Don’t rest on your achievements

KONICA MINOLTA DIGITAL CAMERA
Not so smart phone – but good for making calls

Over the weekend there has been a lot of press about Liam Fox’s comments that British business leaders are more interested in playing golf on a Friday afternoon than seeking international trade deals.

To my mind the comments from the Minister for International Trade demonstrates how out of touch politicians can be with the reality of running businesses both large and small. Long boozy lunches and taking Friday off to play golf with the chaps is a very old-fashioned view of the world of work.

However misguided I think he is, there may however be a small grain of truth in what he said about resting on our achievements of the past.

Last week Apple launched the iPhone 7 and it is hard to remember that prior to 2007 there were no smart phones or at least the smartest phone on the block was Blackberry. Hmm where are they now?

Apple have totally dominated, in financial terms, the smartphone market since its inception. But Apple wasn’t always very successful. In 2001 they lost US$25m and their net profit margin was 1.1% in both 2002 and 2003. Hardly results to boast about.Apple Profit vs iPhone SalesWell everything changes and nothing stays the same. Apple’s iPhone sales have probably peaked and look like falling back by about 15% this financial year. This isn’t a surprise. After all you can’t continue to sell 230m phones a year and expect that market to continue forever. Everyone who wants an iPhone pretty much already owns one. So the desperate search for new revenue sources is on, hence Apple’s move into music, TV, watches and perhaps even cars.

This process equally applies to all businesses both large and small.

Look at Marks & Spencer’s inability to compete in clothing now or Tesco’s problems with their out of town stores (and their alleged £326m accounting fraud to cover it up). I used to buy clothes in River Island many years ago and then their clothes, well became a bit rubbish (for me anyway). Recently I have gone back to buying clothes from them because the quality is right, the price point spot on and the style is perfect for me. Who has changed – River Island or me? It doesn’t really matter. Change is all around us and companies need to change and adapt as their customers change.

The world moves on, clients want different things, products and services become out of date.

If you don’t change then someone else will
seize your opportunity.

 

Small business owners – getting on with the job

BrexitFollowing the vote to leave the EU in June, you might have thought that Armageddon was just around the corner. We are doomed, the economy will crash, it will take years to negotiate an exit, EU countries will punish us with high tariffs….

But Britain’s small business owners, in my experience, have pretty much ignored the background noise. In fact they have been …

  • chasing up leads & identifying new potential customers
  • keeping an eye on costs
  • monitoring profit margins
  • training staff to develop their skills
  • increasing value to clients with new products and services
  • building relationships with other organisations
  • looking for new suppliers
  • providing excellent customer service
  • checking out competitors
  • looking at export markets now that sterling has fallen
  • adjusting prices to reflect input costs from overseas suppliers
  • doing their accounts
  • paying bills and salaries
  • dealing with issues
  • answering the phone

…and working hard to provide an income for them and their families.

In fact small business owners know the only person they can rely on is themselves and their staff. They don’t wait around for governments to make decisions or for EU negotiations to start…

They just get on with the job

P.S. My business is a small business and I have been getting on with the job too. I have done pretty much all of the above AND wrote this blog entry.

To succeed you have to accept failure

YOU CAN ONLY WIN IF YOU LEARN TO ACCEPT FAILURE.

I have just finished watching the Australian Tennis Open final between Andy Murray and Novak Djokovic. One thing that occurred to me during the match was the similarity between failure in sports competition, failure in business and losing in poker.

Winning is easy to cope with (although as I saw at the poker tables last night this can lead to a fatal over-confidence), but what about failure? We all hate it right? It makes us angry and sometimes affects us long after the event.

IT’S ALL ABOUT PERCENTAGES

In most sporting fields, including golf, tennis and Formula 1, we often hear commentators and players speaking of playing a percentage game. So assuming a good tennis shot percentage is around 85% it follows that 15% of the time we will not be successful. In Formula 1 they talk about driving at 95% and in poker a 60% chance of winning a hand is almost always the right percentage play. However in poker that means we lose 40% of the time and fate being capricious and cruel, sometimes that 40% comes all at once and we lose consecutive hands where we had a statistical advantage.

Business decisions are equally at risk of failure. No business decision has a 100% guarantee. Apple’s move into mobile technology looks brilliant now, but at the time there was no promise of success. Tesco supermarket’s move into the US market might have been a very well thought out strategy but it failed. So businesses equally make percentage plays.

WE NEVER FORGET A FAILURE

What happens when we fail? We remember it well and usually vividly because they upset and disrupt our equilibrium. We cannot get out of our minds the ‘what-if’s’and the ‘if-only’s’. When we win we celebrate how smart and talented we are and then promptly forget the success.

In poker when a player gets angry and upset losing a hand where they were a statistical favorite, we say they go on tilt. Tilt can last a few minutes, days or even weeks and it can adversely impact good decision making. Tilt also happens to executives and managers as well as businesses in general.

WHAT DOES THIS TELLS US?

We are surrounded by failure. Operating in any situation where the result is not guaranteed means we must be prepared to handle failure when, and not if, it arrives. What has this got to do with Andy Murray losing? Well I am not sure why he collapsed when he was 2-love up in the 3rd set. Perhaps one of his percentage shots missed and he just was unable to let it go. One thing is certain, Andy will need to let this relative (he got to the final after all) failure go, if he is to win another grand slam.

If you are interested in learning more about handling failure and as a by-product become happier and healthier in your work, then get in touch today.

Fresh perspectives @ StartUp 2015

It is only 2 weeks into 2015 and this year will see some great new businesses launched if StartUp 2015 at Somerset House in London is anything to go by. As an experienced entrepreneur myself and a government accredited SME business coach, I was invited to be one of the resident ‘meet an advisor’ on the day.

Entrepreneurs queuing for StartUp 2015 @ Somerset House, London
Entrepreneurs queuing for StartUp 2015 @ Somerset House, London

I can only say I was amazed by the huge crowds, the incredible enthusiasm and some of the great ideas I heard about. Confidentiality means I can’t share these ideas but I am really pleased that people are not only developing digital services, but also planning to manufacture and retail products.

Here are the three pieces of key advice I gave to new entrepreneurs during the day.

Who are your clients? Make sure you know who is going to be a paying client. This is a vital first step in understanding the type of people who will pay for your product or service. Before setting up your company it is really important to invest time in researching this.

How will you make money? Having paying clients is great, but you must also make sure that you can trade profitably, if not immediately then at some time in the future.

How much money do you need to get started? Often people think they need £100K or even £500k to get their business started but that couldn’t be further from the truth. Most businesses can get up and running with little or no investment. This is a good thing as you want to prove your idea is viable before making any major investments of your time, your money or someone else’s money.

…and finally I advised them to get help from the government’s Growth Voucher scheme, where they will cover 50% of the costs (up to £2,000) for strategic advice. You can use these vouchers for getting strategic business advice from me.

Contact me today to get a fresh perspective on your business.