The Road from Newport Pagnell


Over the last seven years it has been my privilege to listen to some outstanding business advice from the members of TAB York. It’s been advice which has transformed businesses [and] transformed lives.

Those were words I used in my final paragraph last week. Some of you may have detected a valedictory tone.

Well, it’s not farewell. It is, however, time for a change.

Seven years ago I ‘pushed my breakfast round my plate in a desolate motorway service station’ and decided that enough was enough. I walked out of Newport Pagnell services determined to start my own business. In December 2009 TAB York was born and the journey since then has been by far the most rewarding of my business life.

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But, you come to a fork in the road: you have a choice to make and that choice determines your future direction.

In 2015 Paul Dickinson and Jo Clarkson offered me the chance to take over TAB UK – to become the franchise holder for the whole of the United Kingdom.

I thought about it long and hard. It was a significant financial commitment and it meant giving up the regular contact with the majority of my Board members. But that chance – and the challenge – had been offered to me. And – like so many TAB members up and down the country – I didn’t want to think “what if…”

I talked it over with Dav – several times – and thought about little else as I drove around North Yorkshire. And then I committed myself.

So I’m delighted to announce that from today I will no longer be responsible for TAB York: I will be responsible for TAB UK. It will be a challenge, but it’s also a huge opportunity for me. I’ll be going into business with an old friend, Mags Fuller, who’ll be my brilliant co-director and co-shareholder. And right now I’d like to place my thanks on record for all the help Mags has given me in getting the deal over the line, and to Paul and Jo for the incredible work they’ve done from the start.

So I’m looking forward to working with her, with all the franchisees and with Suzanne, Rena, Emma, Nathan and Nick – the outstanding team at TAB UK’s Harrogate head office.

Will I have regrets about giving up TAB York? Yes, of course I will. I’m no longer going to have the same monthly contact with several of my TAB York board members, all of whom have been a huge pleasure to work with and who have contributed to my life. As I said last week and repeated in the opening paragraph, it has been a privilege to work with them.

I will still be running one board, with Paul taking over the Board I’m relinquishing. Now, I’ll also be chairing our internal boards of the 28 TAB franchisees: that will see me leave Yorkshire for London and the North West once a month. Breakfast at Newport Pagnell? Maybe once, to reflect on how far I’ve come and how much TAB has given me.

And the blog? EdReidYork? Rest assured that it will continue: the tone and the content may be slightly different, but writing these words every week has been a central part of the last seven years: it’s given me a chance to pause and reflect and – in doing some of the research – I’ve learnt a lot. And the feedback has been consistently brilliant: intelligent, insightful and supportive.

So a chapter has ended – but a new, and very exciting one, is about to start. Let me finish for this week by saying thank you: firstly to the members of TAB York, who have simply been outstanding over the past seven years. And secondly to Dav and our boys for their support and encouragement as I take the next, exciting step in my career.

Rather more prosaically one of the next steps I take will be on to the ski slopes in Morzine. The blog will be on holiday next week as I try to keep up with Dan and Rory and will return on Friday March 3rd., tanned, relaxed and hopefully not aching too much!

A Glimpse of the Future


I love my job: the opportunity it gives me to say “this is how it could be” – to see someone recognise the possibilities in their life and their work – is immensely fulfilling.

That’s a quote from last week’s post – and the inspiration for those two lines came from the second episode of Westworld.

One scene really struck a chord with me: it went to the heart of everything I do, and I’d like to expand on it this week.

I’m aware some of you may not have seen Westworld, so I’ll tread carefully. In the scene the increasingly desperate writer, Sizemore, presents a scheme for Westworld’s ‘greatest narrative yet.’ There’ll be maidens to seduce, Indians to kill and unnamed horrors that I’m not going to mention in a Friday morning blog post.

“Above all,” claims Sizemore, “It’ll show the guests who they really are.”

He’s shot down by Dr. Ford (Anthony Hopkins), the owner of Westworld.

The guests aren’t looking for a story that tells them who they are. They already know who they are. They’re here because they want a glimpse of who they could be.

