Published on: 26 Mar 2012
KPIs (Key Performance Indicators) are ways of measuring Critical Success Factors in a business (Critical Success Factors are in effect items which an organisation has to get right in order to survive).
Could a t-shirt be part of a KPI though?
It’s not just commercial companies that need to focus on KPIs. Not for profit organisations should also be using them.
Schools are good examples of where KPIs should be used. Measures such as classroom utilisation and exam success should be monitored.
There’s also the subject of looking at the percentage of students that decide to take unauthorised absence from school (or to use a quant old English term, they decide to “bunk off school” and miss lessons).
A city in Brazil has just identified a novel approach to let parents know if their children are missing classes.
Approximately 20,000 students in the Brazilian city of Vitoria de Conquista have just started wearing T-shirts with a built in chip. This chip links with a receiver in class and if the student isn’t where he or she should be a message is sent to the parents to let them know the student isn’t in class.
This sounds very much like a high tech version of “clocking on and clocking off” which can be found at certain workplaces around the world where workers have to record their arrival and departure times.
Only time will tell if the chip enabled t-shirts will be a success and the relevant KPIs for the schools will improve.
Personally I somehow think that some entrepreneurial school-kid may start charging a fee for looking after t-shirts in class. He may well be found sitting in the classroom with a big pile of t-shirts next to him but no classmates…
Published on: 25 Mar 2012
Here’s an interesting question – if you were asked whether you wanted more paid holiday or not, what would you say?
The standard amount of paid holiday in most European countries is 4 weeks.
Over in Switzerland though there was a national referendum recently which amongst other things asked people to vote on increasing the minimum amount of paid holidays from 4 weeks to 6 weeks a year.
Now, let’s just pause there and think about this.
Be honest. If somebody said to you “Do you want 6 weeks paid holiday instead of 4?” what would you say?
My feeling is that there may be a fair few of you out there who would vote for the 6 weeks holiday.
Now holidays are important and are needed to enable people to “wind down” and “recharge their batteries” after working hard but businesses in Switzerland warned against increasing the holiday entitlement.
They mentioned that having more weeks of paid vacation would in effect increase the labour costs for businesses (they would be paying the same amount as before but for lower productivity).
This increased labour cost could put the economy at risk. Putting it another way, an increase to 6 weeks paid holiday could result in people losing their jobs and having in effect a 52 week “unpaid holiday”.
The votes were counted and two-thirds of the voters rejected the proposal to increase the amount of holiday and the minimum stays at 4 weeks.
Now go and grab two colleagues and ask them if they would want an extra 2 weeks holiday.
If you’re in Switzerland then only one of the three of you will be saying yes.
Published on: 21 Mar 2012
Winning the lottery is a life changing experience.
The recent Euromillions lottery had a first prize of £38 million.
In a lot of companies, groups of individuals get together to form a syndicate and they combine their money and enter into a lottery.
The idea is that by combining your money you have more entries and you’re more likely to win. To be honest though anyone with a basic understanding of maths will realise that the chances of winning are still infinitesimally small.
When colleagues from an organisation set up such a syndicate to enter the lottery it’s advisable to have a written record of what was agreed (for example what happens if someone is away and can’t pay their share of the lottery money).
A group of 13 bus drivers working for the Stagecoach company in the UK formed a lottery syndicate and agreed to put in £2 per week to enter the lottery.
Six months ago one of the syndicate, a lady by the name of Miss Loveday (or Miss Unlucky as she will soon no doubt become known) decided to withdraw from the syndicate as she reportedly couldn’t afford to pay the £2 to enter each week.
Fast forward to last week and the winning lottery numbers matched those chosen by the syndicate.
Their winnings? A rather pleasant £38 million which works out at over £3 million each.
Having withdrawn from the office syndicate 6 months ago Miss Loveday doesn’t get anything from the lottery win.
Now, we’ve all had bad days at the office but finding out that you’re not an instant multi millionaire because you stopped paying your weekly £2 entry fee 6 months ago probably ranks up there as being “a really bad day at the office”.
One of the winning drivers wasn’t overly sympathetic about her plight though as he was reported as saying “You’ve got to be in it to win it”.
The one piece of good news for the unlucky Miss Loveday is that she doesn’t have to listen to any of the winners celebrating their win as all of them resigned immediately from their £17,000 a year jobs and didn’t bother going into work the day after winning…
Published on: 19 Mar 2012
We get a weekly report on the phrases that people are searching for when they visit our website.
As well as the search terms that would be expected on our site such as “ACCA courses” or “CIMA courses” there are also some more unusual ones.
One recent such unusual search term was “How do I become Lady Gaga’s accountant?”
Now this is a good question but unfortunately if you’re the person that’s hoping to become Lady Gaga’s accountant then sorry but we don’t quite know the answer to that one.
What is interesting about the music industry though is that things are changing for the top artists around the world.
Music trade magazine Billboard has just published their annual list of the top revenue generating music acts in the US.
