Negotiating with Friends: How we got it Right


Negotiation is very rarely about the short term. It’s an area where you really need to think ‘win/win’ because nine times out ten you’re going to have an ongoing relationship with the person across the table. So don’t set out to ‘screw’ someone: in the long run that attitude is unlikely to be profitable.

That was what I said last week when I was discussing the general principles of negotiation. ‘Think win/win. Nine times out of ten you’re going to have an ongoing relationship.’ But that becomes even more true when you’re negotiating with a friend – as I did when I bought TAB UK from Paul Dickinson and Jo Clarkson.

“Never do business with a friend,” is an old business maxim – and it’s probably saved a lot of friendships – but sometimes doing business with friends and, ultimately, negotiating with them is inevitable.

“Loan oft loses both itself and friendship,” said Polonius, giving advice to his son Laertes before he set sail for France. Well negotiation can do exactly the same: the negotiations can flounder and the friendship can be ruined. Worse still, the negotiations can apparently ‘succeed.’ And then one party gradually realises he’s been ripped off: that he’s been taken advantage of by someone he previously considered a friend. Not any more…

The negotiations to buy TAB UK were long and complex: there were two people involved on both sides, plus accountants, bankers, lawyers – and our respective families.

As Mags and I sat across the table from Paul and Jo I had four priorities:

  • I wanted to buy the UK franchise for The Alternative Board: I’d talked it over with Dav – at length – and I absolutely believed it was the right thing for me, and for my family
  • But like any business deal, I wanted to buy it at the right price
  • I wanted to make sure the negotiations did nothing to damage TAB UK going forward
  • And I wanted to retain the friendship of two people I liked, respected and valued greatly as business colleagues and confidantes.

So how did we set out to achieve that? There were three key rules that guided us through the negotiations and which protected and strengthened our friendship.

  • First and foremost, we set the stage. Both sides were absolutely open about what they wanted to achieve in the negotiations. We constantly asked ourselves a simple question: ‘Is this fair to you? Is it fair to us? And is it in the best long-term interests of TAB UK?’ That question was, if you like, the mission statement of the negotiations
  • …Which inevitably brings me to one of Stephen Covey’s ‘7 Habits.’ “Seek first to understand, then to be understood.” There was a real willingness to see the other side’s point of view. If you do find yourself negotiating with a friend it’s vital to see the negotiations from both sides of the table
  • So there was plenty of goodwill on both sides. But even with all that goodwill, there were bumps in the road: that was inevitable with such complex negotiations. The key was to look ahead and anticipate problems, to be open about setbacks and to clear up any misunderstandings as quickly as possible.

The net result? A very successful negotiation and both sides happy with the outcome. Was it easy? No, but then readers of this blog don’t need telling that few things that are worthwhile are easy. Ultimately, I’m absolutely delighted with the outcome – I’m equally delighted that Paul and Jo will be friends for life.

As it’s Easter, let me finish on a slightly lighter note – and a warning, if you’re planning to spend four days in the garden…

When I’m writing these posts I always – irrespective of how well I know the subject – check with Google, just to see if the Harvard Business Review or one of the entrepreneur magazines has a different perspective. And I’m increasingly astonished at how few words I need to type in before Google guesses what I’m after.

Sims_FreePlay_WP8_Sim_Eating_Plant

Or I was – until this morning. How do you negotiate with I tapped in. Before I could add a friend, Google completed the sentence for me. How do you negotiate with a Sim eating plant? Seriously? That’s the most popular query about negotiation?

Well, fair enough. I always preach the value of knowing and researching your market…

So for those of you whose Easter might otherwise be ruined by the death of your carefully-nurtured Sims, I present perhaps the most useful advice ever offered on this blog. (Warning: the video contains violent scenes which some readers might find distressing. It also contains a teenage son doing nothing while his father is eaten by a tomato plant…)

The Best Bargaining Chips


It’s now nine days since Theresa May formally triggered Brexit, beginning two years of long and complex negotiations with the remaining 27 members of the EU. Whichever way you voted last June there’ll be days when you’re elated and days when you despair. Right now, only one thing is certain – the word ‘negotiation’ is never going to be far from the headlines…

Negotiate-Settlement-Agreement1

It’s certainly played a central part in my life of late, with the lengthy negotiations to buy TAB UK – and what I suspect may be even lengthier negotiations as my sons go through their teenage years. So you’ll be in for ten? I was thinking more like midnight, Dad…

While I await the grey hair and the whispered ‘was that the front door?’ conversation with my wife, let’s take a look at some of the basic principles of negotiation – and then next week I’ll build on those principles by discussing the rather more thorny question of negotiating with a friend – exactly what I was doing when I bought TAB UK.