Sometimes you’re watching a film, reading a book or listening to a song and there’s a line that absolutely hits home. That’s how it was for me last Tuesday. Hopkins captured not only the essence of Westworld, but also the essence of what I do for a living.

The entrepreneurs I speak to aren’t looking to be told who they are, or where their business is now. They already know that. They want a glimpse of who they could be: of how far they could take their business – and how far the business could take them.

The first time I meet someone, that’s all I can offer – a glimpse.

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What do I want in return? First and foremost, I want an entrepreneur with courage. Someone who – to quote Bobby Kennedy – is willing “not to see things as they are and ask ‘why?’ But to see things as they could be and ask ‘why not?’”

So it’s not someone who wants to gamble on the future, or even someone who’s endlessly positive and always sees the glass as half-full. What I’m looking for is an open mind: a willingness to step outside their comfort zone and the realisation (even though they might not be acting on it then) that you cannot become the person you want to be by continuing to be the person you are.

My job is to say, ‘”This is how it could be, for you and the company.”

I’m giving the entrepreneur permission to think about the future: I’m saying, “There’s the door, it’s OK to walk through it.”

In one of his TED talks Simon Sinek makes a significant point: Martin Luther King didn’t say ‘I have a plan’ – much less, ‘I have a business plan’ – he said “I have a dream.”

Giving people permission to dream – and a setting in which they can dream – is what a great TAB board does. Make no mistake, sitting there at your desk, being the person you’ve always been, isn’t conducive to dreaming. In order to think differently – to see things as they could be – you need to move out of your everyday environment.

Good leaders spend their time encouraging others: giving them the means and the encouragement to grow. But someone needs to tell the leaders they can grow as well: that it’s OK for them to dream, that they don’t always need to be the detached pragmatist running the company. That they can be who they could be.

So when I say, “This is how it could be” I’m opening the door and offering a glimpse of what’s on the other side. Hopefully the entrepreneur will walk through the door, where she’ll find half a dozen like-minded people waiting for her.

But going through that door can be painful. Because you’ll need to have a couple of conversations: one with your team, admitting that maybe you don’t have all the answers. And one – which I’ll tackle next week – with your spouse or partner, saying that you have room to grow: that you’ve had a dream, and you’re going to pursue it…

Marks out of Ten


Annual income twenty pounds, annual expenditure nineteen, nineteen and sixpence, result happiness. Annual income twenty pounds, annual expenditure twenty pounds, ought and six, result misery.

We’re all familiar with Mr Micawber’s quote – and while inflation may have changed the numbers, the essential truth of Charles Dickens’ words can never be challenged. Translate them into business and they’re the reason you monitor your cash flow, the reason you check your KPIs and the reason you keep a lid on the expenses.

Yes, you can get away with spending that extra shilling in the short term, but annual expenditure of twenty pounds, ought and sixpence catches up with you in the end. ‘The mills of the Gods grind exceeding slow,’ Sextus Empiricus pointed out in the 3rd Century, ‘But they grind exceeding fine.’

Make no mistake, the result of that extra shilling of expenditure is misery. There is nothing that drags you down – mentally and physically – like staring at the cash flow every night, realising it just doesn’t add up.

So make sure you don’t spend that extra shilling, and you can forget about Wilkins Micawber, and be happy for the rest of your business career.

Or maybe not…

…Because I think there are other areas of business life where the ‘Micawber deficit’ can have a significant impact on your happiness. It’s not just the cash flow.

Let me turn for a moment from Micawber to Maslow – and his hierarchy of needs. Right at the top of the pyramid is self-actualization: as Maslow put it, “what a man can be, he must be.”

Nowhere is this more true than in business. And it takes me right back to last week’s post and the decision to ‘move to the next level.’ If you feel you can do it, you have to do it. If you don’t, you’ll end up frustrated and disappointed – and ultimately, a danger to your business.

We’ve had a recent innovation at TAB York. Before the meeting starts I ask every member for a ‘mark out of ten.’ It’s not quite ‘life, the universe and everything,’ but it is an indication of how they’re feeling – about life and business.

