A Decade of Change – and a Simple Message


Good morning, Happy New Year and welcome to the new decade. 

2020 sounds like a year when we should all achieve something significant. But – as we all know – a business career is built over far more than just a year. So let’s use this first blog of the 20s to look even further ahead. 

I’ve written about the pace of change any number of times. But one thing is certain: if you thought the pace of change was fast in the last decade then it’s going to be lightning fast in the next. 

If you want proof, just look at the annual Consumer Electronics Show in Las Vegas. Every year the industry unveils the latest developments, and every year what we could barely imagine a few years ago is there on stage. Driverless cars are making the news again this year – will any of us even be driving cars when I write this blog in January 2030? 

Another product on show at CES was a TV screen that rolls up into your ceiling. It costs $60,000 and is – in theory – for people who are ‘short of space.’ I don’t know what it’s like in Las Vegas, but here in South Milford if you can afford $60,000 for a telly, you tend not to be short of space in your lounge…

So how might all this change impact our businesses? Let me take just one ‘industry’ as an example. 

What’s been one of the big growth industries (or professions) of the last ten years? Personal trainers. As most people know, I’ve got one – and [name of dog] really enjoyed finishing off the turkey and stuffing…

But now it looks as though personal trainers could be replaced by AI – much in evidence at CES this year. Thanks to AI, machine learning and motion tracking, fitness apps are already rivalling personal trainers. Very fit young men and women have enjoyed a boom over the last 10 years: could we see their industry wiped out in the next ten? 

Quite possibly – especially when you factor in the rapid growth of companies like Peloton. And it all illustrates how fast the pace of change really is. Previously industries might have evolved over 50 years and taken another 50 to decline. That time span is shortening rapidly – and it’s really going to hit home in the next decade. 

Change will affect all our industries. AI executive coaching? It’s already here. Meet Amanda.

Personality coaching? Here’s the YouTube video

And as we read over Christmas, AI is already outperforming doctors in the diagnosis of some cancers.

So don’t think it can’t happen to you. Burying your head in the sand – thinking, ‘it won’t happen in my industry’ – is the one approach that’s guaranteed not to work. It can happen and it will happen. 

That may all sound a little gloomy. It’s the first full week of a new decade: the glass should be at least half-full. AI and machine learning are going to bring enormous benefits as well – and huge opportunities. The vast majority of us just can’t see what those opportunities are yet – which is why an open mind, a desire to go on learning and adaptability are going to be the keys to success over the next ten years. 

And now let me turn to the UK – and specifically to the General Election. My last blog was published on Friday 13th December. The results were only just in as I finished writing.

As you know I didn’t vote for Brexit and I’m not a great admirer of the Prime Minister either. But let me give credit where credit is due. The Conservatives won a majority of 80 seats with a simple message: Get Brexit Done. As Boris Johnson said at the end of the Love Actually parody. “Enough. Enough. Let’s get this done.” 

Now the dust has settled, is there a business message we can take from that ad? Two, actually. The first is that we all have things we’ve wanted to do for a long time. They’re on the long term goals list and – somehow – they’re still on it at the end of the year. 

As I said in the introduction, 2020 sounds like a significant year. So let’s all make 2020 the year we take one thing – be it business or personal – that we’ve always meant to do and, somehow, never done. Let’s lose patience with ourselves: let’s apply those six words to it: ‘Enough. Enough. Let’s get this done.’ 

The second message is yet more confirmation that talent is evenly spread – and not just throughout the UK. Boris Johnson didn’t use Saatchi and Saatchi, a ‘global communications and advertising agency with 114 offices in 76 countries and over 6,500 staff’ for the Conservatives’ social media message. He used two young New Zealanders: Sean Topham is 28 and Ben Guerin is just 24. 

The talent you’ll need over the next ten years is all around you and all over the world – and very often it will be wearing a black t-shirt and a pair of jeans…

Polls, Publishing and Plans for Next Year


What was it Jane Austen said? “It is a truth universally acknowledged that a man who has to publish a blog on Friday 13th does not want a General Election on Thursday 12th…” 

Something like that – but you have to press publish at a certain time. And, very clearly, you can’t press publish without commenting on the result of the Election. But when do you start writing? When you see the BBC exit poll? When the first result comes in from Newcastle? 

Or do you decide that the polls are going to be right for once, and get your introduction written on Tuesday afternoon? 

In the event, I did a bit of all three – and then hastily revised my estimate of the Conservative majority as the BBC exit poll and the early results confirmed a very clear win for Boris Johnson. While the final numbers are not yet in, it looks as though we are on course for a Conservative majority of 70-80 seats. 

Dodging the scrutiny  of Andrew Neil appears to have done Boris no harm at all. Not having a policy on the most important issue to face the country in the last 70 years unquestionably did Jeremy Corbyn a great deal of harm – as anyone who runs a business could have told him. You are the leader. Your job is to lead, not sit on the fence. 

