It is quite natural to assume that others will share your enthusiasm for your business.
Natural, but wrong. They might look to acquire more knowledge over time but on first meeting what they actually want is a simple soundbite.
Here's an experiment - ask a few people linked through business (not colleagues or customers) what it is you do - I'm guessing you will be surprised by how many are off the mark.
As a sales person for your business - the fault lies squarely with you - and is almost certainly because you have told them too much, not because you have been too brief.
Unfortunately, concepts like the 'elevator pitch', or 60-second intro exacerbate the problem - whilst it sounds brief, 60 seconds is actually a long time to talk about something the other party isn't engaged with.
Straplines can seem crass - particularly if too much effort goes into making them 'clever' - but the value of creating a strapline is the thought process involved in condensing what you do into a short snappy phrase - whatever you may think - that is what the other person wants.
So next time you are in an elevator, deliver your strapline, swap cards and talk about the weather, the World Cup or - of course - their business.
Believe me - they don't care how many people you employ.
Tuesday, 17 June 2014
Friday, 19 April 2013
Your marketing prospect is a Goldfish!
Many years ago I attended BNI breakfast meeting regularly - ultimately it wasn't my style but it did teach me some very valuable lessons - most of all the one-minute presentation.
Young and eager I did my best to squeeze the minute full of 'interesting' facts and benefits.
Afterwards, the friend who had introduced me gave me a free and frank assessment which amounted to 'no-one is interested and you did nothing to make them interested'. I love my business., so why doesn't everyone else?
Now, two decades later I try to press this same message home on a weekly basis - At the early marketing stage your prospect isn't interested - and the more you tell them, the less interested they become!
It is a hard thing to take in - but an invaluable one in the early stage of marketing - stage performers use the adage 'always leave them wanting more' which also works in this context.
To get a clear visual of your early prospect just picture a goldfish - swimming around his little bowl happily admiring the model castle each time he passes thinking 'that's a nice castle'.
In this case however, the goldfish is particularly selfish and greedy so all he swims around thinking is 'what's in it for me?'
The instant you get the goldfishes attention you have to deliver the response to 'what do I do now?' - if you don't capture that moment you will revert to 'what's in it for me?'
The 'what do I do now?' will of course depend on your medium - phone call, email, exchange cards etc. But you must harness it and you must make it as easy as possible for the lazy Goldfish before he swims off.
Young and eager I did my best to squeeze the minute full of 'interesting' facts and benefits.
Afterwards, the friend who had introduced me gave me a free and frank assessment which amounted to 'no-one is interested and you did nothing to make them interested'. I love my business., so why doesn't everyone else?
Now, two decades later I try to press this same message home on a weekly basis - At the early marketing stage your prospect isn't interested - and the more you tell them, the less interested they become!
It is a hard thing to take in - but an invaluable one in the early stage of marketing - stage performers use the adage 'always leave them wanting more' which also works in this context.
To get a clear visual of your early prospect just picture a goldfish - swimming around his little bowl happily admiring the model castle each time he passes thinking 'that's a nice castle'.
In this case however, the goldfish is particularly selfish and greedy so all he swims around thinking is 'what's in it for me?'
The instant you get the goldfishes attention you have to deliver the response to 'what do I do now?' - if you don't capture that moment you will revert to 'what's in it for me?'
The 'what do I do now?' will of course depend on your medium - phone call, email, exchange cards etc. But you must harness it and you must make it as easy as possible for the lazy Goldfish before he swims off.
Wednesday, 17 April 2013
Strategy is not a big word!
When the word 'strategy' is mentioned to a small business owner, the reaction all too often is a mixture of shock and disbelief - best summed up in the reply 'I'm just a small business, I don't need that sort of thing'.
Quite simply every business needs strategy - or strategies - covering marketing, collections, 'paperwork' and other business facets.No need for spiral binding, no need for lots of graphics and images - frankly the back of beer-mats will do as long as it is comprehensive, cohesive and workable..
Strategy is what guides your business - more importantly, it is what differentiates you from others who are just doing a job.
Take time out from doing the job and look at your business from an outsider's view (perhaps get an outsider to do this with you) this will provide the foundation for your strategy.
It isn't a big word and it isn't time wasted - it is your route to success!
Quite simply every business needs strategy - or strategies - covering marketing, collections, 'paperwork' and other business facets.No need for spiral binding, no need for lots of graphics and images - frankly the back of beer-mats will do as long as it is comprehensive, cohesive and workable..
Strategy is what guides your business - more importantly, it is what differentiates you from others who are just doing a job.
Take time out from doing the job and look at your business from an outsider's view (perhaps get an outsider to do this with you) this will provide the foundation for your strategy.
It isn't a big word and it isn't time wasted - it is your route to success!
Thursday, 28 February 2013
Target marketing - catch your zebra..
The more I contemplate niched marketing, the more clear it becomes that this is the only way forward for small business.
In fact my first experience of this (though I did not recognise it as such) was many years ago through a builder friend of mine. Based in a wealthy Surrey town the friend worked alone as a general builder - he did OK, but complained that he was constantly quoting blind and missing out on jobs, plus he had to do a lot of jobs that didn't suit his skills.
Apparently on a whim, he decided one day to become a specialist in Victorian property renovation We all thought he was mad - why miss out on all those wonderful '70s avocado bathroom suites and huge aluminium windows that needed replacing?
He was right of course. Literally overnight he eliminated 70% of his competition. within a year he had stopped marketing because order book was full - without discounting his rates. If only I had recognised at the time the cunningness of that plan!
In my role as mentor & trainer I am constantly faced with starters who - quite understandably - see their market as 'everyone' and their range of services as limitless. It is very comforting to think of the universal market opening before you.
The best way I have discovered to explain why this is wrong is to use the analogy of the zebra & the Lion.
Zebras, you will probably appreciate, are covered in black stripes (or is it white stripes?). One reason given for this striping is that is confuses their natural predator - the lion.
What the lion sees is a feast a huge blob of moving stripes; what he fails to do is identify the meal - the single zebra that will actually feed his family. The rest will wait for another day.
Often a weaker zebra will fall from the pack & the lion will get his meal - but often they will not and he will go hungry.
If you randomly market everyone, you too will pick up a few stragglers and you might well keep yourself fed - but you will never be certain of results and you will never be able to milk the formula of waiting for one to fall off.
It takes a lot of courage to turn away from the perceived feast and focus on what looks like a small meal but like the lion - unless you want to spend your career chasing a load of stripes - you really need to select your zebra...
In fact my first experience of this (though I did not recognise it as such) was many years ago through a builder friend of mine. Based in a wealthy Surrey town the friend worked alone as a general builder - he did OK, but complained that he was constantly quoting blind and missing out on jobs, plus he had to do a lot of jobs that didn't suit his skills.
Apparently on a whim, he decided one day to become a specialist in Victorian property renovation We all thought he was mad - why miss out on all those wonderful '70s avocado bathroom suites and huge aluminium windows that needed replacing?
He was right of course. Literally overnight he eliminated 70% of his competition. within a year he had stopped marketing because order book was full - without discounting his rates. If only I had recognised at the time the cunningness of that plan!
In my role as mentor & trainer I am constantly faced with starters who - quite understandably - see their market as 'everyone' and their range of services as limitless. It is very comforting to think of the universal market opening before you.
The best way I have discovered to explain why this is wrong is to use the analogy of the zebra & the Lion.
What the lion sees is a feast a huge blob of moving stripes; what he fails to do is identify the meal - the single zebra that will actually feed his family. The rest will wait for another day.
Often a weaker zebra will fall from the pack & the lion will get his meal - but often they will not and he will go hungry.
It takes a lot of courage to turn away from the perceived feast and focus on what looks like a small meal but like the lion - unless you want to spend your career chasing a load of stripes - you really need to select your zebra...
Saturday, 23 February 2013
DIY threat. Or not?
It is an established cliche in the world of sales that in every threat lies an opportunity. In fact it is so established that it has been rendered almost meaningless.
However this concept came to mind in a recent discussion with 2 web designer - both of whom shared the view that free websites were a major threat to their livelihoods.
the optimist in me immediately pitched in to point out the enormity of the market for people who were happy to pay - many 100s of thousands of potential clients - why worry
about the ones you can't get when there are so many you can?
However following the discussion my mind turned to the nature of DIY - in any context, from wallpapering your hallway to building a website.
Start-up DIYers follow a simple process:
1. Read up about it
2. Do it
3. Pat yourself on the back
4. Compare (perhaps some time after the event).
From comparison you might either pat yourself on the back again, console yourself and put up with inferior quality or change things.
