10 Tips to Organize a Successful Business Meet
What do you do to ensure that the business meet you organized doesn’t fizzle out?
As a top entrepreneur in the lead, you must take the initiative to arrange business meets to connect with others. But that isn’t all; you need to create an event that people enjoy. Not something they dread!
If you create a platform where entrepreneurs share their thoughts, views, opinions and crises. It helps you earn the trust and respect of your fellow entrepreneurs. And it boosts that collegiate feeling. You just need to make it a success. But it is easier said than done.
Let’s take a look at 10 simple but effective things that can help you achieve your goal.
Take Your Time to Plan Every Detail
You cannot wait until the last minute to send out the invites and think everyone will turn up. Decide the time and date, select the venue and inform the business meet group members about it in advance. They have to fit it into their busy schedules too.
Check Every Important Aspect In Advance
How will you feel if the audio doesn’t work when someone’s making a presentation? Reach the venue and double check every detail. Make sure the space is adequate for all and the audio-visual equipment works.
Make It An Exclusive Event
Identify the niche you are in and create a group with a strong focus on the core concept. When you make it an invite-only event, you generate interest about it among the entrepreneurs in the niche to participate. This also encourages the aspirants to be part of the community.
Make Introductions Easy With Name Tags
It isn’t easy to remember the names of hundreds of entrepreneurs at an event. Create name tags. It will make introductions a breeze! You can also add their business name and relevant details to it.
Adhere To Your Goals to Meet Expectations
As an organizer, you need to have a clear idea about what the meet is all about. Make sure this is in keeping with the image of your business. For example, if you are into apps development for educational institutes, educational meets are more suited. Plan the meet according to the purpose.
Organize Topics to Keep Everyone Engaged
What do you want people to talk about? Decide the things you want to interest people in at the meet. Use the topics to initiate conversations. You can also throw in some challenges to keep things in motion.
Offer Exposure for Start-ups
You may also incorporate talks, events, quizzes and such other elements into the business meet. But when you let a start-up offer a demo at the meet, you add to its interest. It supplies food for thought for the entrepreneurs present and gives them an excellent topic of discussion.
Give Conversations a Direction
Don’t let the conversation die down. Place your contacts at opportune points to keep it going. With this simple tactic, you will create an environment where people learn new things without a hitch.
A business meet is all about the relations entrepreneurs create. And the community they build. It is possible to boost entrepreneurial efforts when people have the support of their peers. Don’t just keep it professional. Let entrepreneurs connect with each other on a personal level. Social hangouts can help you with this.
Keep It Confidential
No entrepreneur will open up unless they are sure that their secret’s safe with the attendees. This is possible only when you assure that it remains within the group. Open and frank discussions will be possible only if you do this.
It isn’t difficult if you are aware of how to keep things in motion at the meet.
With a little planning and effort, it is possible to organize a business meet where the group members can share their stories, offer others positive challenges, help others get back on track and create a strong community.
And what do you get out of it? Well, you become the proud organizer of a business meet that isn’t another monotonous hour of long conversations between people who don’t even connect with each other. But something that gives everyone their fair share of exposure in the community and ample food for thought.
The Barking Mad Blog
SME Advice with Bite!
5 Tips for a SUCCESSFUL Start-up
Starting a new business is an exciting and challenging task, one in which success brings a variety of rewards and yet failure can be a painful and damaging experience. Despite this there are 2.0 million SME’s in Australia and new start-ups opening every day.
This is the entrepreneurial drive at work, the human need to try new things and to stretch and grow. The SME is the economic life force and breeding ground of business. Of the many small start-ups some will go on to become multinational corporations, this isn’t everyone’s choice, or objective and statistically most start-ups will fail within the first three years of operation
Understandably starting a new business is full of challenges and I am often asked how I went about starting my first business and what tips I can offer. Starting a business for most entrepreneurs means a huge amount of sacrifice, hard work, risk and belief in your concept.
My first business came about via a combination of accident, hope and “nearness” to opportunity but if I was to start again I would take these points into consideration:-
1. Think carefully about the business you choose:
Last week at a conference I was asked the question “what business would you choose if you were starting again?” A very good question and yet one I felt confident in answering. I would choose:-
- A high volume established industry with proven customer demand
- An industry with a relatively low cost of entry
- A location very close to an established business in the same industry
- I would price my product at the market price or slightly higher
- And this is the WINNER I would out-service and outperform the competition in terms of customer satisfaction.
2. Market your business well – Marketing is your cash engine
If you have taken my advice and set up your business virtually next door to an existing similar business you already have potential customers passing your door so how do you convert them. You need a plan of attack:-
I. Check out your competition and look at weak points in their product offering, customer service, display, staff training, customer handling etc. Then do the reverse and observe their strengths.
II. Build your strategy around out servicing your competition; choose customer service and customer satisfaction as your point of difference. A company we have worked with “Chilligin” is a successful on-line and pop-up retailer of fashion accessories, scarves, handbags etc. Chilligin’s founder and director Nikki Gilhome decided from day one to offer Chilligin customers great products, at affordable prices and to package every item whether ordered on line or in store beautifully. “I wanted the customer to have a lovely surprise when they open their home delivery, or for in store customers something to look forward to when they return home” says Nikki. Small details such as carefully designing wrapping paper, stickers and ribbons, tags etc turn the ordinary into an occasion. Effectively the customer gets a double hit of pleasure first the purchase decision and later a beautiful package to unwrap.
III. Train your sales staff to meet and greet customers with genuine warmth, use quiet times to rehearse the perfect approach.
IV. Wherever possible over deliver on customer expectations, the more a customer enjoys doing business with you the more they will return
3. Employ the best staff:
When starting a business we need to be careful of costs but a really good staff member is a key asset and a valuable part of your strategy. Don’t cut costs here.
Chose staff who share your vision, who want to grow, who will absorb your training and guidance. Respect and reward them. Encouragement and respect are amazing rewards, how do your competitors reward staff? There are many ways to reward beyond the pure financial and most people I know would rather work for a little less in a great environment than for more in an uncomfortable environment.
4. Review Progress and Question – Can we do better?
If your business strategy is to outperform your competition by offering better service and customer satisfaction you must work hard at it to keep at the top of your game. Constantly check your competition, both locally and via the internet, overseas. Read everything you can find for new ideas, engage with your customers, listen and learn. Constantly review every single aspect of your business questioning how you can improve the customer proposal, to satisfy and engage more closely.
Your stock and services must always be current and adjusted as closely as possible to your customer needs. Use stock analysis tools so that you know which items are moving and which are slow. Respond very quickly to avoid wastage, move quickly to special out and move any slow stock. Slow stock is dead money and loosing you sales. Buy more of the fast moving items and consider expanding that part of your range with more options.
Change your web presence or store displays daily to build and maintain customer interest. Collect email addresses via direct questions as you input receipt data, small competitions, draws etc. Communicate directly with your customers, be innovative, informative and “the place to go”.
5. Think carefully about finance & assistance:
Most businesses will involve you assuming responsibility for some level of debt, make sure you understand the obligations here and your responsibilities. Debt isn’t just a loan, it includes your supplier credit, your rental or lease obligations etc.
It’s important to know which type of financing is right for your business and always try to hold three to six months cash in reserve. Are you willing to give away equity in exchange for cash? Are you looking just for an investor or also for a mentor? Is your business plan solid enough to secure a bank loan?