Supposing I were to take that one stage further – and ask the board members to rate their own performance over the last month: to give themselves a mark out of ten?

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The actual mark wouldn’t matter: one man’s eight is another woman’s six. But in the context of this blog, one thing emphatically would matter. We all have minimum standards for ourselves. Whether that’s a six or an eight is immaterial. We all have a number that reflects the minimum level of performance that’s acceptable – that in Maslow’s terminology, confirms our self-actualisation.

To miss that number on a consistent basis – to regularly deliver less than your best – is a recipe for long-term unhappiness. As Mr Micawber might have said:

Monthly target eight, monthly average eight point one, result happiness. Monthly target eight, monthly average seven point nine, result misery.

There are few worse feelings than performing below the level you’re capable of: do that consistently, and it starts to eat into you. And suddenly ‘could have, should have, would have’ are rearing their ugly heads…

KPIs and the cash flow are crucial to the health of your business: but monitoring the KPI that’s your own performance is every bit as important.

Mention of KPIs takes me back to last week’s post: to cricket, a sport which is most emphatically measured in KPIs. Bluntly, I’m not sure whether to order a slice of humble pie or send an invoice…

You may recall that I was mildly critical of Joseph Edward Root. I wonder if he really wants to be one of the game’s greats or merely very, very good. Let’s see if he makes the decision [to move to the next level] over the next five days…

Joe Root – obviously having read the blog on the Friday morning – responded with 254 in the first innings and the highest aggregate runs ever scored by a batsman at Old Trafford.

So don’t ever tell me the blog doesn’t work! And if you’d like me to be mildly critical of your football team as the season approaches, simply send a large cheque to ‘Reid Sports Predictions.’ I’ll do the rest…

I’m now off on holiday for a week. The blog will be back, relaxed and refreshed on August 12th. And I’ll be back determined to deliver at least 8.1 to all my members through the rest of the year.

The Next Level


I was watching the test match at the weekend. Specifically, I was watching Joe Root as – for the second time in the match – he got out playing a shot he emphatically shouldn’t have played.

Joe Root is one of the most naturally talented batsmen I’ve seen – probably the most talented if you only consider England players. And in his short career, he’s not been short of accolades. ‘Could be the best we’ve ever seen.’ ‘He’ll break every record there is.’

But I wonder…

Because as I watched Root casually swat a long hop from Rahat Ali into the grateful hands of Yasir Shah, I wondered if he really wanted to be one of the game’s greats. Or merely very, very good.

Whatever sport you watch, there are people with incredible natural talent. But talent doesn’t always translate into the record books. And everyone reading this blog has watched a sporting event and thought, ‘Why is this person not playing/competing at a higher level?’

Not for the first time, I was struck by the ever-present parallels between sport and business. There are some incredibly talented entrepreneurs out there: some of them right at the top of the tree – but some of them working ‘a long way below their pay grade.’

There are others who may not have been the sharpest tool in the box. But they’ve kept pushing themselves, kept learning, kept setting new targets.

I’ve written many times that the progression of a business is never a straight line. It’s never a graph going inexorably upwards. More often than not it’s a series of plateaus. Reach a level, consolidate, take the next step, reach a new level, consolidate…

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The more time I spend working with entrepreneurs, the more I think it’s the same for them. Reach a certain level – quite possibly the level that was the original goal – there’s a period of consolidation, and then one morning the light bulb goes on again: ‘I’m capable of more than this. I can go to the next level.’

Not for one minute am I saying that you must move to the next level. Goodness knows, no-one has written the phrase work/life balance more than me. But equally, you don’t want to watch the sun go down one day thinking, “If only…”

And my experience of working with entrepreneurs tells me that once the light bulb has gone on, you have to act. Otherwise frustration and boredom set in – and as I’ve written previously, they are few more dangerous forces than a bored entrepreneur…

Moving to the next level is one of the key areas where TAB can help. Yes, we’ll always make sure that your work/life balance stays well and truly balanced. But once you’ve decided to make that move, the support of your peers becomes invaluable – both consciously and subconsciously.