Labour recorded its lowest number of seats since 1935, as large sections of the ‘red wall’ turned blue. ‘Workington Man’ – this election’s version of the mythical ‘Worcester woman’ – has swung decisively behind Boris Johnson and his simple, endlessly-repeated mantra: ‘Get Brexit Done.’ 

So, sometime around mid-afternoon today, Boris Johnson will emerge from 10 Downing Street and tell us his plans. With all 635 Conservative candidates having pledged to back his deal with the EU, we’ll be leaving the European Union on or before January 31st. Negotiations on a future trade deal will follow, and Sajid Javid will present a Budget some time in February. 

Well, I didn’t want to leave the EU, but neither did I – or any business owner I know – want to be locked in a spiral of never-ending uncertainty. We may not have the certainty I wanted, but at least we have somecertainty. There will not be another referendum this year: neither will there be another referendum on Scottish independence. 

And the next General Election won’t be until 2024 – and even then, there’s only a 50% chance of it coinciding with ‘blog Friday.’ You can relax, Ed…

…And look back on what has been a great year for TAB UK. There are now more than 50 people working with and for TAB UK. That was a significant milestone to reach and – as I have said many times – it’s a privilege to work with every single one of them. 

Our franchisees cover the UK from Rick in the South West to Helen, Chris and Jonathan in Aberdeen. Yes, there are still some gaps on the map – but we’ll fill them. 

The head office team has also grown this year – and let me use this last blog of the year to thank them all for everything they’ve done in the last 12 months. A special word, though, to Lydia and Tracey who joined this year. They’ve fitted in seamlessly and are already making a great contribution to TAB. 

There was also a personal highlight for me this year. I still run one TAB board, and this month it turns seven years old. That’s more than 80 meetings with the same small group of people. Over the seven years their businesses have grown (so have one or two waistlines…) and I hope TAB has played its part in helping to preserve the sanity of the relevant MDs. Last time I checked none of them was an alcoholic. Well, not confirmed…

Looking ahead to 2020 

So what of the coming year? 2020 sounds like an auspicious year, and there are two TAB developments I’m particularly excited about. 

First of all there’s TAB Connect, a global platform connecting all our 4,000 members worldwide. It’s live now, and 2020 is the year when it will really come to life, allowing a TAB member in North Yorkshire to connect with a TAB member in North Carolina. If you want to use a shorthand term, it’s LinkedIn just for TAB members – but it’s a lot more than that and I’m certain that it will lead not just to sharing ideas and expertise, but to business partnerships that wouldn’t otherwise have been possible. 

Closer to home, 2020 will see TAB UK roll out StratPro. This will allow us to work with the owners of bigger companies and those companies’ directors and senior managers, to ensure decisions made at the top flow down through the company as efficiently and as effectively as possible. It’s a really exciting initiative, and I’ll write a specific blog post on it early in the New Year. 

2020 will be an interesting year on a personal level as well. Around this time next year Dan, my eldest son, will be home from his first term at university. How did that happen? It’s only two months since I held his hand and took him into the reception class…

But it has happened, the time has passed and – hopefully – I’ve put it to good use. I couldn’t, though, have done it without a lot of help. To everyone who has been part of my journey this year – thank you. Have a wonderful Christmas, may 2020 bring everything you would wish for and the blog will be back – no doubt vowing to do more exercise – on Friday 10th January. 

Your NOT-To-Do List


The children have gone back to school, the nights are drawing in, there’s only a month until the clocks go back. Christmas has appeared on the horizon, you’ve spotted a 2020 diary in the shops…

Which means that for many of us thoughts are already turning towards plans for next year. For what you want to achieve in the year – and, by implication, what you need to do in the first quarter and first month of 2020. 

No question about it, you’ll march confidently into your office on Thursday 2nd January, pull that brand new pad towards you and – knowing exactly what you’re going to achieve – confidently write ‘To Do’ at the top.

But there’s another list you need to write. Not just for 2020, but starting now. And in my view, it’s even more important than your ‘to do’ list. 

Your ‘Not To Do’ list. 

I can still remember the shock I got the first few weeks I used Toggl and realised how much of my time wasn’t being used effectively – and how many things I was doing very definitely belonged on a not to do list. 

Despite the technological advances of modern life virtually all of us are leading busier and busier lives: perhaps because of those advances. How many of us check our e-mails just before we fall asleep? 

Add in family commitments – and for many people reading this blog, taking care of ageing parents is now starting to become a major commitment – and all of us have a seemingly endless to-do list. 

At work you need to delegate: at home you need to decide what’s really important. 

Let’s start in the office. Delegation is one of the hardest skills to learn. It is all too easy to sigh and think, ‘It’s quicker to do it myself.’ But you cannot build a business without delegation. Sometimes ‘done’ is more important than ‘perfect.’ 

And as I have written many times, it is not your job to be the best engineer, coder or salesman. It is your job to lead a team of outstanding engineers, coders and salesmen – and to help them go on improving. 