All important questions to consider and remember with an investor you often gain an experienced mentor as well. If I was starting out again today I would look for an experienced investor who could guide and mentor me over any other form of external funding.
We are fortunate to live in an age when so much information, knowledge and experience is available for those who want to search for it. Eric Schmidt, executive chairman of Google, said: “There’s a new way to do marketing, and it’s to do it with numbers. People do marketing to bring in revenue, to have an impact, and with these new systems you can measure this. The technology the internet brings means you should be able to measure almost everything.”
If you are thinking of a start-up read and absorb, plan and then follow through and your chances of success are high.
The Barking Mad Blog
SME Advice with Bite!
5 Tips for Business SUCCESS!
1. Business Development Is Not Increasing Sales
Managing the development of your business has a lot in common with conducting an orchestra. It’s a case of encouraging and leading the various differing components of your business forward, in harmony, to the same point at the same time to produce an extraordinary effect. You need to develop your unique product or service to meet the highest level of customer expectations and you must do so at a price representing fair value and at a cost which generates a fair profit.
2. Understanding profit does not equal cash
Profitable businesses fail every day. Many small business owners chase growth and revenues forgetting the basic facts of cash management. Profit equals Revenue – Costs but until you have received payment you are in a cash negative position. Ideally you would ensure that you have sufficient cash reserves to meet three to six months of costs. In the early days of a business keep fixed expenses as low as possible, use a virtual office and work from home if possible, keep full time staff to a minimum, pay cash or do without non-essential plant and equipment. This helps if you have a quiet month or even two.
3. Intuition Versus Fact
Don’t build a business around a product or service you like or you would buy. Undertake sound quantitative research to determine what your prospective customers want and buy then see if you can develop an even better product or service at a price they are prepared to pay. Don’t be tempted to compete on price alone. If company A has been making its product for many years and you realise you could source and sell that product at a good profit for less that’s a good value proposition to you not your customer. The market is less willing to change supply on price alone but if you can offer a better value/service proposition where they get a better product and improved customer service you will have a much greater chance of success.
4. Business & Financial Planning
There is an old saying “if you don’t know what you want you will probably never get it” and that’s certainly the case in business. A well thought through and documented business plan outlining your core objectives, market analysis, product development, marketing strategies and detailed financial budgets is essential. This is an area where you should consider the use of a mentor or an external consultant to help you get it right. Your financial plan should include linked budgets for P&L, Cash Flow and Balance Sheets. A beautifully bound business plan kept on a shelf is a waste of space it has to be a living breathing document understood and read regularly, reported against monthly and the strategies varied as needed to meet your actual versus budgeted position.
5. Respect all Stakeholders
A successful entrepreneur understands that the stakeholders in a business are not just the shareholders. The stakeholders include employees, suppliers, customers, shareholders and advisors and they are vital to the success of failure of your business. Spend time with each stakeholder, respect them, listen to their ideas, take their ideas, discuss your plans and your position with them. Take them on your journey as partners. Keep them honestly and openly informed and they will join your team and give you their full support. Again many businesses fail because they don’t earn the respect and support of their stakeholders. Building a successful company is hard, it requires a lot of commitment and courage as well as a little luck and of course having a great product and team. Watching your idea become a product and a product generate revenue that becomes a successful company makes it all worthwhile. Working with your stakeholders and mentors, following and constantly updating your plans and finances will go a long way to ensuring success.
The Barking Mad Blog
SME Advice with Bite!
Communication Drives SUCCESS!
Communication is the #1 single skill needed at every level of business from a one man SME to multi-national corporations. To gain the most out of our lives we need great communication skills and yet I find a great deal of confusion as to what constitutes good communication.
I have written in the past about the importance of SMILES; perhaps the earliest and most basic form of human communication. Communication can be simple good manners. On a recent weekend enjoying the spring sun over an outdoor breakfast my wife and I smiled and nodded at the couple on an adjacent table to us. A simple communication opener which was just as simply reciprocated. The real communication occurred later when my wife asked questions of our new table neighbours …”and what do you do?”
Suddenly not only did their fascinating lives come alive but so did an exciting potential joint project between them and my wife.
Now remember we were just relaxing, careful not to intrude, enjoying Sunday breakfast but we understand communication is human and we are open to communicating. People sense this.
Communication is not what we say; it is who we are and what we do, that creates the impression, or as was said in the Australian movie, The Castle…..”It’s the Vibe”.
A US expert and communication authority Dr John Lund uses an interesting quote; “Don`t communicate to be understood; rather, communicate so as not to be misunderstood.” What a great way to put things in perspective regarding our efforts on how to improve our communication.
Dr Lund has explored the way in which we interpret communication from others. He also reveals some very interesting statistics on communication.
When someone is speaking with us, we interpret their message based predominantly on the following three factors:
•55% is based on their facial expressions and their body language.
•37% is based on the tone of their voice.
•8% is based on the words they say.
Dr Lund states that his findings are the average taken across both males and females collectively, but that if you looked at women alone they would even give greater weight to the facial expression and body language and even less on the words.
This tells us that it is critical that we become very self-aware of how our body language is speaking to others as well as the tone we use.
Read my article on smiles! That smile comes through in your tone of voice over the phone. It works wonders on how well you come off on a phone call, trust me!
Smile: Shortlink: http://wp.me/p401Wv-4x
Early in my career I worked for a hugely intelligent man who used to very gently ask me questions after a meeting. He would listen patiently to my answers and say “Neil listen to what they mean and what they need, not what they say”. At first this confounded me until I slowly realised that it may on occasion be difficult, embarrassing or even offending to state what you mean or need.
Once I learned to look beneath the surface, communication and business became easier, more productive and far more enjoyable.
The next major change in my thinking was when I realised that 10 different people see the same thing in 10 slightly different ways. And importantly women see things as differently again from a man which is why mixed sex teams work so well in obtaining balance.
To get your thinking moving look at the graphic below and tell me how many squares you can see?
I will leave the answer for the end of the article but in warning I will let you know that in a recent study 96% of Telstra management got this wrong!
Getting back on theme, in the study men occasionally and women mostly want to know three things before they are willing to enter into a business conversation with you:
1. Is what you want to talk about going to be painful?
2. How long is it going to take?
3. When you are done talking, what do you want from me?
If they don’t know these three things up front, they will make excuses to avoid your call or to avoid talking to you on the phone. The same applies if you come into contact with them in person.
It’s fair to assume that your manager or client in a work setting will always want to know those three things in advance of agreeing to a conversation as well.
It comes down to an ingrained human need to want a strategic exit from difficulty.
These are acquired skills which roll easily off the tongue of experience; however this terrified me early in my career. If in doubt as to what to say or do remember that a show of genuine respect will always help in establishing a rapport, if you are terrified say so, the person you are communicating with will respond positively.
How to successfully conduct a conversation in business:
Success in business is greatly impacted for better or worse by the way in which we communicate. Happiness in our personal lives is also greatly dependent on this very same skill. If you don’t believe me just look at any married couple and work it out! Becoming a good communicator takes practice and consistent attention and effort on our part, and it is a skill that we cannot afford to overlook.
Remember “don`t communicate to be understood; rather, communicate so as not to be misunderstood.” And always, always allow room for respect.
Now as to the “squares” there are 9 individual small squares; 5 2×2 squares; 1 4×4 square and one 3×3 square. A total of 16.
