Ask a room full of people whether they have more free time now then they did five years ago and rarely do you see a hand go up.

Time, Attention and Trust are all in short supply, we’re optimising every moment, catching up, organising, on top of our other competing demands.

So, if this is now the convention of life – work/life blend, rather than balance, how should you change your business development approach to your customers?

Circles

Life seems to have gone full circle.  Being a proud Generation X, I’ve been schooled in the the importance of personal relationships.  During the late nineties and into the new millenium, businesses went a little CRM crazy, defining relationships by database fields.  It was all about your system.

Compare that to now.  Ten years on, we’re now talking about the importance of one to one, not one to many.  Traditional media continues to find ways to justify itself and social media has created hundreds of millions of individual voices.

Relationship building is becoming about the balance of how frequently you listen combined with how frequently you communicate (reception+transmission) at a one to one level.

Where are you FRoM?

If people are time starved, then traditional methods of reaching out to them may be less effective.  You’re networking events may not be so well attended, your e-shot open rate may be a fraction of a percentage, your direct mail may be directed to the re-cycle bin.

Using applications to stay front of mind (FRoM) with your customers and network are key.  Blanket bombing them with mailshots is a guaranteed way to put yourself in the “less relevant” box of their thinking.

Working smarter with tools like Linkedin and Twitter to create a simmer effect in your relationship isn’t hard.  Primarily it means that when they have a problem, you’re aware and – more importantly – you’re in their field of view as a potential problem fixer or trusted advisor.

Completing some training with a professional services company on Friday, I hit this point home.  Quite often, interventions by the professional services sector are event driven.  If you don’t have proximity to your clients (in range to listen) at their point of need, then you may well find a competitor through the door.  Use the technology that exists today, to make that job easier.

I’ve had personal experience of this over the years and it’s a timely reminder that you have to stay in regular, relevant, contact with the people that are important to you, if you wish to be the person they talk to in their moment of need.

Imitation is the sincerest form of flattery or so the saying goes.  This gave me a few laughs on a short break to Tenerife this weekend when I came across the following: -

1. A Michael Buble tribute act called “Michael Bubble”
2. A restaurant called “Gordon Ramsey’s” offering a three course dinner for €8,95 – their logo was exactly the same as the famous chef – “Gordon Ramsay.”  I did look twice thinking I was about to have the cheapest fine dining meal ever!
3. A Ghanaian looky looky seller (fake watches etc) wearing a Tesco “Here to Help” T-Shirt and badge – he even had Tesco carrier bags if a customer made a purchase!

There is so much talk about innovation today, that it’s easy to forget that imitating or copying a product and trying to improve it is also a tried and tested way of starting a business.

Now, I’m not suggesting that you rip off a major brand owners trademark – you’ll get into serious trouble for that – however significant markets exist for commodity products, where operationally efficient businesses can drum up significant revenues just by doing something better or introducing a complementary product into an existing customer base.

It’s widely acknowledged that in the seventies and eighties that many of the Japanese consumer electronic brands, took existing technology and bettered it.  They reverse engineered products, found ways to either improve them of their manufacturing processes and then launched them in the market, often with another 100 flashing LED lights for full effect!

Many of those brands are now household names – Sony being a great example of a brand that did it well and then went on to bigger and better things, like the Sony Walkman.

So if you’re thinking to try and find ways to expand your business, it doesn’t need to always come as a result of an innovation.  Five ways to further increase revenues could be: -

1. Pick a feature that is the current big thing in the market and see how you could better or improve it (subject to patent).
2. Establish other products that your customers might already sell, that you may be able to supply (always a good one if your customer wants supplier consolidation).
3. Consider how technology you might have developed could be used for other things.  Dyson do this really well, think how they have introduced hand-dryers and vacuum cleaners using their powerful motor technology.
4. See how your competitors might be deriving revenues from complimentary goods and services that you might be able to offer as up-sells or cross-sells.  Classic example for TV’s would be HD cables and cabinets.
5. Consider adjacent marketplaces to your current offering and see if you could move sideways into an adjacent market, rather than trying to do something brand new in a market you may not have expertise in.

Innovation doesn’t always have to be the next big thing, the most radical idea or a game changer.  Small improvements plus complementary products can also increase your capacity to do more business.

“My greatest regret, turning down a stake in Manchester United Football club for £250,000.”    A lifelong fan of the club, Fred Done, of bookmaking giant Betfred confessed to this during an interesting one to one interview with Insider NW Editor – Michael Taylor – in Manchester on Monday night.  The Leaders dinner, an annual affair which brings together around one hundred and fifty leaders of regional businesses, is an event I enjoy each year.  Informal with a great audience of CEO level attendees.