So as you contemplate your plans and targets for 2020 ask yourself – or get someone else to ask – why should YOU be doing that? And delegate what you can delegate, whether it’s to your own team, or to an outsourced specialist. Even starting a ‘not to do’ list will be a valuable exercise: it will unquestionably challenge some of your long-held assumptions about what your job really is. 

Time to come home – where exactly the same principle applies. Let me give you just one example. One of the best decisions Dav and I ever made was to hire a gardener. Andy comes for three hours a week, he cuts the grass and generally keeps the garden under control. We pay him £60 and it is a superb investment. It gives me three hours – longer, really, as I’m not as good a gardener as Andy – which I can spend with my family or simply de-stressing myself. Or yes, as has recently been pointed out to me, hacking out of the rough…

There is one final, and very important, point about your ‘not to do’ list. It doesn’t just apply to you. 

Take a look around you. Is everyone in your team seriously making the very best use of their time? Or are they doing jobs that really could be delegated, allowing them to do much more important work? 

We were guilty of this at TAB head office. Members of the team were doing admin tasks that they really shouldn’t have been doing. That wasn’t a failing: we’d simply reached one of those moments every business reaches from time to time. We’d expanded, there were new challenges, the team needed to focus their attentions elsewhere. 

So Tracey has joined us, she’s immediately picked up a whole range of admin for us and that has helped the existing members of the team to focus on what’s really important. It’s also given them some time to think – to stand back and look at the business. 

I’ve often talked on the blog about working on your business not in your business. A ‘not to do’ list helps you do that. Equally importantly, making sure all the members of your team have a ‘not to do’ list means they can sometimes work on their part of the business not – as Stephen Covey put it – constantly be ‘in the thick of thin things.’ 

And now, with exactly 13 weeks to go until we all abandon the office for Christmas, time for me to make a list…

Be Brave


Last week I wrote a Tale of Four Leaders, contrasting Paul Dickinson and Barry Dodd with two leaders who I consider to be far less successful – the Donald and the Maybot.

I’m still coming to terms with Paul’s passing, but gradually the sadness is giving way to what I’ll think of as his personal legacy to me.

Many of you will know the words of the poem by Henry Scott Holland, so often read at funerals. It’s called Death is Nothing at All, and there is a line that is particularly apt: ‘Why should I be out of mind because I am out of sight?’

Paul will never be out of mind for me and – two weeks on from the funeral – I feel a duty to his memory to make TAB UK the best it can possibly be. That means for everyone in the TAB family: our members, our franchisees, our team at head office – and the colleagues we work with overseas.

How are we going to do that? We are going to be brave. What was it Thoreau said? ‘The mass of men lead lives of quiet desperation and go to their grave with the song still in them.”

No-one in the TAB UK family should do that and so – and I know Paul would have approved – the message this week is simple: Be Brave!

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This, more than ever, is a time for brave decisions, on both the micro and macro level. The world is changing at an ever faster pace: AI and machine learning, advanced search and the personalised internet are knocking on the door of virtually any business you can name. Businesses that were once cornerstones of the national and local economy are crumbling away. Brave decisions have become essential.

So let me turn to two decisions – sadly both from our government – which illustrate exactly the type of decisions we should not be making.

A couple of weeks ago Theresa May announced an extra £20bn – from your taxes – for the NHS. That’s a worthy decision: with four out of five people apparently in favour of tax rises to fund the NHS I’m sure the focus groups will approve.

It’s worthy, but in the long run I think it is wrong. And it’s the easy decision, not the brave decision.

Anyone who walks through any town centre will notice that the UK has an obesity epidemic which is getting worse every year. That in turn is leading to an explosion in Type 2 diabetes which is currently costing the NHS £25,000 a minute. Diabetes UK put the cost of treating Type 2 diabetes and its complications at £14bn a year.

Those are staggering figures for what is – in the main – a preventable disease. And quite clearly there isn’t much of the PM’s £20bn left when you’ve paid the diabetes bill: if we carry on getting fatter there very soon won’t be anything left.

The PM’s £20bn is, in essence, a very expensive bucket. There’s a hole in the roof of your factory, the water is coming in ever more quickly, so clearly what you need to fix the problem is a bigger, more expensive bucket…

Yes, that might be the answer while the guys go up on the roof to fix the hole. But as far as the diabetes epidemic is concerned, we’re not sending anyone up on the roof: we’re relying on an ever more expensive bucket instead of making difficult decisions and telling people the unpalatable truth.

Secondly, pot. Or weed, or whatever you might want to call it. Last week the case of Billy Caldwell and an article by William Hague brought cannabis front and centre in the news.

Writing in the Daily Telegraph Hague argued that the war on cannabis has been “irretrievably lost” and called for it to be fully legalised. He argued that cannabis is freely available in the UK, but available in unregulated forms, with a thriving black market bringing huge profits to criminal gangs and putting an unnecessary strain on the police and our criminal justice system.

Some time ago I wrote about the legalisation of cannabis in the US state of Colorado. The state – which I visit every year for TAB’s global conference – legalised  cannabis in 2012. Teenage use of the drug in the state is now at its lowest level for a decade, opioid deaths are down, crime has not risen – but tax revenues have, by an estimated $230m over two years. The population of Colorado is around 5.6m – that is around one-tenth of the UK, so it is easy to project the tax revenues that might result from legalisation here.

