Welcome

November 29, 2011 3 Comments

Telos Partners is a global team of business professionals united in one purpose – to create sustainable success for our clients, our business and ourselves. You can discover more about what we do by visiting our our main website.

This blog site has been established to capture and share the learning of our work with ambitious business owners and founder-led organisations.

If you are interested in discovering more, please contact adamcampbell@telospartners.com.

Filed under Thought leadership

Successful strategies for growth

May 10, 2016 Leave a comment

In our conversations with ambitious business owners, we often hear two schools of thought – those who support the development of a strategic plan for their business and those who don’t. When you look beyond the subjective argument of these two camps, which is often based upon a clear personal bias, there is strong evidence for the benefit of longer-term strategic thinking in business. Despite this overwhelming fact, many ambitious business owners struggle to realise the ambitions for their own business. We find them asking:

  • what is it about strategic planning that works?
  • what strategic options do I face?
  • which strategic choices carry with them greater chances of success?

It was these questions that formed the basis of our Cog:ent workshop entitled “Successful strategies for growth” on 14 April 2016. As ever, the events provide a safe space for business owners to receive, share and apply relevant learning to the growth of their business.

This blog captures the discussion and learning that took place on the day. You can view the materials used by clicking on this link (160413 Successful strategies for growth – slides v5)

A light bulb moment that became an overnight success after 25 years

We were privileged to hear, first-hand from co-founder Richard Gyselynck, on the story of Acorne PLC. The business started life as a private pilot training school and now runs Virgin Experience Days.

For us, the story brought to life some elements of a good strategic approach:

  • The importance of gaining insight about the real value you bring to your real customer – it was the time that Richard spent trying to understand the customer (what drives and motivates them to buy?) that ultimately provided the stimulus for a different approach to the business. In understanding this, Richard began to realise that what they were doing was not providing flight training but giving ‘the man or woman in the street’ the opportunity to participate in a high value experience at an affordable price.
  • Understanding value and purpose drives strategy – this shift in purpose began a more deliberate and strategic pursuit. The new perspective freed up new ways of thinking and subsequent experimentation honed and fine-tuned a range of ideas linked to a rejuvenated purpose for the business.
  • The importance of using an external perspective to strengthen internal thinking – early on, realising that marketing was now a core capability that the business required, Richard brought in some external support to develop a deeper understanding of what drove success in their new business model. What dawned was the realisation that, as now a marketing business, it was distribution of the vouchers that was key to a successful strategy for growth.
  • The slow and steady march to add things to the core – with the niche essentially defined by a revolutionary shift in perspective, and over a period of years not weeks and months, the offer was then refined and extended (evolutionary growth). In the beginning, growth was fuelled by airfield-related activities, added to this were adrenalin based experiences, but in the last 12 – 24 months it is the rise of ‘afternoon tea’ that has stimulated further growth. The disciplined growth of, and addition to, the core has created a very different business to the original one but the core purpose remains.
  • The role leadership plays in guiding management – crucial to all of this appears to have been Richard’s ability to bring capability into the business to complement his own. Whilst arguing that delegation simply demonstrates his aspirations of laziness, recognising what capability is required to successful implement the strategy (as well as finding and motivating that resource) appears to be a key aspect to Acorne’s success – that and the usual dose of good luck and timing. By freeing themselves from the shackles of running the day-to-day, Richard and his business partner have been able to become non-executives in their own business. They now spend the majority of their time on creating the future and nurturing the identity of the business.

If you want to buy someone special that special gift, or find out more about the Acorne story, please visit click here.

Lessons learned in a joint exploration of strategic success

Participants were then given the opportunity to reflect on Richard story, and our own learning, by applying the thinking to their own business context. The following additional themes of discussion confirmed and strengthened the view of what drives a successful strategy:

  • Culture eats strategy for breakfast (and for lunch and dinner too!) – people and relationships are the key to any strategy. So whilst “hard” factors and objective thinking are important to getting the right strategy, it is the “soft” elements of people, relationships, engagement, motivation and alignment that are crucial to getting strategy right.
  • Good strategy adapts and evolves with the changing tide – with the rapid pace of change, and the increasing need to be responsive and agile, the five year strategic plan is all but dead and buried. However, taking a long-term perspective and updating the strategic approach on an annual basis appears to be an option that is viewed as sensible by all.
  • A shift in strategy often requires a shift in approach and people – this came to life in the exploration of a strategic shift from product selling to solution selling. What seems a simple change on paper is more fundamental in reality. In the first instance, it requires you to make sure you are selling nurofen (solving a real problem) not vitamins (a nicety). And more importantly, your sales team need to be equipped to resource the adapted approach – ninja, warrior, farmer or hunter where words that came to mind – and sometimes this requires bringing in new capability to the business. Linked to this, being pro-active in creating the shift for yourself seems a better choice than waiting for the shift to be created for you.

So with all this learning, what simple messages do we need to take away? The following high level questions, are aimed to help you to consider what is required to create and deliver a successful strategy?

  • Managing the present – What can you learn from what you are doing now? What is the real value that you provide for your real customers? And how might you improve how you deliver it?
  • Nurturing your identity – How is your purpose relevant today and tomorrow? What values and principles are guiding your long-term decision making?
  • Creating the future – How is the external perspective changing? What is your renewed ambition in this changing new context? How might you win?
  • Leading the system – How do you need to change to deliver a balanced result? Who do you need to engage with in order to answer your key strategic questions? How does your strategy fit together as one coherent whole?

If you would like to discuss any of the themes arising in this blog, attend our next Cog:ent meeting or explore how we can support the growth of your own business, please contact acampbell@telospartners.com.

Filed under Thought leadership

Making innovation part of your organisational DNA

February 5, 2016 Leave a comment

Here is the executive summary for our article on innovation, we quite like the response it has had from people. If you’re interested in hearing and/or reading more contact acampbell@telospartners.com.

For organisations to create sustainable success, in an ever changing and dynamic world, they constantly need to find new ways to adapt, improve and reinvent what they do and how they do it.

This opportunity for innovation lies not just in new products and services but also in structures, processes and behaviours. To truly master this challenge requires the whole organisation to excel across the innovation process, from inception, through development and into action.