First things first: unless you’re in a Moroccan bazaar, negotiation is very rarely about the short term. It’s an area where you really need to think ‘win/win’ because nine times out ten you’re going to have an ongoing relationship with the person across the table. So don’t set out to ‘screw’ someone: in the long run that attitude is unlikely to be profitable.

I’ve always tried to go into any negotiations with three positions: my optimum (sell the car for £20,000); desirable (happy with £19,000) and my essential, bottom line price (I can’t accept less than £17,500).

Your ‘opposition’ – I don’t like to use the word but you know what I mean – will have those three in the reverse order. They’d be very happy to buy your car for £16,500, prepared to pay £18,000 and the maximum they’d pay before walking away would be £19,000.

In the scenario above it’s likely that the car would be sold for around £18,000 – assuming both negotiators are equally skilled.

So what do I mean by a ‘skilled negotiator?’ Looking back over my time in business there are probably four principles I’ve seen that work effectively and consistently: in my view, anyone applying these principles is a skilled negotiator.

  • The first thing is to keep the big picture in mind – and leave your ego at the door. I’ve seen too many negotiations fail because people got bogged down in petty details or tried to score points. It’s not just about demanding, “What’s your bottom line?” It’s also about discovering the other person’s ODE – optimum, desirable, essential. If you can operate within those parameters then you have scope to build – or strengthen – a long term relationship.
  • Sooner or later we all have to negotiate with someone we don’t like: someone who changes his mind, can’t make a decision, can’t remember what decision he did make – or all three. The answer is simple: concentrate on the issues, not the personalities. Stick to what you want, and be patient. It may well happen – as happened to me two or three times – that you sigh, mentally prepare yourself for another frustrating day, sit down at the table – and find a new face opposite you. All the problems vanish and the negotiations are wrapped up in a couple of hours. ‘Keep the main thing the main thing’ applies just as much in negotiation as it does in building your business: and the ‘main thing’ is what you want, not the failings of the person opposite you.
  • And don’t get emotional. At least, not for real. Any emotion is fine as long as you are in control of it. But don’t let yourself get angry, frustrated or sarcastic. And don’t get bored: we’re not talking about smoke-filled committee rooms where the old style politicos turned up with flask and sandwiches and simply bored their opponents into submission – but sometimes you do need to settle in for the long haul.
  • Finally, if you’re talking money, think in real money. We all know the traditional approach of breaking it down into ‘silly money:’ Look, you’re going to have this car for three years. £1,000 is 91p a day: two trips to Starbucks a week. Are you going to let that stand between you and a four year old Fiat Punto in Canary Yellow? A £1,000 is £1,000 however you break it down – which brings me back to my original point about optimum/desirable/essential price points. There has to be a point at which you walk away. If you cannot accept less than £17,500 for your car then you cannot sell it for £17,499 – if nothing else determines that, your self-respect should.

With that have a lovely weekend in the (forecast) sunshine and I’ll be back next week with the more personal side of negotiation. And my apologies to anyone who does own a four year old Fiat Punto in Canary Yellow…

Agile Leadership? Or Fundamental Truth?


Agileadjective: able to move quickly and easily. Or, increasingly, relating to software development: relating to or denoting a method of project management characterised by the division of tasks into short phases of work and frequent reassessment and adaptation of plans

And – even more increasingly – the new buzzword in management thinking. We’re now supposed to be agile leaders and agile managers. Our companies need to have an agile culture and, of course, the work is done by our agile teams.

