Posts Tagged ‘cash’
Five threats, five opportunities & five don’t knows for 2015
This is a rather more wide-ranging post than usual. So I would really welcome comments. What have I missed or messed up? I tried the same idea previously here.
FIVE THREATS
The UK economy
The UK and USA economies are currently growing strongly. Europe is not. There’s scope for a Eurozone crisis (Greece?) or sovereign debt crisis (Russia with possibly a 4% reduction in real GNP in 2015?). A potential EC referendum in 2017 will create uncertainty.
Financial risk
We have made progress in understanding risk and lessening the banking rewards that distort behaviour. But the Co-operative Bank recently failed its stress tests. Interest rates will eventually rise and speculation in housing market will be affected.
Information Technology
Our reliance on IT for intelligence, defence, security, “smart things” and communication makes us fragile. Recent breaches on game consoles are the tip of the iceberg. We still over rely on “experts”, talking “gobbledegook”.
Limitations of military power
The USA and UK have struggled to deploy hard power in Afghanistan, Syria and elsewhere. Take Afghanistan: Life expectancy has increased by 10 years, 7 million more are in school, there’s democracy. But the Taliban are still there, along with corruption, loss of many lives, many injuries and stated cost to Britain of £37bn.
Projects and waste
Major projects continue to go wrong – including rail over Xmas. We do not seem to learn.
We also continue to waste food, utilities, water and fuel. Some people starve; others are obese. Some people have no choices; others have suffer from having too many choices.
FIVE OPPORTUNITIES
More tolerance
We have become more tolerant of diversity, (but not of immigrants?). Some symbols of this are same sex marriages, more awareness of transgender rights and “casual dating”.
Fluid central government in the UK
The May 7 2015 General Election in the UK is difficult to call. There are now four minority parties – SNP, UKIP (who won two parliamentary seats in 2014), Liberal Democrats and Greens. All have a chance of joining Conservatives or Labour in power. Political brands will be diluted in coalition conflicts and teamwork will become vital.
Devolution
The trend is for new independent countries – from roughly 60 countries at the end of the second world war to roughly 200 now. The Scottish “No” vote was just a blip on this trend. Large cities and conurbations will also get more powers.
Always on & everything connects
Web, social media, mobiles and international travel are changing information, power and relationships by reducing barriers to entry, sharing information more fairly and making it more difficult for dictators to hide. The downside is stress, “email exhaustion“, and potential for spread of disease like Ebola.
Small societies
The “Big Society” never took off; but many “small societies” have – such as sports clubs, bridge, yoga, “Friends of”, University of the Third Age.
FIVE DON’T KNOWS
Collapse of cash
I used to find it surprising when people paid for a McDonalds meal by card. Now the growth of PayPal, digital currencies is supplanting cash.
Celebrity Syndrome
Our obsession with celebrity continues. This can create role models or entertainment (2.4mn likes on Instagram for Kim Kashadian wedding pictures). But it’s dangerous when people copy over thin or photo shopped images.
Globalisation
We know the world is flat but the full impact of international competition for services, including professional services, is still to come.
Deflation
The price of imported foodstuffs and oil has fallen (crude oil prices by roughly half in 2014). The impacts on Russia, Saudi Arabia and potentially shale gas in the USA are significant.
Hard v soft skills
Are we becoming a world in which “hard” skills (maths, coding, social media) dominate over “soft” skills” (people, relationships, persuading)? Surely we need a better balance of both?
UPDATE: 09012015
Opportunities. Fluid central government: This is reflected in the discussion about how many parties should take part in televised debates – 4 or 5 (or more) reflects this.
Threats: I didn’t mention the gap between the really wealthy and others – it’s reflected in comments by John Gelmini.
Images from mashsteak.com & info@getbodyfit.co.uk & facebook.com/the Martial Arts Project (MAP)
How to sell better A-E
Here’s my checklist for selling better. ABCDE
They are about #behaviour & #mindset.
BEHAVIOUR
Attract new clients.
Promote benefits not features.
Keep it simple.
Use case studies to make it tangible.