Sam Dumitriu, head of research at the Adam Smith Institute says, “We estimate that legalisation would raise at least £1bn a year for the Treasury.” He added, “Just as the prohibition of alcohol failed in the US, so the prohibition of cannabis has failed here.”

What is the UK government’s position? A flat refusal to even discuss the subject – a refusal, not to make a brave decision, but to even have a brave discussion.

In business, you cannot do that. It bears repeating: we are living in the age of brave decisions. The problem is, there’s no pain in buying the NHS a bigger bucket or refusing to discuss cannabis. The government – like so many businesses – is in a comfort zone.

But you know and I know that it cannot last. We cannot go on getting fatter, we cannot go on seeing young people murdered on the streets of London and we cannot ignore Google, Amazon and Uber when they tap on our door.

Throughout his life – and never more than towards the end of it – Paul Dickinson took brave decisions. That’s the legacy he left me: that’s the legacy that we all – in government or in business – need to follow.

Darker Thoughts from an Old Friend


I bumped into an old friend in York last week. He was wearing a suit. And a tie. This was the man who became bored with dress-down Friday – and dress-down every other day of the week – when the rest of us were still learning not to wear a striped tie with a check shirt…

There was only one possible explanation.

“Congratulations,” I said. “You’ve finally made an honest woman of Claire. Where is she?”

He didn’t laugh. “Other end of the scale I’m afraid, Ed. Funeral. My second in two weeks. And both of them not much older than us.”

We’ve all been there: mentioned someone in conversation only to hear, ‘Hasn’t anyone told you? Last Thursday. No warning, nothing.” And inevitably the person being discussed was ‘not much older than us.’

That meeting with my friend played on my mind for the next few days. One thing I am sure of is that there is an ever-increasing level of stress in the average entrepreneur’s life. A few years ago people e-mailed or phoned. Now there is myriad of different ways of contacting someone: whatever you turn off, something else will bleep just as you sit down to dinner.

And we all know the dangers of stress.

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So that chance meeting with my friend stayed with me – not just because we’d been talking about someone close to our own age, but because the conversation posed a question that’s absolutely central to The Alternative Board.

You’ve started a business. You know what you want to achieve: you know what you’re capable of achieving. And you’re determined to get there.

So what do you do? How do you react when someone says, ‘haven’t you heard?’

Do you take it as a signal to run at 100mph in case the same thing happens to you and you never realise your potential?

Or do you stop and smell the roses? Pay attention to your work/life balance? Remind yourself that no-one’s last words have ever been, ‘I wish I’d spent more time at the office.’

The more I thought about it the more I realised I’d seen business owners – perhaps without even recognising it – struggling with the same dilemma. And not just as a one-off.

It’s a problem that raises it head, in different forms, at different stages of your entrepreneur’s journey.

What should I do? Put in the time? Re-invest the cash? And build a company that will really be worth something in 10 or 20 years’ time?

Or realise that I might not get there – and milk the business for all its worth and take my rewards in the here and now.

The answer, of course, is that there is no right answer. The right answer depends on your own individual personality and how you want to live your life. As everyone who knows me will recognise, I’m in the ‘building a business’ camp – and I’m determined to enjoy the journey along the way, sharing that journey with my family and my friends.

Yes, I could be in the office every minute of every day – but I remember waking up one Tuesday morning early in my TAB York days. It was a morning like today: early May and the sun was shining in through the window. I looked at the pile of paperwork on my desk and went off to play 9 holes of golf.

It was a moment when I suddenly appreciated the freedom the decision to start my own business had given me – and when I knew I’d made the right decision in Newport Pagnell service station.

Not every entrepreneur would have taken that decision: some would have ploughed through the paperwork. The important thing, I think, is to recognise what works for you – and what you want from your business.

Whatever choice you make – whether you take your rewards now or later – remember that the business is working for you. It is emphatically not the other way around.

A Brave New World – at least for TAB Members


Clearly I am going mad. That’s the only possible explanation for a world in which people phone the police because their local KFC has run out of chicken. It’s enough to turn a man into Disgusted of South Milford and make him write to the Telegraph…

Assuming the nation survives being rocked to its foundations by the bargain bucket turning into the empty bucket there are rather more serious issues to deal with. Theresa May has just announced a ‘far reaching review’ of the student loan system. As our two boys get older it’s a subject I increasingly read about – and as far as I can see the current student loan system is broken. It must be the only loan where you can make your contractual payments and still see your debt increasing. Shylock would have been green with envy.

Meanwhile the Government is selling student loan debt for 50p in the pound, having already written off around £7bn – a sum equivalent to the capital budget of the NHS. The current system appears to work for neither borrower nor lender.

So some fairly shabby decision making in both big business and Government. Thank goodness artificial intelligence is marching to the rescue. Decision to make in your own business? Sit back, leave it to machine learning and the algorithms and know you’ll have the right decision in the time it previously took to sharpen your pencil.