But is ‘agile’ really a new way of thinking? Or is it simply the latest spin on what have always been the best business practices? The Emperor’s latest new clothes – and maybe I’ve seen them all before…

The more time I spend working with business owners and entrepreneurs, the more I’m convinced that – to borrow a line from a classic – the fundamental things will always apply. Hire good people: don’t hire for the sake of hiring. Give them responsibility and remember that your job is to lead. As Stephen Covey said, “keep the main thing the main thing” and – as this blog constantly repeats – never stop learning. If you don’t grow, your business cannot grow.

Unquestionably business is moving at an ever faster pace. It used to be only companies like Dropbox that boasted of employing staff all over the world: I forget the exact quote but it was something like ‘thirty staff in ten different countries in 12 different time zones.’ But now I notice an increasing number of local entrepreneurs working with suppliers and contractors in different countries, knowing exactly what time it is in the Philippines and as happy to price in dollars as in pounds.

Agile-leader

Is this ‘agile?’ No, it’s change. As an entrepreneur said during one of this week’s inevitable discussions on Brexit, “We’ll do what business has always done: we’ll adapt.”

What about the ‘agile culture’ we’re all supposed to use in our offices as we build our ‘agile teams?’ I saw it suggested recently that we should use an agile culture ‘to foster a healthy and positive working environment that takes advantage of the talent within.’

“No surprise there, Sherlock” as the PG version of Dr. Watson would have said. No entrepreneur succeeds alone – and if you don’t foster a positive working environment and take advantage of everyone’s talents, you’ve no chance. In the seven years since this blog started I have lost count of the number of times I’ve preached the benefits of trusting people and giving them responsibility. You should never be the only person in your company with the ability to say ‘yes’ to a new idea. That’s not ‘agile,’ it’s simply the best way to build a business.

…As is constantly being aware of the way your market – and new markets – are developing. “Agile leaders constantly see their business as a start-up” was another quote I read. If you started in a railway arch and you’re now employing 100 people and turning over £25m I suspect it’s quite hard to still see yourself as a start-up. But every entrepreneur I know who has built to that level is as open-minded and outward looking as any fresh-faced start-up.

My big fear with ‘agile’ is that we’ll all feel we should work at a faster and faster pace: that if we’re not Skyping Chicago at 9pm or instant messaging Manila at 5am we’re failing as entrepreneurs. I remember, nearly 20 years ago, reading an article about Gerry Robinson when he was building Granada – and famously, going home to his wife and children at 5pm. His philosophy was simple: if he couldn’t achieve it between 9am and 5pm, he was unlikely to achieve it between 6am and 8pm.

Trends, theories, buzzwords – and lucrative book deals – will continue to come and go in the realms of management and business but, whatever they’re called, the basics will never change.

…And a little over a month into my new role with The Alternative Board, I’m delighted to see those basic beliefs, practices and values running through every TAB franchisee and every TAB member that I’ve met. Yes, of course the next two years are going to throw up difficulties – some that none of us have yet contemplated – but there will be opportunities as well. And I know every TAB franchisee and member will do what businesses have always done – adapt, and meet the challenge.

The Billy Index


I hesitate to write about current affairs, given that last week I devoted 700 words to the Budget on Tuesday, only for the Chancellor to change his mind – and cause a re-write – on Wednesday. But the P in the PEST analysis seems to be impinging on all our lives and businesses so much at the moment that you can’t ignore it.

According to one of the Sunday papers there was going to be a snap General Election: Comment Central followed up with the same story on Monday. Downing Street swiftly dismissed the idea as ‘nonsense.’

If you’re planning a holiday the rumoured date is May 4th – just six weeks away: and just about when we find out if France is going to follow Holland down the path of common sense, or whether Marine le Pen will be in the Elysee Palace. In which case, ‘cry havoc and let slip the dogs of war’ as Shakespeare wrote.

Over the next few weeks and months I suspect we’re all going to spend more time with the news bulletins than we’d like to – especially after Wednesday’s tragic events. So let’s turn to something lighter this week; specifically, Ikea’s Billy bookcase.

bookcases

In our time we’ve all shopped at Ikea: for beds, sofas, desks for our office and yes, a bookcase that even I can put together on a Saturday morning. The ubiquitous Billy bookcase: dreamed up in 1978 by a designer called Gillis Lundgren and sketched on the back of a napkin in case he forgot it.