I hope you worked it out. Whatever your answer think on what it means about how we see and communicate ideas.
By; Neil Steggall
The Barking Mad Blog
SME Advice with Bite!
6 Key Causes of Procrastination.
Procrastinate, Procrastinate, Procrastinate! Spoken aloud and with the correct intonation this little mantra sounds remarkably similar to the Daleks famous Exterminate, Exterminate and believe me Procrastination can lead to SME Extermination!
Procrastination is a problem for the sufferer, it’s a problem for the SME and it’s a deal breaker for cohesive team work and yet it is a common problem in businesses of all sizes.
Some weeks ago I was surprised when reading an article in Psychology Today, to find it claimed that around 20 percent of people chronically avoid putting their heads down and getting on with the job. In fact they actively look for distractions!
That seemed a little excessive until I looked at my own behaviour and that of our team. I realised that we all occasionally put off certain actions despite our valuing efficiency, team work and “multitasking” as much as we do. The big question is, why?
We all procrastinate from time to time. Sometimes it’s those mundane things – like reconfiguring our computer files, reconciling bank accounts, or fixing up a dated web site. But often we procrastinate on bigger things that require more time, more commitment, and put us at more risk of failing, looking foolish or feeling emotionally bruised. Things like updating our business plan, confronting a complex new task that threatens us, or not pursuing a long held ambition.
It appears procrastinators are not born as procrastinators; rather we are trained to some extent from birth. That’s the general consensus of psychological research into the art of procrastinating. One increasingly popular theory is that procrastination has its roots in childhood, where it functioned as a means of early of rebellion against authority figures or as apathy in the presence of a strong parental pressure to perform.
Doctor Joseph Ferrari, associate professor of psychology at De Paul University in Chicago, suggests that there are three types of procrastinators in the world:
The arousal types, who get a thrill from rushing through projects at the last minute, whether they come out on top or not.
The avoiders, who don’t want to get to the end of any given project because the fear of change keeps them paralysed.
The decisional procrastinators, who simply cannot make any decisive choices because they can’t bear the results of their actions.
I found it interesting that these three types of procrastinators apparently use multiple “tools” to help them procrastinate whilst still appearing to function. Understanding which type of procrastinator an employee is and recognizing which of the following methods they use to procrastinate will help you to work with them and hopefully overcome the problem.
As with most management issues, understanding the cause is 90% of the solution and there is much we can do to help the procrastinator overcome their problem.
Let’s look at the common causes:
We don’t always have to do things exceptionally well, often “good enough” is quite enough. The ingrained desire to get everything 100% correct every time can lead to a paralysing fear of failure and multiple revisions that just waste time. A phrase which springs to mind is “analysis paralysis”.
As John Henry Newman, Anglican Deacon and author, once said, “A man would do nothing if he waited until he could do it so well that no one could find fault.”
Fear of Failure
Fear of failure is a major factor for some. Failure can be seen as having far-reaching implications. For some it’s how they perceive themselves and how they think they are perceived by others.
On the other hand, if this same person breaks all records, they fear all future projects will be held to a much higher standard. Some people are willing to do anything, including nothing, in order to avoid being taken out of their comfort zone.
If a project is complex, the individual steps may seem endless! Instead of seeing individual steps and taking them, the procrastinator thinks they can see all the steps that lead to completion but has no idea which one to take.
If someone is overwhelmed by targets (either the ones they’ve set for themself or the ones they’ve been given by others), they may find themself feeling unable to disassemble tasks into constituent components. As a result they simply don’t know where to start.
This feeling of helplessness usually feeds upon itself until it eats away at their resolve, making workplace distractions a welcome escape. This leads to a loss of focus and thus motivation.
One method of overcoming this form of procrastination is to create an action list that’s prioritised and reduces a complex project into smaller, more achievable steps.
What do you if someone simply can’t prioritise? Chances are they will spend hours working on non-essential tasks and fooling themselves into thinking that everything is okay.
Unlike those who get overwhelmed, those who can’t prioritise correctly don’t see anything wrong. These are the people that spend an hour deciding which font to use on the quarterly report but don’t leave time to get the actual writing done.
One symptom of this type of procrastination is filling hours with “activity” rather than “action”. Often the excuse of being “flat out” is used, when really, this is just another form of procrastination.
As with the overwhelmed procrastinator the method of overcoming this form of procrastination is to create an action list that’s prioritised and reduces a complex project into smaller, more achievable steps.
Lying to Cover
Procrastinators are constantly lying to themselves. They lie to justify their failures (“Oh the System was down”). They lie to justify their successes (“Oh Fred did most of the work”). They lie to justify their justifications (“I’m sorry about the inventory debacle; it’s the warehouse, they screwed up again”).
Some procrastinators just don’t know how to not lie. Learning responsibility is the key to beating back the lies and overcoming procrastination. Help them take ownership and live up to their actions.
Lack of Motivation
Goals have to be worthwhile and achievable or managers and staff are probably going to give up on them. If the task isn’t interesting enough, intellectually satisfying enough or it’s simply dull, a procrastinator’s passion for the task is going to evaporate and they’ll find themselves looking for ways to occupy their minds. Suddenly the sun pouring in through the window becomes an irresistible magnet and they find themselves offering to head out and buy coffees for the team.
If you find this happening a lot, restructure the tasks so that they excite or add a personal reward to the end of every project. For example show real appreciation and praise if you get the monthly finance report on your desk by mid-day.
In a properly functioning and caring work environment management and or team members would ideally recognise the indications of procrastination and work together to break the cycle.
If as suggested procrastination is learned, then with help it can be unlearned. By looking out for and identifying procrastination as it’s happening, you can discreetly help by restructuring work habits, adding motivation and removing distractions.
I am convinced that a simple solution lies in planning and time management. Personally I always work from a rolling weekly task list and each day I write down the 3 things that I absolutely must do that day. This keeps me on the straight and narrow when my mind starts to wander.
Procrastination costs SME’s a good deal in lost productivity and we should work to fix it but don’t expect overnight success. Lifelong habits are difficult to overcome and take time but the first step is always a hard yet positive move.
As Dr Ferrari says in his book “Still Procrastinating: The No Regrets Guide to Getting Things Done”, “Eliminating procrastination from our lives is like trying to stop a moving train; it’s not easy.”
Now avoid moving trains and….do it quickly, don’t procrastinate!
By: Neil Steggall
The Barking Mad Blog
SME Advice with Bite!
How to make a Winning pitch for your Business
We are often asked to assist our SME clients in preparing a “pitch” for major new business or for a new equity investment and it’s an area where our approach surprises the client as we strongly believe that the key to a winning pitch is “less is more” but the content and presentation must be perfect!
If you’re pitching your SME, whether for major new clients or investment, it’s crucial to present in the best possible way.
If you are regular followers of our SME articles you know that we liken the SME operator or CEO to the conductor of an orchestra as he brings his team together at the exact moment to create great harmony and success.
Open with impact – a pitch is like a performance and first impressions are crucial.
Pitching to major potential clients or investors is critical to any growing SME. Yet it is a changing environment the more sophisticated buyer or investor is returning to the time tested value of looking at and listening to the individual and placing less emphasis on or even discounting lengthy PowerPoint presentations and the use of props.
Respect your potential buyer or investor and show that respect from within. If you believe in your pitch and truly respect the potential buyer or investor it will shine through. Smile and be human small points matter.