Clearly your fellow board members can help: there’s almost certain to be someone around the table who’s made the same decision: who’s asked themselves the same questions you’re now asking.

And rest assured I’ll do everything in my power to help. There’ll come a day when I’m watching the sun go down: rest assured that I have no intention of letting my mind drift back to any TAB York members and thinking ‘if only…’

But it’s the subconscious side that fascinates me…

I’ve seen this happen several times.

Someone around the TAB table makes a major announcement. They’ve clearly moved to a different level.

Across the table an expression changes. There’s a momentary raising of the eyebrows. Then the eyes narrow. The focus intensifies. The lightbulb goes on. ‘Good’ is no longer good enough. An entrepreneur has made the decision to move to the next level.

Let’s see if an England batsman makes the same decision over the next five days…

Looking into Your Future


Here’s a question I sometimes ask myself: am I helping? Or am I changing someone’s life?

Make no mistake, I love helping. I love using my experience and solving problems. I love being able to say, “OK. I understand. Another client had a really similar problem and this worked for her.”

And I love it when someone comes to me and says, “Thanks, Ed. That worked. Problem solved.”

But it goes a long way beyond ‘loving it’ when someone says: “Thank you, Ed. Working with you has made a fundamental difference to my business and my life.”

That doesn’t happen often, but when it does it makes me sing and dance. I’m a little too old to skip down the street, but it conveys the emotion. Outside my wife and my children, it’s the best feeling there is.

And when it happens, I realise something important: solving problems is work that’s rooted in the present. Transforming someone’s life or business is very firmly rooted in the future. It doesn’t come from answering the question: ‘what’s the problem?’ It comes from much deeper questions: ‘What sort of person do you want to be?’ ‘What direction do you want to take your business in?’

As I read recently, it’s the difference between running on a treadmill and running to a destination.

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We all have things that we want to be – or that we want to achieve – in the future. Achieving those goals is going to make a fundamental difference to how we see ourselves five, ten, twenty years down the line.

These goals may or may not be business related: that doesn’t matter to me, because TAB is about getting what you want from your business and your life. What does matter to me is that you make a start on achieving those goals. Right now.

Yes, I know that your to-do list is thirty items long and getting longer. I know you have immediate problems that you need to solve.

But the simple fact is that your to-do list will always have thirty jobs on it. There’ll always be things you need to do right now.

I also know that it’s ridiculous to spend time on something that’s five years away – something on which there’s no immediate return – when you could be working productively on something that’s important today. But if you don’t make a start on those things now, you’ll never make a start.

We all know how fast time goes – and that it goes faster as you get older. My eldest son is nearly 14. It’s around three weeks since I held his hand and took him to nursery. In another couple of weeks he’ll be graduating from university.

So if you don’t make a start on what you want to achieve in 2021 it will be here. And ‘significantly improve my photography,’ ‘write a novel,’ or ‘get myself seriously fit again’ will still be nothing more than entries on your mental bucket list.

That’s my key point: if you want to be truly productive in the long term, you need to spend some time being unproductive in the short term.

Your future self needs to be selfish.

You need to sign up to that photography course, start writing, or take advantage of the light nights and get on your bike. And yes, doing those things may feel totally unproductive now – but in five years’ time they’ll be among the best decisions you ever made.

Tim Ferris and Tony Soprano


Most people reading this blog will have heard of Tim Ferris. Best-selling author of the 4 Hour Work Week, The 4 Hour Chef and The 4 Hour Body. Angel investor in and/or adviser to a host of companies including Facebook, Uber, Twitter, StumbleUpon, Evernote and others…

Ferris has been described by New Yorker Magazine as ‘this generation’s self-help guru’ and as ‘today’s equivalent of Napoleon Hill.’ (Remember him? The author of the first self-help book any of us ever read.)

But Ferris is also accused of manipulating his 5* reviews on Amazon, he’s Wired Magazine’s ‘Greatest Self-Promoter of All Time’ and The 4 Hour Work Week has been described by one reviewer as “A disquieting insight into the world of the 21st Century snake-oil salesman.”

