'I'm Micky Mouse, You Know Where To Find Me'

'I'm Micky Mouse, you know where to find me,' is allegedly what Mr. Mouse said after damaging another motorist's parked car in a street in Dulwich last July.

It was further alleged that not only did Mr. Mouse leave the scene of the accident without leaving details like his address or contact details, but that he also was using his mobile phone when the accident occurred, which is an offence. Mr. Mouse vigorously denies using his mobile phone while driving and insists it was simply someone mistaking his white gloves against the background of his large ears.

A spokesman for insurance company, Aviva, a Mr. Bruce-Alice Cooper-Willis, said, 'Mr. Mouse really needed to have left his details with the unfortunate person whose car he had damaged. After all, just because he is a famous rodent it is not incumbent on the person to recognise him - he could be pretending to be Micky Mouse but was actually Roland or Reckless Rat or even Stuart Little, how would our client know? My client may have been a foreigner visiting or an illegal immigrant who may not know that Mr. Mouse works at Disneyland. Besides, Mr. Mouse's employer might have objected to handing out Mr. Mouse's private address which is of course required to pursue the insurance claim.'

Some have described Mr. Mouse's actions as arrogant and full of his own self- importance, some say it was flaunting the very laws he helps make. When asked what he had for Christmas, Mr. Mouse replied, 'A Harriet Harman watch.'

This Internet Thing May Catch On

Cuh, who would have thought it, eh? This little wire into your house and down it comes all this fantastic information and now TV and much more.

In fact so popular has this phenomenon known as 'The Internet' become that advertising spend on it has actually overtaken spend on TV advertising. Some years ago, I attended a conference in London on the future of the web and some chap who was part of an investment group justified some of his company's hair-brain investments by saying precisely this would happen. I wonder if he survived his daft investments in web 1.0 but he was right, despite the guffaws and rude questions of the chap sitting next to me who kept whispering in my ear how he thought the speaker was talking rubbish. I noticed from his badge he worked for a TV company.


It is a fact that during this year, advertising spend has decreased, even on the internet. Companies are questioning more than ever the worth of some of this spend. As Aviva showed with their crazy decision to spend £millions on publicising a name change from Norwich Union while making people redundant, you can blow a lot of money very quickly on TV advertising. While glitzy agencies would tell you can measure the success by means other than sales growth, it would be a really tough job to understand what a campaign like that could have done for Aviva. TV advertising, in the main, is incredibly wasteful. For the millions of TVs it gets played on, the net effect is pretty low and you have to spend a lot of money to sustain the message and advert in order to get some tangible effect.


The internet has given advertising a new lease of life. You see, the trouble with the TV is that by by and large it is technically just a broadcast or stream which hits every aerial in the country regardless of if the TV is switched on or what channel they are watching. At any one time, the vast majority of people are actually watching something else while the advert is being broadcast. The other issue is that TV advertising is not very context sensitive in that an advert for a car may play after a scene where people are in a pub - yet would it not be cool if an advert for beer or wine were shown at precisely that point.


This is where online advertising scores as you can be incredibly targeted down to timing, demographics, geography, location and by the very words used to search the web. At the point you enter your search using a keyword, up will pop an advert only on your browser which is directly related to that keyword. If you search for Indian restaurants, up will pop the name of a local one. There is a simple, yet complex way of 'buying' access to a keyword for your specific needs that is governed by an auction in the ether - it's a bit like TV adverts but it is far more targeted. It can be far more powerful than that as a great deal more information about your browsing habits are stored than you may know or want. It means that adverts on places like Facebook in the future could actually be far more tailored. This is why Social Networking is so important to advertisers and why companies like Facebook and Twitter who have no revenues to speak of today are so highly valued - they contain a great deal more information about you and your online habits than many of your friends know about you. This only exaggerates the futility of TV advertising which is 'hit and miss' at best.


Related to all this is measuring results. The online advertising industry talks a great deal about Return on Investment (ROI) and can measure a great many things about your adverts and traffic to your website. The trouble is that there are many companies that can monitor a great deal of the traffic information by many different methods. There are only a few who have mastered the art of correlating data from multiple sources like Webtrends, Omniture and Google and make some sense of what is really going on by displaying the results with clear dashboards and automating reports. One such company I have found is Theorem Inc and their Data Analytics product which does precisely this. It is now available for companies to buy and use on their own premises to keep their data within their corporate firewall whereas most companies offer web-based access only.


The plethora of analytics tools mean that you can accurately measure response rates, numbers of views, where the clicks came from, time spent on your website, which pages were viewed, how often, for how long and then you can adjust and refine your marketing to maximise response and, hopefully, sales as a result. Naturally, I am simplifying what is a complex industry but when you boil it down, the internet means you can have a great deal more power over your advertising spend to get real results from all your marketing and adjust your budgets as you go, daily and by the minute if you wish. For TV, once you have paid for all that design and production work, it is just a matter of affording the right places to put the advert at vaguely the right time and, literally, hope for the best.

The internet has brought advertising into a new age. For those who doubted its viability against the sheer weight of the TV, it has now proved itself beyond all doubt. The spend statistics tell their story.

How Far Would You Go To Save Your Job?

In these troubled times, even though there is talk of recoveries on the way, the continuing contraction of economies means that inevitably job losses have some way to go before they peak.

British Airways workers have voted to take a 'work for free' month after CEO, Willie Walsh, led the way. The fact that he was surrendering £35k was pretty impressive but then so is his annual salary, despite presiding over the largest loss since the airline was privatised. Workers at JCB voted to go on shorter working hours in order to save some 300 job losses. I am sure there are more examples of how people have either made sacrifices or been incredibly innovative about how they persuade their employer not to shed their job.