“Whole system innovation goes beyond the isolated creation of new concepts and ideas, it covers all parts of the innovation process and pervades all aspect of the organisation – products, services, processes and behaviours. It is the need to adapt to an ever changing world by generating insights and ideas that can be translated into practical, sustained business improvements and commercial benefits – it is an essential component of sustainable success.”

It is using this broader definition of a whole system view of innovation, going beyond the isolated creation of new concepts and new ideas, that we see innovation as a key component of sustainable success. While innovation remains a ‘subjet du jour’ for academics and consultants, our experience is that many organisations still struggle to make the necessary changes. In short, they appear to be asking ‘how do we innovate innovation?’

Our exploration of this challenge has drawn us to three areas that appear key to embedding innovation within the organisation’s DNA:

  1. Defining a broad innovation agenda supported by a disciplined process.

To move innovation beyond the preserve of the R&D department or product marketing team, requires a broader definition of the types of innovation that an organisation can benefit from. To capitalise on these opportunities further requires a more disciplined approach to the innovation process.

  1. Creating a fertile environment

Everyone has the capacity and ability to play a role in delivering the innovation agenda, but to enable this requires people to:  Recognise where and how they can play a role (mind-set). Be empowered to ‘step up’ and ‘speak out’ (behaviour)  Work collaboratively beyond their existing remit (relationship) To deliver whole system innovation requires challenging and changing existing paradigms and ways for working.

  1. Providing adaptive leadership

For innovation to pervade, adaptive leadership is required across the business, in a manner where leaders:

  • Communicate the challenge to staff and show how innovation fits with purpose, values and vision, i.e. a core initiative Identify and own the systems challenges that require major changes in mindset, behaviour and action, i.e. the real game changers
  • Model and encourage the shift in behaviour they seek, while overseeing the innovation process, i.e. encouraging creativity, protecting promising ideas and culling those that have run their course.

In short, creating an environment where innovation is seen as a fundamental part of the day job for everyone is one of the major challenges facing organisations today. In a world that is moving so fast, the price of standing still is great. When organisations are able to embed innovation within their DNA they not only create a major competitive advantage but also unlock the door to long-term sustainable success.

Filed under Thought leadership

Winning the war for talent

February 1, 2016 Leave a comment

Winning the war for Talent

“Our people strategy was our business strategy” stated Victoria Mellor during a fireside chat at our most recent Cog:ent meeting. She has successfully exited her business Melcrum after 19 years.

During the last 16 years of working with our clients, and through the stories we have explored with over 600 ambitious business owners, we have unearthed one element of learning that stands head and shoulders above the rest – the need to bring in to your business, and unlock the talent and potential of, people who are better than you.

It was this theme that formed the basis of exploration for our workshop on 21 January 2015 – this blog summarises some of the discussion and learning from the event.

A deliberate shift in mindset

“We had a five year strategy to change the business radically and facilitate our exit from the business. We decided what our business needed to look like in 5 years’ time and worked backwards from there. Finding good people became an absolute imperative.”

It would appear that this change in mindset, often borne through crisis, is an essential component in winning the war for talent. The desire to exit your business (or at least create a range of options) appears a helpful stimulus in this shift. It is perhaps the recognition and visualisation of a business that is not centred on you, the business owner, which begins to unlock the new behaviours.

An attractive business personality

“I used to tell people that they had the opportunity to be part of a growing, ambitious and entrepreneurial business with a real variety of work.”

Job descriptions and salary bands are all a bit boring really, aren’t they? What everyone finds more attractive and compelling is a story. The ability to describe the personality of the business (purpose, values and culture) along with the future story (ambition, opportunity and vision) appears to be a real attractive force for talent. It might seem that corporates can provide more money, more benefits and more career advancement but when people are attracted and inspired by more than just these rational factors (see Simon Sinek) it is easy to see how smaller businesses can develop a competitive edge for talent.

Drawing people in to business discussions

“We faced a real business challenge of how to exit ourselves from our publishing business. We didn’t have the answer, so we opened the challenge to people in the business. We posed the question and got them to present their thinking to the board. It really got people engaged.”

Once in a business, people generally want to feel that their contributions are being valued. Leaders who recognise that they don’t hold a monopoly on all good business ideas, reach out to the people in their business for help in solving real business problems. This process of involvement and participation appears to provide a real motivating and binding force – even when only a handful of ideas move forward and become reality. Anything that helps people feel a stronger sense of purpose, develop mastery in their role along with an appropriate degree of autonomy has been shown to have real benefit (see Dan Pink). 

Build your network

“A lot of our recruits came from our clients, when I met great people I’d say that they’d come and work for us one day. They always seemed to come back at a later date for a conversation.”

In the stories that were shared on the day, the need to develop the strength of your network is crucial. The number of great hires that were already known to the business or a direct referral continually astounds us. So, whether it is with clients, suppliers, competitors or even at the gym continue to build your network and don’t be afraid to share your story.

Modelling and leading your employee experience

“Once I got these great people on board, I had to manage how they gelled together as a team and get them to realise that it was now their job to attract and retain great people. Managing the experience and motivation of my senior team and reminding them about our strategy and values occupied the majority of my time”

What is absolutely clear is the need to deliberately model and lead your employee experience. To do this, and where we have been helping clients, requires you to:

  1. Develop a clear philosophy
  2. Adopt a people-centred talent push
  3. Create the right environment
  4. Observe real behaviour
  5. Provide everyone with a toolkit
  6. Raise self-awareness and confidence
  7. Promote your employee experience externally
  8. Celebrate successes and learning from failure quickly

That’s a lot of shared learning extracted from a 3-hour workshop and summarised in an 800-word blog! You can read the workshop booklet that we used by clicking on this link (151126 Winning the war for talent – booklet) and more on the 8 steps below.