And so it is with DIY websites. For the sake of simplicity lets say that it is 1/3, 1/3, 1/3 between these categories.
On subsequent meeting I bounced this off one of the designers:
However this concept came to mind in a recent discussion with 2 web designer - both of whom shared the view that free websites were a major threat to their livelihoods.
the optimist in me immediately pitched in to point out the enormity of the market for people who were happy to pay - many 100s of thousands of potential clients - why worry
about the ones you can't get when there are so many you can?
However following the discussion my mind turned to the nature of DIY - in any context, from wallpapering your hallway to building a website.
Start-up DIYers follow a simple process:
1. Read up about it
2. Do it
3. Pat yourself on the back
4. Compare (perhaps some time after the event).
From comparison you might either pat yourself on the back again, console yourself and put up with inferior quality or change things.
And so it is with DIY websites. For the sake of simplicity lets say that it is 1/3, 1/3, 1/3 between these categories.
On subsequent meeting I bounced this off one of the designers:
- Find (say) 1000 DIY business websites, focusing on businesses which are up and running (albeit only for a few months)
- Run a quick critique of the site and its value to the business
- Contact the business owner and engage them - asking for their thoughts on the site
Based on the above, you will find - very pessimistically 200 users who are not entirely happy with their DIY project. If 20% of these want to do something about it you have immediately 40 RED HOT PROSPECTS, who:
1. Have identified a need for your services.
2. Understand the value that your skills can add
3. Have a running business and -hopefully - the means to pay.
That is from day 1! More of your pot will become disgruntled with their attempts and the pot will get every bigger
Surely more of an opportunity than a threat?
Sunday, 13 May 2012
The Business Funding Plan - as you've never seen it before.
Received wisdom will tell you that you should never make assumptions (as put in Police Academy 'when you assume, you make an ass of u and me'); in the real world of course assumption form an integral part of every day life whether it is for basic self preservation, to save time or simply to test our understanding - it is simply too complicated to only act when you know for sure.
The most frequent wrong assumption that people make about my businesses is that the start up business feeds the finance business - they will say 'I see, so you set them up, then go get the funding they need'. In actual fact the funding business feeds the start up business; I am privileged to have a detailed insight to what a lot of businesses do - where they go wrong and where they go right - this insight is hopefully passed on to start ups to help them avoid those mistakes. Funding? If I can help you start with zero funds then I have had a success.
Whilst we are dealing in cliches, my dear Grandmother always used to tell me 'you won't get there any faster by speeding'; one of my more destructive traits is a compulsion to speed on motorways. Whilst in many cases I can directly prove Grandma wrong, the truth of the matter is that she could more accurately have re-worded her caution as 'you won't achieve an more by speeding'. Put into context, because I like to drive fast on motorways, I assume that on a journey of any real distance I can average 60MPH. Ignoring the rising improbability of this happening, I am of course increasing the cost per mile covered and incurring secondary risks such as being caught for speeding (time consuming and expensive), accidents (potentially fatal) and, because I insist on using motorways I often actually travel further than I need to. Do I make extra time? Not really - I might get there sooner but then I spend 10 minutes waiting for the other person to turn up.
Where was I going with this? Oh yes..
By far the most common business start-up mistake is the belief that more cash equals more chance of success; in very many cases this can be the very opposite of what actually happens. Like the risk incurred by speeding, having too much cash in hand carries inherent psychological risk - witness the lottery winner who feels they should now start a business, lurching from franchise to dodgy 'opportunity' like a drunk in a casino, with neither plan nor realistic chance of success.
Alternatively, like my spare 10 minutes the cash will just sit there waiting for something to happen.
A successful business will be planned then capitalised, not the other way around, so here is my very simplistic Business Funding Plan:
STEP 1: Compile your plan and cashflows on the assumption that there is no capital available.
STEP 2: Look at where you go into deficit and ask yourself is there a realistic way that you can avoid or postpone expenditure without fundamentally damaging your business.
STEP 3: Look at ways of improving cashflow rather than introducing capital.
STEP 4: If you are certain that capital is required, build it into your plan as a loan, with repayment terms. (Even if it is your own money that you are happy to inject).
Remember, having cash in your business might get you to your goal quicker, but will it actually be any better?
The most frequent wrong assumption that people make about my businesses is that the start up business feeds the finance business - they will say 'I see, so you set them up, then go get the funding they need'. In actual fact the funding business feeds the start up business; I am privileged to have a detailed insight to what a lot of businesses do - where they go wrong and where they go right - this insight is hopefully passed on to start ups to help them avoid those mistakes. Funding? If I can help you start with zero funds then I have had a success.
Whilst we are dealing in cliches, my dear Grandmother always used to tell me 'you won't get there any faster by speeding'; one of my more destructive traits is a compulsion to speed on motorways. Whilst in many cases I can directly prove Grandma wrong, the truth of the matter is that she could more accurately have re-worded her caution as 'you won't achieve an more by speeding'. Put into context, because I like to drive fast on motorways, I assume that on a journey of any real distance I can average 60MPH. Ignoring the rising improbability of this happening, I am of course increasing the cost per mile covered and incurring secondary risks such as being caught for speeding (time consuming and expensive), accidents (potentially fatal) and, because I insist on using motorways I often actually travel further than I need to. Do I make extra time? Not really - I might get there sooner but then I spend 10 minutes waiting for the other person to turn up.
Where was I going with this? Oh yes..
By far the most common business start-up mistake is the belief that more cash equals more chance of success; in very many cases this can be the very opposite of what actually happens. Like the risk incurred by speeding, having too much cash in hand carries inherent psychological risk - witness the lottery winner who feels they should now start a business, lurching from franchise to dodgy 'opportunity' like a drunk in a casino, with neither plan nor realistic chance of success.
Alternatively, like my spare 10 minutes the cash will just sit there waiting for something to happen.
A successful business will be planned then capitalised, not the other way around, so here is my very simplistic Business Funding Plan:
STEP 1: Compile your plan and cashflows on the assumption that there is no capital available.
STEP 2: Look at where you go into deficit and ask yourself is there a realistic way that you can avoid or postpone expenditure without fundamentally damaging your business.
STEP 3: Look at ways of improving cashflow rather than introducing capital.
STEP 4: If you are certain that capital is required, build it into your plan as a loan, with repayment terms. (Even if it is your own money that you are happy to inject).
Remember, having cash in your business might get you to your goal quicker, but will it actually be any better?
Friday, 24 February 2012
More networking - sometimes it's best not to know!
Having set (and not met) my January challenge, I have ended up a month later still exploring and discovering new network events.
This lunchtime was spent in a riverside pub venue at the delightful Peal Network - a very usable mix of informal chatter and a sit-down 'meeting' featuring 1-minute presentations (no silly bells) and an agenda item of 'other network events you would recommend'.
Unfortunately I have now added the TWM Curry club to my schedule - thus moving further from my original goal.
Anyway, having attended events for 2 months solid, I am now obviously a world authority on face-to-face networking, so will share a few practical tips with you:
Tip 1: Never sell at a networking meeting. EVER. Introduce yourself; a brief sentence about what you do and back to them 'how about you - what do you do'. This is entirely counter-intuitive but believe me, it will work. The person you are chatting to might well ask more about your business, which is an invitation to elaborate, but doesn't open the door for your best sales spiel. Keep with me here...
Tip 2: Where possible, target your 'meetings' - quality rather than quantity. 3 good quality conversations can be better value that 12 encounters.
Tip 3: Think about your message. If you have committed to regular attendance (particularly on a weekly basis), you need to evolve your message - sometimes even straying a long way of your normal territory.
The temptation is to provide effectively a list of your products or services. Don't. Take a risk, and tell them just one thing that might be interesting & they will remember you (as someone who said something interesting, rather than the bloke or woman with a list).
Tip 4: Swap cards. Giving out your card is unlikely to yield results but convention dictates that they will reciprocate by handing you theirs - Thereby providing your with valuable information and an invitation to keep in touch.
Tip 4: Follow up! Think about what you want to achieve and go for it. Because you haven't already bored their socks off, you have plenty left to discuss. In a one-to-one meeting, where they won't be looking over your shoulder to see if their colleague / friend / customer has turned up.
They have given you information - use it to target your marketing and database - this is the warmest contact you will ever have!
Obviously I sometimes forget to follow this advice myself, but trust me, it works!
This lunchtime was spent in a riverside pub venue at the delightful Peal Network - a very usable mix of informal chatter and a sit-down 'meeting' featuring 1-minute presentations (no silly bells) and an agenda item of 'other network events you would recommend'.
Unfortunately I have now added the TWM Curry club to my schedule - thus moving further from my original goal.
