Keep the cash in for long term success

Increasing numbers of small firms are taking too much cash out of their business according to Trevor Williams of The FD Group.

Experience has shown that in a fast changing world, cash is king. Keeping hold of it will ensure that your business can survive the downturns and the lean periods. It also allows for continual investment in the business in terms of assets and more importantly in the people.

So make sure that you take out only what you need after having thought through what the long term needs of the business are. After all it is this that keeps the cash flowing in every month.

Some pointers as to how to manage the cash include - avoid the lavish life styles, stick to the knitting and avoid investing in other peoples ideas, go for the long term, invest in the talent in the business.

The boats, the holidays, the jewellery are all justifiable after years of hard labour, but just make sure that they don't jeopardise the capital value of the business.

Politics and leadership do not mix

This blog is not a political statement. The issue of leadership in a political world affect political parties the world over.

What I am referring to here is the mess Gordon Brown got into when he told us that he did not take into account the latest upswing in the Tory support in the latest opinion polls. The truth or the fact is that we all know that he did. The problem is that some would rather not acknowledge that fact. So he and his reluctant supporters would rather argue a lost point than lose face.

That is not great leadership. A great leader inspires through depth of character. They know that in the times of great adversity they will be called on to make tough decisions. The supporters expect the decisions to be made with the right motives, not through acts of spin to save a faltering reputation.

As a business leader, what would you have done? Would you have continued to argue the point despite all around you acknowledging that you were in the wrong or would you have acknowledged the truth of the situation and demonstrated true leadership?

The importance of succession planning

I attended a talk recently at the DBA by one of the grand fromages of the M&A world called Jim Surguy. He gave an excellent talk about what companies need to do to maximise their value at the exit point.

One of the key points to come out of his talk was the importance of having a succession plan in place. Who are the people who will succeed you and your fellow Directors when the time comes for you to take your hard earned cash and relax on the beach. Even if there is an earn out period they know that your intention is to ease down. Who will take up the slack is the question on the minds of the prospective buyers?

So think about it whilst you are not on the descent path. Who will take over? What skills do they have and what skills do they lack. Are they good as a team or simply as a group of individuals.

If you want to talk to someone about the make up of the succession team call me on 0117 904 7874 to set out the agenda for their progression into filling your shoes.

Exit strategy improves performance

In today's frenetic business climate it takes something special to succeed. It takes that something extra beyond the norm for success to happen. We cannot rely any longer on the received wisdom of today.

The traditional methods for increasing performance such as honing the creative edge, better utilisation of the talent pool, or streamlining the business processes do work to some degree. So do some of the more in-vogue ideas like enhancing culture through becoming more interdependent, enhancing client life time value through relationship marketing, and “user chooser” flexible reward schemes. They have all demonstrated their success over the years.

However, our insight into the media sector suggest that many owner managers exhibit those characteristics of the rolling stones Bob Dylan was singing about when he asks “How does it feel, to be on your own, no direction home, a complete unknown”. They have focused all their attention on doing the work of the business but lack the skills required to maximise the performance of their agency and therefore do not fully develop the capital value.

However, recent independent research in the marcoms agency sector suggests that owner managers in the marcoms sector can significantly enhance their performance by developing:

1. Belief in your own capabilities
2. An exit strategy

If you would like to know more on how an exit strategy can help you to build your agency, please call me on 0117 9047874 or email me at Exit.strategy@credence-uk.com

ABC of Growth - C = Corroboration.

High growth companies have evidence to corroborate their brand and expertise.
They have easily recognised trophy clients. They advertise their successes and promote their expertise through the skilful use of testimonials, reviews, articles and PR.

Prospective clients are looking for ways to reduce the risk of using new suppliers. One way they do this is by looking for evidence of satisfied clients. A list of names is not enough. What they want to see are recognisable names and realistic assessments of what you did for them and the benefit they derived from it.

Do you have corroborative evidence that demonstrates that you are as good as you say you are? If not, then start thinking about asking your clients for a testimonial or writing up your intervention in the form of a case study.

Finally, use every piece of corroborative evidence as many times as you can. Insert it on your website, your blog, your newsletter and so on

If you need any more information - please give me a call on 07956 532963 or email on blogresponse@credence-uk.com

ABC of Growth - B = Brand

High Growth companies recognise the value of their brand. they cherish it and nurture it. they know that it takes times to build a strong brand but only a few minutes to destroy it. It has lasting value that ensures a legacy to future employees and clients. Everything they do adds value to their brand and their reputation.

It is not enough to have a logo, or good stationery. A brand is so much more than that. Wally Olins, a noted thinker in this area has this to say "In a world that is bewildering in terms of competitive clamour, in which rational choice has become almost impossible, brands represent clarity, reassurance, consistency, status, membership. Brands represent IDENTITY".

Does your brand represent your identity. If they see your brand will they recognise you for what you are, what you stand for and what you can deliver?

Call me on 0117 9047874 if you would like to discuss how to maximise the value of your brand.

ABC of Growth - A = Activities

The clearest sign that a business is well led and managed is its ability to deliver consistent, profitable growth.

After years of working with small businesses I have worked out what they need to do to grow.

And it is as simple as ABC!

The ABC of growth – what high growth businesses do well.

High growth companies are hives of activity. They are “doing” orientated. They get it right. They do the right things with the right people to the right customers at the right price in the right place at the right time.

Are you a doing or a thinking company?

How many proposals have you sent out, how many new prospects have you seen, how many networking events have you attended?

The list of activities that will build your business goes on and on.

If in doubt, do the things that you like doing - but do them well and frequently.

The great companies are doing orientated - now go and do like wise