In Spain, where many economists are predicting as high as 20% unemployment very soon, the situation is becoming desperate. To some extent, here in the UK, people are either stoic, fall back on the Welfare State or are reasonably confident they can get another job over time - even if they have to accept less money or seniority. The Spanish predicament is so acute that if someone loses their job, then the likelihood of finding another at all, let alone with a salary drop, is very remote.

There has been the case of one Spanish man who worked at the Barcelona International Convention Centre who contracted a group of six Colombians to murder his boss in the hope that it would stave off the imminent loss of his job. At least he will not go without a roof and food as he is due to spend a significant time in jail.

But it begs the question: How far would you go to save your job?

Work Hard And Be Flexible

I don't know if there are any good formulae to be really helpful in trying to save your job. I am sure many companies are just using the current situation to shed more than is necessary as for some companies you have to believe that they cannot see beyond the very short term with some of the measures they take. Many banks and financial companies have slashed back office staff, while embarking on high visibility marketing campaigns and you have to question their management capability. The Government is reducing the Armed Forces headcount yet we are fighting two major wars - strategies continually seem to be at loggerheads with market situations. Many companies are cutting very deeply just at the point when economists are predicting we are through the worst of the recession and that markets may pick up.

That doesn't help the people being made redundant. Some people can see the writing on the wall and almost invite it. There is some wisdom here. Think about it - the market is at its nadir and things may pick up soon so what better than to have a nice redundancy pay off, take advantage of a lovely hot summer or foreign holiday and wait it out until the market picks up?

The fact is that most of us are born worriers and the older you are the worse it gets. As a person not far from 50, I have mild panic attacks thinking what would happen if my business implodes and it must be far worse for those working for large employers as at least I am pretty much in charge of my own destiny. I have seen small companies cruise into the recession and hang precariously onto a single decent customer who is the difference between survival and bankruptcy and am astonished how they continue to not worry. Then I look at people like my sister, whose company is having a strong time thanks to continued Government spend on training and yet she is never satisfied that they have enough resilience.

Different companies and different people react in different ways. For many, a job is a mark of status or duty while to others it's what pays the bills. Clearly, to the unfortunate man in Spain, it was his everything.

I used to think that if you worked hard and were flexible then your employer would value your contribution. This recession has proved that employers do not always work that way. In the heat of the banking crisis, great swathes of administration and back office jobs - none of which had contributed in any way to the idiotic decision-making that exposed the organisations to losses beyond comprehension - were lost and few of the whizz kids who caused the mess were ditched. In fact, in the craziness of the Bank of America take over of Merrill Lynch, they actually paid bonuses long after everyone vented their spleens on the subject to prevent the very people who caused it all leaving. Here in the UK, the banks proved almost suicidal as RBS shed some 9,000 jobs and then a subsidiary launched a glossy advert campaign saying how they were going to mobilise more staff to visit clients. Aviva spent millions on telling us why they were changing Norwich Unions' name yet in the same timeframe they made many people redundant and saw their share price collapse.

My point here is that this recession has exposed us to some of the worst effects of poor management and it is pretty clear that some seriously large companies are managed by fairly incompetent managers. This means that the decision-making in cutting jobs is being made from pretty limited understanding of business and therefore likely to not really focus on what is needed for the future and almost certainly neglect the general contribution of workers. Management by numbers has come to the fore and 'entrepreneurial' and 'blue sky thinking' managers who delighted in their own successes seem to have all too quickly abdicated their responsibilities and left it to the accountants.

My only advice to people under threat of redundancy is to seek good advice and to listen to what the company has to say. Inevitably there may be some consultation process and, if so, take an active part and be constructive and conspicuous. If you want to save your job in dire times, it is important to be flexible. I know there is a real danger that employers may force what appear to be short term changes in conditions on employees in order to save jobs, but make sure concessions are made with caveats relating to the future. In all of this, keep talking about the future because that's where the company is trying to get to so if you play your part in helping your employer get a future, so too must you at least get back what you sacrificed to help this being achieved.

Redundancy is an emotive topic and many take it personally. In my book, it is more a failing of the company and its management team and the stigma should fall on them. In the UK, it doesn't work like that. There is no penalty on the company for using redundancy to boost profitability, the State picks up the tab and so it becomes an easy weapon to use. In France and other Continental countries, redundancy is a hard tool to use to save money and can end up costing more. For good or bad, this focuses the minds of managers to be not so bullish in the good times and be prudent in the bad - to make them run their businesses more strategically rather than tactically even if they that's what they think they are doing (so many believe if they mention the worked 'strategic' then that is what they are doing - most have no idea what strategy is).

In preparation for potential redundancy, think positively about how you will handle it, talk to family and friends, get ideas on what you may do after being redundant, formulate a plan of action, a list of things you want to do, and how you will do them. Most of all use the experience to gain a confidence rather than the opposite. Remember, if you are not for a man like Stephen Hester of RBS, who will get a £9.6m bonus shortly, nicely in proportion with the 9,000 redundancies. You can walk away with your head held high as you were not in it for yourself alone.

Britain has a chance to get better managers in place, to force companies to think beyond the mountain of short term opportunity, to be more prudent, regulate themselves more and protect their employees against the outcome of their stupid actions. Time and again, low paid workers pay with their jobs for more well off managers' mistakes.

As we sit under a Socialist Government, you would have thought this would have been top of their agenda. Once again it will be an opportunity missed.

Teamwork

Today's topic is Teamwork. Rather appropriate as a rather prominent team is getting a few dissenters in its midst.

I am, of course, referring to the Government and it gives us just a little view on a specific sort of team. The crux to politics is to create a vision, work out a path to the vision, set some milestones and hard evidence of progress and, most importantly, make sure everyone is 100% bought in.