Anyway, having attended events for 2 months solid, I am now obviously a world authority on face-to-face networking, so will share a few practical tips with you:
Tip 1: Never sell at a networking meeting. EVER. Introduce yourself; a brief sentence about what you do and back to them 'how about you - what do you do'. This is entirely counter-intuitive but believe me, it will work. The person you are chatting to might well ask more about your business, which is an invitation to elaborate, but doesn't open the door for your best sales spiel. Keep with me here...
Tip 2: Where possible, target your 'meetings' - quality rather than quantity. 3 good quality conversations can be better value that 12 encounters.
Tip 3: Think about your message. If you have committed to regular attendance (particularly on a weekly basis), you need to evolve your message - sometimes even straying a long way of your normal territory.
The temptation is to provide effectively a list of your products or services. Don't. Take a risk, and tell them just one thing that might be interesting & they will remember you (as someone who said something interesting, rather than the bloke or woman with a list).
Tip 4: Swap cards. Giving out your card is unlikely to yield results but convention dictates that they will reciprocate by handing you theirs - Thereby providing your with valuable information and an invitation to keep in touch.
Tip 4: Follow up! Think about what you want to achieve and go for it. Because you haven't already bored their socks off, you have plenty left to discuss. In a one-to-one meeting, where they won't be looking over your shoulder to see if their colleague / friend / customer has turned up.
They have given you information - use it to target your marketing and database - this is the warmest contact you will ever have!
Obviously I sometimes forget to follow this advice myself, but trust me, it works!
Tuesday, 31 January 2012
Business Networking
I don't do New Years resolutions, but I did start 2012 with something I've never had before (I bet you haven't either) - a business networking strategy. Like many people I have surfed many events over the years with mixed results; the strategy is to create a distinct focus and involves attending as many events as possible throughout January with a view to committing to 2 regular events.
As a general pointer, successful networking without weight gain requires a degree of self discipline I simply don't possess with most events involving food or drink to some degree - from the traditional 'full English' to fancy canapes and free drinks. Just make sure you balance your attendances with a bit of exercise!
I have mostly confined my attendances to the Guildford area and, even with a fairly tight geographical constraint I was amazed at the sheer volume of event available. So much so that I estimate you could actually attend an event each day within a 10 mile radius of our base.Quite often at one event I would receive invitations to several others.
So, with my new expanded waistline i have settled on my 2 events but am trying to decide how best to categorise events in a way that will make sense to you, so here goes!
Breakfast meetings:
These were originally the focus of my challenge. For the most part these events are fairly structured -following with varying degrees of flexibility and self-consciousness - the tight disciplines of BNI. The spin-offs tend to give themselves away with their TLA names (I have experienced BNI, BRE, BOB, BRX), the make-up of attendees and their formula approach. (meet/chat, sit down breakfast / one-minute presentation / special presentation / swap leads / meeting ends). There are very many people who can testify to how well this works but, at a personal level I'm afraid I felt after 3 meetings (various groups) that it was far too oppressive and a little self-congratulatory.
A lighter approach to the theme is offered by 4N, who operate nationwide and take themselves far less seriously, seeing themselves as 50% social 50% business. 4n hit my shortlist but ultimately represented too much financial commitment at this stage.
Informal daytime events;
Mostly held in pubs, hotels or bars there are a number of regular daytime networks, some of which are sponsored locally, some run on a voluntary basis by saintly people who evidently list cat-herding as a hobby.
First Friday is a lunchtime group operating mainly in Sussex and Hampshire - and Guildford, each group will have its own set of rules but a common theme is informality - you have the opportunity to present your business but it is entirely optional. Venues are mainly pubs, though one group did involve a fixed-cost sit down meal.
Business Biscotti is similar, but operates mid morning (9.30 - 11.30) which to some would probably represent half a day out of the office. I struggle to be subjective since i walked into room full of - sorry, there's no other way to put this - infeasibly attractive women. (Something to do with the Guilldford effect); so should I seek a business advisor who can pass me leads, or the pretty lady from the dress shop? On a serious note, the room did balance out over time and did lead to good, informal networking - all for the price of a coffee!
Other lunch events I attended were sponsored and highly localised - Basepoint serviced offices run a good monthly event - with possibly the best canapes in the business; whilst a local firm of solicitors provide free food and wine in their Property Club (every 2 months). Whilst this is technically for property specialists, the fact that I offer finance to developers put me well within qualifying criteria.
Evening Events:
Unfortunately i had to cancel my invitation to the interestingly entitled Entrepreneur's Club, but will try it in February. Surrey Chambers also run a number of evening events, though I am unlikely to commit to regular evening events.
as mentioned, on my journey I was invited to several ad-hoc events. These, together with intermittent eduction type events where you will meet people outside of the usual 'netwrking crowd'.
From a well-intenttioned plan, it quickly became apparent that the networking pool really is very deep indeed - and I have succeeded only in scraping its surface; I still have a few testers to go, but have decided on my forward strategy, which is actually to embrace all of the daytime events listed above, whilst attending ad-hoc evening events. Breakfast clubs definitely have a use, but the costs, structure and formality don't work for me I'm afraid.
Hopefully I will be reporting positive results soon!
As a general pointer, successful networking without weight gain requires a degree of self discipline I simply don't possess with most events involving food or drink to some degree - from the traditional 'full English' to fancy canapes and free drinks. Just make sure you balance your attendances with a bit of exercise!
I have mostly confined my attendances to the Guildford area and, even with a fairly tight geographical constraint I was amazed at the sheer volume of event available. So much so that I estimate you could actually attend an event each day within a 10 mile radius of our base.Quite often at one event I would receive invitations to several others.
So, with my new expanded waistline i have settled on my 2 events but am trying to decide how best to categorise events in a way that will make sense to you, so here goes!
Breakfast meetings:
These were originally the focus of my challenge. For the most part these events are fairly structured -following with varying degrees of flexibility and self-consciousness - the tight disciplines of BNI. The spin-offs tend to give themselves away with their TLA names (I have experienced BNI, BRE, BOB, BRX), the make-up of attendees and their formula approach. (meet/chat, sit down breakfast / one-minute presentation / special presentation / swap leads / meeting ends). There are very many people who can testify to how well this works but, at a personal level I'm afraid I felt after 3 meetings (various groups) that it was far too oppressive and a little self-congratulatory.
A lighter approach to the theme is offered by 4N, who operate nationwide and take themselves far less seriously, seeing themselves as 50% social 50% business. 4n hit my shortlist but ultimately represented too much financial commitment at this stage.
Informal daytime events;
Mostly held in pubs, hotels or bars there are a number of regular daytime networks, some of which are sponsored locally, some run on a voluntary basis by saintly people who evidently list cat-herding as a hobby.
First Friday is a lunchtime group operating mainly in Sussex and Hampshire - and Guildford, each group will have its own set of rules but a common theme is informality - you have the opportunity to present your business but it is entirely optional. Venues are mainly pubs, though one group did involve a fixed-cost sit down meal.
Business Biscotti is similar, but operates mid morning (9.30 - 11.30) which to some would probably represent half a day out of the office. I struggle to be subjective since i walked into room full of - sorry, there's no other way to put this - infeasibly attractive women. (Something to do with the Guilldford effect); so should I seek a business advisor who can pass me leads, or the pretty lady from the dress shop? On a serious note, the room did balance out over time and did lead to good, informal networking - all for the price of a coffee!
Other lunch events I attended were sponsored and highly localised - Basepoint serviced offices run a good monthly event - with possibly the best canapes in the business; whilst a local firm of solicitors provide free food and wine in their Property Club (every 2 months). Whilst this is technically for property specialists, the fact that I offer finance to developers put me well within qualifying criteria.
Evening Events:
Unfortunately i had to cancel my invitation to the interestingly entitled Entrepreneur's Club, but will try it in February. Surrey Chambers also run a number of evening events, though I am unlikely to commit to regular evening events.
as mentioned, on my journey I was invited to several ad-hoc events. These, together with intermittent eduction type events where you will meet people outside of the usual 'netwrking crowd'.
From a well-intenttioned plan, it quickly became apparent that the networking pool really is very deep indeed - and I have succeeded only in scraping its surface; I still have a few testers to go, but have decided on my forward strategy, which is actually to embrace all of the daytime events listed above, whilst attending ad-hoc evening events. Breakfast clubs definitely have a use, but the costs, structure and formality don't work for me I'm afraid.
Hopefully I will be reporting positive results soon!
Thursday, 17 November 2011
Changing my mind - it can happen!
This is my penultimate post on this blog, for reasons which will be outlined in my next and final post.