When you first contemplate robotics, machine learning & Artificial Intelligence the headlines are nothing but doom and gloom. Robots are coming for financial services jobs first. AI to cut a swathe through middle management.

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And, most chillingly of all, the report from management consultants McKinsey that AI and robotics will take 800m jobs worldwide by 2030. AI and robotics undoubtedly will take plenty of jobs. A robot arm can dispense your fries perfectly well – clearly not your chicken though. It doesn’t get sick, doesn’t need a holiday and most certainly doesn’t need including in the company pension scheme.

But let’s dig a little deeper: do technological changes necessarily lead to unemployment and – just as importantly – what do these changes mean for those of us running a business? At the beginning of the 19th Century the Luddites began smashing up weaving machinery, fearing that the traditional skills would be lost and – closer to home – that they’d lose their jobs. Mill owners took to shooting the protesters and the movement was only ultimately supressed with military force. There have been plenty of periods of unemployment in the ensuing 200 years – and all too often the first reaction has been to blame the machines.

There is plenty of evidence though, that technology creates as many jobs as it destroys. There is not a finite amount of labour: it does not follow that because technology removes one job, someone is irreversibly unemployed. The same technology may well create another job. In fact, a recent report on Silicon Valley concluded that for every job lost to automation and AI, four were created.

So where should you work if you don’t want a robot to steal your job? The answer – according to an article in City AM and sitting nicely with Silicon Valley – is in the creative sector, which is forecast to create 1,000 ‘robot-proof’ jobs a week right up to 2030. The creative sector has grown twice as fast as other sectors in this decade, and London now has 90,000 creative businesses. Clearly plenty of those are going to be one-man businesses but that is still a significant number and an increasingly important contribution to UK plc.

But it’s not just the creative sector that offers protection against the march of robots and AI. There’s also the small matter of starting your own business: never say never, but it is hard to see a time when a machine will replicate the drive, desire, enthusiasm – and potential to create wealth – of the entrepreneur, especially those sitting round TAB tables up and down the UK.

As a few of you know, I have just been away for a week’s skiing. A holiday always gives you time to think – and not always about why your sons are going downhill far faster than you are. Change is undoubtedly coming and change will be – to use the current buzzword – ‘disruptive.’ Some companies will be disrupted right out of business. But I am absolutely convinced that no group of entrepreneurs is better equipped to meet, and benefit from, change that those in TAB UK. Yes, they’re awash with drive, desire and enthusiasm – but also with a willingness to question and accept new ways of doing things. As Robert Kennedy famously said, “To see things as they could be and ask, ‘Why not?’”

Which sadly, brings me back to government and education. At the weekend, I was watching this short video featuring a clip from Jack Ma, co-founder and CEO of Alibaba. His message was short and simple: manufacturing no longer equals jobs. As he put it, “It’s not made in China, it’s made on the internet.” In the same way that we urgently need to reform student loans, so we urgently need to reform education. It depresses me to see that so much of the work Dan and Rory do is the same work that I did.

We need our leaders to act like TAB members: accept the change that is coming and prepare for it. To not only ask ‘Why not?’ but also to ask, ‘What can we do to be ready for it?’

The Entrepreneur’s Journey: Taking the First Steps


So you’ve done it. You’ve pushed your breakfast round the plate, wondered why you weren’t with your family and said, ‘That’s it. There has to be a better way.’

And a few days later you’ve burned your bridges – or at least written a letter which can be boiled down to two words: ‘I resign.’

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You’ve committed yourself to the entrepreneur’s journey. Now you need to take the first steps: you need to write a business plan and you need to raise some money.

The chances are that you’d already ‘written’ a business plan before you wrote your resignation letter. I’ve seen potential entrepreneurs – for now, still employed – with business plans at every stage of completion: from neatly bound, carefully worded documents complete with a three year cash flow forecast – to four lines on the back of the proverbial envelope.

For some people the lead up to the resignation letter is calculated and carefully worked out. For others – as it was for me – it’s the moment when that gnawing sense of unease suddenly crystallises. When there really does ‘have to be something better than this – and it has to be now.’

Most of us know the basics of a good business plan – but I am always conscious that this blog is also being read by people who haven’t yet been tempted to tell the MD what they really think… So let me recap the essential details of a business plan:

· What are you going to do? Simply put, what’s the business about?

· What are your goals and objectives?

· Why are you the person to make it work?

· What’s the market? And what’s your marketing plan?

· Who are your competitors? What makes you different?

· If you’re designing and/or developing a product, what are your plans for that?

· Operations and management: how will the business function on a day to day basis?

· How much money do you need? If you’re investing money in the business, where is that coming from? And if you’re borrowing money, how are you going to pay it back?

· And lastly some numbers – projected profit and loss and cash flow forecasts

Those are the basics – but this is The Alternative Board. We’re about a lot more than the basics. We’re about keeping your work/life balance well and truly balanced. About the business working for you, not – as the vast majority of entrepreneurs find – you

working for the business. So your business plan needs to contain something else – something you need to get right from the outset.