But whatever your view on Tim Ferris, one thing is undeniable. He is hugely quotable. Like anyone who’s quoted extensively, there are plenty of clichés in the collection – but there are also some seriously valid points.

I’ve picked out four (an appropriate number!) which both underline the perennial themes running through this blog, and which are highly relevant as we finally get Christmas out of our systems and focus on our goals for 2016.

Here’s the first one:

For all the most important things, the timing always sucks. The stars will never align and the traffic lights will never all be green at the same time. The universe doesn’t conspire against you, but it doesn’t go out of its way to line up the pins either. ‘Someday’ is a disease that will take your dreams to the grave with you.

How many times have I written that – or words to that effect? There’s never a perfect time to get married, have children, quit your job or start your own business. Neither is there a perfect time to expand your business or – ultimately – sell your business. As Ferris says, ‘Just do it and correct course along the way.’

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He’s backed up by that other great business guru of our age – Tony Soprano. “A wrong decision is better than indecision.” Spot on, boss. A wrong decision can be acted upon and corrected. But as Ferris says, indecision takes you and your dreams to your grave.

What we fear most is usually what we most need to do.

A person’s success in life can usually be measured by the number of uncomfortable conversations he’s willing to have.

OK, I’ve cheated slightly by treating these two as one quote: I’ve allowed myself some leeway as they’re so similar.

How many times have you come into the office, looked at your to-do list and seen one job screaming at you? One job that’s metaphorically in 72pt font bold? That’s the job you absolutely need to do – and yes, it may very well involve an uncomfortable conversation.

What’s your to-do list look like two hours later? Fantastic. Loads of jobs crossed out. Except for the one in 72pt bold – the one that would really make a difference to your day/week/month/year. And what was Mr Soprano reading last time I re-watched an old episode? Feel the Fear and Do It Anyway.

If you are insecure, guess what? The rest of the world is too. Do not overestimate the competition and underestimate yourself. You are better than you think.

I often think back to my ‘first big sale.’ “Yes you can, Ed,” my sales manager said to me. ‘No, I can’t,’ I thought. This was a serious client: I’d only been in the job six months. It would be a two hour grilling. Complex, technical questions that I’d struggle to answer.

You know what happened. My competitors were no better than I was. He asked less difficult questions than almost any other client I’d met. I was in and out in no time. “Will you deliver?” “Yes.” “Will you look after me?” “Yes.” We shook hands.

‘Bigger’ never means more difficult or more complex or ‘you’re not worthy.’ It just means ‘bigger.’

Remember – boredom is the enemy, not some abstract ‘failure.’

Over the years I’ve seen so many people running businesses make mistakes because they were bored. Tim Ferris is absolutely right: boredom is the enemy. Now, more than ever, you can’t stand still in business. As the world swirls around you your business has to change and move forward – and you need to be constantly challenged. Beware the temptation to stand still; to think, ‘we’re in a good place, let’s consolidate.’ Boredom will inevitably follow – as will mistakes, both personal and professional.

Fortunately, there’s an antidote. I refer, of course, to your colleagues round the TAB boardroom table. A group of people that will most certainly challenge you, and who’ll give you courage – to do what you fear most, and to go through a few lights that may not be green.

Learning from the big Apple


The numbers are quite simply staggering. $18bn profit for the last quarter of 2014 – that’s roughly £1bn a week. 74.4m iPhones sold – that’s 34,000 every hour – with sales up 70% in China. I’m obviously talking about Apple, the company that sits on a cash pile of $178bn – more than we spend every year on the NHS and education.

But there’s one more stat that I’m struggling to take in. According to the truly terrifying world population clock the number of people on Planet Earth is 7.3bn. Apple sold 74.4m iPhones. That means that in the last quarter of last year 1 in every 100 people on the planet bought an iPhone. Just one product – in the last three months of the year. I’m stunned.

Clearly Apple are doing plenty of things right: the key question is, what can we learn? Or is there simply too much difference between Apple – headquartered in Cupertino, California and dominating the world – and our businesses in North Yorkshire? So much difference that you can’t make worthwhile comparisons? I don’t think so: I think there are four very distinct lessons we can all learn from Apple.

