Inside ASI-AP

I have been pretty occupied over the past couple of weeks helping out the consulting team with their current workload spike so have not had a chance until now to write up the week that Bob visited. Bob arrived on the Monday morning and after checking into the hotel came over to the Melbourne office to join the 1pm pizza lunch and listened to the CEO quarterly briefing. The rest of Monday and into the evening was spent on rehearsals for the exec round table event.

Tuesday and Wednesday was down at the Sofitel at Weribee Mansions for the 2008 Executive Round Table Briefing. I will post about that event separately, but suffice to say Bob believed it was the best round table event yet.

For the first time Bob Alves was actually in Australia for the first quarter CEO update. Bob flew in from the US on Monday morning, and at 1pm in the Melbourne office we had pizza lunch and then played the pre-recorded presentation that he had recorded on the Friday night before coming to Australia. The presentation ran about 45 minutes and it was a little weird listening to Bob speak while he sat there with us - and he didn't even move his lips!

During the presentation Bob covered off first quarter Balanced Scorecard results, financial results, value award winners and he highlighted the global Consulting department. He also made particular mention of the strong first quarter results for AP, Europe and Canada (I had posted previously about the AP first quarter results).

After relocating the Melbourne office last year, this year it is the turn of the Sydney office. We are moving from North Sydney into the Sydney CBD area - which gets us closer to customers, transport options and higher quality premises. To support our telecommute environment we are taking out space in a shared executive office on level 33 of Australia Square - which is located at 264 George Street (down towards the Circular Quay end of George Street). Australia Square is an iconic building in that it is a round tower which at the time it was built was the tallest building in Sydney.

Bob will be in Melbourne and Sydney later this month - arriving into the Melbourne on Monday 19 May, then heading to Sydney on Saturday 24 May prior to flying home on Sunday 25 May. While in Melbourne his main responsibility is to host the Annual Executive Round Table for our invitation-only largest customers; he will also be in the office for a couple of days on Thursday and Friday catching up with me, my review and AP business plans and budget reviews. And if there are no delays to his incoming flight he should also be joining us in person for the quarterly pizza lunch and CEO address on the Monday 19th.

I was a guest of AIM Vic at their "Managing the Future" lunch series on Tuesday where the keynote speaker was Bob Welsh, CEO of VicSuper. Bob has been leading VicSuper with sustainability as a core operating principle since 2000, and has recently been recognised by the UN for his achievements in this area.

There was certainly of lot of interest in sustainability with over 200 people in attendance at the lunch, in many ways driven by the new government's plan to introduce a carbon emissions trading scheme from 2010. This will mean that the cost of carbon will directly impact an organisation's bottom line and as a result costs for many services - including electricity - will go up.

The March 2008 financials have been published - and thus also the first quarter (Q1) results. The budgets are now loaded into Great Plains so we have our first actual to budget results available.

The quarter has been very strong in AP with revenue growth in all areas. Total revenue was up 8% on budget and very significantly 22% up on first quarter of last year. AP EBITDA is ahead of the budget by $320k and ahead of last year by $330k - both better than forecasted increases.

Globally the first quarter financials have also been positive - just under budget for total revenue and 6% up on last year; EBITDA is ahead of budget.

I always look forward to a busy schedule of events in the office as it means more and more people get to come in and visit us and hear our message. I am not completely convinced a message needs to be heard "8 times, 8 ways" before it sinks in, but I am convinced that the message needs to be communicated a number of times from different people. And for me the events we run are a key part of that communication.

This week we have the iMIS Friendraising seminar in Melbourne and Sydney (see here for event info), we have the MD Boardroom luncheon in Melbourne and we have some customers coming in for training.

With the changes we are making at ASI to become a global company I know some of you are questioning why. I think over the years ASI has generally proven itself to be ahead of what customers need in technology trends, and the latest moves on globalisation are no different. Some of our customers are now truly global organisations - and in many cases are dealing with issues between the international head office and the country offices, that we are typically used to seeing between a national office and the state offices. For us to continue to be successful in this changing environment we need to have a global product and a global company supporting it - just being US focused is not going to cut it any more.

I posted previously about the Australian market and our market share estimates. In that post I highlighted a key part of our growth potential will come from Asia. I have some more facts now on the overall market opportunity with regard to general economic importance (the data is from CIA / IBIS World and was reproduced in the April 2008 edition of the Company Director journal published by AICD).

I haven't touched on trying to reduce our email and IM clutter recently but just wanted to give everyone a heads up that I am going to be putting more effort into this year than ever before!

Why?

We have so much knowledge in our email – questions, answers, tips, tricks, who’s doing what, etc etc – but it is all private! For example - I can send an email to Colin on clarifying some pricing policies that may be of use to everyone in the sales and consulting teams, yet no-one but Colin gets to see it. That is a big problem because it is a missed opportunity to not just share useful information, but also to get feedback or clarification.

The Wednesday after conference was a full day for me with Chairman's Circle breakfast in the morning and then a full day Board meeting followed by a Board dinner.

The Chairman's Circle are the top AiSP's selected on an annual basis; for 2008 it is about 16 organisations. At the breakfast – which is hosted by Bob and Don – we handed out a draft of the Product Development Outlook document, which is a new document that we intend to publish next month on the iMIS product plans through to 2010. This document has been requested by customers and AiSPs for a couple of years now to help them plan better and get aligned with iMIS releases and technology. The AiSPs were very happy to be asked for feedback and they had some great suggestions on how to make the document a little better. I also spent a lot of time talking about the iBEF program and we explored ways we could have the Chairman Circle AiSPs adapt all or parts of the iBEF program in their own businesses with their own customers. This also got some great feedback and as a result we will be making more formal plans to do this.

Sunday I flew Brisbane to LA – a 14 hour flight with me only getting about 1-2 hours sleep. Not to be encouraged. I arrived in LA at 7am with almost 8 hours between flights. I was happy that David Riffle and Marilyn were coming to meet me at the airport so we could get breakfast on the Sunset Strip. It was funny going to a restaurant with Marilyn, David and Greg and feeling that Marilyn and I would be treated as Aussies – but then Marilyn does have a US accent so she was treated as a local again and I was the only foreigner. Pancakes as big as manholes were on the menu. Hmm, I am so glad that the waitress suggested Marilyn and I share a stack since we were both ordering plain stacks. HUGE. I have attached a picture of David’s.

The financials for both January and February 2008 have been published. Budgets are still being loaded into the system so our comparison is only against last year, not against budget. First quarter is normally a slow quarter for us, given that we are closed most of January. However this year, with a backlog of consulting services coming off our record Q4 (2007) we have started the year ahead of expectations. Through to the end of February in AP we are 7% ahead of total revenue compared to last year, and globally we are 12% ahead of last year.

Importantly AP and global EBIDTA are both tracking $50k ahead of last year, which is what we want to see - quarter on quarter improvement.

Web links/resources for Module 4 - Strategy

Strategic Management - Hubbard et al