If you would like to discuss any of this learning further and explore how this might be appropriate and relevant for your business, please contact acampbell@telopsartners.com

Eight steps to developing a strategy for talent:

  1. Develop a clear philosophy that sits comfortably with, and reinforces, your purpose and values – create your talent story. In essence, this is about your entire business, rather than just talent. There are plenty of great examples out there, but we’ve always been rather impressed by Ed Perry, founder and CEO of Cook. For inspiration, you can read more about their story and their values here.
  2. Adopt a people-centred talent push (from the individual, bottom up) rather than talent pull (top down) approach. To unlock what is inside the hearts and minds of your people, seek first to understand and then be understood. This is a case of starting with what you have got, rather than what you haven’t got. Spend time with people, explore their ambitions and how they feel they can contribute.
  3. Create the right environment by being clear on expectations (desired outcomes and business objectives) and put people in control – build projects around motivated people and give them the trust and support they need to be successful. Research shows that 71% of employees think it’s their company’s responsibility to manage their career. At the same time, 85% of managers think it’s down to the employees. Take away this ambiguity and start to put people in control.
  4. Observe real behaviour in career moments and be curious about understanding them further – Why is that person not performing? Why have you seen a sudden increase in energy from another? Why did that person really leave? Observe people in the work place and understand the emotion flows at certain ‘career moments’. We worked with a sales team in the early years of their career, where 50% of people would leave with less than one years service. By mapping their motivation levels and understanding the emotional journey, something could be done to improve the situation.
  5. Provide everyone with a toolkit that supports and embeds your desired philosophy – create the space for them to think about their career, how it relates to your business and how they might take ownership of their actions to deliver both. When learning and adopting new methods of doing things, people need guidance and prompts. We developed the Me+ toolkit, working with a large IT client who recruit and train large numbers of graduates each year. It is now used by 1000s of graduates and enables them to take control of their careers and align the objectives to the organisation that they are working for. Discover more about ME+ at www.me-plus.co.uk.
  6. Raise self-awareness and confidence (through praise, quality feedback and recognition) and resilience (by encouraging a sharing, supportive, peer to peer learning environment). Any openness to and an ability to reflect on high quality feedback accelerates learning and builds will power.
  7. Promote your employee experience externally in a manner that helps and encourages self-selection – value attitude and cultural fit over and above technical know-how. Done well, new employees will know if it’s an experience that will match their values and strengths, allowing more self-selection and reducing waste. Netflix do this particularly well (read more here).
  8. Celebrate successes and learning from failure quickly – review the employee experience regularly and be open to feedback and change. Develop a growth mindset. Individuals and companies that have a growth mindset see failure as an opportunity to continually learn and grow. They enquire more deeply into the causes of failure (and success) and accelerate their learning accordingly.

If you are interested in trailing the ME+ career app and toolkit? Or just want to discuss your talent successes or challenges with us?  Send us your thoughts through the ‘Sign Up’ page at www.me-plus.co.uk . We look forward to helping you bring the best people together to discover success.

 

Filed under Thought leadership

Leading a growing business

October 8, 2015 Leave a comment

The next stage of growth for your business is likely to result from you doing something differently as leader. So, what do you want from your business? And what does your business need from you?

This was the theme we explored in our first workshop in the second series of Cog:ent – quarterly thought leadership workshops for ambitious business owners in the Thames Valley. The theme was brought to life by interviewing the founder of a specialist contractor, whose business has grown from £5m to £10 over the last two years. This blog summarises the learning from those who participated in the workshop.

Over the years, alongside our work with large multinational organisations, we have been lucky enough to experience, observe and explore the journeys of over 600 ambitious business owners. Across those journeys there seem to be some common and interesting themes that differentiate those who lead successful, thriving businesses from those who struggle.

Developing the right mind-set

Somewhere on the journey, and before each and every stage of a business’s development, the leader’s narrative seems to shift. Frequently, before growth people say things like “I struggle to find the right people; my team is loyal but lacks the drive I now need”. After growth has occurred, and as a result of lessons they have learned, we hear people saying “I would have employed better people earlier on and let them get on with it”.

Consequently, we are intrigued by what creates this difference in thinking. It is often traced to a strong need to move away from something (“I’ve had enough of this”) combined with a desire to move towards something (“I want a more profitable business”) and a clear first course of action to enable the shift (“I need to get in an FD”).

What does success look and feel like for you? And, what is the mind-set you need to adopt, in order to lead your business towards this?

Doing the right things

We also see these leaders doing things a little differently. They move away from “I’m spending 60-70 hours a week working, it’s relentless” towards realising that “Some of the most valuable time I spend in the business is staring at a blank wall”. Successful leaders spend time outside their business with customers and the industry opening up connections, creating direction with a clear vision of success, nurturing and inspiring a culture with competitive advantage and building a team around them to manage and run the business and the people. They see this as their valuable contribution to the business and recognise that they need to spread their attention and energy across the right things.

Where are you placing your energy and attention? How is it influencing the success of your business?

Evolving and maturing the business

As the business grows, successful leaders enable the business to mature around them – grow up, rather than just grow. This typically requires a move away from everyone doing everything (the one man band) to increasing areas of specialisation and professionalism (creating an orchestra). Each move lessens the reliance upon the founder. Each transition is managed deliberately and effectively.

What is the context in which your business is operating? What is the shift required for your business to survive and thrive?

Learn to let go and evolve your role

Each stage in the development of a business requires the founder to adopt a different role, appropriate to the stage of growth. Activities need to be delegated and freeing up time in this way means that the founder can take on new roles. Successful leaders understand how their role needs to shift and adapt and are clear on where they can and want to add value.

Where are you in your leadership journey? What do you need to let go of? Where can you add most value next?

Build a team for tomorrow, not just today

Once you have established where you can add real value and what role you need to play, consider who you need in your team. This is perhaps the most crucial element of leading your business. Successful leaders recognise the importance of ensuring the right people are on the bus, and this often requires the need to confront the ‘wrong’ people. That does not mean they are bad people who perform badly, more that the business needs skills and capabilities in the future that it currently does not possess. That’s why, in successful journeys, we observe leaders recruiting people who are more experienced and more capable than themselves.

If you were already successful, what would your team look like? To achieve your ambition, who do you need in your team?