Done, looking much younger than his age (mid sixties), spoke of the growth of the Betfred empire, which now has a turnover of £3.5bn+ via its network of 1350 sites.  He’s been in the betting game over fifty years, starting when he was just fifteen and now sitting on an enormous betting empire, including the recent acquisition of the Tote.

There’s a lot to appreciate about the Done brothers.  They started with nothing and have gone on to own multiple successful businesses in differing sectors.  Fred, is a really ordinary guy.  He spoke very plainly about his business, raising finance, the Tote acquisition and lessons learned.  There was no corporate speak, citing “top hats vs. flat caps” as one of his observations of the political nature of the Tote acquisition.  Here are some bullets I took from the interview: -

• The brand Betfred came out of a brainstorming session.  They got an employee to design the logo.  He compared that to the £5M the Tote spent on branding with an agency.
• Fred has “no plans” to retire.
• Bet365 is a business who he admires and feels is the industry benchmark for on-line gaming.
• Their on-line gambling business is growing at 80%+ CAGR.  Staff are based in Gibraltar due to taxation.  He said he would move the staff to the UK tomorrow if the tax environment for a global on-line gaming business were right.
• Money is out there for borrowing.  But you must prove your case.
• The journey to acquire the Tote took around 7 years from first idea to deal conclusion.  It took a huge amount of effort, advisory fees and political lobbying.
• Their initial valuation for the Tote was £150M.  Betfred eventually paid £265m.  He felt that profits could be increased by at least £25M per annum with liberated staff and more business focus, so was happy to pay the higher price.
• A lesson learned from earlier in his career was that he wasn’t aggressive enough and too parochial.  If he wasn’t sure, he walked away from a deal.  Now he says “If in doubt, do it!”
• He feels as ambitious now, as he did as a 21 year old and success for him in the next phase of his career is to make the Tote ” a business that I’m proud of.”

The Done brothers are highly influential in the region.  Fred is passionate about young new start businesses and has backed many, aswell as investing group spend in the region wherever possible.  His brother Peter, who runs an employment law and health and safety business called Peninsula, is very much part of the business too.  They are busy building a conglomerate of businesses.

If I were a betting man, I think that would be “odds-on” bet for great success.  Excellent fellow, excellent business, excellent evening

Bartering has been around for centuries.  A common way of getting things done in the absence of currency or funds.  In my own experience of working alongside some smaller businesses, bartering is alive and well, particularly for cash-starved start-ups.   In the absence of bank lending, I think it’s on the up.  People, fuelled by entrepreneurial passion, want to start things and if they have a skill or patent which they are prepared to swap for get their idea off the ground, then off they go.

As long as you can agree the exchange rate for your transaction and it is clear, fair and transparent to both parties, then it is an excellent way of obtaining something of value to you, for a lower value potentially to you, when related to your time or idea/future project.  As for the tax implications, I’ll leave that for someone else to explain, but I guess the rules are that if you make a profit from something, then you become liable for a taxable gain.  So, it’s important to understand if a profit exists somewhere in the barter.

My main point is this.  What is your personal asset?  Your advice?  Your thoughts?  Your presence somewhere?  And, what would this be worth to someone else?  If you’re trying to get something done, it’s amazing what can be achieved if you have a barter option. Perhaps it’s equity in a start-up that you can swap, some business advice, consulting time, a speaking opportunity?  You’d be surprised what deals can be struck.

I know of many start-ups that have got going using this technique.  It’s less practical for bigger businesses, however, starting up – it could make all the difference between starting and not.

Last night I spoke at an event in Manchester for the Royal Manchester Childrens Hospital “Many Hands” Campaign.  Raising money for the Childrens hospital by encouraging lots of businesses to get engaged and raise a thousand pounds, I was asked to say a few words on the benefits of having a strong CSR position as a business.

Aside from the obvious things which you can read anywhere around risk management and reputation, I thought I’d use an environmental acronym to position where I think business procurement is at.

T - Technical Solution.  Businesses don’t buy you because you’ve got a strong CSR position. It will be taken as one of a series of things in the supply arrangement.  You have to be able to satisfy their technical solution to a problem first.  Whether that be via a box of tricks or a service.

R – ROI.   We’ve been at the forefront of environmental best practice for over fifteen years and one thing that is as clear as day is that the numbers matter.  Unless you can make the business case work first, people won’t attach a premium to your product or service.  In some instances – such as public sector – you can derive some small premium of 2-3% because of government initiatives to accelerate the CO2 footprint of the public sector.

