Early Adopters, Laggards and those in between

I used to work with an Early Adopter. 

No, I mean a real Early Adopter. He loved the newest of new technology. Whether it was the latest phone, the latest palm pilot (as it was back then), he was first in. It didn’t matter that it was pricey or still in Beta version with all the glitches. He had to have it. So he did.

It must be nearly 20 years ago now since we were working together and he was taking notes using a writing gadget on a rudimentary tablet. They are now mainstream with Smart Pencils and other tools and Apps but he was well ahead of the curve.

My tech-loving work colleague has gone on to be a senior director in the world of marketing and social media. Being at the ‘bleeding edge’ has done him no harm at all.

I’m not like that. I’m always interested, but whether its work or play, I usually wait for something to be tried and tested before I dive in and have a go.

There is a ‘Technology Adoption Life Cycle’ which describes the different categories of behaviour types. These range from Innovator and Early Adopter through to the Late Majority and Laggards. Laggards only come along screaming and kicking after the new technology becomes mainstream. Typically they will still be watching Betamax videos and playing their vinyl records. On the latter, the cycle came around again and they could argue they were the innovators. But that is the exception.

Usually the Innovators and Early Adopters win in the market place. They take the pain and make the mistakes but keep learning and stay ahead of the pack. So when the Early Majority join in they are already on to the next thing. 

Being slightly late isn’t always a bad thing. Being too late is disastrous. 

So in the business world, when the Early Majority ‘wake up and smell the coffee’, if they act quickly and decisively and embrace the new technology or process which is disrupting their market, they can still exploit the new opportunity at the expense of the Late Majority and the Laggards. 

Technology is disrupting the accountancy sector in a big way at the moment. Cloud software has been around for a long time but is really now coming into its own. Why would you use a clunky desk-top package when you can have a cloud package where you can view your accounts from any device, at any time and it is always up to date? Scanning software too is taking the drudgery out of bookkeeping by removing the need to key in receipts. 

I have to admit that we have not been first out of the blocks with this. We have had our cautious accountant’s hat on and observed closely how things have developed. HMRC’s “Making Tax Digital’ initiative has also changed the landscape by making the adoption of accounting software a necessity for small businesses.

Our instinct has been to go with our clients on this and move at a pace they feel comfortable with. We will continue to do this but I think they expect us to lead and guide them, which is what we intend to do. 

On a personal level I have my new tablet now with the whizzy drawing pencil for my notes. I’m 20 years behind my old work colleague but I’m embracing it enthusiastically. 

Who knows, I might just try out one of those new-fangled Smart Watch things very soon.

www.base52.co.uk

Knowing when to call it a day

Some do it early.

‘I’ve sold my business’, your business pal blurts out over an early morning coffee. ‘What?’ You didn’t even know they were contemplating selling up, let alone having the deal all done. Signed, sealed and delivered. How did that happen?

Your pal is in their early fifties. This is something that they have been thinking about for a long time apparently. The proceeds from the sale will give them a comfortable retirement. After a short ‘Earn out’ period where they work in the business to hand over to the new owners they will leave, hopefully to enjoy the rest of their lives.

The chat leaves you a bit unsettled. You don’t have a plan. You’re a business owner like your friend and a few years older. From time to time, usually when going through a difficult period at work, you think about slowing down and doing less. Then things pick up again, you get stuck in and the cycle continues. You need the money. You have your old employment pension which will start to pay out soon but there’s still the mortgage to pay off and savings are minimal.

So it feels like carrying on is the only option.

Some entrepreneurs do that. Literally keep going until they drop or ill health forces retirement upon them. The smarter ones have at least put some plans and an infrastructure in place so that the business can continue without them.

There is a saying that a business owner should start to think about their exit on the day that they start.

Essentially an orderly exit breaks down to a few choices:

• Business sale with the owner leaving immediately or after a period of time
• Partial sale or merger with the owner retaining a stake in the business and some ongoing involvement and income
• Retaining full ownership but with gradual handover to a new management team

Exiting well takes time to plan and implement. Those plans may change over time as the owner’s circumstances and aspirations change. 

We may not all be as organised and decisive as our fifty-something retiree at the start of this blog. But a little thought and planning in advance might help us get closer to the retirement we want.

www.base52.co.uk

Ex businessman with ideas to 'Make America great again'

Here are some ideas from an ex businessman on how to ‘Make America Great Again’;

• Low business taxes
• Get other countries to share the burden of American defence spending
• Reorganise and lower the cost of Medical Insurance
• Level the playing field in international trade
• Invest in infrastructure projects

Sound familiar?

Leaving the 'wall' and immigration controls aside, it could be lifted straight from Donald Trump’s manifesto. These in fact are all ideas espoused by Lee Iacocca, then President of Chrysler in the 1980s.