The Government itself comprises of a few inner teams and works a bit like a set of Russian dolls - there are teams within teams. Theoretically The Big Team is made up of like-minded individuals who have qualified via being elected (ok so Mandelson, Myners etc are exceptions), but ancillary to that are the mobilised cohorts of back room officials who are party workers - they are the finance engine and bidders for the Team to ensure the Big Team stays in the game. Then there are the third parties - the apparatus of Civil Servants and whatnot who are associated with the team but may not be part of it in the same way. In the animal kingdom they would coincide with worker ants but in reality they have agendas of their own. They need to be controlled.


Finally, there are the mercenaries. The agents who advise, mentor, coach and control the 'marketing' via analysing the opinions, then controlling the output so that the Team messages are carefully worded to appeal to popular opinion. They also shape policy which theoretically plots the route to the vision.

It is not unlike business where there are many dynamics and influences. Lots of things are going on but it is key to share the same goals, control partners and suppliers, and get the messaging right to maximise appeal in terms of brand loyalty.

Alignment


In business, the resources at hand need to be aligned so that all parts of the business are working to the common goals and therefore every £ expended on any resource is a £ spent in trying to achieve the goals. If any £ is not spent the right way, then a) the organisation is not getting the right return on investment and b) there is a risk that the end goals will not be achieved.


Here is two examples of lack of alignment and 'unjoined up thinking'.


- Aviva


I know I have harped on about this but here is a salutary lesson in lack of alignment. At the heart of every team there are stakeholders - they can be party workers or voters as well as Ministers and MPs in Government, in business they can be staff, customers and, of course, shareholders. This latter group was where Aviva went wrong.


The scene is that we are in a recession and the key goal for every business is to make sure it survives and does not suffer badly at the hands of the market conditions. Every penny to be spent must be accounted for and return on investment is paramount as costs are to be saved - this would make the shareholders' returns not diminish so badly. And remember, they are the people who supply the capital to the company.


Whatever may have been said at Board Meetings and AGMs seems to have passed the executive team by - they forgot out the aims of the shareholders, they forgot about the aims of the stakeholders like staff and started to spend no less than £117m on rebranding Norwich Union who they had taken over so that it was recognised as Aviva. It was high brow, in your face, opulent marketing at a time when all resources should have been focused and aligned on protecting cash and profit.


The result was disaster. Aviva's UK profits plummeted, over 30% was wiped off the share value, limiting its prospects of raising new capital and, worst of all, 1,900 staff had to lose their jobs. Down below, in the engine room of the organisation, there were thousands of people who worked hard to keep the Norwich Union business doing what it does best, service its customers. At the top, the executives got side tracked from the real agenda and wasted £millions which furthered the business not one iota except that the mercenaries told them their brand awareness had been raised. But at what price?

1,900 people at an average cost to the business of, say, £50k would mean around £95m of cost was stripped out. Given that over the last 12 months Aviva spent some £117m on this rebranding exercise, all those jobs could have been saved.

- The Government


The last 2 years have seen the Government lurch from crisis to crisis and then to unmitigated disaster. To some extent, these are extraordinary times although many would argue, including me, that they are times brought upon us by the Government. But let's leave that for now. One of the most crucial things in all teams, is that in a dire crisis, you must share common goals and communicate superbly. It is so vital to buy-in everyone so that they do not get disillusioned, demotivated and, worst of all, feel no longer part of the team or disenfranchised.


Amidst all the economic crisises, the Government has been able to depend on its internal support to a great extent because people have forgiven each other that this is a 'global crisis' and therefore it is important to 'muck in' and look as though everyone is singing from the same hymn sheet even if there was some doubt.

But when common values and decency are set aside because of cost, just after some £300bn has been spent on saving the skins of a few people who nearly bankrupted us through their greed, the Government risked the support of even its most ardent believers in their team when they tried to defeat Nick Clegg's Bill on the future of Gurkhas in this country.

It was hard for the leadership to see what the problem was - the total cost if all retired Gurkhas wanted to live in Britain would be around £1.4bn. Big money. But what price do you put on the lives of a race of people who live a long way from here who are so committed to standing for what we believe in that they would die for each and every one of us? They were not mercenaries, they are loyal, British subjects who see more honour in us than anywhere else on earth. Yet the Government would rather pay £millions per week to faceless advisers who tell them to put more and more taxpayers' money at risk. They are prepared to see billionaires walk across our city earning fortunes and pay no tax, but hey are not prepared to pay for people who have earned 26 Victoria Crosses in saving our freedom.

The forces of the team lost their alignment this week and it was lost because of difference in fundamental values. All great teams have one thing in common - they believe in the same fundamental things or values. Labour once stood for common people and in their heyday they might have seen the cause of the Gurkhas as not just worthy, but of no consequence even discussing. We owe them much more than money.

It extends beyond the Gurkhas - all soldiers who are coming home maimed and disabled due to their wounds have forfeited the rest of the lives for our sake. Families have lost loved ones in the recent conflicts. We all owe it to them for fighting wars we asked them to fight. There should be no questions asked about money. You cannot buy a life back, but we can look after those left behind.


Broken Teams


Teams break most often when the leadership loses touch with its members. Don't use The Apprentice as your role models for teams - the cunning little participants have so much determination to stab the people around them that they can never function in teams because they cannot be trusted. But look at great sporting teams and you see a common theme of leadership whether it be Manchester United or the Lions of 97 or England winning the RWC.


Aviva's leadership lost all connection with its staff and shareholders and in doing so ruined the company - the public failure to their staff will cost them more in brand loyalty and they will forever associated with 'big ego, small thinking'. The Government lost touch with two major parts of the team - their executives and workers, but most crucially, the voters. This week senior former ministers (Clarke and Bunkett) and one serving minister (Blears) came out and publicly criticised the leadership for losing touch with stakeholders.