New ways need new behaviours

It is often said that a leopard cannot change its spots. But we have observed many successful ambitious business owners change their behaviours (not their values) in a way that is more conducive for the next stage of growth. Sure, old habits pop up time and again, but an approach that moves away from ‘driving the business and leading by example’ often evolves into ‘a more enabling and empowering approach that recognises the value of coaching and supporting people’ in the business. In short, they recognise that they don’t have a monopoly on good ideas and decisions.

How are your current leadership behaviours influencing the success of the business? What needs to change to unlock the next stage of growth?

Easy to say, but difficult to do

The need to align your business goals with your personal goals is an ongoing, dynamic challenge. The various roles that you play in life do not always interact neatly with each other. Frequently, they are a tangled mess! Successful leaders seem to have a canny knack of aligning these interests more effectively so that they work with, rather than against each other.

How are your various roles influencing your business transition? How could your business transition fit more with your personal goals?

Having explored these various themes in depth, what observations were made, what learning was experienced, what actions were provoked? Here is the essence of what we heard being discussed:

“It’s nice to realise you are not alone, the themes really hit home and feel real. Sharing and discussing how to address them with others is really cathartic.”

“Leading is more about people than it is about the task. How to enable performance and not tolerating poor performance is essential.”

“All of this starts with a clearer, more defined view of my role. I need to work out the value I can bring to the business.”

“I need to establish how to shift my mind-set and behaviour to strike the right balance of task, people, present and future.”

“I’m going to bring others into the decision-making process more, establish management meetings and share the responsibility more.”

“I need to observe my own behaviour more and understand the impact it is having on our people and our performance.”

“I’m better suited to doing the external stuff that the business needs, I need someone to help lead the internal stuff.”

“I think I really need a mentor, coach or board to help me shift and evolve the way I lead the business.”

“I recognise I can’t just delegate stuff and let go of it, I need to coach and support people more to be successful in their roles.”

So, how do these themes apply to you and your business? What shift do you need to make to unlock the future success of your business?

We encourage you to click here to read the notes from the meeting and to start reflecting. If you need help in thinking this through or support in making the transition to transform your business, please contact Adam Campbell on acampbell@telospartners.com to see how we can help.

Filed under Thought leadership

Planning a successful exit

March 4, 2015 Leave a comment

Our Cog:ent event held on the 22nd of January covered the theme “Planning a successful exit”. It was a fitting topic for the concluding workshop of the current series looking at building and developing sustainable and successful businesses.

Participants got some valuable insights from our guest who “had been there and done it” (the founder of a successful sports management company who sold his business to a large player in the sector) and from experts in the legal, banking and accounting fields.

The workshop highlighted the following key questions:

  • Have you prepared your business in the best possible way?
  • Have you prepared yourself for that important transition?
  • Are people around you ready for it?

This blog captures the learning from the workshop and details what each question entails.

Preparing your business

  • Start preparing your exit well in advance. It pays off to plan a long time ahead.
  • Pay experts to conduct a thorough due diligence on your business to identify weaknesses, potential points of contention and inconsistencies. Fix them. A buyer’s advisers will turn your business upside down and ask many probing questions. You may as well be ready for them.
  • Build in good time a strong exit team, with an experienced Finance Director, an accountant, a lawyer and a consultant. The team must work well with you and have developed a high level of trust and understanding of your business. Bringing them in at the last minute or when negotiations have started is a bad idea.
  • Future-proof the business as much as possible: secure longer-term contracts with key clients and suppliers.Tidy your leases. If you are in the professional services sector, and are using associates as part of your business model, have strong contracts in place and key clauses such as “Change of Control”.
  • Develop assets on the balance sheet to make it easy to value the business.
  • Demonstrate growth over a period of time and be clever about it. Show the buyer there is potential for future growth. Be aware of the economic cycle and sell on the up, not at the top.
  • Be open-minded : buyers may come from locations or sectors you had not anticipated. Foreign firms may want to enter your local/national market. “Old-fashioned” companies may want to acquire modern technology.
  • Do not underestimate the level of time and effort required to pursue an exit and how distracting it can be in the daily running of the business. Stay focused on the present while preparing the future.

Preparing yourself emotionally

  • Think carefully about your motivation for exiting. What is the key driver? Is it a desire to be in control of your time and to re-balance life in favour of family, leisure and a more enjoyable lifestyle?  Is it money? Is it to use the proceeds of the sale as capital for future bigger ventures? Is it having the time and means for charitable or social activities?
  • Do not underestimate the “soft” side. Beyond the transactional aspect of the exit deal lies a strong emotional transition. You are often at the heart of your business and that business may often be your raison d’être. Employees, customers and suppliers may have strong connections with you. Untangling yourself from these relationships and the business may be difficult and painful.
  • Enjoy the ride. It could be a stressful experience but it could also be really fun and bring a lot of learning.  It will most likely be life-changing and therefore must be anticipated as such.
  • Pick your moment. It is best to do a deal when there is no pressure to do one. You will get a much better outcome if you can be relaxed about it and leave “pennies” on the table.

Preparing yourself practically

  • What will you do the day after the deal, when emails will stop, the phone won’t ring and your diary will be empty? Don’t think that, post exit, your diary will fill up automatically with meaningful and fulfilling activities. It will not, unless you have planned for it accordingly.
  • Know your next move, professionally and personally. Prepare your next business venture or second career, start new hobbies, decide to have a period of reflection to think in a proactive and purposeful manner about your next challenge. Don’t get caught in a purgatorial zone of regrets and hesitations.
  • Can you afford to exit? Do the math on the level of monthly “pay” you can expect once you have exited. You may no longer have a monthly salary and regular dividends so how you will support your lifestyle without burning your deal money too quickly? However large that amount was, you will need to make it last and invest it wisely.
  • Optimise the tax situation for yourself and people in the business. Again, start that work early enough to reap the most benefits.

Preparing others 

  • Take your management team with you. Consider stock options to retain your key staff.
  • Communicate with them and make sure they understand what they will get from the exit and how it will affect them. Get them focused on growing the business. When the time is appropriate, communicate with the rest of the company and highlight what the future holds for them.
  • If the business was started with one or several partners, it is essential to be clear from the beginning on the way forward and preferred exit path. Legal documents underpinning the original agreement must have sufficient flexibility to allow several options or scenarios. It is worth having the tough conversations at the beginning rather than when being approached by a potential buyer.
  • Talk to your family about what the future could be like and what changes may occur. Do not think that they will automatically get it and make a smooth transition.