At a recent presentation I was forced into thinking about certain aspects of my course and my thought process; I was also led to confess that certain views I had when I started have now fundamentally changed.
There are 2 key aspects on which I have about - turned:
Firstly, Shareholder / partner agreements: whilst I always saw some value in putting together an agreement, perhaps in the form of a 'memorandum of understanding', I have been truly shocked in the course of research by the number of viable businesses which fail simply because the owners cannot get on or agree with each other. What starts out as a small disagreement escalates out of proportion and culminates in a divorce like - and commercially suicidal stand-off, along the lines of 'if I can't have it you can't have it'. Neither party will look back with pride at this process.
So I will say with far more conviction than before:
By way of research I hung around several of these forums, showing far more interest in the questions being asked than in the answers provided (at this level I will admit that I derived some real value).
The answers I saw were sometimes a bit disturbing, but like most of us I took the view that everyone has the right to their opinion.
There is a simple test of quality in media, which says read an article on something you understand - the quality of knowledge and content on that topic will be indicative of the remainder of that of that medium. On this basis, I adopted an alter ego and threw in questions on the topic in which I have many, many years experience - business finance. The results were truly alarming, which disinformation and unfounded opinion forming about 95% of the response rate - basically the good information was buried amongst so much nonsense as to be virtually invisible.
Another interesting point is that some of these forums listed literally thousands of members, yet the vast majority of daily input came from a handful of posters who were either very bored or simply loved the sound of their own voices.
So, if asked for a view on business forums - It would be simple - 'Don't waste your time' - you'll get better advice from the dodgy bloke in the pub!
At a recent presentation I was forced into thinking about certain aspects of my course and my thought process; I was also led to confess that certain views I had when I started have now fundamentally changed.
There are 2 key aspects on which I have about - turned:
Firstly, Shareholder / partner agreements: whilst I always saw some value in putting together an agreement, perhaps in the form of a 'memorandum of understanding', I have been truly shocked in the course of research by the number of viable businesses which fail simply because the owners cannot get on or agree with each other. What starts out as a small disagreement escalates out of proportion and culminates in a divorce like - and commercially suicidal stand-off, along the lines of 'if I can't have it you can't have it'. Neither party will look back with pride at this process.
So I will say with far more conviction than before:
- Sit down and thrash out all of the details of your business arrangements.
- Commit them to a properly draw-up agreement.
- Get it legally ratified.
By way of research I hung around several of these forums, showing far more interest in the questions being asked than in the answers provided (at this level I will admit that I derived some real value).
The answers I saw were sometimes a bit disturbing, but like most of us I took the view that everyone has the right to their opinion.
There is a simple test of quality in media, which says read an article on something you understand - the quality of knowledge and content on that topic will be indicative of the remainder of that of that medium. On this basis, I adopted an alter ego and threw in questions on the topic in which I have many, many years experience - business finance. The results were truly alarming, which disinformation and unfounded opinion forming about 95% of the response rate - basically the good information was buried amongst so much nonsense as to be virtually invisible.
Another interesting point is that some of these forums listed literally thousands of members, yet the vast majority of daily input came from a handful of posters who were either very bored or simply loved the sound of their own voices.
So, if asked for a view on business forums - It would be simple - 'Don't waste your time' - you'll get better advice from the dodgy bloke in the pub!
Tuesday, 13 September 2011
Why elephants never forget and children are the best salesmen
One explanation for the saying 'an elephant never forgets' revolves around their early days in training (for shows and zoos); the trainer will leave a baby elephant tied to a small stake for a period of time, after which even when fully grown they will never try to escape, having learned early on that they cannot pull the stake out of the ground.
Children, on the other hand are highly selective in their memory and will cheerfully pull on the sweet cupboard door time and time again until they find it open. They will also question ad nausiem any decision of which they don't approve; what are the chances of this conversation?:
'Mum, can I have an ice cream?'
'no, you've just had one'
'Oh, OK, you're right, it will spoil my tea'
More likely it will drone on for a few minutes with about 50% chance of the mother caving in and buying an ice cream.
Even in later childhood/early adulthood we retain this ability to persevere - some 50% will 'learn' to smoke - it is a tough learning curve which will involve coughing, retching and possibly even vomiting, but most will persevere in order to be part of the smoking crew - the same applies to our early experiments with alcohol.
So why, then do most of us go on to become elephants and take on board every single barrier as a finishing point? Take a read through most salesmen's notes on calls and they will be littered with finite comments such as 'customer not interested, do not call'; 'no requirements'; or even 'very rude, do not do business with this person'.
When did we stop asking for the ice cream and become staked to the ground? In the vast majority of cases those comments relate to a moment in time, when a prospective customer was otherwise engaged, perhaps having a bad day, or simply not interested at that moment in time.
By creating this negativity the salesman (perhaps you or me!) has not only lost theirself a potential opportunity, but has put off other people from picking up on the opportunity.
Note to all of us: Remember the child - Even of no means no, it only means it today.
Children, on the other hand are highly selective in their memory and will cheerfully pull on the sweet cupboard door time and time again until they find it open. They will also question ad nausiem any decision of which they don't approve; what are the chances of this conversation?:
'Mum, can I have an ice cream?'
'no, you've just had one'
'Oh, OK, you're right, it will spoil my tea'
More likely it will drone on for a few minutes with about 50% chance of the mother caving in and buying an ice cream.
Even in later childhood/early adulthood we retain this ability to persevere - some 50% will 'learn' to smoke - it is a tough learning curve which will involve coughing, retching and possibly even vomiting, but most will persevere in order to be part of the smoking crew - the same applies to our early experiments with alcohol.
So why, then do most of us go on to become elephants and take on board every single barrier as a finishing point? Take a read through most salesmen's notes on calls and they will be littered with finite comments such as 'customer not interested, do not call'; 'no requirements'; or even 'very rude, do not do business with this person'.
When did we stop asking for the ice cream and become staked to the ground? In the vast majority of cases those comments relate to a moment in time, when a prospective customer was otherwise engaged, perhaps having a bad day, or simply not interested at that moment in time.
By creating this negativity the salesman (perhaps you or me!) has not only lost theirself a potential opportunity, but has put off other people from picking up on the opportunity.
Note to all of us: Remember the child - Even of no means no, it only means it today.
Friday, 9 September 2011
What is your time worth?
Some time ago there was a TV ad featuring BT and Gordon Ramsey (neither of which top my favourites list); which spelled out with fantastic accuracy the small-business dilemma. You might recall; it showed Gordon lying on the floor opening the back of his computer with a carving knife.
So, hands up - which small-business owners are guilty of doing something similar to this?
In the ad, there is a great compounding of errors which includes ruining an essential business tool (the carving knife) and ruining another essential business tool (the computer) as well as the absurdity of the kitchen running out of control whilst Gordon messes up the computer.
It's OTT, but it is also very real.
Most small-business owners, asked to put a value on their time, will come up with a reasonable figure - say £2 - 500 a day - yet most of us will happily spend half a day doing what a professional could do in an hour - without collateral risk.
To an extent this approach is encouraged in business literature; Duncan Bannatytne, for example states that the first thing he did was learn accounting 'to save paying for an accountant'. Thinking this through, why do you pay an accountant - there are basically 3 reasons:
1. As bookkeeper. So Duncan values his time less highly than the cost of a bookkeeper? Unless you genuinely enjoy pumping in figures whist Songs of Praise is on telly (and some people do), then this cannot constitute good use of time.
2. As auditor. This is not optional and has to be undertaken by an unrelated party so is not relevant.
3. As advisor/consultant. The results from this should be quantifiable, so there is a clear business rationale to employ or not employ the services of an accountant.
Additionally, amateur accounting, like opening a computer with a carving knife, can produce misleading - or just plain wrong - results, which in turn can lead to bad business decisions.
Don't get me wrong; it is an excellent idea for a business owner to understand accounts - they aren't just for Companies House and the Tax Man - management information (MI) is invaluable for business; learning accountancy will help you to understand and interpret the information which is provided.
But to save money on accountants - sorry worst reason ever.
So, hands up - which small-business owners are guilty of doing something similar to this?
In the ad, there is a great compounding of errors which includes ruining an essential business tool (the carving knife) and ruining another essential business tool (the computer) as well as the absurdity of the kitchen running out of control whilst Gordon messes up the computer.
It's OTT, but it is also very real.
Most small-business owners, asked to put a value on their time, will come up with a reasonable figure - say £2 - 500 a day - yet most of us will happily spend half a day doing what a professional could do in an hour - without collateral risk.