I’ve just finished reading Lee’s autobiography, the modestly titled ‘Iacocca’, written more than 30 years ago. It charts his rise to be number 2 at Ford and his fractious relationship with Henry Ford II.

He was eventually unceremoniously sacked when Henry decided they could no longer work together. Within weeks he was recruited to run the ailing Chrysler business. He quickly found this was a poisoned chalice with the financial situation much worse than he had imagined. With guts, drive and sheer force of personality he managed to achieve ‘equality of sacrifice’ with management, workers, suppliers and banks all tightening their belts. With the help of a hard-won government loan guarantee he managed to turn the company around, paying off the loans early and restoring profitability.

Lee was an engineer by training and a marketeer by inclination. The son of Italian immigrants he believed in the virtues of education, hard work and ‘doing’ rather than just thinking. His politics may sound conservative but he was much more nuanced than that. If anything he leaned more to the left politically and was supportive of targeted government support for industry if it was in the national interest. He was also a strong believer in balancing the books and concerted effort to reduce the national deficit.

One of the final chapters of the book is entitled, ‘Making America great again’. In his heyday Lee was seen by some as a potential future president. Politics wasn’t for him though. He preferred the cut and thrust of business and being able to make and implement decisions quickly.

Another ex businessman is now shaking things up at the White House and at least some of his ideas bear a striking similarity to those of his older contemporary.

www.base52.co.uk

'Everyone needs a Willie'

So Margaret Thatcher famously said about Willie Whitelaw.

He was her Home Secretary when she was Prime Minister in the late 70s and early 80s. He went on to be Leader of the House of the Lords and during this time he became more of a confidant to her. She was a passionate and driven leader and one not inclined to listen or compromise. Whitelaw was one of few trusted advisors who could give her honest and direct feedback and perhaps help to soften some of her harsher inclinations. Thatcher still divides opinion but Whitelaw undoubtedly helped her cope with the demands and pressures of being number 1 and probably made working with her a little more tolerable.

In business too there are many examples of supporting actors backing up charismatic and high profile leaders. Charlie Munger with Warren Buffet, Steve Wozniak with Steve Jobs to name two of the most prominent. Who knows if these business superstars would have reached such great heights without their lesser known compatriots?

Premiership football is one of the most public and hostile arenas to be a leader. Everyone has an opinion and performance is there for all to see, week in, week out on the football pitch. The pressures are enormous. So having a trusted lieutenant can be very important. Jose Mourinho was sacked by Manchester United several months ago. There were probably multiple factors which brought this about but some have cited the departure of Jose's longstanding number two, Rui Faria a few months earlier as the start of his fall from grace. Alex Ferguson too had several assistant managers during his time at the top - Brian Kidd, Steve McLaren, Carlos Quieroz and Mike Phelan stand out.

An interesting observation, particularly in the football world is that these brilliantly successful 'number two's' rarely go on to have stellar success being number one. Many have a go but often revert back to being number two somewhere else. That is their strength. They don't crave the limelight or the plaudits. They quietly get on with doing what they need to do to help their boss and their team be successful.

Small businesses are often founded and managed by a single individual. It can be a lonely place and the pressures can be significant. The more successful business owners build a team.

Being a boss often means having to do things the team don't like, but are best for the business. Having one or more members of the team 'on side' can help to ease the pressures and make managing the business more enjoyable.

So whether it's a Willie or a Steve or a Stephanie, I think on this point at least, Maggie had it right.

www.base52.co.uk

The annual budget still has its place

Accountants like scorekeeping.

Keeping accounts up to date, reconciling the bank accounts, reporting monthly profits. This is  'bread and butter' work and an essential part of maintaining financial control for a business.

Another key tool is the annual budget. Typically in our business we do this towards the end of the current financial year. Already at Base52, we are thinking ahead to the next financial year. Plans are taking shape, things we would like to achieve. Extra costs we need to allow for. Pulling the budget together brings this to life. 

In a larger organisation, preparing the annual budget can be a major exercise taking a Herculean effort from the company accountants and senior management. In a small business, it might just be the business owner and their spreadsheet. 

Often the first draft is a disappointment. The projected profits are lower than expected. Then some tweaks and adjustments and it starts to take shape. Decisions are made about priorities.

Voila! You have it. 

Your financial plan for the year. You now know what is possible and what you need to do month by month to reach your financial goals.

Of course, that's the easy bit. You now need to work with your team and your customers to deliver the plan.

Without the budget or target, scorekeeping on its own is missing something. A bit like a runner recording his time without having a target time to aim for. Roger Bannister would probably never have achieved the 4 minute mile if he hadn't set it as a benchmark.

So in my view the annual budget should be an essential step for all small businesses.