Your business plan needs to contain two commitments – to yourself and to your family. To yourself a commitment that you’ll take time off, that you’ll make the time to keep fit – mentally and physically – and that you’ll invest time and money in self-improvement. Because if you don’t grow, your business cannot grow.

Secondly, a commitment to the people you love. That you’ll be there for them. That you won’t have your body at home and your soul back at the office. However high up the mountain you climb, the view is a lot better if you’re sharing it with someone.

I also like to see a business plan contain a statement of values: this is what we believe in, these are the ethics that underpin the business. Your business needs to be profitable: it needs to be one you’re proud of as well.

And now let me backtrack to the business plan. Because there at the bottom is the thorny question of finance. How much money do you need to start the business? Where is it going to come from and – if you’re borrowing the money – what are you going to use for security? Despite the increasing popularity of new initiatives like Funding Circle, Kickstarter campaigns and venture capital investors, the bank is still far and away the most popular option – and the bank will ask for security. Personal guarantees are never far away for the owners of most SMEs and in many cases, neither is your house.

This is the moment when the price of building your business really hits home. This is the moment when you say to your husband/wife/partner, ‘The house is on the line. The bank want some security and, I’m sorry, that means the house.’

That’s a difficult moment for your relationship. The house you bought together, where you’re raising your family: the house you have plans for… Suddenly there’s the spectre of someone else holding the keys: of a letter arriving from the bank politely inviting you to move out. However much someone loves you, that’s a difficult moment. It’s the moment you realise it’s not just you that will be paying the price.

Which is why that line in the business plan is so important. Time with your family. Yes, you’re building a business – but making sure you don’t miss the Nativity Play is every bit as important. Fortunately, you’re among friends: everyone at TAB UK is committed to making sure you’re sitting proudly in the front row.

Carillion: Incompetence on an Industrial Scale


Well, I’ve been through the post three times – yes, home and work. Checked my e-mails. Facebook, obviously… And it’s not arrived. Clearly an administrative oversight. Can’t get the staff I expect. So for yet another year I won’t be going to the World Economic Forum, the annual meeting of the great and good in the Swiss resort of Davos.

But tempting as it is to write about it instead – to spend the next 800 words with Theresa May, Donald Trump and Elton John’s speech on ‘5 Leadership Lessons from my Darkest Hours’ the real story right now is the collapse of Carillion.

Carillion

Like all big companies, Carillion had a strap line: ‘Making tomorrow a better place.’ As everyone now knows, the company went into liquidation last Monday with debts of £1.5bn and a pension shortfall of at least £600m – so for Carillion, there is no tomorrow. For the handful of hedge fund managers who made millions out of betting against the company tomorrow may not be a better place but it will certainly be a richer place.

But for the thousands of Carillion staff, and many, many small businesses, tomorrow looks anything but a better place. I have absolute sympathy for every single member of Carillion’s staff – with the exception of the directors – but in this article I want to concentrate on the 30,000 small businesses that will be impacted by Carillion’s collapse.

Carillion was created in July 1999 by a demerger from Tarmac (which was originally founded in 1903). With the Governments of David Cameron and Theresa May continuing the Blair/Brown practice of using the private sector as the supplier of services to the public sector, Carillion was effectively the Government’s ‘go-to’ contractor.

And yet there was plenty of hard – and anecdotal – evidence that the company was in deep trouble. In 2017 it issued three profit warnings: there was also plenty of gossip.

I have not previously used the comments column of the Daily Mail as a source, but two replies to a recent piece on Carillion are worth repeating:

Carillion have been shaky for ages. We were asked if we would undertake a multimillion pound project [for them] as a sub-contractor. Based on some reliable info we said no – thankfully, or their crash and non-payment would have taken us down too.

[They] have been using ‘dodgy’ business practices for years. Undercutting on quotes to the point where competitors know the figure is unsustainable. Writing that piece Mail City Editor Alex Brummer called Carillion a ‘giant Ponzi scheme…’

Effectively Carillion was using the cash flow from their latest contract to paper over the cracks – or fill the black hole, choose your metaphor – from the previous contract. Ultimately – like Mr Ponzi’s investment scheme – that was unsustainable.

Did anyone pay attention to the profit warnings and the dark mutterings? Yes, the hedge funds did. Carillion was ‘the most heavily bet-against company on the stock market’ and the hedge funds will apparently profit to the tune of £300m from the company’s collapse.

Sadly, Her Majesty’s Government did not pay any attention. Despite the profit warnings and the gossip the Government continued to award contracts to Carillion. For example, a week after the first profits warning the Department of Transport announced that Carillion would partner another construction company on a £1.4bn contract as part of HS2.

There was another profits warning in September of last year – swiftly followed by another key infrastructure contract, awarded at a time when Carillion’s CEO and finance director were both leaving. The Government may not be to blame for Carillion’s collapse but it has left senior ministers looking at best naïve and at worst incompetent.