To an extent this approach is encouraged in business literature; Duncan Bannatytne, for example states that the first thing he did was learn accounting 'to save paying for an accountant'. Thinking this through, why do you pay an accountant - there are basically 3 reasons:
1. As bookkeeper. So Duncan values his time less highly than the cost of a bookkeeper? Unless you genuinely enjoy pumping in figures whist Songs of Praise is on telly (and some people do), then this cannot constitute good use of time.
2. As auditor. This is not optional and has to be undertaken by an unrelated party so is not relevant.
3. As advisor/consultant. The results from this should be quantifiable, so there is a clear business rationale to employ or not employ the services of an accountant.
Additionally, amateur accounting, like opening a computer with a carving knife, can produce misleading - or just plain wrong - results, which in turn can lead to bad business decisions.
Don't get me wrong; it is an excellent idea for a business owner to understand accounts - they aren't just for Companies House and the Tax Man - management information (MI) is invaluable for business; learning accountancy will help you to understand and interpret the information which is provided.
But to save money on accountants - sorry worst reason ever.
Wednesday, 7 September 2011
Embarrassing moments
'In a customer-facing role, you will be presented with limitless opportunity to make a complete and utter fool of your self''
An early piece of advice from a sales training course way back in the early '80s. Having seen and taken a few of these opportunities, I would also add that for some unfathomable reason they always seem to occur in the same place meaning that, whilst most of your customers will view you with varying degrees of respect, a small handful will see you as at best incompetent and at worst a menace to society.
In my days of dealing with the motor trade the ultimate no-no was to drive through a showroom window (I have met a handful of people who actually did this); mindful of this caution, I put my own spin on things and actually walked through a plate-glass door (well, my knee was the only thing that actually went through). The noise and impact were spectacular - if not entirely conducive to good business relations.
When managing sales teams I used this information to try and coax out other embarrassing moments - partly for fun, partly to make people appreciate that they are not alone in looking foolish. Unfortunately only half of the people ever played the game, with the remainder split between dressing up a great result as an embarrassing act (the equivalent of listing being too determined as a weakness), or simply not acknowledging ever having embarrassed themselves; really? Never!? What a dull life...
An early piece of advice from a sales training course way back in the early '80s. Having seen and taken a few of these opportunities, I would also add that for some unfathomable reason they always seem to occur in the same place meaning that, whilst most of your customers will view you with varying degrees of respect, a small handful will see you as at best incompetent and at worst a menace to society.
In my days of dealing with the motor trade the ultimate no-no was to drive through a showroom window (I have met a handful of people who actually did this); mindful of this caution, I put my own spin on things and actually walked through a plate-glass door (well, my knee was the only thing that actually went through). The noise and impact were spectacular - if not entirely conducive to good business relations.
When managing sales teams I used this information to try and coax out other embarrassing moments - partly for fun, partly to make people appreciate that they are not alone in looking foolish. Unfortunately only half of the people ever played the game, with the remainder split between dressing up a great result as an embarrassing act (the equivalent of listing being too determined as a weakness), or simply not acknowledging ever having embarrassed themselves; really? Never!? What a dull life...
Friday, 2 September 2011
The business plan - a business essential
OK, so again, far too big a topic for a light-hearted business ramble but of course, your business plan is effectively the centrepiece of your business so I am obliged to mention it.
In my thousand or so years in the finance business I have seen all sorts of business plans from ranging from true 'fag-packets' to several hundreds of glossy pages, neatly bound and , presumably costing several thousands of pounds to create. So, which do I prefer? Well, if pushed, I would probably err in favour of the fag packet on the basis that its creators probably know what they're doing.
The issues, of course are far bigger than that; it might be that 100 pages are actually necessary to present your case, or that your fag packet plan is intended for a major VC - who clearly won't be impressed; to an extent your plan does need to be geared to a specific audience,though I would not agree with the assertion that you need 2 plans, one for yourself and one for investors.
Primarily, you plan must be for yourself (inward facing) - and for this to work it must be realistic, achievable, sensibly ambitious and mindful of variables, risks and pitfalls.
Second; the plan is for investors, funders, clients (possibly), potential key staff etc (outward facing). For this to work it must be realistic, achievable, sensibly........ - you get my point. Despite what you may think, lenders and investors aren't stupid and they will question your assumptions far harder than you will. - which can of course provide useful input for you.
Incidentally, we used to play a little game with business plans called 'spot the fact' - in one 100+ page plan we identified just 3 quantifiable facts the remainder was just bullsh!t and pretty pictures (in another case I received a 2-page plan which, to this day, I've no idea what the business was supposed to do).
So here is my recipe for a simple, adaptable plan:
Executive summary: Think of it as your 3 minute pitch; a brief overview of what, who, where, why, how. (remember your audience - whoever they are - will have a shorter attention span than you - this is your chance to engage them).
Body of the plan: Puts more flesh on the bones but needn't go into excessive detail so, for example 'our Chief Executive has 15 years experience in petrochemicals and has licensed 2 applications' will probably suffice at this point. Similarly 'Year 2 we aim to achieve £3 million turnover and net profit of £50,000' the breakdown comes later.
My personal advice on headings is always to use those that make sense and are relevant to you; unfortunately I was once tripped up on this by a certain bank, who insisted that every section of the plan was completed. Very silly indeed...
Appendices: This is the section where you can adapt and customise your content to your target audience; for example if you are pitching your new paint technology to Ford, it might well be appropriate to include a 100-page technical overview, whereas if you are pitching for bank funding, a letter from Ford expressing interest will be more appropriate.
Some appendix staples are cashflow/p & l projections, director/key person CVs, balance sheets, and SWOT analysis.
SWOT analysis: By far the most abused yet potentially valuable part of your plan! In the vast majority of cases, we see lots of strengths and opportunities, with a few threats and weaknesses, which are shrugged off. The bad news is that your business model can fall over and if you haven't found the fall-over point, you haven't tested it sufficiently. The good news is that even Microsoft's business can fall over - but it seems OK at the moment. To put that into context, every new car model is tested to destruction - this testing makes the product better, not worse.
So, in a nutshell:
If you want your plan to be read, it has to be readable.
Bullshit might baffle brains, but a baffled brain is unlikely to buy.
You can target your plan without re-writing it.
If your plan is infallible, it is definitely wrong.
In my thousand or so years in the finance business I have seen all sorts of business plans from ranging from true 'fag-packets' to several hundreds of glossy pages, neatly bound and , presumably costing several thousands of pounds to create. So, which do I prefer? Well, if pushed, I would probably err in favour of the fag packet on the basis that its creators probably know what they're doing.
The issues, of course are far bigger than that; it might be that 100 pages are actually necessary to present your case, or that your fag packet plan is intended for a major VC - who clearly won't be impressed; to an extent your plan does need to be geared to a specific audience,though I would not agree with the assertion that you need 2 plans, one for yourself and one for investors.
Primarily, you plan must be for yourself (inward facing) - and for this to work it must be realistic, achievable, sensibly ambitious and mindful of variables, risks and pitfalls.
Second; the plan is for investors, funders, clients (possibly), potential key staff etc (outward facing). For this to work it must be realistic, achievable, sensibly........ - you get my point. Despite what you may think, lenders and investors aren't stupid and they will question your assumptions far harder than you will. - which can of course provide useful input for you.
Incidentally, we used to play a little game with business plans called 'spot the fact' - in one 100+ page plan we identified just 3 quantifiable facts the remainder was just bullsh!t and pretty pictures (in another case I received a 2-page plan which, to this day, I've no idea what the business was supposed to do).
So here is my recipe for a simple, adaptable plan:
Executive summary: Think of it as your 3 minute pitch; a brief overview of what, who, where, why, how. (remember your audience - whoever they are - will have a shorter attention span than you - this is your chance to engage them).
Body of the plan: Puts more flesh on the bones but needn't go into excessive detail so, for example 'our Chief Executive has 15 years experience in petrochemicals and has licensed 2 applications' will probably suffice at this point. Similarly 'Year 2 we aim to achieve £3 million turnover and net profit of £50,000' the breakdown comes later.
My personal advice on headings is always to use those that make sense and are relevant to you; unfortunately I was once tripped up on this by a certain bank, who insisted that every section of the plan was completed. Very silly indeed...
Appendices: This is the section where you can adapt and customise your content to your target audience; for example if you are pitching your new paint technology to Ford, it might well be appropriate to include a 100-page technical overview, whereas if you are pitching for bank funding, a letter from Ford expressing interest will be more appropriate.
Some appendix staples are cashflow/p & l projections, director/key person CVs, balance sheets, and SWOT analysis.