Exiting your business is kind of easy. Exiting your business in a successful way, on your terms and with the best possible outcome, is not. It is clearly a complex task and it will require a significant amount of physical and emotional energy to reach that objective successfully. Be prepared and have the right people around you to support you in that challenging endeavour.

Should you wish to find out more about what we discussed on the day, the slides of the day are available here (150113 Cogent – planning a successful exit slides only).

If you would like to explore the relevance of this theme to your ambition and your business, then please contact jcfonfreyde@telospartners.com, dhenwood@cvdfk, josh.white@hsbc.com or rgregory@pitmans.com.

We are currently planning the next series of Cog:ent events, so watch this space for more information.

Filed under Themes of sustainable success, Thought leadership

Financing Growth – the easy way

November 5, 2014 Leave a comment

Two years ago, when we came up with the title “Financing Growth – the easy way” for our 7th Cog:ent Group meeting, we didn’t really know what we meant by the term easy way. At Telos, we had just run a meeting to explore the same topic (click here) which highlighted some important questions:

  • To what extent does your ambition for the business require finance?
  • What amount and source of finance best meets your growth aspirations?
  • How do you make your business attractive for potential funders?
  • And, once the funding is in place how do you capitalise on the ‘personality’ that comes attached?

We decided that the easy way meant creating a simple and practical process that allowed businesses to answer these questions for themselves. So, the Cog:ent meeting on 9 October 2014, brought together 17 ambitious business owners, an entrepreneur turned funder, a panel of experts and 5 different sources of finance to do exactly this and, in the process, build better connections between businesses and funding.

This blog summarises the discussion, observations and learning from the event. The key slides for the event can be found by clicking on this link 141009 Financing Growth Slides.

Financing landscape

As with each of the themes, we do a lot of background research into the topic. As well as confirming well established facts, such as different stages of growth require different sources of finance, it also provided some interesting insights. In particular:

  • Attending a conference at Middlesex University, Financing Growth in SMEs meeting the challenges after the global financial crisis, appeared to highlight that the supply of finance is no longer a key issue and that it is more the demand for finance and the availability of “investible businesses” that needs addressing;
  • The funding landscape remains a highly confusing maze for time-starved ambitious business owners to successfully navigate;
  • The rise in a range of alternatives has got people’s attention, yet banks are still viewed as the primary source of, and route to, finance for most ambitious business owners;
  • The “financial maturity” of the business and the willingness of owner-manager to let go, or accept restrictive covenants or personal guarantees, is a key enabling (or limiting) factor.

With this information in mind, we set about designing an event that started to address some of these factors for attending businesses.

Drawing upon experience

We interviewed a panel of experts consisting of Rob Keown-Boyd, Debbie Clarke and Andrew Peddie and Josh White. The discussion brought out the following observations:

  • “If you tell the right story, in the right way, to the right people you WILL get finance”;
  • It takes practice, effort, courage, a lot of shoe leather and continual learning to get it right – it is very much an iterative process;
  • It’s important not to forget about financial benefits that come from “better management of the business” – better relationships and/or arrangements with customers or suppliers can often negate the need for finance in the first place;
  • It is important to clarify “why we need finance” by challenging your own assumptions, as it allows for more informed, solution-focussed conversation with funders;
  • “You don’t know what you don’t know”, so it is important to consider all options and get advice.

Building connections

Given that half the problem is finding the time to find and meet with the right finance, we created a structured “trade fair” that allowed participants to meet with a range of sources of finance, that included:

The conversations, led by the business owners as opposed to the funders, drew out the following observations and actions:

  • Every situation is unique and there is no “one size fits all” solution;
  • Personal and business aspirations on future, growth and exit all need to be considered;
  • Work needs to be done to create a story and plan to help funders understand the ambition;
  • It’s important to understand/compare the mechanics/cost of the various sources of finance;
  • Working with an experienced specialist advisor can help save a lot of time.

Each business owner enjoyed the practical way of exploring the theme, leaving with a renewed sense of hope about the future and more informed about the varied sources of finance available to them.

If you are interested in exploring the outcomes of this topic and how they apply to your business, the Cog:ent Partners can help you in the following ways:

  • Telos Partners– create a robust strategic plan that develops strength within your team and presents a compelling investment.
  • Chantrey Vellacott – assist you in preparing financial forecasts to support your business plan and understand your financing requirements.
  • Pitmans Solicitors – provide legal advice from a full service firm tailored to your needs and utilising our lawyers from across 20 sector specialisms.
  • HSBC – give you an honest feedback on the current feasibility of your finance considerations.

For those of you who enjoy reading more on the topic, we found the following The British Business Bank – the business finance guide a particularly useful source of reference.

The next Cog:ent meeting is on 22 January 2015 and explores the theme “Planning for a successful exit”. If you are interested in receiving an invitation, please contact acampbell@telospartners.com.

Filed under Themes of sustainable success

Building an agile and resilient business

August 20, 2014 Leave a comment

In a world of ever increasing pace of change and complexity it is impossible to predict what will happen in the future. Even those whose full-time job it is to predict the future fail to do so with any degree of accuracy or consistency. And, if highly experienced and knowledgable business executives can fail to adapt to the ever evolving world and lead their organisations into crisis, how can those of us running our own, smaller but still ambitious businesses fare any better?

  • How can we grow a business on a rising and falling tide?
  • How can we survive heavy blows and come back fighting stronger?
  • How can we build an agile and resilient business?

These questions were the topic of exploration for our Cog:ent meeting on 10 July 2014. What follows are the key topics and themes that were discussed during the day.

If you are interested in discussing the theme further, or, if you are interested in diagnosing how agile and resilient your business is, please contact acampbell@telospartners.com.

What do we mean by agile and resilient?