The Objective: Without a pre developed written objective you won’t know your true criteria for success, so don’t pitch without one. Try and establish before the pitch exactly what the client really wants both in terms of specification and service and as importantly what the client needs. This may be different to what they want. If pitching for investment always use a third party to identify the investor’s guidelines and “hot spots” before you meet. Finally include in your written objective exactly what you want to achieve in the meeting, ask yourself would I buy this? Ask your mentors what they think, rehearse your pitch, the first time you do it you may feel embarrassed but it pays off so stick with it.
Your team: Take the team that is most appropriate. The CEO doesn’t have to be involved, though they can confer valuable status if you’re pitching to a larger organisation. But do make sure your team includes the person who will be doing the work if you win the bid. If pitching for investment have the SME’s “engine drivers” present, investors are usually going to back the people ahead of the figures. Allow time for each team member to shine. An investor will look closely at your team dynamics and how well you relate. That said don’t take a football team if you are pitching to an individual.
Their team: It’s reasonable to ask who is on the panel and evaluating the bids, though you probably won’t be told. If you do find out, do your research and match your team by having people who complement their skills. If their finance director will be present, make sure your team includes someone who can answer financial questions. If the investor brings along his lawyer or accountant be aware they will ask questions if only to justify their fee, so be prepared.
First impressions: Be yourself and relax, this is your pitch and you are proud of it. Allow five minutes of small talk – it’s all part of getting to know one another. Then open with impact. Really plan and rehearse this opening. A presentation is like a performance, so be sure to entertain as you inform. Be anything but boring. Do something at the front end that gets everyone’s attention.
If you’re pitching a game-changer for your SME, say so; or find a great quote or an arresting image. If pitching for investment it’s probably because you have already invested every cent you can. Say so, demonstrate your passion and commitment, tell the investor why you are going to make this business work. Again seek out a winning quote or image to imprint in their mind. Mentally invite and bring them on board as stakeholders from that very first meeting, show you like them.
There’s a lot you can do beyond PowerPoint, samples brochures etc – but if you must use them, use just one word on each slide. Hand out the presentation at the end, or everyone will just leaf through it and jump directly to the price. If pitching for investment show only headline figures and be prepared to leave the detailed figures with the investor at the conclusion of the meeting. Don’t just leave printed figures leave a USB with the work sheets open so that an investor can “work” the figures, show trust.
Finally don’t ask the investor to sign a CA, if a regular investor they probably see several opportunities a week, if they wanted to replicate your business they would already be out building it. By definition they are not interested in running a business any more – their USP is now their capital.
Observe: Have an ‘observer’ on your team who watches and notes how people respond and takes detailed notes. If meeting an investor at night say up front “I know you must be tired we will only take 30 minutes of your time”. Let the investor relax.
The Q&A: When do you take questions? Do you let people interrupt as you go or ask evaluators to hold questions till the end? Allowing interruptions can completely hijack a presentation. I like to ask that they save the questions, as they may well be addressed during the presentation. But if it’s really burning, deal with it quickly and don’t get side-tracked.
How did we do? You don’t want to walk out without feedback on how you’ve done. So ask: “Has this addressed your needs? Did we drop any clangers? Is there any further information you need?” If the feedback is that you didn’t answer something sufficiently, you can always follow up with supplementary information.
The goodbye: The most revealing moment of all. When all the formalities are done and the performance is over – that’s often the most telling moment. You’re walking out to the lift, shoulders are relaxed, guards are down, and you’ll get nuggets of feedback via body language, a smile, a comment such as “‘you did really well” (a big thumbs up) or “you might want to go back and sharpen your pencil” (lower your price).
Listen and observe that chemistry. At that moment, you will know whether or not you’re in with a chance.
By: Neil Steggall
The Barking Mad Blog
Business Advice with Bite!
Think, Change, Grow, Prosper!
In the dark distant past when coffee came without froth and computers were kept in sealed rooms and operated by bespectacled men (sorry ladies its true) in white coats, I spent a few years climbing the corporate ladder which included a stop off in the Marketing Department of a major multi-national.
We saw marketing in aggressively military terms of war, battles, and campaigns, all fine-tuned through tactics, strategy and whiskey.
Statistics and information was gathered from the market and analysed, products were designed, costed, tested, refined, manufactured, advertised and sold, hopefully, at a profit.
Much thought and combative discussion was applied at each stage, key objectives were established, strategic marketing plans, short term tactics, placement attacks and budgets were drawn up and approved before being committed to endless reams of paper. Weekly meetings were held to gauge progress and we wrote up even more notes in pencil before dictating them to our “girl”, sorry PA, to be typed up.
Much time and efficiency was lost in the process and very few really great ideas came out of it.
When I attend marketing meetings today the mood is less combative and the whiskey has unfortunately disappeared yet I fear just as much time and efficiency is being lost in the discussion of SEO’s, word place rankings, the placement of hash tags and how well the product will look on mobile devices. I leave the room bored and just a little concerned that no one is actually marketing the product.
Perhaps it’s time to redefine MARKETING.
“Marketing is too important to be left to the marketing department.”
– David Packard, co-founder, Hewlett-Packard
When you own the show you can make such bold statements! However, if we ask any ten business leaders today to define marketing we will probably get ten different answers. Marketing its function and its purpose appear to have entered a management grey zone.
I was fortunate some years ago to meet the father of modern management, Peter Drucker, on a number of occasions and his view was: “Because the purpose of business is to create a customer, the business enterprise has two – and only two – basic functions: marketing and innovation. Marketing is the distinguishing, unique function of the business.”
So, what is marketing and are we moving closer to a definition? The Silicon Valley venture capitalist and former Intel executive Bill Davidow said, harking back to warfare, “Marketing must invent complete products and drive them to commanding positions in defensible market segments.” The man should know. He wrote the seminal book on high-tech marketing.
Interestingly Davidow didn’t learn marketing at university as he studied electrical engineering. Steve Jobs, another brilliant marketer, dropped out of school. These guys and others like them demonstrate that great marketing skills can be developed.
So how do great marketers learn about marketing? I am convinced that great marketing skills are best learnt on the job. Doing the hard yards.
SME’s and Startup companies are great places to learn and develop marketing skills because they’re all about developing innovative products and getting customer traction – and not much else. Further they’re always strapped for cash and needing people to wear multiple hats.
Interestingly as an engineer by training I also learnt marketing on the job.
Its been a long and complex journey but here are THE SIX KEY LESSONS I learnt along the way:
Marketing is Hard.
It has been said that “Marketing is like sex: Everyone thinks they’re good at it”. Well I’m not getting into that one but on observation there are more posers in marketing than most other fields, probably because the demand is so strong and the supply of real talent is so weak, and it’s easy to fake. When discussing a Telco acquisition with an American banker some years ago he started to tell me how the marketing model needed to change. When challenged he answered “Bankers like to think that they are marketing geniuses. We really do.” He said, this is because “we can fake it far more convincingly than in other areas …” It’s worrying but it’s out there, be warned.
It’s about determining what customers want, often before they know it themselves – look at Sushi-Sushi and how they got everyone eating raw fish. If you’ve got a knack for that sort of thing, trust it. Be your own focus group of one. And while it’s tempting to think of markets as amorphous virtual entities, remember that, even in the B2B world, every product is purchased by a human being in the real world.
Marketers don’t reinvent the wheel.
