Archive for April, 2016

Serendipity Leicester’s Friend

Friday, April 29th, 2016

The great thing with success that seemingly arrives from nowhere, is how it has this affect of forcing you to dive deep into your memory to try to make sense out of a sequence of visual images and serendipity. Yet you are none the wiser when you stop thinking about it. On the eve of Leicester City, let me say it once more, Leicester City, being crowned Premier League champions, as someone who was born in Leicester, it is just nonsensical. 5000/1 was probably mean, bookies are not in the business of being generous.

Yes the older locals would talk to an 8 year old kid about the sides of the sixties and the near misses. The 70s team had their moments. Watching Leicester’s own “George Best”, moustachioed striker Frank Worthington, clad in black leather jacket, loud shirt, and a host of gold rings and necklaces take his seat with the routine blonde in hot pants at the local circus. More Dirk Diggler. Keith Weller, a talented midfielder, who did more to promote Leicester’s hosiery industry, wearing a fetching pair of white tights on an icy day in January 1979. The 90s under genial manager, Martin O’Neill, securing a League Cup but in truth, every response before and since to where do you think the City will finish this season has been tinged with pessimism. Indeed, even the most ardent fan this year has sensed a potential collapse is around the corner, until now.

With bookmakers offering no higher than 1/20, it is going to happen. There is no logic too it but why worry, when serendipity strikes we just have to make the most of the moment. Unless of course, it happens again next year…..

© James Berkeley 2016. All Rights Reserved.

The Value Creating Agenda In European Private Equity

Monday, April 25th, 2016

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150 of the leading minds in the sector assembled at Private Equity International’s Operating Partner Forum 2016: Europe. Here is an exclusive snapshot of 5 key takeaways from a list of 20 priorities shaping the future:

  • Impact trumping brand. What an Operating Partners does in future is more important than the size or diversity of the PE firm.
  • Little guys on the rise. Substantial “growth” opportunity in the next 12 months for small and boutique consultants and advisors. Tightly customised products and services, absolute credibility (IP), the ability to build a seductive rapport and convert it into increased market share .
  • 6 core value creation themes in 2016 (all businesses). 1. Structural transformation, 2. Operational improvement (often seen as unfashionable but where a lot of hidden value resides), 3. Buy and build platforms, 4. Emerging market growth, 5. Strategic repositioning and 6. Growth acceleration.
  • The Atlantic Divide. Limited Partners (LPs) report increasing geographic distinction between US and European PE  buyouts. In the US, a great frequency  of institutional buyouts (“IBO”), manifest in telling managers “we own your business, you will follow our approach”, consequently, management are more subservient. In Europe, a greater frequency of working with management and a greater propensity for peer-level relationships. Skills, behaviours and expertise needed differ, particularly communication.
  • The Digital PE Value Creation Wheel. Outstanding PE firms are embedding in their portfolio company due diligence 1. Product (capability), 2. Price (transparency), 3. Channel distribution (eCommerce), 4. Marketing (how they do it), 5. Operations (managing the business), 6. People (awareness, skills, behaviour)

Want the other 15 priorities, write to James@elliceconsulting.com  for a free copy of the full listing.

© James Berkeley. All Rights Reserved.

Are You Thinking What I Was Thinking IX

Friday, April 8th, 2016

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  • Most businesses don’t lack great ideas today, they lack people with the skills and volition to apply and monetise great ideas
  • The problem is not the regulatory changes forced on banks, insurers, pharma etc, it is the ability of management and employees to respond effectively and efficiently (skills, behaviour and expertise)
  • The media and politicians express “shock” and “revulsion” at those using offshore tax havens to mitigate their tax liabilities but barely a whimper about at the cyber security criminals, who initiated the breach.
  • Man’s ingenuity is such that we can send a rocket into space and return it to the exact same position it departed, yet our “precision” capabilities when it is applied to tracking terrorist threats, cyber, people smuggling, are largely scrambled and ineffective.
  • Global markets have largely recovered the losses incurred at the outset of this year, yet the business media continues to run “recession scare” stories.
  • Every company is becoming a digital company, the consequences differ based on the quality of the management and employees, the amount of uncertainty within the business and the competitive threats
  • Microsoft and Google beat the best human at image recognition in 2015 but there is little evidence that humans will be replaced by computers in assessing and underwriting risk, which largely depends on art and science.
  • Value chains in almost every sector are being compressed and traditional functions increasingly being made redundant, as technology facilitates the faster dissemination of information and the application of knowledge to critical decision-making (capital deployment, human resources, innovation, strategy implementation). There is no going back.
  • Contrary to popular myth what new entrants into the workforce want today (interesting work, a gratifying job, career progression and equitable rewards) hasn’t changed in decades, what has changed is the ability of businesses to deliver it. Understanding why and doing something about it, is where the valuable debate lies.
  • In all the chest-beating about diversity and progressive organisations, by far the most disadvantaged and impactful on society are not single issue “victims” (sex, race, nationality, age etc) but those individuals with diverse pasts (educational backgrounds and life experiences), who are routinely rejected by businesses driven to hire and promote “people like us”.
  • The fanfare about “Self-Management”, as practised by organisations such as Zappos, speaks louder about the concept than the results the business has achieved in the real world. Separate the fad from reality.

© James Berkeley 2016. All Rights Reserved.