It serves as a seminal lesson to all would be leaders. Never, ever, take your team members for granted.

Aviva Who?

Being right doesn’t mean you’re clever. That’s my theory but I blogged some time ago about Aviva’s stupid wastage in rebranding Norwich Union to the Aviva brand – the cost has been revealed as being £80 million for the current campaign and some £37 million from last year.

The stupidity is coupled with shame. As Ringo Starr, Elle McPherson and Bruce Willis told us they wanted to be treated like real people, Aviva’s results meant that 1,900 real people are being made redundant and the share price collapsed.

Defending the indefensible, Lord Sharman, Chairman, said that brand awareness had gone up from 35% to 80%. Yes, we will certainly remember it alright. It was in the heart of a recession, when everyone should be watching every penny. Besides, no one knew who Aviva was but everyone knew Norwich Union – this could have waited and those jobs could have been saved.

I got into a heated argument with marketing people about this. The brand still needs to be promoted and so forth. I agree – but £80 million is just dumb and it justifies every CEOs decision to slash the marketing budget in a recession because you simply cannot trust the judgement of people like that.

But stupidity isn’t a lonely creature. As I sit on my 5:25 Eurostar to Paris, I see a gaggle of 5 executives from the same company reviewing the agenda and information pack of the company they are going to see – a Board meeting or similar. Laughing and joking about the Board’s comments, I wonder why it takes 3 people to work things like this out. Each of them arrived at the station by private car to make sure they feel important enough. Then one of them says he is off to the re-launch of Hastings Insurance tonight who will be launching a new brand, Hastings Direct with a 1066 theme. The invites arrived in a scroll and with a seal, superb marketing idea blah, blah, blah. So a bunch of financiers will be lauding it the event and back slapping one another. I dare say they may join the Aviva shareholders shortly.

Aviva’s angry shareholders were aghast at their investment’s wanton waste of money. ‘Who needs to see Ringo Starr telling us about name changes? You seem to think you can squander our money how you want’, said one very irate person. ‘These grand ideas sound alright, but if you’d saved money we might have been better off.’

Indeed. The CEO tried to justify all this by saying they actually saved money due to the fact that media prices were cheaper during a recession. Why didn’t he actually use programs between midnight and 3am if he really wanted to save money on the media? In a microcosm, this sums up UK management – executives with over inflated opinions of themselves and non-executives who just read what it says on the piece of paper.

At the sharp end, 1,900 leave the company due to this ego-mania and shareholders are out of pocket. It should not have been the minions sacked – the whole management should be cleared out.

The Power of The Negative

Whilst sitting in the bath, I noticed two pieces of reading material we have side by side on the window sill are, '1,000 Places To See Before You Die' and Richard Wilson's 'Can't Be Arsed'. Essentially Wilson's book is a parody of the theme of the one next to it and is a torrid but funny series of reasons why not to do exciting things or see certain places before you expire. It struck me as odd that such a negative series of thoughts could be turned to profit.

It reminds me of the situation we are in right now in some ways. We are in the heart of a recession and every way we turn there is negative information, news, thoughts and people - it's enough to drive us to despair and sometimes it certainly makes me feel down. Strangely, it as at such times I get more creative, am able to channel more energy into things and get better results. Maybe that's what Richard Wilson (not of 'One foot in the grave' fame) used to be successful with his book - I don't know.

Thinking about the subject further, one of our most useful inventions uses the principle of creating negative energy - I am talking of the refrigerator. Sometimes negatives can be powerful sources for positive thoughts and energy - call it desperation, call it 'when all else fails', it doesn't matter, I like to think of it as inspiration.

Inspired By Negatives

If you want to hear one of the most inspiring talks, then sift through the Harvard Review online and find JK Rowling's address to the Graduation Ceremony last year. She talks to some of the most gifted and un-desperate people on earth to tell them how she found inspiration in her darkest hours. When she was virtually penniless, a single mum, and having lost her job she was as big a failure as she could be. What she talks of was how, at that lowest ebb, she was able to throw off all the inconsequential things in her life that had no bearing on her position and focus only on what was important - her child, her home and a big, big idea.

From this lowest point, Harry Potter was crafted, having already had the idea some time earlier, and it became the focus of all her energy, turning negative energy into an incredible, powerful positive.

I have also read some articles from a chap called Richard Fenton whose mantra is 'Go For No!' in sales and he advocates that you should up your failure rate in sales. His perverse logic is that you need to fail regularly to be successful in sales. I can understand the gist of what he means as the more you fail, the more your desire to succeed should compensate - but that is not common to all people in sales or business. Sometimes failure drags them down.

At this point, the recession looks very negative. Wishful thinking people who have not heeded warnings have literally Hit The Wall and gone from having a successful business one minute to abject failure the next - simply because they had not failed enough in the past to sense it careering up into their faces. When it strikes, they simply abdicate all responsibility to cost cutters and pretend that it is the only way forward - in fact, they have already ruined their business by that point.

So the point of my article today is how negatives can be turned into positives - and how to take the recession by the horns and turn it to your advantage making it something from which to survive and, indeed, to thrive.

Hitting The Wall

When companies Hit The Wall, as I call it, they actually find that, in a very short cycle, just about all of their key business indicators have turned negative on them. I used the example of Norwich Union/Aviva lately who consumed a £multi-million budget to advertise that they were changing their name - yet, with some of the adverts still running, they have reported heavy losses, seen 33% wiped off their share value and shedded 1,900 jobs. They ran straight into a recession while spending more money on advertising in a single period than a good share of the combined sum of the salaries of the staff they have just made redundant.

That's what I mean - it is the idea that one minute the garden is rosy, sales are buoyant, the forecast looks good and you believe that you have a recession-proof business as everyone needs things like insurance. Suddenly, you are in the depths of despair and the only way out is to hand the business across to professional numbers-people and hack the heart out of the business.