Agility is the ability to move quickly and easily. Resilience is the capacity to recover from difficulty. An agile and resilient business is able to respond quickly to the first signs of crisis, spot new opportunities and come out of the situation stronger and better. As such, an agile and resilient business is very different to a bloody-minded, stubborn and persistent one.

Agility and resilience are essential attitudes, skills and strengths to enable people to cope, bounce back from and potentially thrive, in times of adversity or pressure. Their relevance is as important to individuals as it is to teams and organisations. And of course, there is both an internal and external context to be considered.

As skills, they can be learnt. Indeed, each and every business challenge is an opportunity to develop greater agility and resilience. Each time, you face up to, reach out and overcome a crisis your “plastic shield” and social network become stronger allowing you to face and conquer ever increasing challenges.

To what extent do you have it already?

According to Diane Coutu (2002), there are three essential ingredients to resilience: the ability to face down and confront the reality and brutal facts; a deeper search for meaning and understanding of how this builds a bridge to the future; and, the ability to adapt and improvise.

So perhaps we should ask:

  • what is really happening for you, your business and the business environment?
  • how is this relevant and meaningful for the purpose of your business?
  • how can you adapt and create opportunities in a new world?

And what of this “plastic shield”? Consider it like a firewall or a flame retardant paint. It won’t stop the crisis but it will buy you time. From a business perspective this includes (amongst other things):

  • a strong brand and value proposition that provides a strong competitive advantage
  • deep and close customer relationships
  • a positive culture where people step up and take responsibility
  • a relevant position in the value chain
  • diverse sources of income
  • a flexible cost base
  • enough cash in the bank to survive a downturn in business

How can you develop your agility and resilience further?

Airline pilots train themselves to deal with the unexpected. Successful sports teams practice a wide range of game scenarios. And, they do this to increase the likelihood of being able to successfully respond to challenging and difficult circumstances.

In the world of ambitious owner-managed business, it is rare for us to find a management team doing something similar. That is why we often find ourselves in coaching, team development or strategic planning processes using scenario planning to help develop this capability.

So here we ask:

  • How are you developing agility and resilience in yourself, your team and your organisation?
  • And, are you developing your social support network in the process?

And, so what?

After participating in the day, what were some of the actions that our ambitious business owners took away?

  • “revisit my strategic plan; marry my personal objectives with my business ones”
  • “build stronger relationships with my clients; staff and building growth”
  • “align company aims throughout the business”
  • “understand resilience in different parts of the business”
  • “be more creative; allow my staff to take more responsibility”
  • “better understand staff weaknesses and see how to support them”

You can view the slides used on the day here. For those of you who are interested in reading more on the topic, a reading list is included below. The next Cog:ent meeting “Financing the growth of your business – the easy way” takes place on 9 October 2014.

Background and further reading

  • How Resilience Works, Diane L. Coutu, HBR May 2002
  • The Quest for Resilience, Gary Hamel and Liisa Välikangas, HBR Sept 2003
  • Two Routes to Resilience: rebuild your core while you reinvent your business model, Clark Gilbert, Matthew Eyring, and Richard N. Foster, HBR Dec 2002
  • Adapting in tough times: The growing resilience of UK SMEs, written by the Economist Intelligence Unit on behalf of Zurich, Nov 2012,
  • Organisational resilience: development of a conceptual framework for organisational responses, Burnard and Bhamra, International Journal of Production Research, Sept 2011
  • Engendering resilience in small- and medium-sized enterprises (SMEs): a case study of Demmer Corporation, Demmera, Vickeryb* and Calantoneb, International Journal of Production Research, Sept 2011

Filed under Themes of sustainable success

How do you stand out in your market place and grow your business?

May 1, 2014 1 Comment

Our Cog:ent meeting on 10 April 2014, explored this topic. The themes discussed are captured below.

High growth businesses focus on their customers and have brands with a reputation of consistently delivering better value than their competitors. Facts that are proven time and again by the clever minds of academics everywhere. The case for investing in your brand is a strong one, but brand is more than just a logo or a new lick of paint. Brand is everything you stand for and say. It is everything that you do and are as a business. It is your customer’s experience of your culture.

How do you create a great brand?

Well according to Steve Edge, our special guest for the day, it’s about balls! That is, finding the one ball that makes you really stand out and then building upon it to the nth degree. Call it purpose, call it value proposition, call it whatever you want, but this is about the special relationships that exist between the real passion of the business, the gap in the marketplace and the emotional needs and wants of the customer.

What is your one ball?

  • For Lidl it is about giving people the simple pleasure of finding a bargain
  • For Apple it is about bringing consumers beautiful products that are a delight to use
  • For Cog:ent it is about simple business truths, borne of real world experiences, delivering long-term benefits

However, answering the question is harder than you might think. It requires the right blend of pull (listening to what customers, staff, suppliers, competitors say about you) and push (clearly, concisely and consistently communicating your core brand message). It is very much a dance. For most, the scariest part of this is the fear that what customers might say and is very different you might hope! But isn’t that the point of branding? What hope do you have of doing this if you are too afraid to ask? In exploring this point further, we all concluded that we are not as customer focused as we might like to think!

So, once you’ve discovered your one ball, what do you do next?

Well, you do everything you can to keep that ball in the air. By constantly assessing and monitoring how well you are doing in the eyes of the customer across all aspects of your business. Simple!

Well, perhaps not!

Because like most things in your business, your brand is delivered by your people, who live and breathe in the culture of your business. When you are an ambitious business owner focused on growing your business it is hard to pay attention to the people and cultural aspects of your business. Yet the high growth ones make that time and continually demonstrate that if you can align your culture and brand, your competitors will find it hard to match you in the long-run!

So how are you, through your people, going to create the brand that you want?

We suggest that you start by:

Our next Cog:ent meeting themed ‘building an agile and resilient business’ and takes place on 10 July 2014. If you are interested in finding out more about the theme, Cog:ent or how Telos Partners can help you to grow your business, please email acampbell@telospartners.com.

Telos Partners, has teamed together with Chantrey Vellacott DFK, Pitmans Solicitors and HSBC Bank to develop and run a series of practical, thought leadership workshops on how ambitious business owners build a successful and sustainable business against the background of a difficult economic climate.