Facts tell; stories sell
Play to your strengths.
Use recommendations, referrals and track record..
Create a brand. Make sure your bland isn’t bland.
Here ‘s how to SPICE it up.
Build existing clients.
Start by retaining clients, at least the good ones.
Think about their value over a lifetime.
Look out for opportunities to sell additional and different services.
Remind them to renew.
MINDSET
Collect your fees promptly.
Sales are vanity, profit is sanity
But only cash and clients really count.
Deliver
Meet client needs and communicate clearly.
Here’s an example from a membership group.
Extra
Provide something extra and focus outwards on clients.
Not on internal bureaucracy.
Go the extra mile.
ABCDE are simple.
But not easy.
I have come across very few businesses that use all five steps.
And none that has turned them into systems.
Image Sunset at the North Pole
How to avoid the 4 most frequent #WarningSigns of organisation failure
The rocky road to survival
UPDATE: The Brexit turmoil adds a further dimension of uncertainty currently.
22102018 The idea of #warningsigns also applies to life and sport. Jamie Carragher writes in the telegraph of 20 October 2018, that footballer Alexis Sanchez could be the next Torres – a big buy who is past his peak. This is based on a comparison of goals and assists over time of the two players.
A book, ‘The upside of turbulence’, by business writer Professor Donald Sull, lists warning signs that a company is about to fail.
It includes:
- The chief executive appearing on the cover of a business magazine;
- A guru saying the company is outstanding.
- (What about a grand new Head Office?)
He argues that these and other factors create
an “active inertia that accelerates activities that succeeded in the past.”
I would add:
- Repeated profit warnings;
- A culture which shoots the messenger with and news; and
- Delays in paying suppliers #Carillion.
My slogan is:
‘Revenue is vanity; profit is sanity, but only customers and cash really count.‘
It’s not a complete explanation because it doesn’t take into account:
- Compliance with regulations (some banks),
- Sustainability; and
- Criminality (think Enron).
But it’s not a bad start.
Here are examples from my past assignments:
Not realising that cash is king (and queen) – a training company
A small training company was busy and they had a client list to die for. But they were in danger of running out of cash and making losses.
I found that nearly all their assignments overran and that their corporate clients were delaying payments. This came as a surprise to them.
The remedy was tactical.
- Better project management,
- Clearer payment terms,
- More assertive billing practices; and
- Better debt collection.
The #MartialArtsPrinciples is Manage by #PulsebeatsNotPostmortems
Failing to keep good customers – IT company
An internet company was losing clients.
The parent company was concerned about service quality and client retention. I informally interviewed 20 of their clients.
Roughly half thought the company was fantastic; the other half thought they were appalling.
Why? The company was based in the City of London, but had taken on clients throughout the country. They could get to local clients on the same day as service problems were reported. But they had insufficient staff to travel to client sites that were further away.
The remedy was strategic.
- Reducing overload;
- Concentrating on local clients; and
- Identifying additional sales within their existing local client base.
The #MartialArtsPrinciple is #Look4Leverage
Being unrealistic about revenues – management consultancy firm
A consultancy partnership tried to position itself as a premium brand.
But it then tried to gain work by responding to open public sector tenders. Such tenders will always be very price sensitive and attract many competitors. They also need a lot of administrative overhead to write proposals and complete forms.
The remedy was strategic.
- Stopping competing in open tenders; and
- Developing new sources of business.
The #MartialArtsPrinciple is #KnowTheScore
Profit – not understanding costs and strengths – business centre
A housing association had started a small business centre.
I visited and we reviewed their costs and revenues.
Their pricing did not reflect the very different costs of acting either, as an accommodation address, or actually supplying business accommodation.
They had also not explained to potential customers how their offering was distinctive.
We took action to:
- Agree some simple price changes; and
- Improve promotional activities.
Within two months they were full and profitable.
The #MartialArtsPrinciples are #Simplify & #PlayToYourStrengths
Picture by jadakatt
Do you recognise these warning signs. Do you have a story to tell? If so, please feel free to comment or to contact me. You can contact me here:
Mike Barnato 