For small and medium sized (SMEs) businesses, this can be far more damaging. Too many SME firms have either a one-track business or have too many eggs in too few baskets. When the recession arrives it can be like an absolute bomb going off, literally wrecking the business overnight. I know a recruitment firm that in one quarter went from record sales to 50% drop and had to shed 50% of its workforce. They are not alone, even the mighty Dragon's Den hero, James Caan, has a latest venture which is suffering while Michael Page has seen its worth drop dramatically from the point at which it turned down a bid from a would-be suitor.

Recessions pay no respect to egos or reputations - they can ruin anyone.

Turning Negatives Into Positives

The most common issues faced by firms right now is dwindling order books and low or negative cashflows. The answer in most cases is to dramatically cut costs and try to eek out longer terms with suppliers while voraciously collecting cash. These are the answers from the numbers-people and they make sense. However, it would help if sales went up and cashflow became more positive - but that's the point of a recession, they go the opposite way.

Too often in the recession, the above action is the limit of the thinking. Batten down the hatches until the market gets more buoyant. The sales-driven executives have handed the reins to the finance guys and that's that. When the negatives get too much, too many executives are happy to 'walk away' from their pulpit of success, hand over the power to finance and snipe from their background position about the company's long term prospects.

It's a pity they don't mobilise that negative energy into a powerful force for the positive - if nothing else, the negative attitude will rub off on staff and things tend to spiral from that point.

Here's a thought. If cash is tight and sales are low - how can you find more sales that bring in cash quicker? The first step is to ensure you know enough about your current sales to make an intelligent decision. The decision needs to be about the product or service you want to sell, what its value proposition to the customer is, who would be interested and how you are going to get that message to enough people in a short time to make it successful.

The heart of the decision is to make an attractive incentive for cash payment for the proposition, but the most crucial part is the value proposition - it has to resonate with the customers you choose. Messaging is vitally important here and everyone in the organisation must be word-perfect on the message and spot on in execution.

Very often, the answers to tough questions can lie right in front of you - only the negative thoughts stop you from seeing them. If you have a product or service that is valuable, then make sure the value is realisable fast and compelling - then make sure you know who would be interested, why and make sure you get in front of as many of them as possible, with as many of their objections thought of as you can, and as fast as you can.

A recession will kill those companies who stand still - mobilise your thoughts and people with cohesive messages and actions to turn negatives into positives.

Blue Ocean Thinking

It is always a surprise to hear that many successful companies started during a recession. Dave Hewlett and Bill Packard (HP) started their business in a garage in 1939 building a device used by the Disney Corp. on the film Fantasia - it was not what you would call ideal conditions for a start up. Cisco claims to have started in a recession, as did Facebook. The key to success in a recession is to find a part of the market where there is less turbulence from competitors or is simply an unaddressed need.

In the teeth of this recession, car sales in the US and the UK have dropped dramatically and there is a real risk that many car makers will either not survive or not exist in the same way as before. While sales plummeted 30% in the UK over last year in the peak selling month of March, in Germany they rose by 40% and in France by 10%. In these countries, in conjunction with the Government, a scrappage incentive was offered direct to consumers and backed by a vigorous sales and marketing campaign by the vendors and their dealer networks. The results were spectacular while in the UK we are still considering what to do.

The fact is, there are an awful lot of old cars out there, the dealer network has switched to secondhand selling and the car makers are in too much trouble to see what to do. By the time we do something, it will be too late.

What has happened is that while most car models have dropped in sales, small cars have bucked the trend by selling up 80% on last year - the Ford Fiesta leading the sales charge for the fourth successive month. Here is the plan for the future right in front of people's faces - swap production skills and tooling into making more smaller cars with ultra high fuel economy or new eco fuels and cut mid and high end cars to a minimum and charge a huge premium for them. It is the ideal time for better, more environmentally sound, vehicles to be made and a chance to shape the industry for the future. By using the scrappage incentives in a targeted way, swap out the oldest cars for the new small ones now.

It calls for a concerted line of thought and actions - we have the chance to build a new, better car industry from the ashes of the old, and the opportunity is right here and now.

Blue Ocean Thinking is all about re-invention and in a recession there is no time like the present. The recruitment industry has been cruising for a bruising for some time. In the sustained boom, it grew fat on high fees, low value for money and has spawned a new, valueless level of service on the internet. Recruiters have been very hard hit as companies have cut back on headcount and not replaced those who leave voluntarily. For my example firm, with too few large customers, the effect has been crippling. Correspondingly, large companies have devalued the recruitment process, outsourced it to foreign shores and introduced reverse auctions for placement - how on earth can companies get good people in a recession by using such a valueless selection process? Now is the time to re-invent the whole industry.

I have long held the belief that recruiters should share the pain for poor recruitment. I believe there should be performance related incentives for recruiters so that fees are lower up front and are earned over time according to the success of the recruit and their clients, and I am not talking stock options here. Instead of having salespeople in the recruiters, have professionals who have recruited and managed the kinds of people they are trying to recruit for clients. It will bring back the value in the industry, reduce the costs due to bad recruitment, create more value for recruiting clients and, long term, more profit for recruiters.

The firm that breaks the mould today and offers this kind of model will take the high ground - I know, I have already worked it with clients like Theorem Inc of the USA, and we are both better off for it.

Channeling The Negative Energy

JK Rowling created the most successful series of books in modern times which have also produced a string of fabulous films and merchandising - so becoming incredibly wealthy in a matter of just 10 years. The whole concept was built out of failure and despair. Sometimes you have to fail to realise what its like to really succeed and certainly success tastes that much more sweeter after a failure.

