Sage Blog

No matter what size or type of business, from a high street florist to a multi million pound engineering company, your biggest asset is your people. Your people are critical to the success of your business and at Sage we follow these rules from getting the right employment law and HR advice, to building trust.

Rule 1 – Get the right people on the bus

Start as you mean to go on. Recruiting the right people with the right skills is essential. Set yourself up for success by deciding on the exact type of candidates you want to attract and settling for nothing less.

Rule 2 – Teamwork

It’s no use hiring talented people if they won’t work as team. Employing people who fit your culture can be just as important as hiring those with the right skill set. Some people may not suit the atmosphere and feel of your business and it can affect motivation and productivity. Consider introducing candidates to the rest of the team informally to see how they get on.

Rule 3 – Ask if you have the right people in the right places every six months

Every business goes through periods of evolution and change. Sometimes it’s organic, but sometimes you should make changes to increase your business’ effectiveness. Are any talent gaps forming, or are someone’s skills not being fully realised?

Rule 4 – Create the right framework and your team will be self-organising

Set clear goals and ensure each individual has a job description and knows their role, and the role of other teams, within the business as a whole. How they interact is crucial in your overall efficiency.

Rule 5 – Empower your people

Give your people the tools to do the job themselves. You’ve hired them for a reason and they will often appreciate your trust in them to fulfill their role. That said, always let them know they can come to you with concerns.

Rule 6 – Clear the route for your people so they can do their job

Take the time to ask your people if there are any issues stopping them from achieving their potential within their roles. Ask for honesty and be prepared to make changes if you need to.

Rule 7 – Trust

Open and honest discussions with your team can get the best out of everyone. If you’re facing issues, get them out in the open and work as a team to overcome them. It’s a cliché, but you really can’t buy respect or trust.

Rule 8 – Celebrate your team’s success

It’s always worth thanking your team for a job well done, and celebrating success as often as possible. Even if cash bonuses aren’t in the budget, sincere thanks and appreciation are valuable tools in forging strong bonds within your business.

Rule 9 – Be prepared to lose your best people as they grow

It’s inevitable that the career paths of some individuals may take them out of your business. Remember that no-one is irreplaceable, and make sure that no processes are reliant on just one person, in case they ever leave.

Rule 10 – If you need advice, make sure you know where to get support

HR and employment law is a large and complex area. Sage People Advice can help. We’ve got flexible options, from a single phone call to a 12-month contract to help support you with any employment queries. For more information call us on 0845 111 2450.

Matt Forrest, Small Business Team

‘’Tis the season to be merry’ or so the carol goes but as Christmas approaches together with all of the associated opportunities for client entertaining, businesses are being told to beware of the anti-bribery legislation lurking over the horizon.

Lucy Cook, Sage Legal Team

The Bribery Act

The Bribery Act, expected to be introduced in April 2011, is an attempt to bring England’s anti-corruption laws up to date.  One of the offences to be introduced by the Act is ‘promising or offering a financial or other advantage intending the advantage to either induce another person to perform improperly a ‘relevant function or activity’ or to reward a person for doing so’.  Potentially, the laying on of extravagant hospitality by a company to prospective (or, in some case, existing) clients in the hope of new orders or the like could lead to prosecution.

Scrooge’s delight?

No doubt to the delight of Scrooge’s followers, some commentators are suggesting that the new Act will chime the death knell for corporate hospitality.  However, looking at the Act this seems to be at best, an exaggeration and at worst, scaremongering (particularly, when coupled with details of the fairly draconian penalties for breaching the Act). 

Keep it reasonable and proportionate

Scaremongering aside, so long as any hospitality is ‘reasonable and proportionate’ then companies have nothing to fear from the new Act vis-à-vis their entertaining plans for the festive season.  Government guidance on the Act is expected to be published early in the New Year and it is hoped that clear guidelines on what constitutes ‘reasonable and proportionate’ hospitality will be included in the guidance. 

The CBI recently called upon the Government to ‘put “beyond doubt” that bona fide corporate hospitality will not fall foul of the Bribery Act’ .  There is however no certainty that such guidelines will be forthcoming given the views expressed by the Government Spokesman for the Ministry of Justice who stated that ‘it is sufficient to rely on prosecutors to differentiate between legitimate and illegitimate corporate hospitality’  (letter to the House of Lords 14 January 2010).   It is difficult to reconcile such a view with the general principle that laws should be fair and transparent. 

Moderation and transparency

Putting legal arguments aside, given the current economic climate and the associated general drive towards moderation and transparency in business, it is more likely that invitations to client hospitality events will feature local go-karting venues rather than trips to the Monaco grand prix and so are likely to fall within the ambit of what is ‘reasonable and proportionate’.

Businesses would be well-advised to consider the timing of any hospitality and to recognise that it may not be appropriate to invite representatives of businesses, which are involved in conversations or negotiations around new contracts or renewals of existing contracts, to any extravagant events.