It has also left them with the lot of explaining to do to the owners of small businesses. ‘It’s got 450 Government contracts, the company must be alright’ is a not unreasonable deduction to make.

But now one industry group estimates that up to 30,000 firms are owed money by Carillion, with the firm having spent £952m with local suppliers in 2016. Clearly many small companies will face uncertain futures and/or will need to consider laying off staff to reduce costs. Carillion may have employed 20,000 people in the UK but the 30,000 firms owed money will have employed considerably more. There are real fears of a ‘domino effect’ among smaller companies, with liquidators PricewaterhouseCoopers saying they will not pay any bills for goods or services supplied before the liquidation date of Monday January 15th. Carillion’s creditors have already been warned in court documents that they are likely to receive less than 1p for every pound owed to them.

Bluntly, that is a disgraceful state of affairs. I am trying to keep calm about this but Carillion captures so much of what is wrong with British business – and which the Government could so easily put right. It’s not just the continuing award of contracts, there is also the small matter of Carillion’s terms of business – 120 days.

I’ve used this line before but it bears repeating. When the boys were little they’d occasionally do something and we’d say, “No, you can’t do that. It is just plain wrong.”

That’s how I feel about 120 day payment terms. It is just plain wrong. At best it is asking small business to finance big business and at worst it is pure and simple exploitation. ‘Do the work in January, send the invoice at the end of that month and we’ll pay you at the end of May.’

Back in September 2016 I took Liam Fox – the Secretary of State for International Trade – to task for his description of small business owners: ‘fat, lazy and off to play golf.’ No, Mr Fox, they are anything but ‘fat, lazy and off to play golf.’ They are trying to plug a hole in their cash flow that your Government could fix with one simple piece of legislation. And some of them are wondering how they’re going to save the business they’ve built from the effects of a corporate crash: one that could have been avoided by a Government with an ounce of business acumen.

Some of the smaller companies affected by the debacle will be TAB members. Carillion will unquestionably be one of the problems brought to future Board meetings.

But amid the rubble there is a silver lining – and that silver lining is the meetings of The Alternative Board, and the accumulated wisdom of your colleagues round the table. ‘We’re thinking of signing a contract with X’ is a phrase I’ve heard any number of times. And on a few occasions I’ve also heard that intake of breath and seen the slow shake of the head – the one the garage mechanic used when you asked if your first car could be fixed – and every time it has proved invaluable.

You’ll never be able to take out insurance against the greed of big business and the incompetence of the Government, but your colleagues around the TAB table are the next best thing.

Panto Season Comes Early


The scene: an Alternative Board meeting, anywhere in the UK. We’re going round the table, updating each other on progress. It’s Dave’s turn…

TAB franchisee          So, Dave, bring us up to date. How’s it going?

Dave                           Yeah, good. The MD’s coming over at the weekend and we should finally be able to sort it all out. Few wrinkles to iron out in Ireland but we’re getting there

TAB veteran               You said last time that your two divisions in Ireland couldn’t agree on anything…

Dave                           Well, technically, yes. But we’re getting there

TF                                So you’re all set to abandon your current deals and go it alone?

Dave                           Yep. That’s what the shareholders want

TabVet                        So what deals have you got lined up to replace them?

Dave                           Well, technically, none

2nd TabVet                 Sorry if I’m missing something here but isn’t that … well, just a touch risky?

Dave                           It’s what the shareholders want

TF                                OK, so what impact is this all going to have on the company?

Dave                           Huh?

TF                                About six months ago you said you were doing an impact analysis on the effect this would all have. On every division of the company

TabVet                        Yep, I remember that

2nd TabVet                  Me too. Remember asking if you thought you could get it done in time

TF                                So where is it?

Dave                           Well, technically…

TF                                It was so in depth that you haven’t finished it yet?

Dave                           Not quite

TabVet                        So when will it be ready?

Dave                           That’s a difficult one to answer

2nd TabVet                  Why

Dave                           We haven’t started it yet.

There is silence around the table. A pin drops…

TF                                So you’re telling us, with our experience in business, that you are planning a major, major overhaul of your business, abandoning trading relationships you’ve had for forty years, you have nothing ready to replace them – except hope – and you have done no analysis at all of the impact it might have on your company?

Dave                           Well, technically…

GD*26426046

The TAB blog is politically neutral. And whatever my personal views, I try to be strictly neutral on Brexit. The blog is not, however, common-sense neutral. And when I read the stories coming out of the Committee on Exiting the European Union (let’s just call it the Brexit Committee, shall we?) on Wednesday I was, bluntly, staggered.

Were the UK Government – in the shape of Dave – a member of any TAB board (and frankly, Mrs May, right now I think it would be money well spent) he would not have survived the meeting. I can think of no instance in my seven years with TAB UK in which a member has gone ahead with a radical overhaul of his business without doing some seriously in-depth analysis of the potential impact. If a member of TAB York had acted in that way I would have questioned whether I was any good at my job.

