Category: business advice

Can we trust online reviews?

Customer review sites are important. But can we trust the comments?

Travel review site Tripadvisor was in the news last week when a british hotelier threatened to sue the service over a subscriber’s poor report that alleged, among other things, a dead mouse was found in their suite.

Online review sites are changing the way we do business, particularly in the hospitality industries where sites like Tripadvisor, Urbanspoon and Eatibility are becoming the first places people check when planning a meal or holiday.

The value in these sites are the user reviews, people trust others opinions and experiences far more than they trust marketing material or even the world of professional reviewers.

For customers and the industry this is a good thing, however there is a downside as anonymous reviewers can’t always be trusted to tell the truth.

So how do we separate the false reviewers, be they positive ones placed by the establishments or negative ones places by competitors or people with an axe to grind?

Reviewer profiles
All review sites show the reviewers’ history. If a reviewer has only one review then the credibility is suspect, particularly if that one review is overly critical or complimentary. Trust reviewers with multiple, fair minded posts.

The nature of the reviews
Real reviewers rarely score ten or nine out of ten on all aspects. So treat gushing reviews with suspicion.

Mixed reviews
Even the best establishment has a bad day and even if they are perfect there is always a customer who is never happy. Real reviews vary across a range where a venue with top service might see the review scores ranging from 7 to 10 out of 10.

Review length
Long rambling reviews praising or criticising everything from the online booking facilities through to the dining room’s cutlery are either the work of plants or a nutters. Most genuine reviews are a paragraph or two.

Age of reviews
Establishments change over time, some get better and some go downhill. Newer reviews deserve more weighting although some managements decide it’s easier to fix a problem by making their own reviews so be cautious of a recent wave of positive reviews.

Regardless of whether managers and business owners like them or not, review sites are here to stay and they are spreading out of hospitality into almost every industry.

So for business owners, it’s important to take reviews seriously and use the legitimate ones as a reality check to make sure you and your staff are delivering the best possible product.

For customers, these sites can be a really useful service but they rely on real people giving genuine reviews. If you do use one of these sites to research your travel and dining, give a little back to the community by adding your own honest reviews.

Review sites are part of the information economy that’s developed around the Internet and we expect trustworthy data to be at our fingertips. Time will tell just how much we can trust these sites

Australia’s one trick economy

Businesses need fall back plans, particular when the nation doesn’t have one.

Earlier this week, Reserve Bank of Australia Governor Glen Stevens gave a speech to the Australian Industry Group on the world’s changing economic currents.

That presentation has a number of pointers for Australian businesses on how we use technology, our investments and, most importantly, where the Canberra sees our economy going.

Much of the Governor’s speech discussed how those of us who at the beginning of the century believed Australia’s economy had to diversify into new industry sectors — such as the IT sector — were proved wrong by the Dot Com Bust and the subsequent boom in the resources sector.

“Australia would probably do best, in its production structure, to stick to its comparative advantages in minerals or agriculture or various services.” Mr Stevens quoted from ten years ago, “but it was hard going trying to make sensible points against the barrage of market and media commentary.”

Perfect hindsight

It’s impressive the Governor had this perfect hindsight which can overlook the role of ramping the housing markets by the Rudd and Howard governments to avoid the 2001 and 2008 US recessions along with the sheer good luck of having a resources boom through the last half of the decade.

During his speech the governor referred to an RBA research paper, Structural Change in the Australian Economy which casts an interesting light on the comparative advantages in those “various services”.

That paper shows that service sector employment has risen to nearly 85% while its share of GDP has stayed around the same for the last twenty years, which to this non-economist’s mind implies the portion of national wealth is declining for service based workers and businesses.

Sleepwalking into the dutch disease

Of course those of us in the service sector could make it up by exporting but here again, service sector exports haven’t done much over the last decade which won’t be helped by the current high Aussie dollar — another aspect of the Dutch Disease we seem to have sleep walked into over the Howard and Rudd years.

Those same statistics show mining employment has declined over that period as well and if you’re considering sending your kids down the pit, or even packing in your own city job to drive a mining truck, you might want to read the interesting work being done by the University of Sydney’s school of robotics.