Rowling's message is simple - when you are at the lowest point, you can shed all of the things which are not important and focus only on the things that mean most. It means you can channel all your energy on the things that will bring you most success - by having that single-mindedness you can increase your creativity and make something far more powerful than you could ever do if all you have is success. For many firms, the recession will mean a re-focus on something new or an innovative change to their norm.

If there is one message out of all of this, it is to prioritise. Sit down, think what is important and, quite literally, forget all that is unimportant so that all energy, investment and skills can be applied only to what is important. Don't do an Aviva - now is not the time to blow a lot of money on nice-to-haves. Make sure every penny brings a return.

Make the recession work for you.

Death By Meeting

How many managers can identify with my heading today? Sometimes a business day can just seem an endless stream of meetings, with little chance to do more than answer a few emails and return the odd call in between. In fact, sometimes it seems that all managers do is meet and do not actually DO anything.

Meetings in business are of course a necessity. In fact, I would argue that in times of a recession, it is important to meet MORE rather than less.

I have said it many times before, the speed at which this recession is striking is breath-taking - one minute the business looks pretty sound and the forecast is good, the next sees sales collapse, orders dry up, forecast dwindle and cashflow decline sharply. While small businesses can adapt quickly, too many get caught in rich veins of business or a few large customers which are fantastic when the market is strong but hit very hard when the market goes down.

Meetings Are Crucial

The need for faster, more effective meetings is paramount in times of hardship.

As market conditions and customer buying patterns change almost daily, it is critical to meet more often to make sure you are on top of what is going on.

Many firms I talk to wait until the monthly management meeting to discuss the forecast discrepancies, as a good for instance. With a fixed agenda and several topics for discussion, this is the 'formal' stake in the ground or governance for most firms. Again, when times are good, that is well and fine, but why wait 4 weeks to discuss and action news of a major lost piece of business or the withdrawal of a lending facility when it could have a profound affect on the business in bad times?

I have seen many managers with their 'One Minute Manager' or 'How to Run Effective Meetings' books - these are great tools, don't get me wrong, but it is a sad comment that most managers have little clue as to what an effective or productive meeting is. It seems many just call meetings to occupy their daily time and do not actually achieve a great deal other than fuel a cycle of more meetings. The fact is, instinctively knowing what the business issues are and how to go about solving them should a basic skill for every manager. Yet, they more often than not either stick to given formulae or delve into text books for answers, when the going gets tough.

Priorities and Measurement

I don't have a secret elixir or recipe for managing in a crisis but what I do know is that very quickly, the executive team need to decide the priorities of the business, then have some key measurements of its progress against these priorities and then have a process to review the progress and adjust the business to put it back on the right course or remedy the situation. For this, I advocate more regular, shorter, more succinct and action-based meetings with a rapid cascade of actions after.

Deciding the priorities really comes back down to understanding what is going on in every part of the business to a granular level of detail. I cannot stress enough that in the sales and marketing areas, for instance, there is a huge requirement to review every deal reported on the forecast and have an understanding of all the dynamics in the marketing areas.

What I mean for sales is not a wishy-washy look at the forecast but a face-to-face, eye-to-eye review with every salesperson and a detailed look at every deal of significance and look at the situation of each customer. It's time for hard questions about every deal and its chances, about every customer and their situation and what every salesperson is doing to remedy shortfalls and to replace business that will not happen. It is also time to look hard at what existing customers are doing, what are they experiencing in the recession and how their buying patterns may change.

In marketing, it is about looking at how every penny is spent and how it can be geared toward supporting the sales team in remedying a shortfall. In short, it is getting alignment - through finance, operations, administration, IT etc - the business needs to be fully aligned to the common priorities.

These then become the template for the short review and action meetings.

Rocket Science?

Too often sales and marketing executives run their teams with wishful thinking - believing deals will come good or that customers will buy even when the data is obviously refuting this. Then, when all goes to pot, the same executives are the first to hand over control to the finance team and cost cutters and then bemoan the fact they don't understand the business. Theirs is a world of simple arithmetic and they don't see the long term as by the time the company is handed to them, the sole priority is survival.

Avoiding this is not rocket science - it is simple, practical management. If cashflow is declining and sales falling - the adage 'cash is king' becomes the mantra. The accountants can certainly batten down the hatches and collect cash more voraciously, pay suppliers on longer terms and drastically reduce costs. But viewing it from a holistic position, the salesforce and marketing can be refocused to drive a short term opportunity for more cash based sales via special promotions, targeted marketing and negotiating current deals to bring them and the cash in faster. Such priorities can be easily measured and reviewed very regularly, weekly, even daily. If one offer does not bite, try another - if one set of customers don't respond, try others.

More regular, more tactical management meetings really do drive the business around the twists and turns of a recession rather than waiting for the formal ones.

Cut Non-Priority Meetings

It is a direct outcome of this thinking that allows managers to quickly recognise what meetings are simply not essential. If the meeting does not help the business' priorities then do not have it - it's that simple.

Prepare in Advance

How many times, because business seems an endless succession of meetings, do you enter meetings where either you have not prepared or at least one of the other participants has not prepared for the meeting. Too often, there are 'I will have to get back to you' or 'the data was not available' or 'I got called into another meeting beforehand' given as an excuse. The fact is, if the priorities are not priorities for everyone then people will find excuses and revert to type, wasting time and energy on non-priority tasks.

Recessions are not forgiving - ignore them at your peril. If there is one time in your life when you deliberately skip non-important meetings then this is it.

In a recession, there should be no excuses. If managers do not prepare, there should be little room afforded and no tolerance as it is managing for a failure. And for the excuse of the 'data was not available' that too is symptomatic of non-aligned business processes. If IT is not aligned with the priority of producing data ready for the preparation, then a step is missing or again managers are not tuned in.

There is no room for non-alignment.