And yet, on Wednesday morning, David Davis sat down in front of the Brexit Select Committee and said that Her Majesty’s Government had done no significant work on the impact Brexit might have on major parts of the UK economy.

Translate that into business terms. If you had tasked your finance director with doing these impact assessments and six months later he came back and said he hadn’t started then there would only be one outcome. He’d be clearing his office the same day. Even if he hadn’t been tasked with doing the work – but hadn’t shown the initiative to do the assessments – the end result would be the same.

David Davis has argued that there is no point in preparing impact assessments because the scale of change will be so big. Again, if you translate that into business, it’s just nonsense. “We’re going to make major changes in the company – a complete change of direction. And because the changes are going to be so big we’ve decided not to bother making any plans.”

Yep, that would go down well with your TAB colleagues.

Enough lampooning politicians. Sadly, they’re an easy target. There must be a reason for the Government’s failure to carry out due diligence…

Theresa May – the MD in our example – famously campaigned for Remain in 2016. A few weeks later she was roundly declaring that ‘Brexit means Brexit.’ She had seen the shareholders get rid of the previous MD and give her the job – with a clear mandate to deliver something she’d very recently campaigned against.

This is the time of year when I traditionally write about planning for next year. And that’s where the lessons of Brexit apply. Because if you don’t absolutely believe in your plans, targets and goals – if they don’t reflect what you want both for the business and as an individual – then you’ll end up exactly where Theresa May and David Davis now find themselves. Trying to deliver a plan that you don’t believe in and, consequently, controlled by external events – when it should be the other way round.

That’s it for this week. Next week will be the last post of the year and I’ll be looking forward optimistically to 2018. And also announcing a change…

Three Ideas we Must get our Heads Round in 2018


It’s generally believed that the oldest board game that has been continuously played is Go, dating back to China more than 2,500 years ago. For those of you that haven’t played, the aim is to surround more territory than your opponent. The game is played on a 19 x19 grid and it’s far more complex than chess: the number of possible moves is put at 2 x 10170 – or, more simply, there are more potential moves in one game than there are atoms in the universe.

So quite a lot.

Anyway, last month Google-owned DeepMind introduced AlphaGo Zero, their latest evolution of a computer programme which defeated the Go World Champion earlier this year. You remember those possible moves? More than there were atoms in the universe? The programme mastered them all in less than 72 hours – with no human help.

The simple fact is that machines are going to surpass human intellect in any given intellectual task: right now, the AI community believes that 2060 is a reasonable estimate for its arrival – but not so long ago driverless cars weren’t going to be on our roads until 2040…

We all need to get our heads round Artificial Intelligence and we need to do it quickly. Worryingly US Treasury Secretary Steve Mnuchin says he isn’t worried about AI and automation: it’s so far away apparently, “that it’s not even on my radar screen.” Presumably he’s not yet read McKinsey’s report saying that robots will take 800m jobs worldwide by 2030…

Meanwhile Home Secretary Amber Rudd cheerfully stands up at the Conservative Conference and admits she doesn’t really know how encryption works.

Well no – we don’t need our Home Secretary to pop back to her bedroom after a Cabinet meeting and do a bit of coding. But it would be useful if our political leaders had a vague idea of what’s coming down the track. Google, Apple, Amazon and Facebook most certainly do know what’s coming – and it is going to impact your business.

Let me give you a simple example. I don’t know how many possible ‘moves’ there are in deciding whether to lend you or me £250,000 to buy a new house or build that new factory. I do know that it is significantly less than the number of atoms in the universe. I’m acutely aware that sooner rather than later I’m going to need to offer Dan and Rory some careers advice: bank manager may not be top of the list.

Now a rather more basic idea that far too many people still need to tackle: like AI it needs to be on your to-do list at the start of 2018 and crossed off it by the end of the year. The very basic idea is equal pay.

I was reading a salary comparison produced by a TAB member: very clearly, women in North Yorkshire – even in senior roles in the professions – are paid less than men. One line in the report leapt out at me. In comparison to men, women effectively work for nothing from November 7th onwards.

Just say the following out loud. “I’m sorry, you’re bald, we’re going to pay you 80% of what we pay people with hair.” Or try this: “Yes, well, obviously it would have been £3,000 a year more but you’ve got ginger hair…”

…And if you still have a problem with equal pay, go and sort it out now. Equal pay is ethical, it makes business sense and – bluntly – it is just the right thing to do.

And the last idea? Disruption. Henry Ford disrupted horses, Uber disrupted taxis and – as above – AI and ‘fintech’ are going to painfully and permanently disrupt traditional banking. Oh, and the nice, cosy world inhabited by Gillette and Wilkinson Sword and impossibly good-looking men with impossibly smooth chiselled jaws? I’m very sorry, but the Dollar Shave Club is coming to the UK.

Whatever industry you are in – and not for one minute do I exempt peer-to-peer coaching from the list – it is going to be disrupted. We need to be the disruptors, not the disrupted. At the very least, we need to be thinking a long way outside the box, so that we’re prepared when the Dollar Shave Club – or its equivalent – appears on our horizon.