SWOT analysis: By far the most abused yet potentially valuable part of your plan! In the vast majority of cases, we see lots of strengths and opportunities, with a few threats and weaknesses, which are shrugged off. The bad news is that your business model can fall over and if you haven't found the fall-over point, you haven't tested it sufficiently. The good news is that even Microsoft's business can fall over - but it seems OK at the moment. To put that into context, every new car model is tested to destruction - this testing makes the product better, not worse.
So, in a nutshell:
If you want your plan to be read, it has to be readable.
Bullshit might baffle brains, but a baffled brain is unlikely to buy.
You can target your plan without re-writing it.
If your plan is infallible, it is definitely wrong.
Thursday, 1 September 2011
Where to get advice
Always an interesting debate starter this one; where do you go for advice, how much do you pay and how do you implement it?
I have previously mentioned that there are good, legitimate sources of free advice available to all - the best known being Business Link. Whilst competent and reliable, these sources are by definition somewhat generic and lacking in imagination.
In the course of research I hung around a number of business forums and I have to confess that my opinion is that the advice given is marginal - sometimes outright wrong; try a simple test - ask a question on a topic you really understand and evaluate the responses - it is reasonable to assume that the quality of response will apply to other topics.
Don't get me wrong, there are many people on these forums with genuine specialisms, many more who are entirely well meaning if slightly misguided, then there is the vocal minority who, frankly have little better to do than make crass observations and sweeping generalisations. As the person seeking advice for a business, your biggest challenge will be to work out which is which (and to wade through the crap to get to the quality). If you want to go the forum route, my recommendation would definitely go to LinkedIn, though you might want to take the effort to narrow your fields to avoid getting global input on a local matter.
If you are willing and able to pay, there are any number of specialist consultancies giving advice and support either in specific fields or to specific sectors of industry. It can be difficult to define specialisms, particularly as many of them want to spread their net as far as possible and therefore are somewhat vague about their areas of expertise. The point here is that we all know that no-one is an expert is everything; if your accountant starts selling you advice on marketing - run away!
To plug myself a bit here, I am very specific in my target area - I work with people who are thinking of starting a business through to shortly after opening the doors. Once you have been running for, say, 12 months you will be able to evaluate any weaknesses and focus your attentions on them with guidance specific to that field, be it accountancy/cashflow, marketing, PR, HR or whatever (or work around the weakness as a temporary measure) - there is no point paying a generalist to do a specialist job, so that is where I leave.
There is, of course one well known, universal source of advice that I have failed to mention - yes - the Bloke in the Pub; His advice is technically free and is dispensed with reckless abandon. Reference points are always available - typically 'I know a bloke who' or 'a mate of my brother's' - obviously you will never meet these people. The best thing about Bloke in the Pub's advice, is that you always get to do exactly what you like, you always save loads of money and you normally undermine the people you detest - such as the tax man.
I say technically free; there might of course be a small cost - over and above the pints you buy him - such as tax penalties, loss of customers or your business or, possibly a brief spell at Her Majesty's pleasure; still, he's a lot more fun than a consultant and he tells you what you want to hear.
I have previously mentioned that there are good, legitimate sources of free advice available to all - the best known being Business Link. Whilst competent and reliable, these sources are by definition somewhat generic and lacking in imagination.
In the course of research I hung around a number of business forums and I have to confess that my opinion is that the advice given is marginal - sometimes outright wrong; try a simple test - ask a question on a topic you really understand and evaluate the responses - it is reasonable to assume that the quality of response will apply to other topics.
Don't get me wrong, there are many people on these forums with genuine specialisms, many more who are entirely well meaning if slightly misguided, then there is the vocal minority who, frankly have little better to do than make crass observations and sweeping generalisations. As the person seeking advice for a business, your biggest challenge will be to work out which is which (and to wade through the crap to get to the quality). If you want to go the forum route, my recommendation would definitely go to LinkedIn, though you might want to take the effort to narrow your fields to avoid getting global input on a local matter.
If you are willing and able to pay, there are any number of specialist consultancies giving advice and support either in specific fields or to specific sectors of industry. It can be difficult to define specialisms, particularly as many of them want to spread their net as far as possible and therefore are somewhat vague about their areas of expertise. The point here is that we all know that no-one is an expert is everything; if your accountant starts selling you advice on marketing - run away!
To plug myself a bit here, I am very specific in my target area - I work with people who are thinking of starting a business through to shortly after opening the doors. Once you have been running for, say, 12 months you will be able to evaluate any weaknesses and focus your attentions on them with guidance specific to that field, be it accountancy/cashflow, marketing, PR, HR or whatever (or work around the weakness as a temporary measure) - there is no point paying a generalist to do a specialist job, so that is where I leave.
There is, of course one well known, universal source of advice that I have failed to mention - yes - the Bloke in the Pub; His advice is technically free and is dispensed with reckless abandon. Reference points are always available - typically 'I know a bloke who' or 'a mate of my brother's' - obviously you will never meet these people. The best thing about Bloke in the Pub's advice, is that you always get to do exactly what you like, you always save loads of money and you normally undermine the people you detest - such as the tax man.
I say technically free; there might of course be a small cost - over and above the pints you buy him - such as tax penalties, loss of customers or your business or, possibly a brief spell at Her Majesty's pleasure; still, he's a lot more fun than a consultant and he tells you what you want to hear.
Wednesday, 31 August 2011
Who can multi-task?
I have been asked - not unreasonably - what happened to me 2 weeks ago; I appeared to burst back from holiday in a blaze of glory only to disappear again.
The truth is that - like many a business owner before me (particularly in a home-based environment) - I believed that I didn't need to be on holiday and that I could carry out all those jobs I had promised to do around the house whilst also being at work.As a result, I now have gloss paint on my phone (and my ear) and lots of illegible messages piled on my desk.
This, of course in modern parlance is known as multi-tasking and I will let you into a secret. It doesn't work.
I have received direct warnings against alienating female readers but I fear it's about to happen again: Extensive studies into multi-tasking have reached 2 clear conclusions:
1. There is absolutely no correlation on ability to multi-task on the basis of gender, age or mental/physical capacity.
2. The only clear conclusion was that, when multi tasking, each task was done less well than if it was done in isolation.
Of course, in certain cases this might not matter for example, you can do the ironing whilst watching Coronation Street as quality of viewing is clearly not an issue. However if either task is important, then you should consider very seriously whether it should be shared. Some customers will be amused that you have dropped your phone in a bucket of paint, others will see it as a tad unprofessional.
The truth is that - like many a business owner before me (particularly in a home-based environment) - I believed that I didn't need to be on holiday and that I could carry out all those jobs I had promised to do around the house whilst also being at work.As a result, I now have gloss paint on my phone (and my ear) and lots of illegible messages piled on my desk.
This, of course in modern parlance is known as multi-tasking and I will let you into a secret. It doesn't work.
I have received direct warnings against alienating female readers but I fear it's about to happen again: Extensive studies into multi-tasking have reached 2 clear conclusions:
1. There is absolutely no correlation on ability to multi-task on the basis of gender, age or mental/physical capacity.
2. The only clear conclusion was that, when multi tasking, each task was done less well than if it was done in isolation.
Of course, in certain cases this might not matter for example, you can do the ironing whilst watching Coronation Street as quality of viewing is clearly not an issue. However if either task is important, then you should consider very seriously whether it should be shared. Some customers will be amused that you have dropped your phone in a bucket of paint, others will see it as a tad unprofessional.
Tuesday, 30 August 2011
Titles - how important are they?
It is an entirely personal perspective, but in my opinion making a big deal out of job titles belongs in the 'big corporate' arena and shouldn't have a place in small business. One of the things I would never miss about corporate life is the stepping stones to success with random words from trainee, deputy, assistant deputy assistant trainee, and so on (as an aside, I also don't miss car-badge promotion where seniority is judged by whether you drive the L or the GL variant). This was brought home to me early on when a friend who worked for a large accountancy firm described their philosophy as 'if you can't give them a raise, give them a title'.
Unfortunately there are many people out there who don't entirely share my view and I have noticed that when 2 or more people are looking to start a business together an argument frequently breaks out over roles and titles; often culminating in the development of ever more spurious titles to satisfy all egos thus you can end up with a 3-man business whose owners bear the title CEO, MD and Chairman.
There are two key issues here, one is resolution of disputes and laying down of responsibilities, which will be the topic of a detailed post in the near future. For the purpose of this post I am really interested in perception - ie - will anyone really take you seriously when you claim to be Chairman of a business which operates from a shed in your garden?
Again, it is not a matter of wrong and right, but I for one am entirely unimpressed by self-granted status - by all means, make it clear who you are - proprietor, owner, MD and - should the need arise - dish-washer.