Use Technology

Using web and telephone based technology allows you to meet more people, more regularly and with less impact of dead time like travelling on the business. It's more green too which means it not only is better for the environment but it is cheaper for the business.

Stop Looking For Answers

From Government to business, we hear everyday that this is a global crisis and so it effectively answers all questions on performance. There is always an excuse.

That is not true. We know that many famous businesses actually started during a recession (e.g, Cisco, Facebook)and many more actually thrive during them. They do it because they do not look for excuses and answers, they look for opportunities, prioritise, align, measure, review and adjust. This comes from rapid planning, executing and a less focus on 'going through the motions' of business like having just the one monthly management meeting.

Companies who survive or thrive in a recession are absolutely on top of their business and understand exactly how they stand and what they are doing for the future, in every part of the company, from top down and bottom up.

I have used the example of Aviva changing its UK subsidiary's name, Norwich Union, during a recession with a £ multi-million series of high profile advertising. Within weeks, they announce bad results, lose 33% of their market value and cut 1,900 UK jobs. This is monumental hubris and lack of management in a crisis. They just did what it said on the monthly meeting minutes and ignored the world around them until it was too late. In fact, it could even be worse than that - they may have actually decided to spend all the money KNOWING the results were bad.

That would actually be close to criminal negligence - deliberately diverting funds into stupid marketing that could have saved jobs. But it illustrates what I mean - priorities have to change in a recession.

Practical Solutions

I have blogged endlessly on the subject of managing during a recession yet I still see companies around me falling into the same traps. Often we get Dragon's Den heroes talking of their fantastic anecdotes and what has served them well. Duncan Bannatyne, who is one of the best of them, actually told the story of one of his managers calling and telling him a rival gym was putting leaflets on cars in the car parks suggesting a £50 reduction for signing up. Bannatyne gave the entrepreneur's response - only 5% of the City's population paid for a gym, so he wanted to focus on the 95% who didn't pay for a gym as there was a much bigger opportunity than just nicking customers from another gym.

But this was not practical advice - certainly not in a recession. If he is not providing enough value to his current members that they see a £50 offer as a good alternative, then he is going to lose customers. What is more, we all know it costs roughly 4 to 5 times as much to find a new customer than to keep an old one. The number one priority for every business must be to KEEP as many of its customers as it can - and if a £50 leaflet on a car window is taking customers away, then Bannatyne's business model is flawed - and ever more so in a recession when customers may walk just because they cannot afford it. Common sense would say the market opportunity on a 'nice to have' item like a gym will diminish in a recession - current cash paying customers are jewels in such an environment. In fact, in a recession, his advice could not have been worse.

But sometimes that's where entrepreneurs fail - they get too caught up in their own world to see the outside. I think Bannatyne was just illustrating a point because I cannot believe he got where he is today on such a course of action.

Sound Thinking

Again I don't have all the answers - but as an entrepreneur who has managed businesses through several recessions, I have learnt the hard way that applying the same principles in a recession is business suicide. Many of today's business people would not have gone through even one recession let alone a few, so solid thinking and good advice is actually very valuable - pithy anecdotes on the road to success from famous people often glosses over the point.

The question always remains - what does that mean to my business?

I have made the offer before, but I am very happy to offer my practical advice to businesses. Please contact me at nigel.dunn@calxeurope.com or 0207 193 2356.

Aviva - Loco!

You could have bet your house or pension on it. I wrote about whether it was a great thing to market heavily in a recession and used the specific example of Norwich Union's parent, Aviva, taking the opportunity to shove its name change down our throats at the height of the recession.

I could argue all they needed to do was to announce big losses, have 33% of their share value wiped out and then cut 1,900 UK staff - we would all have noticed the name change. Instead, they embarked on a multi-million pound advertising campaign employing the likes of Bruce Willis, Elle McPherson, Ringo Starr, Alice Cooper and McCauley Culkin, to name a few, to tell us that changing their name was the key to future success and vital in a downturn.

Tell that to the 1,900 staff who will face the dole this year.

Corporate Bull

While professional marketeers may argue with me on the amount you should spend to keep your brand alive during a recession, the General Manager in me says there is a time and a place to announce a name change to just to boost the Corporate ego - and at the height of the recession, just before set of bad results and news, is not the time to do so.

This is an illustration of management stupidity and gross negligence. You can see bad results coming and you can plan for it. Marketing in a recession is important but you need to be clever, tactical and do only the things that will get a return for the money.

Corporate name changes and big TV advertising are notorious nebulous activities where it is hard to measure direct results and therefore estimate a proper return on the outlay. I would argue strongly that such moves are just corporate self-abuse at best and so doing them in the middle of a recession is just suicidal and management of the dumbest quality.

I could have predicted the outcome - it was a story writing itself. For the management who sanctioned such high profile spending at this time, they should have been the first of the 1,900 to leave.

Sadly, I will also bet not one of them will be leaving.

Marketing In A Recession

I am not a classically trained marketing person so my comments are not based on professional or academic expertise but I know enough to make a comment on this subject and invite views. I am specifically talking about two campaigns and a product launch which have caught my eye.

In a recession, one of the first budget lines to get slashed is marketing - there is a logic that says that if people aren't buying so much there's no point in communicating with them, plus it is usually a budget line that has not been all spent so there can be some actual savings made. Training is another budget line that gets hammered early for the same reason on savings although the logic is different.

So here are two campaigns which are very high profile in the UK right now and I thought it apt to highlight them. Remember, this isn't just a recession, but we are in the grips of a financial meltdown with the stock market going like a roller coaster and pensions getting walloped because of it and Quantitative Easing.

1) Aviva/Norwich Union

For many in the know, Norwich Union, a bastion of the British insurance and pension market, got taken over by insurance giant Aviva a while back. Until recently, Norwich Union had remained under its own brand as it had such good position in the market. So in the teeth of a recession and credit crunch, Aviva has taken the opportunity to change the name of its UK dominant brand from Norwich Union to Aviva.