There are now more than 60 million Billy bookcases scattered around the world – in very round figures, one for every 100 people on the planet. And so common – and far-flung – is the Billy Bookcase that Bloomberg use them to compare purchasing power. For example, a Billy costs £79 in Egypt: just £31 in Slovakia.

And thinking about the Billy Bookcase Index set me wondering: what other unusual economic indicators are there?

So let’s start with another tick in the ‘never say never’ column. I never thought I’d use the phrase ‘bodice ripper’ in this blog but yes, bodice ripping romance novels fly off the shelves in tough times. Sales were up 32% in 2008, the year of the economic crash. And the ‘high heel index’ confirms that heels also get higher during a recession.

Another indicator of tough economic times – sales of men’s underwear fall sharply, as we look to economise in areas that won’t be noticed. Hopefully… And, of course, more people grow their own fruit and veg: the number of households growing their own fruit, veg and herbs was up 19% in 2009.

What other indicators of the economy tanking are there? Fortunately we’re past this stage but a key indicator is the ‘Diaper rash index.’ During hard times parents try and save money by changing their babies’ nappies (yes, diapers to my American colleagues) less often – so sales of nappy rash cream increase.

Moving through life’s journey, there is an increase in first dates during a recession as people look to brighten the gloom. Match.com reported that the second quarter of 2008 was its busiest period for seven years.

And sadly, long after the mystery of the first date, there is an increase in the re-sale of burial plots when the economy is struggling, as people decide that cremation will be a cheaper option.

But my favourite indicator of hard times (literally) is the ‘marine intensity index.’ With the economy in trouble, more and more people apply to join the US marines. So to discourage applications from anyone who’s not 100% committed the Marine Corps toughen up their ads. Fast forward four years and if you see a marine wearing swimming trunks, carrying a 40lb pack and wading through Arctic water you’ll know that Trump’s economic reforms haven’t worked out too well…

What’s the best indicator that the economy is doing well? Garbage, rubbish, trash… As we produce and consume more, so there’s more rubbish. An analysis by Bloomberg put the correlation between volume of rubbish and the health of the economy as high as 82%.

As we might expect, we’re more willing to get divorced as the economy improves and the Swiss watch index soars into the stratosphere.

More worryingly (given my new role) the New HQ index also rises as the economy improves. Companies are more ready to spend the money on a new headquarters – not always with successful results. There’s an old stock market saw that says sell your stock when the MD or CEO announces an expensive new HQ and recently The New York Times, AOL and Time Warner have all fallen victim to the curse.

It is therefore with great pleasure that I can announce that TAB UK will still be at 15 Hornbeam Square next week – and I’ll be back with a post on ‘agile leadership…’

The Budget: the Shape of Things to Come?


But there’s also a problem: namely, where is the value you’re taxing actually created? If Apple builds an iPhone in Taiwan, using raw materials from Australia and advanced components from Brazil, to a design thought up in California (but partially in Oregon), then markets it in the UK, via a company based in Ireland, where is the value created?

(This is without even getting into the licensing and buying-back of intellectual property rights, or any number of other accounting dodges.)

That very pertinent question is from an article in Cap X that I read last week. More of it later: first, last week’s Budget.

Philip Hammond bounced confidently to his feet and delivered his first (and last – it’s moving to the autumn) Spring Budget speech. There was good news on the economy: growth forecasts were up, borrowing was down and the Government’s “plan was working.” He delivered some far better jokes than George Osborne and sat down to a loud chorus of approval from the Conservative backbenches. He may even have glanced sideways at Theresa May and concluded that in the event of the mythical fall-under-the-bus, Mrs Hammond would be odds-on to be measuring up for new curtains in 10 Downing Street.

He could look forward to a nightcap, a good night’s sleep and plenty of plaudits in the following day’s papers…

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Sadly not. Thursday morning’s newspapers were united in their condemnation.