Some people are great inventors. They come up with wild concepts that nobody’s ever thought of. But great marketers tend to be innovators who turn inventions into things people can use. Marketing thrives on reusing ideas in new ways. Most modern Japanese industry was based on this premise. Steve Jobs didn’t invent he moulded inventions into products people wanted to use.
Marketing is too important to leave to the marketing department.
It really is! Marketing is the hub of the business wheel. It’s where product development, manufacturing, finance, communications, and sales all meet. Marketing’s stakeholders are every critical function in the company. Every member of the leadership team is an adjunct of the marketing department. SME or Giant Corporation it’s all the same.
Marketing Really Counts.
Contrary to today’s popular feel-good wisdom, in business, winning is everything. Every transaction has one buyer and one seller. If you do it right, buyer and seller both win. All the other would-be sellers lose. The real world is brutally competitive. Be different to win.
Great Marketing Ideas are Rare.
By executing the right communication strategy, great marketers can create a groundswell of customer excitement and viral demand for a company or product that nobody’s ever heard of. And it can be done on a shoestring budget. Steve Jobs was a master at maintaining secrecy and controlling exactly how and when anybody learned anything about Apple’s products. MacDonald’s are turning bad press about fast food into selling points through its new menus and PR.
The truth is that great marketers are few and far between. Which begs the question, who exactly are you trusting the most important aspect of your business to? Something for you to think about as you take your SME global.
Finally my definition of marketing is to “take something useful and turn it into something desirable”
The Barking Mad Blog
SME Advice with Bite!
Are Banks Funding SME’s?
A good deal has been written recently regarding the attitude to SME lending by the major banks. On the one hand we have SME owners frustrated by their inability to attract bank funding and on the other we have the banks advertising and talking up their preparedness to fund SME’s.
Why do we have this disconnect of views?
It is clear that since late 2008 and the commencement of the GFC, banks have been more wary of lending. The financial crisis – caused largely by risky lending and banking mismanagement – combined with subsequent higher liquidity and capital requirements have made for a far more risk adverse approach.
However, banks are lending and they are increasingly keen to do so. They are lending less than they used to and looking for tighter security, but the idea that they won’t lend to anyone is simply not true, but you must submit a well-reasoned, structured, quality application.
This myth is not only hurting the banks, but it is hurting SME’s. A problem is that we hear so many negative stories of loan applications dragging out for weeks before amounting to nothing and of bank BDM’s being excited by your application only to have it knocked back by credit that many established businesses with sound bankable propositions are not even applying for funding
Other SME’s will get a rejection from one bank and assume they fall into the ‘do not lend’ category, and give up – whereas in a more positive climate, they might keep trying. This is slowing business growth and therefore the growth of Australia’s economy.
Why is everyone saying that ‘banks aren’t lending to SME’s’?
To answer the question we need to understand the lending process and rationale applied by the banks. Decisions are no longer made by your local manager who in days gone by would have known you, your business and the state of the local economy in which you operate. Lending decisions are now centralised and subject to stringent internal rules, guidelines and matrix ratings.
It is possible in this centralised and semi-automated system of credit approval to fail simple because you can’t “tick” a given box. So let’s look at some of the actions you can take to improve your chances of success:
In tough times banks require a near perfect credit history with no defaults, judgements or slow payments showing on your credit history. The reporting agencies make mistakes and many suppliers make mistakes so it pays to request a copy of your credit file from the main agencies such as Veda or Dunn & Bradstreet and check that it is accurate.
Recently our Credit Manager brought a large monthly trading account application to me for approval, the applicant trades nationally and is at the upper end of the SME definition. On the credit file were two very small sums of money showing as outstanding for over two years to a major utility company. Had I been a computer I would have rejected the application but as a reasoning person I could accept that such small sums were inconsequential against the annual revenues of the applicant. A quick conversation with the applicants CFO satisfied me and the application was approved.
For a relatively modest annual fee the reporting agencies will provide you with email notification of any changes to your credit file and provide a fully detailed up to file each year.
Most banks from time to time place a limit on the amount of funds they will advance into a certain business sector or avoid some sectors all together. In late 2010 we had a client with a strong business case and sound backing who wanted to acquire assets in the wine industry. At that time none of the major banks would lend to any “non existing” wine industry clients. Don’t be afraid to question the banks BDM as to their attitude to your sector and if the BDM doesn’t know ask them to find out.
Business Plans, Budgets & History:
Being able to table a well-constructed funding application supported by a current business plan, detailed budgets including P&L, Balance Sheet and Cash Flow will help enormously and if you have maintained accurate records of plans and performance over the past three years even better.
The plans and records don’t just show how your business has performed and how it may perform in the future they speak volumes about you as a thinker and manager.
It’s relatively easy for you to know how you stand from a profit and cash position on a monthly basis and you may question the time and investment required in maintaining such detail but believe me it will pay you dividends time and again to do so.
Provide information about your management team. This will be a key consideration for any lender. You need to show you have a team that can develop the product, market and sell it, and just as importantly, manage the finances. If you have gaps in your team, try and fill them get one in place before you apply.
Interest Rate Cover & Security:
The banks will calculate how many times cover your current net profit will give to the total amount of interest payable and they will want that cover to be 2.5 – 3.5 times as a minimum. For additional security the banks will look at your stock and debtors and advance funds against that security, again they will be conservative and depending on the age and condition of stock may lend 60% of cost and up to 80% of debtors. The bank will also look to take a charge over the various assets of your business.
As a general policy you should, wherever possible, avoid giving personal guarantees or security over your family home and always seek professional advice before executing any loan documentation.
Amortisation & Exit:
An often over looked point which the banks will be very interested in is how quickly can you repay or amortise the loan and how you plan to do it.
The banks don’t want open ended facilities and they want to know you have more than one option to repay, irrespective of anecdotal reputation banks do not enjoy having to collect on defaults.
Hopefully you will be able to demonstrate an ability to amortise the loan over a reasonable period whilst still leaving sufficient cash flow to cover your interest ratios.
In summary the lending market is constantly changing and hard to keep up with. For this reason it’s often worth engaging one of the companies that specialise in SMS funding as they will have strong relationships with a variety of lenders, understand each banks current requirements and how best to structure and present your application to provide the best prospect of success.
The Barking Mad Blog
SME Advice with bite!
SME’s: Starving for Cash
Just how much cash does a start-up need?
In my experience the simple answer is “a lot more than you think”. The lack of cash to fund SME growth is the single biggest cause of SME failures and yet it need not be so.
With a proper understanding of business dynamics and risk, cautious budgeting and the regular monitoring of your performance against your budgets you are already a long way along the path to securing your future.
So How Much Cash Does an SME Start-up Need?
THE FIRST STEP
Be totally honest with yourself when assessing your business plans, don’t plan on what you hope will happen, don’t even plan on what you think will happen. Plan on what you know you can achieve and then allow for the unexpected.
Over the span of a long career I would estimate that 80% of the start-up budgets I have seen, over estimate sales and cash flow, whilst under estimating costs and cash burn.
This will possibly frighten you but you should have sufficient cash on hand at the start of your business to cover at least six months of total costs and operating expenses and you should maintain this cover throughout the growth of your business.
If your business concept is realistic and your business plan and budgets well thought through you will almost certainly succeed but be very realistic when budgeting.