As I've mentioned in previous posts, small business is all about flexibility and personalisation - being a small business is something to be proud of, not to hide from; so why deprive yourself of the benefits of being small by saddling yourself with a big title?
At another level, there are recognised traps to avoid; one I walked into was sharing the MD title - people look at the card which says Joint MD and immediately ask 'so are you MD or aren't you?' I won't do that again!
Unfortunately there are many people out there who don't entirely share my view and I have noticed that when 2 or more people are looking to start a business together an argument frequently breaks out over roles and titles; often culminating in the development of ever more spurious titles to satisfy all egos thus you can end up with a 3-man business whose owners bear the title CEO, MD and Chairman.
There are two key issues here, one is resolution of disputes and laying down of responsibilities, which will be the topic of a detailed post in the near future. For the purpose of this post I am really interested in perception - ie - will anyone really take you seriously when you claim to be Chairman of a business which operates from a shed in your garden?
Again, it is not a matter of wrong and right, but I for one am entirely unimpressed by self-granted status - by all means, make it clear who you are - proprietor, owner, MD and - should the need arise - dish-washer.
As I've mentioned in previous posts, small business is all about flexibility and personalisation - being a small business is something to be proud of, not to hide from; so why deprive yourself of the benefits of being small by saddling yourself with a big title?
At another level, there are recognised traps to avoid; one I walked into was sharing the MD title - people look at the card which says Joint MD and immediately ask 'so are you MD or aren't you?' I won't do that again!
Thursday, 25 August 2011
Words and meanings
It is strange, isn't it, how the meanings - both overt and subtle - of certain words change over time. One of the best examples of this is the word gay - in my parents' generation it was an innocent expression describing bright, cheerful or happy; in my formative years it became used to express homosexuality - still often a term of abuse in those days. More recently, the courts have accepted it to mean useless or non-functioning - as in 'my computer is being gay today' - interestingly my copy of the OED pre-dates this variation, but the online version covers it as 'not impressive, stylish or attractive'.
Similarly, I recently had a discussion with my parents about the use of bad language on TV (you know the discussion...) and found myself trying to explain, as delicately as possible, that certain words that they would freely use are now considered far more offensive than the generally acknowledged obscenities.
What has this got to do with business? Well in marketing terms - everything. A large facet of the marketing industry revolves around the adaptation of words for a specific purpose.
I'm sure you already know that the official name for evolution of words and meanings is Etymology.
To a marketeer the pinnacle of achievement is to have your brand become common usage such as Hoover, Ansafone etc, or alternatively to have an established every-day word become inextricably linked with your product; to this day the word posh is linked in my mind to Bowyers sausages and that must have been 30 years ago.
On the other hands, marketing jargon and management-speak can grab hold of every-day words and render them meaningless or even negative. For some time Private Eye magazine has had a running feature mocking the use of the word solutions in business names - with the best will in the word, this will reflect on your business name. Similarly, the word opportunity has been abused to the extent that it practically sends shivers down my spine because I know that 9 times out of 10 the next sentence will be asking me to part with money, normally on a premise so whimsical as to be comical.
These negative connotations were once described to me as dead cow - as in, 'which would you prefer, a well-matured Angus Sirloin, or a piece of dead cow?'
Restaurant owners could try this out on their menus - after all, it's only words, isn't it?
Similarly, I recently had a discussion with my parents about the use of bad language on TV (you know the discussion...) and found myself trying to explain, as delicately as possible, that certain words that they would freely use are now considered far more offensive than the generally acknowledged obscenities.
What has this got to do with business? Well in marketing terms - everything. A large facet of the marketing industry revolves around the adaptation of words for a specific purpose.
I'm sure you already know that the official name for evolution of words and meanings is Etymology.
To a marketeer the pinnacle of achievement is to have your brand become common usage such as Hoover, Ansafone etc, or alternatively to have an established every-day word become inextricably linked with your product; to this day the word posh is linked in my mind to Bowyers sausages and that must have been 30 years ago.
On the other hands, marketing jargon and management-speak can grab hold of every-day words and render them meaningless or even negative. For some time Private Eye magazine has had a running feature mocking the use of the word solutions in business names - with the best will in the word, this will reflect on your business name. Similarly, the word opportunity has been abused to the extent that it practically sends shivers down my spine because I know that 9 times out of 10 the next sentence will be asking me to part with money, normally on a premise so whimsical as to be comical.
These negative connotations were once described to me as dead cow - as in, 'which would you prefer, a well-matured Angus Sirloin, or a piece of dead cow?'
Restaurant owners could try this out on their menus - after all, it's only words, isn't it?
Wednesday, 24 August 2011
Free advice and resources - from the Government
There is an excellent source of free information for new and small businesses. It is Government sponsored and it is called Business Link. There, I've said it!
So, if this information is available for free, why on earth would you want to pay me (or any other charging resource)? Quite simply, because we offer something quite different and further reaching. Take the analogy of free newspapers - in the short term The Metro (free newspaper) will impact on sales of the The Times - what The Metro provides, however, is a simplistic, bite-sized view of world affairs. Having read 2 paragraphs of events unfolding in the Middle East you might well be thirsty for more knowledge so you will look for a newspaper with deeper coverage, opinions and perhaps feedback - like The Times. In this sense, the free resource is actually a feeder for the paying one. (I'm ignoring the Internet which is a different discussion all together).
Like any free resource - particularly one which is Government sponsored - Business Link has some serious limitations - and indeed it has been an early victim of spending cut-backs. These limitations are always highlighted very loudly when the topic of Business Link is raised on business forums or media.
So, to elaborate on my initial comment, Business Link is an excellent source of information and, at best, a variable source of advice. (A dictionary is a great source of information, but it won't teach you how to write a book).
When it comes to advice, the very status of Business Link is a vicious circle. Its founding committee is comprised mainly of politicians who have absolutely no hands-on experience of business and are far too busy drowning everything in paperwork and red tape. (Just an aside, but my belief is that Government officers genuinely believe that we business owners actually like filling in forms).
As a nodding recognition of their limited experience they appoint to their committee some business big-hitters - the former chairman of Dixons, for example - not a bad step, but it is still a long time since they were at the coal face, filled in a VAT return, worried about a Companies House filing penalty or had to deal hands-on with an employee issue.
On the front -line, they gave us face-to-face advisors; the majority of these are (or were, I think they are being minimised). This is where it all goes seriously pear-shaped. Don't get me wrong I know that they are by and large diligent, well-meaning and knowledgeable in their own field, but business advisors? Really, they are not.
The reason that Government love bank managers is that essentially they are quite similar - they left school or college and joined a bank. They worked their way up through the system without ever having to leave the confines of their singular environment. Yes, sometimes they would move from one bank to another, but the systems and procedures were so similar as to make no realistic difference. Also, they love forms and paperwork!
OK, so their work environment is tunneled, but they are dealing day-to-day with business and helping them to manage and develop. Well, perhaps they were in the '60s and even the '70s, but since the last recession the average bank manager has been a pure salesman whose role has predominantly been to develop relationships with brokers, intermediaries and business advisors - therefore the banks have effectively delegated the role of understanding customer needs to the professional and broker community. Those who regularly face customers have a simple remit - sell more products (I do know that one bank has a target that every customer should have 4 of their products). When the customer looks shaky the manager has one primary option - get out - quickly!
And that is why I cannot give any credence to bank managers as business advisors - they are the front face of Business Link, so I cannot recommend them as a source of advice.
So, simply, if you want to find out how to register for VAT, or the ins and outs of Ltd company versus sole trader, go to Business Link,. If you want advice on how to develop and run your business, go to someone who knows what they are talking about.
So, if this information is available for free, why on earth would you want to pay me (or any other charging resource)? Quite simply, because we offer something quite different and further reaching. Take the analogy of free newspapers - in the short term The Metro (free newspaper) will impact on sales of the The Times - what The Metro provides, however, is a simplistic, bite-sized view of world affairs. Having read 2 paragraphs of events unfolding in the Middle East you might well be thirsty for more knowledge so you will look for a newspaper with deeper coverage, opinions and perhaps feedback - like The Times. In this sense, the free resource is actually a feeder for the paying one. (I'm ignoring the Internet which is a different discussion all together).
Like any free resource - particularly one which is Government sponsored - Business Link has some serious limitations - and indeed it has been an early victim of spending cut-backs. These limitations are always highlighted very loudly when the topic of Business Link is raised on business forums or media.
So, to elaborate on my initial comment, Business Link is an excellent source of information and, at best, a variable source of advice. (A dictionary is a great source of information, but it won't teach you how to write a book).
