and hassle your staff 24/7. In fact you want to give them credit for making independent decisions and acting from good judgement.

Having said this, you also want to have measures in place that review the processes on a regular basis.

Transparency Improves Performance

It has been observed by savvy businesses that increased transparency fosters improved performance. When your team knows what strings to pull and how they are more inclined to excel in their day-to-day operations.

The Most Important Part of Being Transparent

I can’t stress enough how important it is to actually have systems in place that monitor your team’s performance and actions. This is where junior and senior management can play their best game.

The secret to playing the game at the top level lies in keeping control of who pulls the strings in your company. Trusting your staff is great, but ultimately keeping control is protecting you, the owner against nuclear disasters like the one News Corps is dealing with right now.

The recent disruptions of flights around Australia, resulting in closed-down airports has once again made apparent the importance of insurance cover for unlikely events. InsuranceNews.com.au reported in their June 27 issue that many airlines were unlikely to be covered with a business interruption policy for the event that created chaos all over Australian airports.

As reported by the website, the disruption of services cost Qantas some $21 million in lost revenue! A massive loss in anyone’s book if you ask me. And while no one would ever expect an ash cloud disruption of the magnitude we just experienced in Australia it is clear that these things do happen – and for that we ought to be covered with the right insurance policy.

Do You Have Sufficient Cover?

How does your business insurance policy stack up against sudden, unexpected disruptions? Do you have ample cover, or have you neglected this side of your business in favour of other, more pressing financial matters?

Don’t Wait Until It’s too Late…

The statistics never lie and the following high percentage of under-insured SMEs in Australia should be enough reasons for you to be concerned.

“The Australian Bureau of Statistics and the Insurance Council of Australia estimate that 67% of small businesses have no business interruption insurance or are underinsured.”
− source CIA Insurance

Thinking that “she” be right” is asking for serious trouble down the road.

GM of Vero Insurance’s SME Products, Rob Walters, tells how approximately “70 per cent of small businesses that are not insured or underinsured and suffer from a financial loss fail within a year.”

Statistics have proven that most SMEs underestimate the serious consequences of a business interruption. Often to the cost of failure.

How to Take Out the Right Cover?

Taking out the right cover is essential to avoid potential misunderstandings when trying to make a claim for something you are not covered for. The best way to do this is by using a qualified insurance broker. They can help you design a comprehensive risk management plan suited to your circumstances and your business.

Brokers have adequate knowledge of policies that are not known or available to the general public. A broker can custom-design a cost-effective policy cover for you and your business.

Don’t delay getting adequate cover for your business, because failing to do so can cost you and your family your livelihood. To learn more about business insurance and the various types available download this SME Insurance Whitepaper for free.

The resignation of Deputy Victoria Police Commissioner, Sir Ken Jones, once again opened up the discussion about transparency in decision making. Many Australians speculate that Sir Ken might have been encouraged to leave by Commissioner Simon Overland.

Whatever went down behind closed doors is not a good advert to build trust between the public and the law. Or for that matter, the public and the Government.

People want answers and they want the truth.

But, if we have learned anything from this latest saga, it’s that an ‘open’ decision making policy might not be the best thing for your business. Why? Let’s discuss some of the more obvious (and not so obvious points).

What is Open Decision Making?

The basis of open decision making is simple:

• The first step is to collect input from a large number of people
• Step two is to facilitate agreement between all parties
• The third step is the announcement of the decision

In short, ODM is a group decision.

Many business owners believe this strategy to be counter-productive and to a large extent I have to agree, and you might want to consider a few points before you employ an open decision making policy in your company.

# 1 – Too Many Cooks Can Spoil the Broth

In business sometimes less is more. When you have to wait for a collective decision within a group, time and money can quickly become an issue. Whenever opinions divide – and they always do in a group environment, things take a longer to finalise. If you own a small business this reason alone could make or break your survival.

# 2 – Authority Could be Tarnished

People generally want and need leadership. Even if they think otherwise. Most people will talk around in circles if given the chance. If you employ an open decision making policy in your business it could easily invite trouble. If you do, make sure you establish clear boundaries and rules as to how the policy will be executed.

# 3 – Reconsideration Requests

Once the group makes a decision you should never reconsider, unless important new information becomes available. Despite your best intentions you might be pressured to reconsider because someone didn’t agree. People are funny that way: they sometimes say one thing and do another.

Unless you can impose strict guidelines and stick by them you should ask for opinions when warranted – but ultimately make the decision yourself.

What do you think?

It shouldn’t need to be said but just because something generates revenue you are not necessarily making money.

A good example is Insurance Brokers.

It costs about $300 a year to send out a renewal, handle the paperwork, manage claims and answer phone queries. So you would think that dumping anyone who generates less than $500 would be a no brainer – right.

Wrong. Most brokers hate to part with clients.

There are solutions such as direct links to underwriters and claims services but the lesson is to work out which product lines or parts of your business generate the most profit and focus your energy there.