E - Environmental.  This is all about CO2 and the cradle to grave footprint on the environment.  You’ll get to this if you satisfy T+R.

E - Ethical.  Beyond the attributes of the product itself and into the overall approach to doing business.  Choices you make in your supply chain and your holistic approach to business.

S – Stakeholders.   How those benefits can be used in your business or your customers business to further their aspirations, meet their targets or CSR aims.

So, if you want to sell to me, you need to act like a TREE  

In our own organisation, we look for suppliers and initiatives which are cost effective, cost-reducing, easy to implement and wherever possible give us some stakeholder advantage. 

When the Rubber Hits the Road

Does everything need to have a business case?  If we’re talking about the deterioritation of the planet, is there an ROI attached to it?  Here lies my last point.  Sometimes it’s just about doing the right thing.  Giving a hand of help, showing leadership, taking an early adopter position.  However, if you are turned on by the numbers, here’s a few to throw at you: -

1. We’ve more than halved our energy consumption in less than 5 years.
2. Water consumption is down 21%.
3. Our length of service across the business exceeds eleven years.
4. Our sickness ratge is 40% lower than the national average (increased productivity).
5. We’ve recieved a colossal number of awards resulting in many hundreds of thousands of pounds of free publicity for the business, enhancing our Corporate Reputation.

Later this month, I’ll be visiting Buckingham Palace to collect a Queens Award on behalf of the company for our leadership in this area.  We’ve proved that by joining the dots up in your organisation, you can still be very business focussed when it comes to CSR, but you can still achieve the end game, do good and have a little fun along the way.

I’d encourage any business to get involved in the Many Hands campaign.  I like the idea so much because it’s not just about opening up a cheque book, it’s about how and what you do with your people to achieve the goal.  Along the way, you’ll meet lots of other businesses, some new contacts and end up doing something really brilliant for kids that need it.  Experiences need to be experential, your people need to get involved emotionally if they are to buy in to your ideas and working alongside good causes is a great way to achieve that.

I closed my talk yesterday by saying “Be MAD For It” – MAD meaning “Make A Difference”.  Being able to help others is the most wonderful way of helping yourself, your own esteem and growing as a leader. 

Senior Vice-President and Chief Financial Officer of IBM – Mark Loughbridge – visited Manchester last week to deliver a lecture at the business school about IBM and their 100 year journey from a small punchcard company to global giant.  In an hour long talk, he covered the four phases of IBM’s existence, including the disastrous imploding which saw their share price collapse between 1973-1993 as the company lost it’s way and drifted from its core competency, losing $16bn in 3 year period at one point.

Compare that with now and IBM is unrecognisable.  They totally turned the business around and made an astonishing 125 acquisitions from 2000 onwards, totalling $33bn, quite a story.  Highly articulate money man – Loughbridge, 57 – lived through all of this.  Joining IBM in 1977, he now has over 11,000 financial people reporting into him across the globe.

A few things stood out for me from the lecture, which I think are worthy of note: -

1. Between 1951-1972, what he described as “The System/360″ years, the then president discontinued every single product line they owned and threw an incredible amount of money at product development.  During this period, they spent as much on R&D as the American government did putting the Apollo space rocket on the moon.  After a period of re-consolidation, IBM came back stronger and went on to grow at 20% CAGR.
2. When they had their bad times, it was because the company launched into so many non-core areas, in so many countries, they lost the DNA of the businesss.  Son of the founder – Thomas J. Watson Jr – was quoted as saying “It’s harder to keep a business great, than it is to build it.”  This took a massive amount of energy to turn round and at times the business came close to running out of cash.  A far cry from the hugely profitable business it is now with $47bm a year in gross margins alone.
3. They achieved the turnaround by jettisoning low margin, non-core businesses and launched themselves into the services/consulting sector, focusing on performance, information and content.  They acquired buinesses with high margin potential and proprietary technology, improving productivity and margin as they consolidated them into the group. IBM now employees over 420,000 people – some wage bill that must be.