RPM II: The Cornerstone Client Walks

Sunday, April 3rd, 2016

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In the second in our weekly series of Resilient People & Momentum (“RPM”), James discusses how to lessen the impact of a key client exit on the firm’s profitable growth plans. No seriously, clients aren’t for life!

Situational Overview: The Cornerstone Client Walks – you have done a fabulous job. It is not personal but the buyer has decided that they can live without your product, service and relationship. You have a cashflow problem. You have a potential reputation problem within (direct reports and peers) and outside the firm (customers and business partners). You have a potential employee problem (productivity and morale). You have a potential investor problem (earnings and value). Is your first thought to seek blame or come up with a great response? I’d say in 80% of these situations I have been privy to the former explodes virally.

Resilient People & Momentum Mindset: I subconsciously expect this to happen in a growing business when I least expect it. How I respond is more important than what has happened. I earn others respect by displaying the right mix of skills, behaviour and expertise. I am willing to be intellectually honest about my own performance. I will listen to and respond sensibly to solicited feedback while ignoring unsolicited feedback that is largely for the other party’s benefit.

Resilient People & Momentum Questions:

  1. Cashflow: where can we create more short-term revenue, not where can we take money from?
  2. Reputation: where can we earn more respect (new ideas, reciprocal opportunities, return the favour), not how can I save face or pass the blame?
  3. Employees: where can we more productively deploy and offer more gratifying work to our employees, not who needs to be harangued or worse, fired?
  4. Investors: where can we display and exude greater confidence in our talent and judgement to investors such that a short-term set back, is just that, a blip on a road to riches, not a mind numbing defeat that forces investors to thrown their hands up in the air?
  5. Development: what can I learn from the treasured client’s reasons for the decision to walk away that I can apply for the future benefit of the firm (better client communication), its’ existing clients (prioritising investment) and our prospects (market positioning)?

© James Berkeley 2016. All Rights Reserved.

RPM I: My Best Laid Plans Are Screwed

Friday, April 1st, 2016

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I recently talked about the organisational dynamics and consequences of Resilient Growth in the value creation process for large and small businesses.

Resilient Growth

Behind resilient organisations lies resilient people. People with the skills, expertise and behaviour at all levels to thrive not just survive on the firm’s profitable growth journey. To maintain and increase the profitable growth momentum in the organisation. Think of this as keeping the “rev” counter high.

Knowing “how” their behaviour accelerates or destroys profitable growth is important but maintaining the right mindset and knowing the right questions to ask is the difference between someone telling you what route to fly and actually co-piloting the plane with you. Huge!

Starting today in a new series, titled Resilient People & Momentum (“RPM”), here are my observations from over 450 clients around the world over the past 25 years in very common situations, where I have had a ringside seat.

Situational Overview: The New Market Entry Strategy Has Gone AWOL – your best laid plans aren’t working in the real world. The assumptions made about the market size, demand, relationships, marketing impact, acquisition costs, ease of delivery and available resources are miles off in reality. Executive management, investors and employees are fretting madly or indeed, clamouring for your blood. Cut and run, retire graciously or come out fighting?

Resilient People & Momentum Mindset: You are a prudent risk taker. You have a track record of past success honed by past wins and losses. You live for ambiguity. This is your time to shine. Failure is not about you personally. No one is firing at you. You have tremendous value and results to provide to others in future. You can work it out with others help given their support, time and resource.

Resilient People & Momentum Questions: Your first and most important assessment is with yourself 

  1. Is there a visible outcome (result and value) that is good for my key constituents?
  2. Is there an alternative allowing for speed and the quality of the outcome that I can immediately call on or develop (good news: unless the car has crashed there is always an option)?
  3. What are the attendant benefits and risks (after preventative and contingent actions are put in place)?
  4. What is the best course of action for all parties (accepting that you are looking for a compromise that preserves everyone’s critical and highly prized issues but dispenses with the moderate and low-level stuff)?

Liked this? Daily bursts of resilience advice to follow on this blog. Please come and read, share your experiences and comment. If you prefer, a quick confidential “free” debrief, write to me at james@elliceconsulting.com

© James Berkeley 2015. All Rights Reserved.

The Media Mirror

Friday, April 1st, 2016

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Why do so many business media interviews tell us less about the individual’s story and more about their fears? If the objective of talking to a “friendly” reporter is to increase the likelihood that you are seen as an object of  interest (credibility, intellect, empathy) amongst your key constituents (clients, prospects, shareholders, employees, business partners etc), you would be wise to start by understanding the reporter’s objectives.

1. What logical and emotional priorities is he/she seeking to accomplish?
2. Why interview me? (unique story)
3. Why now? (event or occurrence)
4. Why in the manner suggested? (environment, conditions etc)
5. How is the reporter better off or better supported after the interview is published?

I see a great many successful business folk, investors and board chairs expressing anguish at what they see in the “media mirror”. “He twisted my words”, “She portrayed me in an ugly or vulgar light” or “They lied to me”.

The reporter is the easy soft target for their frustration when the real culprit is the individual themselves. They failed to ask themselves the right questions before agreeing to the interview and they walked into the interview I’ll-prepared with their ego dangling out front.

Media promotion is an important part of building a marketing gravity to businesses that  want to lower acquisition overheads and accelerate top line revenues. Doing it right is more important than not doing it at all.

 

Copyright James Berkeley 2016. All Rights Reserved.