 

Filed under Themes of sustainable success

How to transition your role as business founder …

March 25, 2014 Leave a comment

… and build a business that is less reliant on you was the focus of our discussions at the Business Improvement and Growth (BIG) Network session on 7 March 2014. (click here for a link to the BIG website)

Few business owners have spent much time thinking about how they want to exit their business. And if you’ve not thought about how you want to exit, you’ll be unclear as to the leadership transitions you will need to make in your current role in order to achieve, in time, a successful exit. But what does a successful exit really look and feel like for you? How do you successfully transition in your role to ensure the business continues to create value beyond you? These were questions we began to ask ourselves as we explored this topic.

We continue to be told that the number of businesses that survive beyond their original founder is relatively small, but there are many who have achieved this feat. For instance, there’s the Weir Group Plc founded 1871 by George & James Weir, IMI Plc founded in 1862 by George Kynoch, Microsoft founded in 1975 by Bill Gates & Paul Allen, and Tesco founded in 1919 by Jack Cohen etc. These examples highlight that many businesses can successfully transition through period of wars and crisis, so a transition in leadership is possible, but needs to be thought about and managed.

As we began to explore the academic research on leadership transitions it became evident how little there was on the subject, especially in small firms. Despite its importance, few have studied this area. The research we found tended to bias a financial management perspective (i.e. the passing down of assets), or a family firm perspective (i.e. the father and son analogy). Whilst these findings highlight the particularly challenging nature of the leadership transition process in owner-managed firms, with ownership responsibilities becoming intertwined with management and family responsibilities, it raised some key questions for us:

  •          what does a successful leadership/role transition look and feel like?
  •          what are the transitions that founders/leaders make? And need to make?
  •          how would you like to exit the business, and what actions would you need to take to make this a reality?

So, as part of the BIG Network session on 7 March, we set off to explore these questions, and this is what we uncovered

1. Start with the exit in mind

Have you thought about how and when you would like to exit your business? If you haven’t, some would say you’re already behind the curve. In his seminal book “7 Habits of Highly Effective People” Steven R. Covey identifies a need to “Begin with the end in mind” as the second habit of highly effective people. And in order to create the exit you want you’ll need to work out what’s really important to you in your various roles and relationships, you’ll need to visualise what they look like in the future, and consider the actions you will need to take along the way to realise them. A simple activity that we suggest would be to write yourself a “Postcard from the Future”, 12 months after you’ve exited the businesswhere are you? what is it like? what are you doing? who are you with? what are they doing? what have you done along the way?

2. Be prepared to navigate the ‘exit obstacle course’

It was Shakespeare who said that “all the world’s a stage, and all the men and women are merely players”. Behaviour is often determined less by characteristics of the person and more by the part one is assigned to play. We all play a multitude of roles in life, whether these are roles in our personal lives or in our business lives. What we might overlook however is the way in which these roles are wrapped up a range of other issues. You’ve put your stamp on the organisation culturally, the way it is structured, to the systems you have implemented and the strategy you have created. Extracting yourself from this complex web creates an ‘exit obstacle course’ to be navigated, one that will ultimately define the organisation you will leave, and everyone working within it.

3. There’s many ways to pass a baton and we can all learn from sport!

The transition from one role to another has been likened to the passing a baton in a relay race (Dyke et al., 2002). As such it requires a clear process to get the baton from one person to another whilst allowing the efficient functioning of the whole team. According to the Dyke et al. model doing so requires: a considered ‘Sequence’, the right ‘Timing’, a good ‘Technique’ and appropriate ‘Communication’. As we explored this model with our cohort of business owners the following issues emerged as challenges to be embraced and managed

4. What does the business really need?

It is the business context and needs that determine the style of leadership that is required for the next stage of business development and growth. To take up this challenge of leadership the business owner has to find a way to delegate more of their functional roles, the day-to-day activity; but what do they let go of? What you hand over is entirely up to you, but it must be deliberate, well considered and clear. Letting go of stuff you simply don’t enjoy or understand is the equivalent of throwing the baton from 20m, hoping someone will catch it before it hits the floor!

  • Timing is everything, and it will take longer than you think!

Recognising when it is the right time to transition, within or out of the business, means accepting your limits of competence, and your own frailties. It is hard to accept and hard to do, but ensuring the timing is right is essential. Waiting until the year before you wish to hand over the leadership reins and/or retire is potentially a recipe for disaster. And, trying to do it with a failing business brings its own unique challenges. It’s also a process that takes time. A typical succession process for a founder-led business can take up to 3 years – a year to find someone, a year to see if they are any good and a year to really let go! The businesses owners we speak to say that if they had their time again they would have started conversations earlier. By starting conversations early on you can build a picture together with those around you of what the future looks like and you can align you expectations with others. Ask yourself: when do I intend on exiting the business? how will I know when I have transitioned successfully?

  • Mind the gap!

Who is best placed to run the next leg in the development and growth of your business? The business owners we work with often admit that they would have brought in the right skills earlier. But what are the right skills? You do a role that no one else does, and you probably don’t know it. It’s also not just about skills and capabilities, but also behaviourHow do you transfer your passion, commitment and ownership to someone else? These are all important questions to address to ensure continuity in leadership, and that the baton is not dropped into a leadership void. Ask yourself: what skills does the organisation require from its next leader? what are the selection process and criteria? And, what will the organisation miss when I’m not performing that particular role anymore?

  • Beware of ‘false starts’

Don’t make assumptions that the role or process for transition is understood by the other person. The context also changes and people’s priorities shift in time, what was important a year ago to someone, might not be the same now. If there is a gap in skills, or a lack of clarity around the process for transition, you might find you hand the baton over only to pick it back up again. Ask yourself: what am I doing to build trust with my successor? How am I encouraging communication on this matter?

4. Guidance is helpful

Finally, unlike a relay race, you will not have endless opportunities to practice a transition. So drawing on the experience of others to help increase your chances of a successful outcome will be important. Talk the challenges through with your peers or your business coach, clarify the wants and needs of those involved and create a roadmap for achieving the transitions that support the development and growth of your business.