It’s a fascinating story of a business that grew and grew and grew, had a major period of drifting in the wilderness which nearly bought it to bankruptcy, which turned itself round to become a huge global organisation with massive profits.    There’s some lessons there: -

1. Sometimes you have to be bold, to stay relevant. Discontinuing every product they produced was a massive gamble or calculated risk?  Looking back, their CEO was a visionary, he studied what he felt the future might look like and got the business ready for it.  What’s the future for your business/category/space?
2. Big decisions need implementing. Jettisoning the low margin businesses, cost a lot of money and time,  however they had to cut them loose to grow their profitability.  Think long term, don’t wed yourself to something because it has been great in the past.  If you decide to do something big, do it.
3. They standardised quickly. Using the same language for financial reporting, sales reporting and group KPI’s.  It was “my way or the highway” when it came to implementing reporting.  Those that resisted were quickly exited in favour of progress.  Time was against them, they had a sense of urgency to save IBM in the dark days.  What could you do to standardise more and get a common language going in your business as you grow.
4. They dealt with the brutal truth. Read Jim Collins book “Good to Great” and you’ll see the importance of doing that.
5. They had a strong vision of the future. Loughbridge put up some interesting charts which they used with investors, to give clarity as to their future plans and reasons for acquisitions.  Many of those reached out over ten years.  It’s important to financially plan, to know what course you’re ultimately sailing.

It was an hour well invested.  Some good lessons and a great reminder that even big businesses get it wrong.  The trick is, recognising it and pulling it back.

Earlier this week, I was invited along to Hull Business Week to deliver a keynote around megatrends.  Hull Business Week does what is says on the tin, a week long celebration of business.  Speakers, exhibitions, dinners, you name it, they do it.

I don’t get over to East Yorkshire much.  It was a few weeks since I was there last and I do remember how welcoming the business community was then.  Nothing’s changed.

Delivering a keynote around something I call “The Me-cosystem”, I shared some trends which I think are changing the game in respect of how businesses need to re-define themselves in the new hyper-speed economy.  Time, Attention, and Trust continue to dominate the social landscape.  Breaking through is the new challenge for marketeers and business development professionals.

In an engaging Q&A session afterwards, we spent a lot of time discussing questions around which platforms are right for business, how to manage a PR crisis on social media, developing policies for your business to give guidance to staff, the legalities of web defamation and even what the digital future holds for  a printer company – great stuff!

Some of those answers were: -

1. In a social media crisis, respond and take it off-line wherever possible.  Don’t pour further fuel on a fire by debating in the public domand.  Keep your answers to facts, keep it short and take it to e-mail or phone.
2. Create  a social media policy for your staff.  Do’s and dont’s.  Remember, nearly all your staff will already have a social media profile – you can’t control that.  But you should give guidance to what they do or don’t say about your business and in business hours.
3. Platforms for business.  I use Twitter for listening, Linkedin for contacts that I’ve met, blogging for reputation.  I don’t use Facebook for business at a personal level, however we do use it for customer interaction.
4. F-Commerce is the new E-Commerce.  Transactional platforms like e-Bay and Amazon are dominating the convenience of on-line marketplaces and communities.  Facebook is coming.  Facebook credits are alread on sale in the USA – the new global digital currency perhaps?
5. Managing your on-line reputation is key.  Honesty and transparency matter.  You can’t edit content so that it only contains good stuff or people won’t believe you.  People will tell you if you’ve got a bad product or received bad service.  Better to listen and respond and do better next time.  63% of people trust recommendations from peer review ahead of adverts.  So, start listening and engaging with your customers.

Hull Business Week was well managed, well attended and a great example to other regions on how to lay on a top quality event for business.  Great job.

One of my favourite tunes from 1994 – Incognito “Positivity”.  Used to love listening to this in the car due to it’s uplifting words, always gave me a lift as a 26 year old salesman driving a White Cavalier. 

On the subject of “positivity”, last Friday night I spoke at a business awards in Tameside, Mancheser to an audience of around 250 people.  It was billed as an “inspirational speech” – so I’d pondered on what to say for a couple of weeks and decided on ambition and having a positive mindset (we call this 141%).

I’d clearly hit a chord as so many people came to me afterwards to say how much enjoyed hearing someone from a large company talk up small businesses and have an outlook that says you can achieve things.  Newpapers are still full of negativity, bad news and super-injunctions!   Five key points I covered were: -

1. Give, Give, Give – Giving has a wonderful karma effect.  The more generously you give your time to others unconditionally, the more opportunity comes and knocks on your door. 
2. Have a plan of where you are navigating to and programme your sub-conscious.    Your brain is a very powerful thing.  When you walk, you just walk, your brain does the clever bit.  When you pre-programme your sub-conscious with your objectives – it has an amazing effect of navigating you towards them.  What are your goals? Jot them down.  Process them.  Tell your brain out loud to help you get there (not at a bus stop mind you).
3. Have the mindset of an opportunity engineer.  Don’t think “What can I sell  you” – think - “What opportunities could we mutually work on?”  Win/Win wins business.
4. The world is a huge marketplace at your screen.  Never has there been a better time to open up your products and services to a global market.  It’s a click away.  Don’t limit your thinking to your local neighbourhood or regional.  Think Globally!
5. Small has a great advantage – you’re not BIG.  Speed is crucial in the hyper world we all live in.  Big businesses take longer to do things. Smaller busineses can punch above their weight using social media to engage customers, google to turbo-boost up local ranking and geo-location to grab people in local markets.  Get tech savvy.