THE SECOND STEP
When writing your business plan and establishing budgets calculate the cash needed in year 1 to meet your three key areas of expense; Cost of Entry – or Capital Expenditure (CAPEX); – Cost of Goods Sold – (COGS) and finally Operating Expenses – (OPEX).
If after careful consideration and budgeting the sum is higher than you thought, see what if anything can be scaled back, without losing sight of your concept and what cash is really going to be needed to deliver the objectives.
Do not despair if the cash needed is more than you thought or indeed more than you have available. The cash needed is the cash needed so plan for it.
In respect of Revenues employ caution in the quantum of sales you project. A mistake here will cost you dearly and don’t expect your customers to pay you on time. Most “good” debtors pay in 30 days but it is usually 30 days from the end of the month in which you invoice and if they are savvy buyers they will order in the first week of the month thus getting almost 60 days to pay.
THE THIRD STEP
The business plan and budgets are written and after due and diligent consideration you feel you are short of cash “Stay Calm and Engage Stakeholders”.
The stakeholders in your business include you, your family, your investors, your staff, suppliers and customers.
If your business plan is sound and well-articulated and explained, each of these stakeholders will support you. Your family will probably support you best by understanding long hours worked and tiredness at home.
Your investor in making the decision to back you and your idea has the most to gain by supporting and helping you meet goals. The investor is probably experienced and can be a great mentor and sounding board for you so use the relationship and value it.
Your customers and suppliers both stand to gain through your business success so engage them, show them your plans and discuss the terms on which you need to trade. Treat them with respect and they will return the favour in heaps.
We are yet to answer the big question: Just how much cash does a SME start-up need? It’s a bit like the question; how long is a piece of string and the answer is the same……it’s as long as it is, or it needs as much cash as it needs.
Don’t be worried by this, in almost 30 years of SME experience I have always had access to more investor cash than I have had to good ideas and people to back.
If you have confidence in yourself and your plan and need an investor, speak with local accountants, financial planners and lawyers, they will almost certainly know someone looking to invest funds in a sound idea.
Most importantly if you think you need $8.00 ask for $10.00 it’s much easier to return funds with a little interest than to ask for more. Again if you think your first years profit is going to be $10.00 write it up as $8.00 and come in ahead of budget. Everyone loves a winner and success spreads!
Follow these simple steps and you should be set for a successful future with loyal stakeholders willing to follow you into your next bigger venture.
The Barking Mad Blog
SME Advice with bite!
The Three Profits of SME’s
Most SME operators tend to think that good management, innovation, hard work and productivity will result in a profitable business, well they should but that’s not the whole story.
Not all profits are created equal and indeed some are much more valuable and more quickly and easily attained than others. Ah there must be a catch I hear you say; there is no catch but understanding the Three Profits of SME will make a significant difference to the way in which you view and manage your business.
The First Profit
The First Profit of SME is the easiest profit you will ever make and could account for a substantial amount of the total profit your business generates over its lifetime. The First Profit flows directly from your cost of entry.
Once you decide on starting or buying a business be it a hardware shop, bakery, call centre, IT service or a property development, do your research. Look around for a similar business in distress or even facing or in administration or receivership. There are many reasons businesses fail but most often its insufficient cash or poor management, if you are a good manager and you have cash get out there and buy well.
Most businesses fail within the first two to three years. I have bought near new businesses out of distress for less that 10% of the cost of establishing that business. Plant and equipment as new, some customers in place and ready to go. If you can run that business and cash flow it you make a 900% profit in your first 2 years because well run the business should be worth at least its true set up costs.
The Second Profit
This is the only profit some people think of; the operating profit that flows from good management, business planning, innovation, hard work, productivity and sales effort. The Second Profit most importantly sustains your cash flow, pays the bills, allows you to further develop the business and should leave you with a healthy profit after drawing your wages.
The real key to the just how large The Second Profit is relates to the lessons of the First and Third Profits. Put simply the keys to strong operating profits are how well you control the cost of the goods and services you offer and how well you price them.
Do the maths. You are much better off and your business is stronger selling a lower number of products or services at a higher margin than going for volume at a discount.
Look for ways to offer a significantly better service to your customers than your competitors are and lift your prices. Treat cost controls and buying as seriously as sales, manage your stocks to achieve maximum stock turn at minimum inventory. Establish and monitor your KPI’s. Motivate and reward your staff. Build a happy and united team.
The Third Profit
This Third Profit if planned carefully and executed well will bring you a profit as relatively easy and large as your First Profit. We are talking here of your exit strategy, the day you sell your business. Whilst this seems a long way off when you start your business you should be planning and working towards the exit every day.
The Third Profit will directly reflect the desirability of your business to a potential buyer. That buyer will need to be very comfortable with your business if you are looking for a premium priced exit.
From day one work to a detailed financial budget and business plan, report against it monthly; draw up detailed monthly accounts, (it’s so easy today), hold monthly board meetings with an agenda and minutes, even if the directors are you and your wife. File all tax returns and corporate documents on time and constantly update your corporate register. Imagine how comforting 3, 5 or 10 years of such well-maintained records are to a potential buyer.
Lock as many customers as you can onto long term supply or service contracts and do the same with your key suppliers. Look after, reward and motivate your staff so that your retention rate will be high. Another three prospective purchaser concerns answered.
Typically a purchaser will offer a multiple of earnings (EBIT) plus stock at valuation as a pricing mechanism. If the accounts, customers and staff look ad hoc the multiple offered is going to be between 1 and 2 times earnings and stock over one year old will be discounted to $0.10 in the $1.00 and over six months old $0.50 in the dollar.
With solid accounting, tax and corporate records, good budgeting, a regular stock turn, sound supplier and customer relationships, and loyal staff a potential purchaser is going to look much more favourably on your business and a multiple of 4 to 6 times EBIT plus SAV at full cost is a likely outcome.
Another strategy is to approach your major competitor; a consolidation of the two businesses could bring about significant efficiencies and cost benefits thereby lifting to value of your business to a multiple of 6 to 8 times EBIT.
I hope you take on board The Three Profits and prosper from them. Good Luck!
The Barking Mad Blog
SME Advice with bite!
1 November 2013
A STRONG TEAM
VITAL TO SUCCESS
Early in my career it was noted that “I didn’t suffer fools gladly”. At the time I took it as a compliment as I couldn’t understand why some of the people in the organisation just couldn’t grasp the problem, yet alone see the solution and fix it. Clearly they were fools!
As I travelled around the organisation from city to city reviewing performance I was unbeknown to me leaving a trail of emotional disaster and disharmony. One day the CEO sat down in my office and declared that if he could lock me in that room, push problems under the door and wait for me to push the solutions back out some time later, we could change the world. Yes this was the pre computer age and I had to change.
Whilst I had grasped problem solving I had little idea of or interest in the team. I was just so absorbed with problems and their solutions.
I am now much better, though still not good, at team work but I have recognised that a good team is both high performing and exciting to work in. Results flow from great teams.
Cerebral loneliness is a very real problem, I need the companionship of strong thinkers to challenge and spark my own mind. Brilliant ideas are rarely born in isolation, and successful projects stem from a strong, collective team. Without the spark of companionable challenge I find I can become almost self-destructive in my thinking.
In other words, to do great work, you must surround yourself with great people.
It’s an interesting exercise to define what this means for the type of thinkers you want on your team. I find that my best work comes from interaction with people who think differently than I do – and differently from each other. A diversity of mental profiles yields the richest results. Here are six personality types I would have on my dream team.