It's one more thing to add to the already very long list but it should pay back many times over by providing clarity and improved financial control.

www.base52.co.uk

A hotel with a difference

It's good to be different in business.

Marketeers call it having a ‘Unique Selling Proposition’ or USP. It’s what differentiates you from your competitors and gives your customers a reason to buy from you rather than them.

On a trip to Morocco with my wife we booked to stay in a Riad close to the Atlas Mountains, a little over 20km outside of Marrakesh.

We arranged to stay for a few days as a change from the hustle and bustle of the city and maybe to do a little walking. The reviews were good so we settled on Riad Sougtani.

What we stumbled upon was something very different from a typical hotel.

It is run today by the nephews of one of the descendants of Caid Omar who completed the construction of the Riad and an adjacent Great Kasbah in the 19th Century. The brothers inherited the Riad in a run down state and have painstakingly restored it to its former glory.

Their ethos has been to recreate the welcome and sanctuary the Riad used to provide for their forefathers and their special guests who used to stay there. A beautiful central courtyard is fully enclosed by high walls and 6 self contained apartments. Guests and their families used to stay in their own accommodation and gather together for meal times and to discuss family business.

The atmosphere is less of a hotel and more akin to staying as a guest with welcoming and attentive hosts. There are no set meal times. You just turn up when hungry or pre-book if you choose to. There is no menu, but for breakfast and dinner an array of simple Moroccan food is served. Trips can be arranged to the mountains, back to Marrakesh or further afield. For the less active, lazing around the Riad is not a bad option.

The brothers could have chosen to make the Riad into just another hotel, with smaller rooms, a varied food menu, maybe a spa, lots of extras.

In choosing their USP they may be less wealthy than if they had chosen a more conventional format.

They are however generating enough income to keep their beloved Riad well maintained and  through their guests their illustrious family history lives on.

That is a rewarding and distinctive legacy to keep going and more satisfying I suspect than the pursuit of ever increasing profits.

Being different isn't just about making more money.

www.base52.co.uk

The perfect sales pitch

Have you ever met a brilliant salesperson?

My wife and I met one on a recent trip to Marrakesh.

We went on a walking tour through the ancient souk with our jovial and knowledgeable guide, Fouad. The souk is a labyrinth of alleys with stalls selling wares of every description. We strolled along for an hour or two dodging people and motorbikes and marvelling at the sights, smells and sounds.

Then almost imperceptibly we crossed the threshold into a carpet shop. We were greeted by the charming and fluent Omar who welcomed us and ushered us inside. We explained that we were not really looking for carpets but this did not dint our garrulous host's enthusiasm.

He asked us to go upstairs to, 'Admire the beautiful building' and have some mint tea. 'No pressure we are just friends speaking together'. Fouad nodded encouragement so up we went.

Pleasantries were exchanged - Where were we from? How long were we staying? Then the show started.

Omar's helpers proceeded to roll out carpets of all shapes, sizes and colours. He tells us they supply Liberty, John Lewis and other prestige British stores.

'Which do you like?'

'Er...we're not looking for a carpet but maybe a small one?'

Omar claps his hands and shouts a command. More helpers arrive with armfuls of small carpets. By this time Omar has noticed that my wife is more receptive to his charms than I am. 'Let's choose the ones you like - just say yes or no'.  In no time at all he had narrowed it down to 6 'possibles' and then 2 'most likely.'

Now to talk money. 'These are hand made. Every one is unique. A work of art.' Omar tells us, 'They are a snip at 1,000 of your English pounds each.'

'They are really very nice but we are not looking for a carpet.'

'Ok you make me an offer'

At this point my wife leaves (she hates haggling) and goes off to find Fouad.

This is where my years of watching Antiques Road Trip and Bargain Hunt on the telly pays off. I make a ridiculously low offer (which I would be happy to pay) and refuse to budge despite Omar's pleading and big reductions from his initial price.

Eventually he gives up. We parted friends (I think) - Omar still with his carpets and us with our money.

I reflected on the experience afterwards and especially Omar's sales technique - being referred by a trusted mutual contact, the lovely welcome, building rapport, demonstrating credibility, offering choices, changing the conversation from, 'Do you want?' to 'Which ones do you want?'.

All brilliant and much to admire and learn from. Except one important thing. He didn't really listen to what we wanted.

Omar's well rehearsed theatre undoubtedly works for one off sales where he is unlikely to meet the buyer again. I'm sure there are lots of mild-mannered tourists who leave Marrakesh with expensive carpets they never knew they needed.

If we want customers to buy again and spread the word about our business, we need to listen and try and give the customer what they want. Sure, sometimes we may need to help them appreciate what is possible but we are still listening and fulfilling what is right for them.

Sprinkle that with a little bit of Omar's magic and I think then you may be close to the perfect sales pitch.

www.base52.co.uk