Generously, Governor Stevens didn’t completely write off the role of technology observing that, “in the old versus new economy stakes, it was probably in the use of information technology, rather than in the production of IT goods, that the gains would be greatest.”

Invest in, but don’t develop, technology

The Governor’s messages are clear to business people; our businesses have to invest in technology to be more efficient and we need to understand that government policy will be geared around the mining sector.

Most importantly, we need to understand that on a national level there is no Plan B.

In the last election it was clear both sides of politics based their policies, such as they were, on the assumption the China boom will last for the foreseeable future. Yesterday’s speech shows Glenn Stevens and the Reserve Bank share that outlook and no other alternative is being planned for.

That’s fine for Glenn, Julia, Tony and their colleagues as they have safe, indexed pensions when they deign to cease giving us the benefit of their visionary leadership.

In the business community we don’t have that luxury; a plan B is required just in case things don’t quite work out the way we hope. As the Governor says:

Succeeding in the future won’t ultimately be a result of forecasting. It will be a result of adapting to the way the world is changing and giving constant attention to the fundamentals of improving productivity. That adaptability is as important as ever, in the uncertain times that we face.

That’s excellent advice. How adaptable is your business in these uncertain times?

The next business era

No business is invulnerable in a time of change

Ray Ozzie, Microsoft’s outgoing Chief Software Architect, has some interesting reflections on the future of the PC as he steps down after five years.

His views on the mobile, pervasive always connected world and how the Personal Computer fits into it come at a time when there are real questions on how the Microsoft will fare in coming years.

Scoble’s article, based on an interview with Starbucks Chief Information Officer, Stephen Gillet, describes how laptop usage is falling as customers are moving to slate computers such as the iPad and smartphones. He also touches on how standards like HTML 5 are beginning to replace proprietary products like Adobe Flash and Microsoft Silverlight.

Is this necessary bad news for Microsoft? Perhaps not, but it what it means is they will have to reinvent the business away from the old, PC based, model of selling operating system licences.

That’s not to say it can’t be done, Bill Gates successful turned the entire company around to an Internet Explorer view of the computer industry shortly after the launch of Windows 95 as it became apparent the bet on the Microsoft Network was wrong and the open Internet was where the market was going.

One salient point that we should remember is the biggest businesses are not forever. In his post, Ray referred to the 1939 New York State Fair where one of the key exhibits was the S1 locomotive which was built by the Pennsylvania Railroad

At one stage the Pennsylvania Railroad was the world’s biggest listed company, it went a hundred years without missing a dividend payment and at one stage employed more people than the US government.

It ceased to exist in 1976.

No business is forever and even the most powerful is at risk during times of great change. We need to remember that when looking at today’s seemingly untouchable business giants.

The 360º brand

Our brand is bigger than just advertising

“How do I advertise on LinkedIn? Asked a business owner at a recent workshop.

While I answered that LinkedIn advertising probably isn’t the right path for many small businesses, one of my fellow presenters, Lara Solomon, disagreed and made the point LinkedIn is an important marketing tool.

There’s no doubt about that as a marketing, rather than an advertising tool, all online channels — including LinkedIn pages — are important to businesses as customers, suppliers and potential staff check the web before doing business with an organisation.

A good illustration of this was over the weekend when digital marketer, Raz Chorev, called out chicken chain Oporto’s for not training their staff on honouring Foursquare deals. Raz also made a point about censoring web comments which might be the topic of a future post, but really isn’t the issue here.

Raz’s comments appeared on Twitter, Facebook and on web searches. To their credit, Oporto responded quickly by isolating the damage, explaining their position and learning a lesson on letting their staff know about all the offers they post.

It isn’t just cranky customers posting on their own sites or any one of the thousands of review services such as Eatablity or Tripadvisor, we’re being judged on the comments of ex-employees, suppliers and even the quality and content of our own online utterings.

our brand is out there, on line, all the time.

A surly call centre, missed deliveries or billing mistakes all add up and damage our brands. Eventually, the massed weight of negative comments can overwhelm even the best, most expensive advertising campaign.

