Gill South: Flying in the face of recession to win over customers and staff

Gill South

As some industry sectors experience an upturn, and others expect one, managers should be asking the question: am I seeing enough of my customers, suppliers and staff?

For many companies, management has needed a damn good reason to go on a corporate trip in the past year, especially if it's to the other side of the world. However, the business trip might be making a comeback.

Overseas, British Airways is trying to give its international business travel a kick-start. The airline is running a competition offering 1000 US businesspeople the chance to win a flight to London for a networking event. They may then fly to a destination of their choice if they can convince the judges that the subsequent trip will win them business which they would otherwise lose. BA is keeping its fingers crossed; its business and first class passengers numbers are down 15 per cent so far this year, according to Economist.com.

For New Zealand businesses looking for growth and international expansion, it is crucial that they continue to make the effort to get on a plane at times and go and see people.

Bridget Liddell, who chairs NZ Trade and Enterprise's North America Beachhead Advisory Board, has strong views about the amount of personal meetings Americans expect of new businesses knocking at their doors.

"Business is fundamentally about people and relationships, particularly in a mature and complex market like the US," she says. "Typically New Zealand companies win on the basis of relationships so it is critical for success to leverage this advantage by being physically present in the market."

Greg Anderson, a partner in Deloitte's accounting and advisory group, helps small to medium-sized businesses with expansion and urges them to make time to visit customers and suppliers.

Deloitte NZ has not cut down at all on external client meetings in the recession, says Anderson. "When people sell a service rather than a product, how can you trust someone that you have not been face to face with?

"It's important that companies meet and spend time with their customers," he says. Even if you have bad news to share, it's best done face to face, certainly not with an email.

One Deloitte client, a shoe retailer, recently sent the business owner and general manager on a trip to China to visit some of its manufacturers. Suffering from narrowed margins, they were there to negotiate a smaller order.

The two came back saying it was a worthwhile trip, rather than just doing it over the phone. They did not fly business or first class; they went economy.

"It's a business success if it means the continued existence of a NZ company," says Anderson.

New Zealand businesses expanding in Australia should not take their near neighbour for granted either, he says. He recently met some Melbourne-based New Zealanders who urged expanding New Zealand businesses to visit more often.

Because Australia is so close, New Zealand businesses often assume a formal meeting is not necessary. "But to sell in Australia, you have to know how to use the networks," says Anderson.

If they don't know you at that "gidday, mate" level, you haven't got a chance.

The Deloitte Fast 50 companies are trying to break into international markets.

Their stories are all the same: they can't afford limitless trips to their markets so they are appointing agents there and inviting them to New Zealand to spend time with the business. Anderson says this makes sense.

"We are small and a long way away from most markets. We've got to rely on exporting more than primary products."

As for internal meetings, management should consider stepping these up once more, for the sake of morale.

Two senior Deutsche Post DHL directors were in town recently to support the New Zealand managing director, Brian Broom, with the opening of a new $14 million DHL distribution and office centre at Auckland International Airport.

Amadou Diallo, CEO of DHL Global Forwarding, South Asia Pacific, flew from head office in Germany to be at the New Zealand event, and met some key customers while he was here.

"It is important for customers to understand that we take them seriously," he says.

Diallo was also here to support and meet the New Zealand staff.

"When you are an executive you need to be able to see into the eyes of the people working here. Ten per cent of DHL executives come from New Zealand. It is really a talent pool for us," says Diallo.

Tony Boll, CEO, DHL Global Forwarding South Pacific, comes to New Zealand three or four times a year.

"I helped approve the facility - it was important to see the finished product," he says.

"We have spent $14 million on this facility - it would be the wrong signal to say we are not going to spend on a party for staff and customers. Of course we have to continue visits, you can save money in the wrong areas."

Iain McCormick, managing director of the Executive Coaching Centre, says it is crucial for senior managers to continue to see subsidiaries, staff and customers.

"If a business has had a particularly good result, a manager can use that as a basis for going out," he says.

In tougher times, there is a temptation for companies to become more and more centrally controlled and less personal.

Gill South is a freelance journalist and author of the newly released Because We're Worth It, a "where to from here" guide for today's working mother