The top 10 includes some of the newer artists such as Taylor Swift (No. 1 with $35.7m) and Adele (No. 10 with $13.1m) but it also includes some of the
more experienced artists such as U2 (No. 2 with $35.1m) and Bon Jovi (No. 7 with $15.8m).
These are pretty impressive amounts of income especially when you consider that they only represent the US income sources and also do not include revenue from sponsorships or merchandise sales.
The income profile of top music acts has changed over recent years though.
Whereas a decade ago the dominant proportion of income would have come from sales of CDs the big earner for most of the artists nowadays is concert and touring revenue.
U2 are the kings of making money from tours and their recently completed “360° Tour” which ran from 2009 to 2011 grossed an incredible $736 million and over 7 million people saw them in concert on the tour.
Back to the person that searched for how to become Lady Gaga’s accountant though and it remains to be seen whether the person searching for the answer was an individual student or a business development partner at a firm of accountants…
(here are your free ACCA and CIMA online courses)
Published on: 14 Mar 2012
Companies often offer incentives to encourage people to sign up for their products or services.
BOGOF is a term that’s well known in marketing circles.
It stands for “Buy One Get One Free” and as the phrase implies it is a sales promotion encouraging people to buy a product or service. If they pay for one they’ll get the other one free.
In a somewhat unusual approach to promoting a particular service, a doctor in Massachusetts in America is currently offering a free pizza with every vasectomy.
Now, call me old fashioned but the decision as to whether or not you get a vasectomy should in my opinion be driven by other factors other than the offer of a free Spicy Meat Feast Deep Pan Pizza.
Evan Cohen, the manager of Urology Associates who are offering the promotion was quoted as saying that March is the most popular month for vasectomy operations.
Apparently the Spring weather offers a more comfortable recovery period than other months and also for sports lovers March has what is known as “March Madness” when the NCAA’s college basketball tournament takes place. This tournament features 68 basketball games on television throughout the day and evening for most of March.
So, there you go. Who needs a BOGOF promotion as what better incentive can there be to have a vasectomy done that sitting at home with your feet up watching basketball and eating a free pizza??
The TV commercial by Urology Associates advertising the free pizza offer is below.
Published on: 14 Mar 2012
What price should you charge for your products?
As any professional business qualification student knows, there are several different pricing strategies that can be used when setting the price for your product.
You could for example base it on the internal factors of how much it costs you to produce (cost plus pricing) or you could use external factors such as how much a customer is willing to pay for it (perceived value pricing).
So if you owned a cafe what pricing strategy would you use?
Well over in Moscow in Russia a new cafe has taken an unusual approach to pricing.
The trendy Babochki Anticafé does not charge for food and drink. Instead the customers are charged according to the time they spend at the cafe.
Customers pay one ruble and 50 kopecks for each minute they spend at the cafe. This works out at approximately £2 per hour.
Now this got the accountant in me thinking as I must admit that I am partial to the occasional social drink and there are some very good Russian vodkas out there.
A pleasant evening spent drinking some of the top (and very expensive) Russian vodkas at £2 per hour seems like a good deal (even allowing for the charge for the time when I fall asleep in the cafe at the end of the evening)
Alas for anybody thinking of grabbing a drinking bargain the refreshments are limited to tea, coffee and deserts.
Still, it’s certainly a novel approach to pricing food and drink and we wish the Anticafé well.
Published on: 05 Mar 2012
What have the Olympics, The European Football Championships and the American presidential elections got in common?
Well, if you’re WPP, the world’s largest advertising and marketing group then they are all hopefully going to make it a bumper year for profits.
The WPP Group make a fascinating case study.
On Thursday they released their results for 2011 and they were pretty spectacular.
Pre tax profits in 2011 were 18% higher than the previous year and broke the £1 billion mark for the first time. Revenue also increased by a healthy 5% to exceed the £10 billion level.
2012 is also expected to be a good year for them as “high spending advertising events” such as the Olympics and the US presidential race are all taking place this year. 2013 could be more of a challenge for the company though as there aren’t any of these big spend events on the horizon.
So, WPP are the largest advertising group in the world in terms of revenue and they’ve got an interesting history.
The name WPP originates from “Wire and Plastic Products” which was a UK manufacturer of wire baskets and was nothing to do with advertising.
Back in the 1980s a gentleman by the name of Martin Sorrel (now Sir Martin Sorrel,) who was previously the Finance Director of advertising agency Saatchi & Saatchi, was looking for a listed company to use as a vehicle through which to build a worldwide marketing services company.
He invested in the “Wire and Plastics Products” company but had no intention of owning a wire basket manufacturing company.
No, instead he used it as a vehicle to buy up companies in the advertising field to create a global powerhouse in terms of advertising groups
As the picture above shows, there are numerous brands within the current WPP group and these include some of the world’s largest firms in the areas of advertising such as JWT, Ogilvy Group and Young & Rubicam.
So, there you go. Buy a company that makes wire baskets and you could end up running the largest advertising agency group in the world.