1. The dreamer: This person never ceases imagining what’s not, what’s next and what’s possible. They think big and hopefully, stretching the bounds of what is considered achievable. They never stop asking, “what if?’ and supply your team with an electric and optimistic creative energy.
2. The debater: Debaters question your assumptions, call out your leap of faith logic and point out the flaws in the plan. They see problems long before others, and they keep everyone grounded and prepared. Their questioning nature forces you to strengthen the rigor of your arguments.
3. The disruptor: The disruptor challenges the status quo and breaks others out of their mental ruts and insular perspective by bringing fresh and far-ranging perspective. My favourite disruptors are intellectually curious, lateral thinkers who are first to spot latent competitors and untapped opportunities in the market.
4. The driver: Drivers are natural leaders, bringing a crusading, concentrated vision to all work and supplying forward momentum when everyone else is losing steam or motivation. They are positively relentless in pursuing an idea, galvanizing political support for it and keeping it on track. They can be fantastic advocates for the customer, and at times hard drivers keeping the team focused on the problem you’re here to solve.
5. The detailer: This type digs into every facet of a project. Detailers focus on practicalities and save everyone else from silly mistakes and fatal design flaws because they think through all the angles and implications. They identify what’s missing in even the best-laid plans and can diagnose the precise point when something could break or be improved.
6. The doer: The doer is the wonderfully resourceful team member who gets stuff done, no matter what. Doers roll up their sleeves and find the practical solutions to delivering products services and “what-nots” on time and on budget. They are great colleagues to those who devise the grand strategy because they get it delivered on time, all the time.
Do you recognise your team members here or see gaps in your own team? Do you think of attributes that I may have missed. Let me know or post your comments below.
The Barking Mad Blog
SME Advice with bite!
October 22, 2013
Creating an Entrepreneur!
Is it possible….you better believe it!
Entrepreneurs are often the rocket fuel which drives new ideas, creates new businesses and indeed new industries. In common with such inflammable fuels entrepreneurs can often end with a bang but overall they have driven commerce and commercial ideas for millennia.
Most entrepreneurs tend to be highly individual, difficult and unpredictable and lacking in reputation when it comes to team work and the subtleties of the office culture. This is changing as most business schools and universities are turning out graduates with qualifications in entrepreneurship.
Having tame yet empowered entrepreneurs within a company is the dream for most business owners. These are employees who will undertake something new, without being asked to do so. They are innovative and creative – they are people who can transform an idea into a profitable venture for your business. They strike the perfect balance – act like entrepreneurs, but they work for you.
But as any business manager will know, such individual entrepreneurs are a rarity, however, this needn’t be the case. Every employee can become more creative and entrepreneurial if their company adopts a different approach to their development and cultivates a culture where innovation and creative thinking is encouraged and supported.
One of the main problems facing many Australian businesses is that they have lost sight of the importance of fostering creative thinking and innovation. In doing so, they are placing their business at risk and giving the competition a serious advantage.
We can’t lose sight of the fact that the economic crisis has turned many offices into high pressured working environments, where employee engagement and confidence has been eroded. In such businesses energy, creativity and innovative thinking has been lost.
However, what has also emerged is a (it’s not us) blame culture where business people are blaming their current poor business performance solely on the recession and external factors. But this is a bit like complaining that you are wet because it’s raining. How about wearing a raincoat? Businesses have a duty to prepare for the future upturn and ramp up their competitiveness.
The actual ‘raincoat’ for business is not to cut costs and act in defence; it is to build resources and attack. Sun Tzu in the sixth century said that you may survive though defence but you can only win by attacking. One of the oddest paradoxes of the business world is how many business owners never even see themselves in a competitive situation. Absurd! Competition in so many forms is ever present and can never be ignored.
So what can businesses do to be more competitive? It is in times of adversity that some of the greatest innovations have appeared and in today’s straightened times there is a healthy pressure to differentiate, become more competitive and establish more intrinsic value in the organisation. Does this come about by exhortations by the CEO or by establishing a culture of freedom to think and innovate? It may be the former but it must be the latter.
It is down to business managers and the HR department to establish a culture where intellectual power within the company is harnessed to the betterment of innovation and in so doing equals motivation, productivity and profits. An energised workforce is an effective and content one.
Most people in an organisation have enough insight of what is going on to be able to contribute to innovation. However, we are not talking just about suggestion boxes. I am referring to special projects and cross functional work groups to establish innovation in products, service and operations.
Managers need to make it clear that this is not a one off; to create sustained motivation, people must feel valued. Leadership has to be consistent and authentic in the way that it empowers teams to be create
Here are some ways of encouraging creativity and innovation:
1. Understand and know what the market wants, but know more about what your competitors are offering and how they behave.
Competitors of all kinds are the minimum benchmark for which to aim. Equalling the value of competitive offerings is rarely going to suffice – always ensure you are moving to stay ahead. Look at every weakness in competitor offerings and operations and use advanced brain storming tools such as ‘meta planning’ to develop and refine the winning concepts. To win you must find that point of difference and it’s usually a combination of ingredients which becomes – your winning recipe
2. Empower people to implement their innovations.
3. Make it clear that a business must always rethink, reposition, invest and develop its products and services.
NEVER stand still. Even those lucky enough to have patent or intellectual property protection must seek to acquire more advantages. If in any doubt about this then compare the car manufacturers on the road today with those of thirty years ago. GM laughed at the Japanese cars with their floral carpets and tiny engines. England was the undeniably solid centre of motorcycle production.
4. The customer is always a good start point for innovative thinking and should be a central focus for the whole business.
The customer and their relationship is central to business success. Do not rush to copy some competitors’ ways of caring for customers (e.g. automated telephone services!). Develop new ways to engage with customers in a way that customers want. They will repay you over and over. This is how Virgin took so much business away from the likes of Qantas
5. Treat internal employees as customers and friends.
The best innovation can come from co-operation between employees – this is an effective way of bringing out entrepreneurs. Identify and appoint innovation ‘champions’ around the business. These people will be the leaders on innovation development and manage the process. They must drive the culture.
6. Any function has scope for innovation – always.
HR, finance, customers service, manufacturing, legal, they all must innovate and an innovation culture that embraces all the functions will be a better joined up organisation.
7. Lead people to look externally for inspiration and don’t be afraid to steal other people’s ideas.
Some of the best ideas and simplest innovations are from businesses that already have had such a drive or survived times of stress. Don’t reinvent the wheel copy the world’s best practice then improve it.. Sometimes copying is the best route. However, copy it, and then improve it. Look at how the Japanese destroyed the UK motorcycle industry, they initially copied the UK and then made the products better.
8. Managers should promote external focus from all departments.
Many businesses suffer from internalism and parochialism. They stunt growth, innovation and sap energy. Assume that your business could be killed off by new entrants to the market or new innovations – people or technology based. Get people to think the un thinkable, develop thinking around scenarios that may seem unrealistic. In the 1960’s Black & Decker was the world’s largest and most trusted power tool maker. Which of the analysts and business commentators wrote or though in 2007 the major global banks would fail, that the system was unsupportable and a crash inevitable.
9. Lastly, companies must look forward, and by looking forward I mean 360 degree vision and a strategy to see through it. Most look back when setting budgets and design parameters.