Our brands, both as individuals and our businesses are bigger than just marketing, we have to make sure we are consistently doing the right thing by our customers, suppliers and staff.

We’re in an era of accountablity which forces us to deliver on our promises. This is not a bad thing.

A time for fresh ideas

To stand out from the crowd we need to be original and creative

Stale old thinking doesn’t cut it anymore. In an age when plagiarism and rip offs can be uncovered with a few minutes searching on the web, simply copying someone else’s work has ceased to be an option.

The same can be said for just recycling past ideas; the days of money for old rope are over.

It’s time for new, innovative ideas and work. The opportunities for getting fresh thinking into society and business have never been greater.

We can all do better than just leeching of other people’s work.

Eight online tips for franchising

Is your franchise network part of the online economy, or becoming a relic of the past?

The world wide reach of the web has always been a problem for territory based franchises. As a consequence, many franchise networks have a token web presence which they use mainly as a recruitment tool for new franchisees.

An aversion to the web presents a difficulty for these franchisees as most customers are now online. By not actively using the net, those locally based franchise chains are finding themselves at a disadvantage to their non-franchised competitors.

The franchising industry’s problem was illustrated last week by Ben who called into to my ABC radio spot last week on Internet business trends to ask about how a territory based lawn mowing franchisee can use the web.

Ben’s question raised some important points that franchise holders — and anyone considering entering a franchise — should check to make sure that business is competing in today’s marketplace.

Does the franchise have an individual page for each territory?

Each franchise area should it’s own page within the chain’s site. While the contact details can redirect back to the central phone or form, the territory page should include some local testimonials and few other localised features.

Is the home page regularly updated?

A static index page that rarely changes isn’t attractive to search engines or customers. A vibrant business should be updating their page regularly. This is particularly true if there is a substantial network of franchisees.

How does the site rank?

When searching for the product or service the franchise sells, how high does the franchise’s page come up. If it doesn’t appear in the first page, then the franchise isn’t working.

Does local search work?

Type in a search for the franchise’s product and an established territory such as “lawn mowing Footscray”. If the Footscray franchise doesn’t appear in the local listings then the franchisor hasn’t listed their sites in the local search listings.

What does the site sell?

In researching this article, I found the biggest franchised lawn mowing chain appears in paid ads for “buy a lawn mowing franchise” but not for a actual lawn mowing. A site or digital strategy designed to sell franchises is good for the franchisor but doesn’t do much for the franchisee looking for customers.

Is the franchise engaging with social media?

Whether you trust social media or not, the market is talking about you on forums, blogs, Facebook, Twitter and other channels. A great example of this was Oporto last weekend. A franchise needs to be engaging with customers, critics and fans.

Where are the franchisees?

Are the franchisees listing themselves? This is always a worrying sign that a franchise isn’t controlling its marketing properly. On the other hand, if their personal profiles aren’t appearing on sites like LinkedIn, it can indicate too tight a control on franchises.

What is their media strategy?

The whole point of buying a franchise is to have a ready made brand and marketing strategy. If a franchise is locked into a print mindset with only at best a token online presence then they aren’t going where the customers are. Have a look at the online versus print effort before signing up.

Many franchisors are playing by 1990s rules. Which was great for the last twenty years, but the old models are evolved as customers and potential franchisees have changed the way they shop and do business.

The web and social media are more than just a passing fad or a blunt advertising and marketing tool. They are a key part of your business identity and are being used by suppliers, recruiters, job seekers and commercial partners to figure out whether you are worth doing business with.

A franchise that doesn’t use today’s media tools is stuck in yesterday’s market.

ABC Nightlife October 15 2010

The new business web trends

Update: You can download the show from the ABC Nightlife homepage included in the program are some ideas on how kids use the net, the challenges for franchises and the importance of search engine optimisation.

The Internet is changing how businesses are working online. Join Tony Delroy, Paul Wallbank and Chistena Singh from Sensis to discuss some of the ways customers and businesses are changing the way the buy and sell on the Internet.

Business has changing for last fifteen years as customers move online to check the deals and products available. With most people now on broadband and more using their mobiles, the game is changing again.