  • First off, Apple make brilliant products that simply work. I remember getting my first iPhone out of the box. ‘Where’s the instruction book?’ I thought. There wasn’t one – because you didn’t need one. It just worked. I always come back to Simon Sinek’s TED talk when I think about Apple: many companies understand what they do and how they do it. Very few understand why they do it. That’s what sets Apple apart and it’s what can set your business apart. Apple give a brilliant customer experience and make fantastic products: they just happen to be computers and mobile devices.
  • Secondly, attention to detail. As the old cliché goes, good enough isn’t good enough. Or as one of the Michelin-starred chefs put it on Masterchef, “the difference between a good dish and a great dish is a pinch of salt.” You can never pay too much attention to detail, whether it’s design, function or customer service. In the long run, it always pays off.
  • Offer a complete package – and don’t underestimate what you know. I’ve seen two or three articles suggesting that Apple make more money from their after sales service and their cut of the apps than they do from their basic product line. Don’t underestimate the value of support, maintenance, updates, training and consultancy. Your knowledge can be as valuable as your products.
  • Lastly, don’t be afraid to charge what you’re worth. An iPhone isn’t cheap – but people pay for the perceived value. There’s a tendency in the North to say, ‘the market won’t stand it. The price is too high.’ It will: the price isn’t too high if the customer perceives the value he’s getting. Don’t ever be afraid to charge what you’re worth – or to say, ‘I’m sorry, that’s the price. No, I won’t negotiate or ‘do you a deal.’’ Sometimes you’ll need to be brave and walk away – but trust me, it works.

Of course, the cynics will say that Apple’s success won’t last. They may be right. When I started in business there was a saying: ‘No-one ever got fired for buying an IBM.’ Does anyone know anyone who’s bought an IBM recently?

But as long as Apple stay committed to the ‘why’ and – as Simon Sinek says – working from the inside out, then they’ve a great chance of staying ahead of the game. And let me chance my arm and make one prediction. The potential health benefits from your smart phone and developments like the iWatch are simply astonishing. Ten years from now monitoring your health – especially things like glucose levels – using a smart device should be routine.

Whether the NHS will be brave enough to embrace these potential benefits I don’t know. But clearly that’s enough from me for this week: still three months to go and I’m straying dangerously close to politics.

Have a great weekend – and remember the lessons from Apple. You might not be sitting on a billion dollar cash pile by the end of the year: but you can definitely have made a difference.

I Have Seen the Future…


Scene One: A car park outside a hotel on the York ring road. A man and a woman, Neil and Sophie, come out of the hotel. They’re both carrying a leather case. Possibly it contains an iPad, or something of similar size.

 

Sophie:          Ed was on form today…

 

Neil:                Unbelievable. How can anyone have that much knowledge? Scanned straight through that proposal of ours.

 

Sophie:          What was it? Twenty pages?

 

Neil:                Thirty six. Full of really complex technical data as well.

 

Sophie:          It’s relating the proposal to all the previous experience that staggers me. Honestly, Neil, I thought I’d reached the age where not much impresses me, but you put a proposal in – a business plan – and two minutes later Ed’s analysed it, compared it to about a thousand other businesses and told you the strengths and weaknesses. TAB is staggeringly good value for money.

 

Neil:                Not like the old days, eh?

 

Sophie: (laughing) You can say that again. I mean, I liked Ed Reid. He was a decent bloke. But the difference in my business since they replaced him with Edwina…

 

They shake hands and climb into the back seat of their cars. They can be seen speaking some instructions. The cars start up and drive out of the car park.

 

If the blog is still around in ten or twenty years’ time that’s what you might be reading. Like Sophie, I thought I’d reached the age where not much impresses or surprises me – but the other day I came across this story on the BBC news site.

I had to read it twice to make sure it wasn’t a hoax. But no, the story’s real and the implications are enormous – for all of us. I’ve often written on the blog, ‘don’t think it can’t happen because it can.’ Amelia has taken that one step further – especially when you click on the link in the BBC story and see that a Hong Kong company has appointed an algorithm to its board of directors.