‘Hammond breaks election pledges,’ said the Telegraph. ‘Hammond raids the self-employed to fund care,’ declared the i newspaper. The tabloids were significantly more direct: ‘Spite van man’ screamed the Sun. ‘Rob the Builder’ was the headline splashed across the Star.

Hammond’s crime? He had allocated money to fund social care – £2bn over the next three years – and one of the ways he planned to fund it was by raising the Class 4 National Insurance contributions paid by the 15% of the UK workforce who are self-employed.

By Friday morning more than 100 Conservative MPs were supposedly voicing their discontent, with Anne-Marie Trevelyan, the MP for Berwick-upon-Tweed, saying “it goes against every principle of Conservative understanding of business.” The Chancellor was roundly criticised for riding roughshod over David Cameron’s ‘5 year tax lock’ and the Conservative manifesto.

There’s no doubt that, politically, Hammond made a mistake. Wittingly or unwittingly he’s given the impression that the Government doesn’t like or trust the self-employed and those running small businesses. As the Spectator said, it seems ‘that he suspects them of being tax-dodgers, of using the NHS without paying for it.’

He may even have given an unintended boost to the black economy. If the legendary ‘white van man’ suspects he’s being taxed unfairly he might decide to do even more work for cash – and the Chancellor might end up with lower tax receipts, and very expensive egg on his face.

But let me say a word in defence of the Chancellor – and here we return to the quote from the Cap X article. In his speech Philip Hammond talked about “the challenges in globalisation, shifts in demographics and the emergence of new technologies.”

He’s right – the economic landscape is changing rapidly. More and more people are becoming self-employed or trading through limited companies: people are changing jobs far more frequently, and all too often they need to have two jobs, often combining employment and self-employment. As Cap X put it, a 20th Century tax system is failing to cope with a 21st Century labour market.

And it’s not just the labour market: look at retailing, where online, out-of-town, low tax distribution centres are wiping out the bricks-and-mortar, high street, highly taxed shops.

Right now the tax system is divorced from the way business operates. There will have to be changes over the coming years and it is simply another illustration of the point I’ve made continuously in this blog: business is changing, and the pace of change is accelerating.

In a future post I’m going to look at the growing trend towards ‘agile’ leadership and management. What the Budget – and its fall out – illustrates is that in the future we will all need to be increasingly agile as we face ever-faster change.

But for next week we might just be due something a little lighter: why Ikea bookcases are a vital economic indicator…

…And there, gentle reader, are the perils of including current events in your blog. I wrote this post on Tuesday evening and, as you’ll all know by now, The Chancellor performed a humiliating U-turn on Wednesday and the NIC increases have now been scrapped. (You can forget measuring up for curtains, Mrs H…) I was initially tempted to re-write this post but, on reflection, I think the U-turn illustrates my point even more forcibly: today’s tax system simply has to change to cope with today’s economy. Maybe Wednesday’s climb-down will bring those changes closer – but let’s hope that whichever Chancellor finally has the courage to undertake a wide-ranging review pays more attention to detail than the Rt. Hon member for Runnymede and Weybridge did last week…

It’s Time for E-levels


There’s a simple truth that all parents know. Letters from school are very rarely good news:

It has come to our notice that…

It is with some concern that I write to you regarding your son…

And, of course

The school nurse has regrettably informed me of an outbreak of head lice.

Yes, almost always bad news: unless of course, your son or daughter goes to Saint Francis High School in Mountain View, California.

Last week the Principal sent out a rather unusual letter: Dear Parents, we’ve made $24m…

You may have seen that Snap Inc. – parent company of messaging app Snapchat – floated on the New York Stock Exchange. The company has never made a profit – last year it lost $515m – but that didn’t stop investors piling into the stock, attracted by Snapchat’s 161m daily users. The price rose from the initial $17 a share to end the opening day at $24.48 – valuing the company at $28bn.

That was good news for the company’s backers, great news for the two founders, Evan Spiegel and Bobby Murphy, both still in their twenties and both now multi-billionaires – and quite extraordinary news for Saint Francis High.