When it comes to advice, the very status of Business Link is a vicious circle. Its founding committee is comprised mainly of politicians who have absolutely no hands-on experience of business and are far too busy drowning everything in paperwork and red tape. (Just an aside, but my belief is that Government officers genuinely believe that we business owners actually like filling in forms).
As a nodding recognition of their limited experience they appoint to their committee some business big-hitters - the former chairman of Dixons, for example - not a bad step, but it is still a long time since they were at the coal face, filled in a VAT return, worried about a Companies House filing penalty or had to deal hands-on with an employee issue.
On the front -line, they gave us face-to-face advisors; the majority of these are (or were, I think they are being minimised). This is where it all goes seriously pear-shaped. Don't get me wrong I know that they are by and large diligent, well-meaning and knowledgeable in their own field, but business advisors? Really, they are not.
The reason that Government love bank managers is that essentially they are quite similar - they left school or college and joined a bank. They worked their way up through the system without ever having to leave the confines of their singular environment. Yes, sometimes they would move from one bank to another, but the systems and procedures were so similar as to make no realistic difference. Also, they love forms and paperwork!
OK, so their work environment is tunneled, but they are dealing day-to-day with business and helping them to manage and develop. Well, perhaps they were in the '60s and even the '70s, but since the last recession the average bank manager has been a pure salesman whose role has predominantly been to develop relationships with brokers, intermediaries and business advisors - therefore the banks have effectively delegated the role of understanding customer needs to the professional and broker community. Those who regularly face customers have a simple remit - sell more products (I do know that one bank has a target that every customer should have 4 of their products). When the customer looks shaky the manager has one primary option - get out - quickly!
And that is why I cannot give any credence to bank managers as business advisors - they are the front face of Business Link, so I cannot recommend them as a source of advice.
So, simply, if you want to find out how to register for VAT, or the ins and outs of Ltd company versus sole trader, go to Business Link,. If you want advice on how to develop and run your business, go to someone who knows what they are talking about.
Tuesday, 23 August 2011
Business funding - The 3 Fs
Here's a subject I have steered clear of in this blog - mainly because it is my own line of business and I could probably ramble on for ever about it.
You can't fail to have noticed that business finance is pretty hard to get hold of at the moment; in fact the press are having a field day writing about it. I don't want to go into that argument except to point out that I have actually written to several Government officers -not to make borrowing easier but to stop them from banging on with their stupid 'force banks to lend' message.
Anyway, with the banks being an unlikely source of funding, new business owners are having to look closer to home for their finance - often this will involve the proverbial 3 Fs - friends, family and fools.
As a matter of course I suggest this to business owners seeking finance - it is very telling to judge their knee-jerk response.
Of course it is sensible to keep business and family separate, but if you would not approach them for money because it is too risky, it does beg some very obvious questions about your expectations.
I would honestly suggest - even if you don't actually want any money - that you prepare your business plan on the pretext that you need funding from family and friends - and present it to them on that basis - it will raise a lot of interesting and relevant questions that the banks might be too discreet to ask! Just try it and see..
If you want to seriously consider 3-F funding, rather than depriving your parents of their hard-earned pension you might want to set up a micro-financing package, where you get a small investment from a number of individuals - well within the bounds of what they can afford to lose; that way you might still be friends if it all goes horribly wrong.
You can't fail to have noticed that business finance is pretty hard to get hold of at the moment; in fact the press are having a field day writing about it. I don't want to go into that argument except to point out that I have actually written to several Government officers -not to make borrowing easier but to stop them from banging on with their stupid 'force banks to lend' message.
Anyway, with the banks being an unlikely source of funding, new business owners are having to look closer to home for their finance - often this will involve the proverbial 3 Fs - friends, family and fools.
As a matter of course I suggest this to business owners seeking finance - it is very telling to judge their knee-jerk response.
Of course it is sensible to keep business and family separate, but if you would not approach them for money because it is too risky, it does beg some very obvious questions about your expectations.
I would honestly suggest - even if you don't actually want any money - that you prepare your business plan on the pretext that you need funding from family and friends - and present it to them on that basis - it will raise a lot of interesting and relevant questions that the banks might be too discreet to ask! Just try it and see..
If you want to seriously consider 3-F funding, rather than depriving your parents of their hard-earned pension you might want to set up a micro-financing package, where you get a small investment from a number of individuals - well within the bounds of what they can afford to lose; that way you might still be friends if it all goes horribly wrong.
Monday, 22 August 2011
Negotiation - Making it fun.
When the topic of negotiation is raised it seems to bring one of 2 images to people's minds:
The main reason people fear negotiation is that they see it as a kind of face-off, where inevitably one party will win and the other, by definition, will lose. The reality can be very different and, done correctly, that old cliche of a win-win situation is a real possibility.
The first rule of negotiation is not to make it personal or 'separate the people from the problem'. This isn't a battle between you and them it is a business discussion. Keep your terminology business-like, not personal - eg 'I just can't make the project pay on those terms' vs 'you're taking the p!@s, don't try and rip me off'.
The second rule is to understand the relative cost and benefit of what each party holds or consider your currency. In the vast majority of cases there is more to a transaction than price (in these cases the biggest single mistake is to focus on price alone). The other party might have huge benefits they can deliver at little or no cost to themselves whilst you might have skills or contacts which are disproportionately valuable to the other party. This is where the true win/win comes in. These currencies might be esoteric and entirely irrelevant to the core of the trade; an example I once saw was a customer who offered the use of parking spaces as a concession on payment terms.
The large brewers are masters of secondary negotiation and will often strike supply deals where their buying power enables them to supply something of value - at little cost to themselves - against contracts to buy (eg: We will provide you with quality garden furniture if you commit to stocking our beers on 2 of your pumps').
The concept of empathy to revolves around the ability to see a situation though the eyes of the other party; not only will this make you an interesting and engaging business partner, but it will help to move the focus from a single point negotiation to a discussion that takes on all facets of the deal. You will be surprised at how different the final result of a negotiation can be from your expectations.
Perhaps the most dangerous negotiating tactic is to fixate on what the other party gets out of it. In my opinion one of the worst mistakes the FSA made was forcing commission disclosure. This is just a red herring which leads customers to make decisions based on the -often erroneous - assumption that whats worst for the vendor must be best for them. Mature business discussions revolve around maximizing your benefits - if that outcome earns the other party good money, then that is an all-round good decision, surely?
Finally, with a bit of homework and lateral thought, negotiation can become enjoyable. And if you enjoy it, you will probably become good at it.
- It's a dark art which requires huge amounts of specialist training or
- Its a game of poker, just out-bluffing the other party to get the better end of the deal.
The main reason people fear negotiation is that they see it as a kind of face-off, where inevitably one party will win and the other, by definition, will lose. The reality can be very different and, done correctly, that old cliche of a win-win situation is a real possibility.
The first rule of negotiation is not to make it personal or 'separate the people from the problem'. This isn't a battle between you and them it is a business discussion. Keep your terminology business-like, not personal - eg 'I just can't make the project pay on those terms' vs 'you're taking the p!@s, don't try and rip me off'.
The second rule is to understand the relative cost and benefit of what each party holds or consider your currency. In the vast majority of cases there is more to a transaction than price (in these cases the biggest single mistake is to focus on price alone). The other party might have huge benefits they can deliver at little or no cost to themselves whilst you might have skills or contacts which are disproportionately valuable to the other party. This is where the true win/win comes in. These currencies might be esoteric and entirely irrelevant to the core of the trade; an example I once saw was a customer who offered the use of parking spaces as a concession on payment terms.
The large brewers are masters of secondary negotiation and will often strike supply deals where their buying power enables them to supply something of value - at little cost to themselves - against contracts to buy (eg: We will provide you with quality garden furniture if you commit to stocking our beers on 2 of your pumps').
The concept of empathy to revolves around the ability to see a situation though the eyes of the other party; not only will this make you an interesting and engaging business partner, but it will help to move the focus from a single point negotiation to a discussion that takes on all facets of the deal. You will be surprised at how different the final result of a negotiation can be from your expectations.
Perhaps the most dangerous negotiating tactic is to fixate on what the other party gets out of it. In my opinion one of the worst mistakes the FSA made was forcing commission disclosure. This is just a red herring which leads customers to make decisions based on the -often erroneous - assumption that whats worst for the vendor must be best for them. Mature business discussions revolve around maximizing your benefits - if that outcome earns the other party good money, then that is an all-round good decision, surely?
Finally, with a bit of homework and lateral thought, negotiation can become enjoyable. And if you enjoy it, you will probably become good at it.
Subscribe to:
Posts (Atom)