History is littered with people who’ve thought their business model was untouchable – that there’d always be a demand for candlesticks. Now more than ever you need to think the unthinkable – and think about how it would impact your business. Ten years from now the world will be a radically different place – and machines managing humans may be one of the least surprising aspects.

After all, as it says in the BBC article, “human judgement is often clouded by irrationality, emotion and imperfect knowledge.”

But human judgement and human behaviour is also distinguished – by insight, empathy, gut feeling and the sheer bloody-minded will to win.

Nowhere is this more evident than round an Alternative Board table. One business owner acting on his own is frequently irrational and emotional and acts on imperfect knowledge. But when he’s run that decision by six or seven of his peers irrationality is replaced by careful consideration; emotion by cool detachment and the imperfect knowledge is supplemented by the wisdom of the group. And when you’re accountable to your peers, your determination to succeed is even stronger. To repeat one of my favourite sayings, ‘If you want to go fast, go alone. If you want to go far, go together.’

None of us knows what will happen in the future: but if you have to meet the challenges of running a business in an ever more rapidly changing world, you can’t be better armed than to have your TAB colleagues at your side.

But yes, I suppose it’s possible that it could play out like this…

Scene Two: The same car park, one month later. Sophie and Neil meet as they climb out of their cars.

 

Sophie:          Hi Neil. How are you doing? Good month?

 

Neil:                Staggeringly good thanks, Sophie. Smashed all our targets.

 

Sophie:          Ed’ll be pleased with you.

 

Neil:                Well it’s all thanks to her. Trouble is, she’ll make me increase our targets for next year.

 

Sophie:          Yeah, she did that in December last year…

 

Neil:                No Christmas drinks, either…

 

Sophie:          Nope. One thing a Cognitive Learning Hologram doesn’t have is the Christmas spirit.

 

Neil:                Maybe we should bring back Ed Reid…

 

They look at each other. Simultaneously they laugh and shake their heads. They walk into the hotel. Lights dim…

 

-The End-

Small Gains, Big Profits


OK, Friday morning, you’re all fit and alert, let’s do some maths…

Your total receipts in the year are £100,000. Your expenses are £50,000. Leaving you a nice, round £50,000 of profit.

Now let’s work a little bit harder on the top line – up by 5% to £105,000. Let’s work on the expenses as well – down 5% to £47,500. And this means your profits are up to £57,500 – an increase of 15%.

Hang on, is that right? Earning up 5%, expenses down 5% but profits up 15%?

Yes, it is right.

And having done maths, let’s move on to cycling – because what we’re talking about is Dave Brailsford’s ‘aggregation of marginal gains.’

When Brailsford became Performance Director for British Cycling in 2003 the sport and the team were at a low ebb. Brailsford was determined to change that, and everyone now knows the results. Two gold medals at the 2004 Olympics, followed by eight in 2008 and 2012 – and victories in the Tour de France for Bradley Wiggins and Chris Froome.

Brailsford’s philosophy was the aggregation of marginal gains: he reasoned that if he could find a 1% improvement in everything that his team did, the cumulative effect of all those one per cents would be enormous.

The whole principle came from the idea that if you broke down everything you could think of that went into riding a bike, and then improved it by 1%, you will get a significant increase when you put them all together.

There was plenty in the work of Brailsford and his team that you’d expect: nutrition, training, the weight of the tyres, and so on.

But there was plenty there you wouldn’t expect as well: which type of pillow gave the best night’s sleep; the most effective massage gels and – almost unbelievably – teaching the riders the best way to wash their hands to avoid infections.

The parallels with business are obvious – and as my remarkably simple maths demonstrates, small gains can make a big difference to your profits. You might, however, suggest to me that running an SME is slightly more difficult than sitting on a bike.

And you’d be right.

Much as I admire the achievements of Hoy, Wiggins, Froome and company their job description is simple: eat, sleep, train, sit on that thing and pedal.

The job of any professional sportsman is to perform in the moment: it’s not to see the bigger picture. If you’re running an SME you need to perform and see the bigger picture – all the time.