Back in 2012 the school – encouraged by one of their parents who had seen how excited his children were by a fledgling app – invested $15,000 in a little known start-up. That start-up was Snapchat and, five years later, the principal has been able to write to parents regarding the small matter of $24m. We can assume that the cake stall won’t be so crucial in the future…

Meanwhile in the UK there’s a crisis over school funding. I was listening to Radio 4 the other morning when the head of Altrincham Grammar School for Boys said that the school was considering asking for voluntary contributions of £30 to £40 per month from parents, with “many other” schools also apparently considering a similar move.

One head teacher went much further, suggesting that if the funding problems couldn’t be resolved she would need to run her school on a four-day week, scrap the sixth-form or remove arts subjects from the curriculum.

Despite this, Philip Hammond, our (relatively) new Chancellor, has committed himself to spending £500m on vocational education. The move was trailed on Sunday morning’s Andrew Marr Show and confirmed in Wednesday’s Budget. It’s a bid to train more skilled workers and thereby boost productivity and the UK economy. The plans will see 15 ‘routes’ into employment, linked specifically to the needs of employers.

The government is calling these plans – due to be introduced from the 2019/2020 academic year – “the most ambitions educational reform since the introduction of A-levels some 70 years ago.” The new qualifications will be known as ‘T-levels’ and will increase the amount of training available to 16-19 year olds by 50%.

And I’m absolutely in favour of the move. I don’t often quote former shadow business secretary Chuka Umunna, but he was right when he said, “It takes the British worker to Friday to do what the equivalent French or German worker will do by Thursday afternoon.”

The country has to close the productivity gap – but let’s not stop at T-levels. Let’s have E-levels as well.

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Yes, let’s see Entrepreneurship on the National Curriculum.

Why shouldn’t schools take a leaf out of Saint Francis High’s book and invest in emerging local companies? And why shouldn’t Entrepreneurship be a recognised subject alongside Science, Technology, Engineering and Maths?

The scientist, the engineer or the mathematician might well go on to start a business in the future. But they won’t do that without the entrepreneurial spark: if there was ever an education secretary brave enough to kindle that flame and put Entrepreneurship on the curriculum then he or she would have done the country an enormous service.

Because let us be clear on one thing: it is the entrepreneur, not Government policy, that creates jobs and growth. It is the entrepreneur’s willingness to sacrifice security, to put his house on the line, to give up sick pay and holiday pay and pursue a dream that, yes, benefits himself and his family. But at the same time it also enriches – figuratively and literally – the country and the wider economy.

The Skills we Can’t Measure


Before I plunge into this week’s post, let me just take a moment to say ‘thank you’ for all the e-mails, text messages and calls over the last fortnight. Taking over TAB UK is a huge honour, privilege and challenge – but I couldn’t be setting out on the journey with any greater goodwill. So thank you all.

Back to the blog: and who remembers Moneyball?

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The old ways of recruitment in baseball were jettisoned. In came Billy Beane, his stats guru and a transformation in the fortunes of the Oakland Athletics.

The central premise of ‘Moneyball’ was simple: that the collective wisdom of baseball insiders – managers, coaches and scouts – was almost always subjective and was frequently flawed. But the key statistics for baseball – stolen bases, runs, batting averages – could be measured, were accurate and – used properly – could go a very long way to building a winning team.

Well, it worked for the Oakland A’s. As Billy Beane memorably says at the beginning of the film, ‘There’s rich teams, there’s poor teams, there’s fifty feet of $%&! and then there’s us.’ The ‘Moneyball’ approach changed all that, with the film chronicling their hugely successful 2002 season.

Small wonder that business has followed the ‘Moneyball’ approach for generations. “What we can measure we can manage” as my first sales manager incessantly chanted, drumming into me that I needed to make “Specific, measurable” goals.

And he was right. Business has to measure results: goals must be specific and measurable and, as anyone who reads this blog on a regular basis will know, I believe there’s only one long term result if you don’t keep a close watch on your Key Performance Indicators.

But does that tell the full story?

Of course we have to keep track of the numbers: of course salesmen must be able to sell, coders must be able to code and engineers must be able to do the basic maths that means the bridge doesn’t fall down.

But none of those things happen in isolation: all of us in business are part of a team. We have to work with other people and – if our job is to lead the team – we have to get the best out of the people we work with.