Create a ‘can and will do’ rather than ‘can’t do’ culture. There are ‘no but’s’; only ‘yes and’
In the end, innovation is an state of mind. Train your key people to think and see differently, search every day for the new, the better, form, function, value and service. This is where Steve Jobs was masterful in transforming not only an industry which he had helped create but in transforming the culture of a major global enterprise.
The value of leadership and empowering your management is enormous and in truth no one has a choice in the matter. Everyone must adapt, change and innovate and we can all with training, help and enthusiasm become entrepreneurs.
Empowering employees to be innovative and creative, and encouraging a ‘can do’ attitude can reap rewards for everyone – whether monetary or reward based – and companies that do this are more likely to survive the recession.
A new show on the ABC called Redesign My Brain, hosted by Todd Samson, shows just how adaptable to new ideas, concepts and skills our brains are.
It’s been said so many times but the answer is to look out of the box or in more 21st century terms constantly look beyond the horizon and use 360 degree vision and thinking.
The Barking Mad Blog
SME Advice with bite!
13 October 2003
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A Single Smile!
Can it be so easy? Continue Reading
The Perfect Storm
(A Modern Horror Story)
Why be so negative?……. well let’s use Paradise as a metaphor.
Because It Rains in Paradise…….!!!!!!
Come along take a short ride on this little thought wave, let’s see Paradise as a metaphor for a well-run business, a prosperous and growing concern and let’s see the rain as a metaphor for an approaching economic storm.
How well protected are we in terms of our ability to weather the storm? We have our business plans to hand but they make no mention of a storm. Have you been through a storm before? What changes? How do we survive? How bad will be storm be? Can we rebuild post storm?
So many questions and yet so far so few real life answers.
Breath deeply, let us relax together and read a little story……….
At times business can appear a lot like paradise, it’s a great place to be, and everyone wants to be there to enjoy life with you, to know you and to bask in your reflected success. You are the visionary, the hard working, creative, entrepreneurial brain who made this all possible, your adrenaline flows, your energy and ideas come together, your staff are happy, motivated and successful, they respect you, the cash flows in, you drive a nice car, dress well, you eat at the best restaurants, you fly at the front of the plane, you speak at conferences, and…….ahhhh you sit back, relax and you reflect on just how good your life is.
One day, a small cloud passes between you and the sun, sending a slight shiver through you, but it quickly passes. Utilizing your latest smart devices you send a few more ideas, instructions, queries, emails and more pictures of Paradise to your office, you check your bank balances, transfer a few funds here and there and it’s not yet lunch time.
The sun still shines but the palm leaves rustle again this time with an unsettling sound and in the distance the ocean appears darker, are those clouds, building in the far distance or a trick of light on the horizon?
Far, far away from Paradise and way over the horizon is The Land of Plunder (LOP). A terrible, bleak, dark miserable environment that draws the humanity, skill, resourcefulness and entrepreneurial spirit out of you like a black hole draws energy from its surrounding universe…..no profit, not even a scrap, ever escapes its clutches.
Populated almost entirely by wise and educated sages such as investment bankers, credit providers, speculators, derivative traders, stock brokers, securitization specialists, short sellers, long sellers, fund managers, promoters, actuaries, lenders, accountants, auditors, receivers, managers, liquidators, lawyers, barristers, regulators, and their shiny suited minions oh it’s a soulless place to exist yet alone to live.
The problem is that in the Land of Plunder no one actually makes, grows, manufactures, produces or sells anything. Nothing. Not a single thingamajig or even a widget. Not a single truly commercial activity in the whole land. Yet its population consumes the funds made in Paradise, it lives to play games with those funds converting them into concepts and instruments called spreads, market sectors, cash, gold, minerals, fuel, pork bellies, red bean futures, long and short positions, options, shares, derivatives, differentials, margins, rates of interest, rates of exchange, incremental ROI, leveraged positions, contingent assets and equally contingent liabilities. Perhaps the favourite game of all, played only by the most knowledgeable of sages, is the interpretation and discussion of meanings…..net, gross, before, after, on or off the balance sheet, earnings brought forward, deferred debt, provision for, contingent, or not and most importantly the holy grail itself………THE BONUS.
That night as you lay back in your king size bed, sipping a final glass of Comte de Taittinger, the wind rises and the palm leaves rustle, indeed as the tree trunks bend under the increasing force of the wind you get to thinking about The Land of Plunder. Who actually pays them and what for? What happens historically? Doesn’t the LOP like totally fuck up at least once every generation? And what happens when they do? Could it damage your business? What could you do to protect your business and the thousands like yours?
Another perfect day in Paradise dawns and already your CFO has confirmed that your cash registers are still singing caa-ching, your revenues are up, your staff are motivated, your customers are happy, your suppliers are on time and on budget and your R&D team is about to make yet another technological breakthrough and yet that lingering fear niggles away at you. How would I get by if the LOP was to get it all wrong?
Much of your new day is given over to this dreadful thought, and with the help of your laptop you reflect on history’s greatest LOP fuck ups. Dating from the Roman Emperor Diocletian’s disaster in the fourth century to those wicked Medici’s and their Pazzi Conspiracy and the subsequent Banking collapse of the fifteenth century, to the collapse of the Spanish economy in the mid sixteenth century….oh how could the wise sages have got the gold price so wrong? Of course no one within the LOP’s Dutch branch could have imagined that one day a Tulip Bulb would be worth less than its weight in gold but alas it came about. All of this further distresses you.
You of course realise that in the eighteenth century the sages came up with a brilliant plan, they sold the South Seas Company the exclusive rights to trade with and to import gold and other untold riches from South America. Sadly the sages didn’t actually clear this with the owners of South America, (Spain) or even mention it in the prospectus, small oversights they later realised and thus came about the South Sea Bubble. To date this is still history’s largest corporate collapse. Those damned Spaniards just didn’t play Cricket, did they, the sages were heard to mumble.
Racing forward, you find we have the sages of the LOP, engineering a convenient double act, in the Railroad and Silver collapse in nineteenth century America. Again the sages were ever so slightly wrong. More rail road carriages and rail roads were built than there were people and stock to travel on them. Some railroads went to towns and cities yet to be built. Proving that a double act was possible, the sages funded one or two, or was it ten or twenty, US silver mines to be opened on virtually the same day and surprise, surprise, the silver price fell through the floor. The US economy plunged into recession, jobs lost, families homeless, Railroad stocks crashed and companies failed but God Bless the sages……they still had their fees.
Still good hardworking entrepreneurs just like you were soon back at work in Paradise building their businesses, making and selling thingummy bits, widgets and the many whatnots needed by the people of Paradise. The sages were so impressed they decided to buy shares in these solid enterprises and trade them at a profit in LOP, whilst of course charging fees and profitably clipping tickets along the way.
Alas the shares were oversold and overpriced and in 1929 the entire global monetary system collapsed causing the worst depression, loss of jobs, homelessness, self-respect and starvation the world has ever known. In fairness some of the sages did feel quite bad about this and threw themselves out of their Towers of Babel to the pavement below. Though not many; and for the few that fell it was often as close to reality and real people as they ever came. One could go on and on mentioning the sages doing so well out of the provision of two glorious sessions of twentieth century global war debt, the Credit Squeeze of the early ’70s, the stock market collapse of 1987, the Banking Crisis of the early 1990’s and that monumental fuck up of 2008, but by now you really need a drink;
More importantly you need to recognise a the pattern, call in some real people and plan!
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