Do not think outside the box. There is no box! Do not allow your thinking to be constrained by imaginary objects and theories.
Do not ‘see through the wall! There is no wall. If it is indeed there, use the nearby door.
A strategy for a new era calls for free thinking. Approach today’s challenge with an open mind. You must always be thinking about better ways of solving tomorrow’s challenges today.
How can an existing Nursery school increase children enrolment and pay the ever increasing bills?
If you want to see chaos in any business or organizational set up, remove money from the table. When it is month end, and there is no money in the bank account, no bills can be paid. Not even staff salaries. No one will have the energy to come to work. You don’t want to have many people as goal keepers. You only need one!
You don’t need many people as defenders either. At least only offer scoring some goals! It is not a good strategy for a startup company, without any income generating potential to recruit so many defenders, read cost managers or administrators.
These may cause the company to save on costs but not grow the business line.
In business, the first focus is to grow revenues. And so, when Prime Kindergarten Limited, with an established capacity of 210 children and monthly fixed costs of over Ugx 15m registered only 50 students by the end of the first term intake, they recognized a big challenge right away. That is the good thing of great leaders. They are able to anticipate challenges and proactively fix them other than waiting to see what happens without doing anything about it.
Management sat down and discussed possibilities of overcoming their major obstacles. They decided to print small brochures and distributed to all my car drivers at key junctions and traffic jam points near the location of their kindergarten.
This did not work. Not even one person made enquiries as a result of this intervention. Management decided to take this a notch higher. They recruited a marketing and PR firm to undertake the marketing intervention they termed as ‘below the line’ BTL market activation.
This too, was a total failure. Over Ugx 10m spent, no visible progress. In fact, some parents who had brought their children became so alarmed about the low numbers, and moved their children. The good news for the kindergarten is it had a no fees refund policy. By the end of the term, the kindergarten had only 42 children. This was very bad considering the high demand for early childhood development, day care and need for a very personalized offering.
The new era
Summit consulting was called in March 2015. The challenge posed was: how do we achieve 80% full capacity within a period of one year?
When a company is doing very badly, leaders tend to be impatient. They want magic. They are looking for a silver bullet. Such urgency tends to affect rational thinking. As consultants, we have learnt techniques of removing anxiety and creating calm. And that is what we did: identify key people across the board and sit on the strategy table.
The first stage in such interventions is usually current state assessment (CSA). What is the current condition? Where are you in terms of 1) markets- who are your potential clients and where do you find them? 2) Money, do you have all the money you need? If not, can you get a quick loan? Do you have favorable financing options with banks? 3) Man power? Do you have the talent you need to succeed? 4) Machinery- do you have the tools and processes you need? 5) Materials- Do you have the teaching aid and teaching materials you need to operate your business? And 6) Make-up- do you have the right skills mix and experience essential to show your business.
More importantly, we review the current cost structure so as to understand how your business fairs. Is your current income source sufficient to cover all your current costs- both variable and fixed without challenges?
The common, and worst, business challenge is that of poor working capital management. Even accounting firms suffer from this- the inability to meet operating costs as they fall down in time.
After current state assessment, it was clear; the school had a cash flow problem. The key focus was: How do we grow the revenue lines?
Increasing the number of admitted children was the only solution. All incomes are a result of increased children intake. Without increasing revenues, it does not matter the extent you cut costs. They will still catch up with you UNLESS you close business.
The new Strategy
Our first intervention was to reallocate space for over 50 day care students, instead of having 200 capacity for Nursery only. The intervention was simple: explore ways of increasing the traffic to Prime Kindergarten. With a 50 capacity day care center, and 150 capacity Nursery school, we had effectively expanded our offering, diversified revenue and improved our options.
The second intervention was how we create awareness of our offerings to prospects. To answer this, we needed to know clearly, who is our customer and who is our end user.
Clearly, our end user is the little child. Unfortunately for a kindergarten, the end user cannot make decisions. The person who makes the decision or influences it by over 70% is the mother of the child. The next question we had to answer was: where do we find the mothers? The closer they are at the kindergarten, the better the chances of bringing their children to the school. We also, targeted those who ply by the school, as they go to work. Mothers want convenience.
Since children are so special to every parent, we had to look for an ideal positioning to tap into the hearts and minds of mothers. They want a school where they can leave their children and go to work with peace of mind. To create such a feeling, we decided to position the school as a religious institution, aligned to a Christian faith. Effectively, the gospel values were printed out and effectively positioned.
You are free to position your school as Moslem or Budhaism, (assuming you will have enough target market from such segment. The risk you run is if in your area, there are few people who respect your chosen identity and positioning, you may fail to get the clients).
After that, we got few people to issue brochures at all nearby Churches. Luckily, KCCA (Kampala City Council Authority) had put some bumps in front of the school’s entrance; we also positioned someone to give out the brochures to the passerby in vehicles.
The results were instant. Today, the kindergarten is looking for expansion as it has attained full capacity. That is the power of a strategy.
So what is your strategy for 2017? How will you face the New Year? You need an expert to help you see your business from all points of view.
Wish you success.