And for that we need a set of skills that can’t be measured. I’ve written before about the World Economic Forum and their document on the key workplace skills that we’ll all need by the year 2020. Their top ten list includes creativity, people management, co-ordinating with others, emotional intelligence and cognitive flexibility.

Last time I checked, none of those could really be measured objectively.

So are we swinging back to the pre-Moneyball approach? To a time when ‘gut-feeling’ held sway.

No, we’re not. But I do believe we are in an era where what we’ve traditionally called ‘soft skills’ are at least as valuable as ‘hard,’ functional skills.

This has implications for those of us running businesses – and it especially has implications for the training programmes we introduce. In the years ahead, we’ll still need to train our salesmen and our coders, but we’ll need to give them skills that go well beyond selling and coding.

There are implications for hiring and firing as well: they can no longer be based purely on numbers. And yes, I appreciate that the second one is going to cause problems. As a TAB member said to me last month, “I can fire someone for under-performance, I can fire them for stealing from me. But try and fire them because they bring the whole team down with their negative attitude and I’m heading straight for an employment tribunal.”

We’ve all been there: been in a meeting where someone’s glass is determinedly half-empty and they’re equally determined that it will remain like that. There’s a collective sigh of relief when they go on holiday. You can’t let one person bring the team down: it’s up to us as leaders to use our soft skills to make sure that doesn’t happen.

It’s also up to us to make sure that everyone in the team has the chance to develop their own soft skills. Whether it’s negotiation, creativity, co-operation or flexibility – those are the skills our businesses are going to need over the coming years: those are the skills that will help us turn our visions into reality.

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!

The Five Lessons I’ve Learned


I was talking to a potential new member of TAB York last week: explaining what I did, how the concept of peer coaching worked, the benefits it had brought to my members… And looking back on the seven years I’ve been running TAB York.

“So,” she said. “What are the five key pieces of advice you’d give to an entrepreneur?

Five? I thought. More like 55. Or 555. But let me try and answer the question more successfully than I answered it then. What are the five most important lessons I’ve learned in the past seven years – and by definition, the five most important pieces of advice I’d give?

Lessons Learned written on chalkboard

1.The job of a leader is to lead

You’ve pushed your breakfast round your plate in a desolate motorway service station: you’ve decided that enough is enough. It’s time to start your own business. You owe it to yourself: you owe it to your family. Sooner or later your new business will be employing people – and your job is simple. It’s to lead them: to say, ‘this is the where we’re going, follow me.’ There are plenty of other things you need to do – realise you don’t need to be an expert in everything and don’t be afraid to hire people who are brighter than you – but it is your drive, determination and vision that will carry the company forward.

2.A mistake is only a mistake

I made Spaghetti Bolognese at the weekend. I broke a bowl, tipped pasta sauce on the floor and left the gas on under a pan. They were mistakes – and that’s all they were. No-one (not even my wife) is suggesting that I give up cooking and never enter the kitchen again. So your latest idea didn’t work out: the guy you hired who was going to transform your business transformed it in the wrong direction. Move on: you live to fight another day – your vision is still the same. No-one scores 100% with their decisions – and as the saying goes, ‘the man who never makes a mistake never makes anything.’

3.Keep on Learning

I think we can say that the world has changed since I joined The Alternative Board in 2009. In that year Facebook had 360m users and 20m iPhones were sold. Today the figures are approaching 2 billion and over 200 million. In 2009 Apple had just introduced a fledgling service called the ‘app store.’ The pace of change over the last seven years has been astonishing, and it’s not going to slow down. You need to set aside time to learn – and as I wrote a few weeks ago, if you don’t develop and grow, then your company can’t develop and grow.

4.Nothing can replace your KPIs

Having just written about change, let me turn to something which can never change: your Key Performance Indicators – the numbers and metrics which tell you the current state of your business and go a very long way to predicting its future.

If I’ve seen one cause of business failure over the past seven years it’s not knowing your KPIs. Checking your KPIs every month is simply essential to the continued success of your business. And ‘How much have we got in the bank?’ is not an adequate check. Sadly, it is almost always followed by ‘Can we afford to pay the wages this month?’