We’ll be looking at the e-business report which is a free download available from the Sensis website.

Tune in on your local ABC radio station or listen online at www.abc.net.au/nightlife.

If you’d like to join the conversation with your questions or comments phone 1300 800 222 within Australia or +61 2 8333 1000 from outside Australia.

You can SMS Nightlife’s talkback on 19922702 or twitter @paulwallbank using the #abcnightlife hashtag

On being a price taker

does your business rely on being cheap?

As Australia’s dollar reaches parity with the US dollar for the first time in thirty years, the nation’s newspapers and politicians are awakening to the reality that this is not a good thing for most Australian exporters, particularly for those mineral industries which are cited as being responsible for the Goldilocks economy.

Those concerns are real, as this affects the employment of millions of Australia in the agriculture, mining and tourism industries.

Selling a price dependent commodity product locks a country or business into cycles they can’t control; currency movements, trade wars and cheaper competitors.

Adding value and creating products that can withstand the commodity cycles is the future for advanced economies. It’s as true for the businesses within these countries as it is for the entire nation.

If your business sells on price, then you’ll need to think on how you can change your customer’s perception about your product before they see it as a commodity which can be bought cheaper from someone else.

Providing substance

a successful business is more than a facade

Businesses are told they have to tweet, set up a Facebook page and update a blog on a regular basis. But this doesn’t matter if the venture doesn’t deliver what it promises.

A good case of this was a business I recently visited that’s prominent in various social media channels. The owners do everything right by the new media textbook and have been featured in a number of articles for their use of new media tools.

But they have a problem; their product was poor. Thinking I might have caught them on a bad day, I even went back the following week and found it was still disappointing.

It wasn’t so bad I’d complain, but I left feeling I could get better quality and value for many at other places. There simply wasn’t a reason to go back.

As business owners we need to keep focussed on our core product; the coffee in a coffee shop, the sales team at a real estate agency, the shoes in a shoe shop or whatever goods and services it is we actually sell.

If the underlying product doesn’t deliver on your customer’s expectations, then marketing or any other tools won’t save the business.

So by all means play with the new tools and explore the opportunities, but don’t lose sight of the core reason why customers will come to you.

The power of delegation

Why organisations need to learn Steve Jobs’ lessons

Randall Stross of The New York Times looked at Steve Jobs’ years in the wilderness running NeXT Computers and concluded the lessons he learned were essential to making Apple the success it is today.

While leading NeXT Jobs obsessed about detail, famously leaving his key customers waiting while he discussed the layout of sprinklers in the landscaped gardens.

On returning to Apple, Stross points out Apple’s management team has been remarkably stable and this stability, borne out of Jobs trusting his key staff to make the right decisions, is one of the reasons for the company’s success.

As we move into an era where information becomes a commodity and the old style of manager guarding their sources of knowledge becomes irrelevant, the trust based organisation is going to replace the command and control models of the past.

This is going to challenge to a lot of managers in private and public organisations. It will be interesting to see how enterprises, government agencies and political parties around the world manage those challenges.

The style of leader raising today is very different from those of the past.

The strange story of the Stuxnet worm

A virus crippling the Iranian nuclear program could affect your business

The tale of the virus infecting Iran’s nuclear program is one of the fascinating stories of the computer world.

Whoever wrote the Stuxnet worm did a spectacular job in bringing together a number of security problems and then using two weak links — unpatched Windows servers and poorly designed programmable logic controller software — to create a mighty mess in the target organisation.

The scary thing with a rootkit like Stuxnet is that once it has got into the system, you can never be sure whether you’ve properly got rid of it.

What’s worse, this program will be writing to the Programmable Logic Controllers the infected computers supervise so plant operators will never know exactly what changes might have carried out on the devices essential to a plant’s operations and safety.

Damaging Iranian nuclear plants

A report on the Make The World A Better Place websites over the weekend indicates the Stuxnet Worm may have damaged the Iranian nuclear reactor program.