There’s never been a better time to be a new start.  Free tools on the web.  Cloud based applications for money management, marketing and collaboration.  Social media to access markets.  Free business advice.  If you are positive and realistic, so much can be achieved.  That’s coming from a bloke that started out as a barman, who now shapes the direction of a £100m+ business.  Go get ‘em!

Chatting with a small business on the phone the other day, a quick conversation on the phone turned into an hours business clinic.  The business involved was suffering the after effects of a decision, which seemed good at the time, but is later paying the price for.

I won’t do the detail on the why’s and wherefores of the specifics, but there was some good advice there, which was worthwhile to share.  Again, this is linked to things that big businesses do well, that smaller businesses can learn from.  In no specific order: -

1) Know what your end game is. Selecting which pieces of business to progress/not progress rely on you having your end game down somewhere in a basic plan.  That sets the route for your business, the pace, the tone and utlimately the types of customers you want to attract.

2)  Don’t over-commit yourself. If your resources are limited, concentrate on the things that matter. In the early days of a start-up, there’s a tendency to do any piece of business at any cost, just to get money through the door.  If it totally overstretches you, it may be taking you away from more important potential higer value business opportunity.  Don’t be a busy fool, turnover = vanity, profit = sanity.

3) Opportunity Cost. You have a finite amount of time in working week.  Commit your time to achieving your plan.  Filling your time with business which you don’t make much money from simply limits the amount of available time you have to do more important things, like looking for more profitable customers or developing your offering.

4) Don’t always offer trade credit if it’s stretching you, particularly if selling to consumers. Ask for cash upfront or if for a trade customer, where you cashflow may be stretched.  Ask for part-payment up-front to cover your costs.  Be brave!  You’re not a bank or a charity.  Or give an early payment incentive (if your margin supports it).

5) Gear up to grow. If you know your end game and you know what working capital requirements might be, you will be far more selective about which bits of business you can do.  A good question to ask yourself is if a large customer walked through the door tomorrow, have you got the working capital to fulfill their order?  They will be expecting credit, probably 30 days net.  You’ll need to fund that.  Can you do it?

6) ABC. When taking a large order, take into account all the activity based costs (ABC).  What I mean is all the hidden costs of fulfilling the order.  The stuff that takes loads of time.  It’s tantamount to leaking profit.

7) Don’t get excited by the project, get excited by the profit. A common mistake I see is small businesses, particularly creative ones, being excited by a project and committing to it because it appeals to them.  Do a clinical assessment of every opportunity, you’re not a charity.  What’s in it for me?  How much net profit in this piece of business taking into account all the running round, the trade credit and the other costs.

Growing for Gold. That’s what I entitled a talk I gave at the Business North West fair in Manchester today to an audience of small businesses.  Examining three key areas of growing a small business to large, I made these points: -

Growing Pains – Things you’ll experience as your business grows.

• Feeling less connected with the breathing heart of the business.
• You’ll feel a bit out of control.  As you will realise you can’t do everything.
• You’ll spend more time in meetings.
• You’ll spend more time on people issues.
• You have to bring in managers to run areas for you (and by default spend more time managing them).
• You spend your time avoiding calls of people trying to sell you stuff.
• Life gets lonelier.  You’re not part of the team anymore.  You’re the big boss.

Things that Big Companies do well that small businesses can learn from

• They’re on the numbers. They always have a budget, 3 year plan and cashflow forecast.
• They make their processes slick, with as little human intervention as possible.
• They have a good plan A, but always have a plan B.
• They fail fast. If things aren’t going well, they don’t get wedded to an idea.
• They spend more time in the future. Looking at future markets, products and growth areas.

Transitioning from Management to Leadership

I ran through ten things from a previous post I’d written around leadership.  You can view it here and some tips to make you a better leader.

An interesting conversation came from the audience.  “What’s your motivation for giving this talk today?” – excellent.  Answer = My day job is creating market space for us to sell our products to SME’s.  It’s in my interest to see small businesss grow.  By growing, we get to sell more products to them (plus I enjoy the public speaking).

At the end of today’s talk, I spent about an hour talking to small business owners about various challenges, problems and opportunities that are on their desks right now.  It’s clear, that there are plenty of businesses with big ideas, ambition and the metal to get on with it.  Good for them.