5.Your product is more important than anything

Despite the internet, despite social media, despite e-mail marketing and despite every change that’s happened over the last seven years, your product (or service) remains the key to everything. And if it’s not excellent, you’re in trouble. To paraphrase the old saying, stories about bad service are half way round the world before good service has got its boots on. Not only is the world changing, it is spawning a lot of hungry competitors: if you’re not innovating and improving, then someone else will be, and they’ll be telling your customers.

6.We all need friends

Clearly I haven’t learnt to count, but where else can I finish? 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, transformed lives and – on at least one occasion – saved a marriage. We all need friends and – in business – you will never find better friends than your colleagues round a TAB boardroom table. As the man said, we all need a little help

What can we Learn from Loyalty Cards?


Open your wallet.

Go ahead. Open your wallet. Or your purse. I’m conducting an experiment.

I am prepared to wager that in there – along with the photograph of your children and the credit cards – are two or three loyalty cards. I don’t mean your Tesco Clubcard – I mean the ones that are stamped. The loyalty cards from coffee shops, bakeries and your enterprising local burger restaurant.

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…And I’m prepared to make a second wager: that all those loyalty cards – that need eight or ten stamps before you get your free bagel or burger – have just one or two stamps on them. That you thought, ‘hey, that’s a good idea, I’ll do that’ and then quickly lost interest.

You’re not alone: that’s archetypal human behaviour – but according to an article in the Harvard Business Review it’s behaviour that may offer business owners and managers an insight into how to improve results from their teams.

Interestingly, it flies in the face of most current business thinking, especially when it comes to setting and achieving goals.

The modern trend is towards flexible working. As I wrote recently, the evidence suggests that teams allowed to work flexibly are both happier and more productive. And unsurprisingly, the vast majority of people have a preference for flexibility when it comes to goals. As the HBR puts it, ‘Adopting a somewhat elastic approach to setting goals allows us some future wiggle room.’

But it you want to achieve a major goal, then the article suggests you’re much more likely to do so with a rigid and restrictive structure for the necessary steps.

And this is where loyalty cards – and yoghurt – come in.

Professor Szu-chi Huang and her colleagues in the marketing department at Stanford University conducted research on the effectiveness of loyalty cards at a local yoghurt shop. It was the standard offer: a free yoghurt after six purchases.

There were two separate offers – the ‘flexible’ one, where customers were free to buy any yoghurts they liked, and a far more restrictive one, where customers had to purchase specific yoghurts in a specific order.

Unsurprisingly, there was far more take-up of the ‘flexible’ offer. Rather more surprisingly, those customers opting for the restrictive offer were nearly twice as likely to complete six purchases and get the free yoghurt. (And before you think it’s just one yoghurt shop near Stanford University, YesMyWine, the largest imported wine platform in the world, has reported similar results with special offers.)

The academics at Stanford suggested that the result was because customers responded to not having to make a decision: that in our ‘information-overload, decision-fatigued’ society people will appreciate something that gives them the chance to make fewer decisions. They go on from that to draw a conclusion for business: that once a goal has been decided on, managers should be rigid in the steps needed to accomplish it – in effect, take any decisions away from the team.

I’m not so sure. First of all I’d argue that people who sign up for a ‘restrictive’ offer are more committed in the first place and therefore more likely to ‘see it through.’ Secondly, my experience of managing large teams suggests that the real answer is “it depends.”

Specifically, it depends on the experience and capabilities of your senior team. If you’re looking to achieve significant change and/or achieve a major goal then, yes, there needs to be a detailed, step-by-step approach with a list of actions and a series of deadlines.

But if you have a ‘details guy’ in the team, my advice is delegate it to the details guy: it’s almost always better to ‘trust and delegate.’ But if you don’t have a details guy, then the actions and deadlines become your job: what’s absolutely certain is that they cannot be left to chance.

So there I am, disagreeing with learned academics at the world’s third-ranked university. I’d be fascinated to hear your views on this: and yes, let’s discuss it over a coffee. I can’t miss a chance to double my number of stamps…