It goes without saying that when making hospitality plans involving clients, businesses would be wise to take into account the circumstances, wishes and any relevant policies of the client business.  A business which has had a tough year might have concerns about the impression which could be created by its senior people attending particularly lavish events.  Depending on the client business, it may even be worth speaking to client organisations about how they support their chosen charities to see whether there are any opportunities to work together over the festive season to make Christmas better for those less fortunate.

So, the good news is no need to cancel Christmas just yet!  And a final word (or two) from Scrooge: ‘Bah, Humbug!’.

Lucy Cook,  Sage Legal Team

For my second contribution to the Sage blog, I wanted to share my thoughts about negotiation.  Having previously blogged about plain English, I am more than a little nervous about mentioning latin.  But here goes…  The root of the word ‘negotiation’ can be found in the Latin verb ‘negotiare’ which means ‘to carry on business’.  The origin of the word shows its relevance to day-to-day business which is borne out in the commercial world around us as we see the growing importance of getting negotiations right.

The benefits of collaboration

Lucy Cook, Sage Legal Team

If it is important today, it will become even more so in the future as businesses recognise that collaborative approaches herald greater success than the insular, competitive view commonly held in the past and begin to reach out to other organisations and individuals.  Organisations will be increasingly keen to forge relationships and strategic partnerships and to leverage the power of those alliances.  During the establishment of a new partnership (for example, a joint venture) the method of negotiation will set the blue print for the negotiation and communication style for the rest of the relationship (from how the parties cooperate to resolve any contractual issues to how any exit plan will be managed).  Negotiation will be at the centre of those emerging relationships and to some extent, will dictate their success or otherwise.

Competing negotiation v collaborative negotiation

In these types of scenario, the value of a collaborative (rather than a competing) approach to negotiation becomes apparent.  In a competing negotiation, the parties approach the negotiation as if there were a limited amount of resources to be distributed.  So let’s take a Mississippi Mud Pie as an example (why not!), by taking another slice for itself party A would deprive party B of a slice.  The tactics of a collaborative negotiation involve focusing on the interests and needs of the parties (rather than positions) and looking at creative ways to meet the needs of both parties.  Back to the Mississippi Mud Pie, in a collaborative negotiation before making the first cut, the parties might get their heads together to discover that party A prefers the gooey filling whereas party B likes the chocolate crust and so they slice it differently.  They might even engage in a brainstorming session to look at ways to unlock synergies and produce more pies for everyone!

The pie analogy is, of course, a simplistic one but it shows two of the different negotiation techniques available.  Collaborative negotiation is an effective way to build up mutual trust and ensure open dialogue between parties.  The way we approach a negotiation with a partner with which we hope to forge a long and fruitful relationship should be very different from how we approach a one-off deal for a commodity.  Most importantly, whenever we are involved in a negotiation we need to look at the context of the negotiation and choose the most suitable approach based on the background rather than relying on our standard negotiation modus operandi.  All of us have our own default setting when it comes to negotiation (as do the organisations we work for) and some fine-tuning of the settings could bring about significant positive change (otherwise known as more Mississippi Mud Pies!).

Lucy Cook, Sage Legal Team

In this era of 24 hour media it’s interesting to see stories develop online, but I still enjoy glancing over the newsstands the morning after a big story to see how the traditional press have summed it all up.

The morning after the Pre-Budget Report The Sun claimed ‘Darling raised a storm of protest yesterday as he hammered millions of hard-working Brits’ referring to the new tax increases and public spending cuts, The Financial Times declared ‘Chancellor accused of sleight of hand’ and The Times’ broke with ‘Pre-Budget Report: Darling unveils stealth tax and public sector pay cap.’

But aside from the headlines in the media what does the Pre Budget Report mean to businesses in the UK?

The key for all businesses, regardless of size, was that the Chancellor set out plans that would do as little as possible to hinder firms trying to recover from the recession. It is business growth that will ultimately pull the country out of recession.

Encouragingly there were a number of measures unveiled to specifically help small businesses. The Chancellor proposed to extend the availability of loans to small firms and defer the increase in corporate tax, which is welcome news to many small businesses in the UK. Many businesses will be happy to see that Mr Darling will be indefinitely extending the “time to pay scheme”, which helps businesses to improve cash flow by helping small companies spread tax payments over a longer period. This comes just in time as improving cash flow has been identified by our customers as the key challenge in 2010. 

But with the positives there were also a few announcements which could harm a number of businesses, one being the increase in National Insurance contributions – which are set to rise by 0.5 per cent by 2011.

Update: 14.12 - Our payroll expert Gary Ging has just pointed out that this 0.5% increase comes on top of the 0.5% increase announced in the Budget earlier this year. All of which means NICs will increase in April 2011 by 1%

The full effect of the Pre Budget Report will not be felt in businesses for a number of months. But  rest assured, here at Sage we are busy at work incorporating these changes into our software and services and will be on hand as always for customer support.

Cath Sheldon