Having read this blog we challenge you to

draw a picture to represent the change you will have experienced in 3 years’ time:

  •          where are you? what is it like?
  •          what are you doing? what is your role?
  •          who else is with you, what are they doing and how do they relate to you?
  •          where is organisation in its stage of development?

Using the learning you have developed from this blog, explore the transitions taking place over the next 3 years and record any actions that you will need to take to achieve a successful transition in your role.

Get in touch and share them with us and the other ambitious business owners on the programme; we’d love to hear about them.

Further reading for those keen ones amongst us!

Bolden, R. (2001) Leadership Development in Small to Medium-Sized Enterprises, Centre for Leadership Studies.

Cadieux, L. (2007) Succession in Small and Medium-Sized Family Businesses: Toward a Typology of Predecessor Roles During and After Instatement of the Successor, Family Business Review, 2.

Cope, J., Kempster, S. and Parry, K. (2011) Exploring Distributed leadership in the Small Business Context, International Journal of Small Business Reviews, 13: 270-285.

Dyck, B., Mauws, M., Starke, F.A. and Mischkea, G.A. (2002) Passing the baton: The importance of sequence, timing, technique and communication in executive succession, Journal of Business Venturing, 17: 143162.

Handler, W.C. (1990) Succession in Family Firms: A Mutual Role Adjustment between Entrepreneur and Next-generation Family Members, Entrepreneurship Theory and Practice, Fall.

Handler, W.C. (1994) Succession in Family Business: A Review of the Research, Family Business Review, 7: 133.

Hannonen, T. (2013) Management Succession in Family-Owned SMEs: Learning from Failure, Master Thesis, Aalto University School of Business.

Ip, B. and Jacobs, G. (2006) Business Succession Planning: A Review of the Literature, Journal of Small Business and Enterprise Development, 13(3): 326-350.

Kempster, S. and Cope, J. (2010) Learning to Lead in the Entrepreneurial Context, International Journal of Entrepreneurial Behaviour and Research, 16 (1): 5-34.

Martin, C., Martin, L. and Mabbett, A. (2002) SME Ownership Succession Business Support and Policy Implications, Knowledge Management Centre, Business School, University of Central England

Motwani, J., Levenburg, N.M., Schwarz, T. and Blankson, C. (2006) Succession Planning in SMEs: An Empirical Analysis,International Small Business Journal, 24(5): 471-495.

Sonnenfeld, J.A. and Spence, P.L (1989) The Parting Patriarch of a Family Firm, Family Business Review, 2(4): 355375.

Venter, E., Boshoff C. and Maas, G. (2005) The Influence of Successor-Related Factors on the Succession Process in Small and Medium-Sized Family Business, Family Business Review, 18: 283.

Wang, Y., Watkins, D., Harris, N. and Spicer, K. (2004) The relationship between succession issues and business performance: Evidence from UK family SMEs, International Journal of Entrepreneurial Behaviour & Research, 10(1/2): 59-84.

 

Filed under Themes of sustainable success

Delivering Business Growth Through Strategic Alliances

February 3, 2014 Leave a comment

The theme of our fourth Cog:ent Group meeting, held at HSBC Green Park, Reading was “Delivering Growth Through Strategic Alliances”. If you want to get a sense of the overall discussion, you can view the summary slides here.

This blog highlights the key themes that arise when you bring together the experiences of 15 ambitious business owners, combine it with the experience and knowledge of consultants, accountants, solicitors and academia and then discuss the theme in depth.

So what is in a theme?

Seeing relationships through a strategic lens

The activity of drawing your business relationship system throws up some interesting shifts in thinking. A significant number of participants commented on how they had started to see an existing relationship in a different way. For one participant, this new perspective opened up potential routes to two overseas markets. We suggest that you try this for yourself.

What’s behind that handshake?

It seemed that we could have spent the entire day debating how much needs to be written down. Is a handshake just enough? How detailed does the alliance plan need to be? To what extent is the plan the contract?

However, there was a common view that it’s essential at the outset of any strategic alliance to have a clear and common view of its purpose, the objectives and the commitment required from all parties to make it successful. You need agreement on these things. Writing this down helps to clarify understanding and share that understanding with other people. It’s amazing how disagreement can fall around the smallest misinterpretation or a missing word, so make sure your assumptions have been well and truly checked.

That said, given the changing nature and complexity of the world, there is a need to balance formality with opportunity.

As a slight aside, for those of us who believe in the power of a handshake, it’s interesting to discover that scientific evidence supports what we intuitively feel – the handshake touches neural circuits inside the brain that predispose a person toward positive feelings of competence, trustworthiness, and it opens a relationship of positive cooperation while suppressing negative feelings and avoidance behaviour. But, for those of us who believe in the power of planning, it is interesting to note that  a psych professor at Dominican University of California found that people who wrote down their goals, shared them with others, and maintained accountability for their goals were 33% more likely to achieve them, versus those who just formulated goals.

Optimising risk

As with most things in life and business, strategic alliances are all about optimising risk and sharing the reward. So understanding what the risks are, how to protect yourself against them, what’s required to deliver the reward and how the reward will be distributed is critical. The form and business model of the alliance needs to help those involved to balance these things.

If you’re inexperienced at undertaking strategic alliances, the risk increases. So, where might you seek guidance and support?

The power of the network

Finally, it’s interesting to note that two of the Cog:ent participants have entered into a strategic alliance that has already delivered in excess of £100k of turnover at a good margin. And, a further two started to explore mutual benefits then and there in the meeting!

So, some key questions to answer are:

  • How might your existing relationships help you to achieve your strategic goals?
  • To what extent do you have agreement in your strategic alliances?
  • How does the form of the alliance help you to fairly share risk and reward?
  • What needs to be written down to confirm your agreement?

The Cog:ent Group meetings are a result of a collaboration between HSBC, Chantrey Vellacott accountants, Pitmans Solicitors and Telos Partners. To discover more about these meetings please click here.

If you would like to explore how strategic alliances might help your business and how Telos can help to support you in the process, please contact acampbell@telospartners.com.

Filed under Business Growth Networks, Themes of sustainable success

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