The Brailsford model is excellent – and I absolutely commend it to anyone running a business. If you can make a small difference in sales, in finding and retaining new customers, in the performance of your team, in cutting costs – the overall effect on your business will be little short of sensational. But you have to do that whilst consistently focusing on your big goals – the aggregation of marginal gains is a tool, it’s not a result.

You also have to make sure that you don’t get lost in ‘the thick of thin things.’ Not only do you have to stay focused on your big goals, you have to be aware of what’s happening in the world outside your business.

It’s no use saving 5% on the cost of tallow and beeswax if someone has just invented electricity.

Fortunately, you have The Alternative Board. Rest assured that your colleagues around the table will see the big picture and they will keep you focused on your goals. Yes, they’ll cheer when you announce that sales are up 10% and they’ll ask you how you did it. They’ll be delighted that the aggregation of marginal gains is working for you – but one of them might also say, ‘By the way, have you heard about this Thomas Edison bloke…’

Sixteen Weeks and Counting…


As I mentioned last week, there were 17 weeks to go until the end of the year. Inevitably, that’s now 16 weeks and – as Rudyard Kipling would have said – we need to fill them with 90 days worth of distance run.

…And we all need to make sure we hit the ground running on Monday January 5th. You have two choices on that morning. You can go into your office knowing exactly what you need to do and what you’re aiming for in 2015. Or you can sit at your desk trying to remember what you do for a living. The choice you make will define – at the very least – the first three months of the year.

So as promised last week, here are five key strategies to follow between now and the end of the year that will help you finish 2014 in a blaze of glory and start 2015 in exactly the way you’d want to start the year.

As I’ve said many times on this blog, remember the mantra of Stephen Covey. ‘Keep the Main Thing the Main Thing.’ What’s the One Big Thing you really need to do before the end of the year? What’s the OBT that would make all the difference to your business? Keep that front and centre of your agenda in the next sixteen weeks: share it with your fellow Board members. Don’t worry: they’ll make sure you keep it front and centre…

And yes – if the One Big Thing is simply ‘get all the nasty stuff done’ so you can really start 2015 focusing on exactly what you want to focus on, that’s fine. But the key word there is all. If you’re going to clear the decks, do it thoroughly. Write down everything that needs to be done and out of the way by the end of the year – and sit down to your Christmas dinner with it all done.

Go Away. I absolutely mean it. The Northumberland coast is wonderful in the Autumn. Take yourself off for a couple of days, walk on the beach, come back to wherever you’re staying and sit and think. What do I really want from my business? What could we really achieve if we put our mind to it? And most importantly, is my work/life balance as balanced as I’d really like it to be?

Spend a morning with excel as well – and you need to prepare two cash flow forecasts: the best of times and the worst of times (sorry, I’m still hooked on my Dickens quotes…) Prepare a worst case scenario cash flow forecast: don’t gloss over expenses, assume you’ll lose a major client and assume you’ll hit 80% of your targets. And then dare to dream. What would your business, your bank balance and your life look like if you hit all your targets? Even the ones that you think are well out of reach.

Get your tech up to date. Do you have a social media plan? Can you edit word documents on your iPad? How out of date is your website, Facebook page and Twitter profile? Take the time to do a proper audit of the tech and digital changes you need to make to help you achieve your goals – and I guarantee you’ll be able to find a lot of the answers simply by asking Google and investing some time.

Lastly, find your perfect client. There’s a client or customer out there that you really want to work with in 2015. We’ve all got one, and I’m no exception. So what makes them tick? What do they really want from their business? And why are you the perfect person to supply it? Start the charm offensive now – and you may be pleasantly surprised. They may become a customer or client well before 2015.

Of course, if that happened the killjoys round the Alternative Board table would simply demand that you chose another perfect client, but that’s the price of progress!

Oh – there’s one more thing you need to do well before the end of the year. You know it and I know it. None of what we do or achieve would be possible without the support and understanding of our wives/husbands/partners and families. So don’t leave the Christmas shopping until December 24th. Get it done, cross it off your list and give them the Christmas they deserve…