The story behind the Suxnet worm is remarkable. It appears this little beast is a sophisticated act of sabotage involving using a number of weaknesses in computer systems as detailed by Computer World in their Stuxnet Worm hits Industrial Systems and is Stuxnet the best Malware Ever articles.

The risk of unpatched systems

One of the things that leaps out is how servers running unpatched systems are an important part of the infection process. The Stuxnet worm partly relies on a security hole that was patched by Microsoft two years ago so obviously the Iranian servers were running an unpatched, older version of Windows.

This is fairly common in the automation industries. I’ve personally seen outdated, unpatched Windows servers running CCTV, security, home automation and dispatch systems. They are in that state because the equipment vendors have supplied the equipment and then failed to maintain them.

These companies deserve real criticism for using off the shelf, commercial software to run mission critical systems that it was never designed to do.

Commercial programs like the various Windows, Mac and other mass market operating systems are designed for general use, they come with a whole range of service and features that industrial control systems don’t need. In fact, the Stuxnet worm uses one of those services, the printer spooler, to give itself control of the system.

Securing industrial systems

These industrial systems require far more basic and secure control programs, a cheap option would be a customised Linux version with all the unnecessary features stripped out. In the case of Siemens, the providers of the PLCs supplied to the Iranian government, it’s disappointing such a big organisation couldn’t build its own software to control these systems.

Business owners, and anyone who has computer controlled equipment in the premises, need to ask some hard questions to their suppliers about how secure supplied computer equipment is in this age of networked services and Internet worms.

A single point of failure

Where are the weak spots in your organisation?

If anyone had any doubts about the importance of technology to the modern business, they only have to ask one of Virgin Blue’s staff or customers about the last three days of disruption.

“An external supplier’s hardware failure” is the given reason for the problems and it shows how we all need to be conscious of the key “choke points” in our business processes where a disruption will quickly bring operations to a crawl or stop.

For any organisation risk arises when those choke points rely on one thing — it could be a person, a computer or a physical widget — for the system to keep running. Should that one item fail, then the organisation stops. In Virgin’s case that thing appears to have been a router or server controlling their booking systems.

A single point of failure is the Achilles heel of any organisation, anything one item that can disrupt operations has to be identified and contingencies developed so when a failure happens, and it will, the organisation can quickly move to a work around.

In Virgin’s case it appears they were prepared for a disruption of up to three hours but when the booking system outage dragged on for 21 hours their fallback procedures were simply overwhelmed.

We often think of these things as technically related but often it’s something more mundane like a burst watermain blocking access to your shop or only one person, who happens to be driving along the Gunbarrel Highway for the next six weeks, has the keys to the fuse box.

In fact those human points of failure, where only one person in the organisation knows the combination to the safe, the bank account PIN or the password to the company’s servers, are probably the riskiest points of failure of all.

Another common point of  failure is relying on supplier contracts and service level agreements. Warranties and indemnities are nice to have, assuming they are enforceable when you need them, but they won’t fix the damage to a company’s reputation when a crisis on Virgin’s scale hits.

Even if you have a guaranteed response time, as it appears Virgin had, you need to have something in place to keep the business running in the meantime. Also “response time” is how long it takes your supplier to start doing something about the problem, not the actual time to fix.

Regardless of how well we plan and how watertight our supplier contracts and SLAs are, crises happen and that’s when the quality of a business and its management are tested. One sure indicator of a poorly run, bureaucratic organisation is when management hide at the first sign of trouble.

For Virgin, that’s a good sign. I had to reluctantly call them yesterday to deal with a problem and ended up with a good customer experience.

The very helpful Ruby not only called me back when the line dropped out but she also revealed she was a PA, not a regular call centre worker and all the office staff, including managers, were manning the phones.

Ruby turned out to be a real gem, not only quickly fixing my problem but also wiping out the additional charges without prompting.

That at least is an encouraging sign about their organisation and I hope Ruby and her colleagues get a thank you from the man with the beard when the problems settle down.

Virgin’s problems though show us that as business owners and managers, we need to understand where the points of failure are in our organisations and how we would deal with them should bad luck strike.

You might want to walk around your organisation, sit down with your staff and work through where the points of failure, both human and technological, in your organisation may be.