And not just with the odd brochure - this is as subtle as a housebrick through the window.

The first wave of adverts used the likes Ringo Starr, Elle McPherson, Alice Cooper and Bruce Willis to demonstrate how stupid the public are in that we would not have taken these people seriously if they had not changed their given names to their stage names. Some may be pedantic and say changed from their 'real' names. It is pretty much in your face stuff as the names are so iconic and the stars so recognisable, and subtly international - perhaps. It certainly got my attention.

The point being that these people had to make the name change to get where they are or simply get on in life. The interesting risk to the point of the adverts is that the vast majority of the world's population, and many famous people to boot, have not changed their name and still thrived. I would argue that it is not mandatory to change your name to become successful, but in those specific cases highlighted in the advert, it has worked for them. I suppose that in each case, they feel that we, the public, are so fine tuned in our tolerance range of names that if Alice Cooper had not been called Alice then we would not have heard of him or rated him. I would suggest that he became prominent for biting the heads off live chickens during his gigs which did that - but what do I know. I honestly don't think that it makes a jot of difference to Elle McPherson that she changed her name - she would still have been one of the most attractive people on earth. Ringo Starr, though, may have a point.

Famously, when asked if Ringo Starr was the best drummer in the world, John Lennon replied that he wasn't even the best drummer in the band.

A subsequent advert goes on to give us the real message. Norwich Union clearly felt that people were just numbers and did not cater for the individual - Aviva in contrast does and this name change proves it. We get the same icons in Starr, McPherson and Willis telling us how they want to be treated in a series of role plays and then we get the rather forlorn figure of McCauley Culkin who moans that he 'Just wants to be known'. The sulky looking McCulkin's career seemed to have peaked too early after the immensely enjoyable 'Home Alone' franchise and he has certainly struggled to gain our attention since. Aviva has sorted that out.

Clearly the advert was not made in the UK and it seems awkwardly American in its slant and I may be wrong in guessing that this advert was made originally for the US market. It makes it all the more risky from that viewpoint as we Brits are stuffy sorts when not having adverts tailored to our way of life.

Let's take a look at the second before my comments.

2) Nat West Bank

The new Nat West adverts courted early controversy, I am told by an industry insider. Apparently the originals featured wording either in the advert body or the small print that no one reads on the screen, that Nat West would be giving impartial advice. This clearly was never going to be true so a complaint was made and upheld and the word impartial was changed to helpful - allegedly.

We see a string of scenes where bank advisers have been mobilised and are visiting people in their homes to sit them down and give them advice on their future plans involving savings etc. All very nice and friendly.

It does not escape the cynical amongst us that Nat West is owned by Royal Bank of Scotland who are at the centre of a storm on one person's investment advice, namely their former CEO Sir Fred Goodwin, who left with his formidable pension after clocking up a UK record for corporate losses. Of course, had RBS itself led with this advertising then we would have all fallen off our chairs, mouths frothing and spitting vilely at the TV at the audacity to show such hypocrisy as it is very unlikely that anyone watching the adverts would ever be treated so generously by the Bank.

Such is the genius of marketing people, that RBS had a brand that was still functioning well and had not been caught up the controversies surrounding its Board, although I dare say it contributed some of the losses to the group. It has been handy, in this instance, that the Nat West brand has not been assimilated and turned into RBS, as ABN AMRO has.

Bold Moves or Good Money After Bad?

It is an interesting argument on marketing spend in a recession.

Clearly, it is not wise to stop spending money on brand, image and general communication to the outside world in a recession - that only damages the company in the long term. Most would advocate being wiser on marketing and use different, perhaps lower cost methods to keep the momentum going and certainly not spending any more than necessary. So in Aviva's case, this is a huge gamble. There is a lot of cynicism out in the market particularly about the largess of banks and institutions generally. The insurance market has weathered the storm well as long as you discount one of the biggest of that fraternity, AIG. But there has been a belief by a number of economists that insurance stands at a precipice and that should there be many more body blows to the financial industry then insurance could become part of an inevitable domino effect.

Aviva not only flies in the face of this but they have actually done what could be described as, in the vernacular, corporate self-gratification. That a company should think so much of itself that by changing its name we will believe it is good is just bloated self-confidence, it could be argued. Certainly, to do it in such a gaudy way with household names of high standing telling us how good it is to change your name, we get to know that they have spent a fortune on this one thing.

Here's the rub - by using household names to tell us, they have missed the obvious point that the Aviva brand is virtually unknown outside of the insurance inner world and it is not a household brand name in the UK the way that Norwich Union was.

So the question must be asked of the Board - was this the right time to blow such a vast amount of money just to announce a name change? There wasn't even a single comment on there to tell us what to buy - it was all about self flagellation and it seems so inappropriate.

Or is it?

The risk for NatWest is unquestionably whether the public are clever enough to make the connection between Nat West and its troubled, disgraced parent, RBS. I did and I shouted out loud frightening the dogs and stormed around the room in a lather. It did not help that just over 3 years ago I changed all my bank accounts, personal and business, from Nat West after a series of appalling calamities, lack of service and the fact that they certainly did not value my custom. There were plenty interested in calling me to sell things, though.

I think this, again, is a gamble by Nat West. they have been clever enough to keep the brand alive despite being part of RBS and keep its own strand of image, very different from the more corporate looking parent, although I dare say there are many customers in Scotland that have banked with RBS for many years who have difficulty recognising the new RBS.

I suspect that Nat West have weighed all this up and concluded it's worth it. However, talking of savings in the current climate is actually a bit dodgy given the dreadful run on the stock market and low interest rates and given my own IFA (and I stress the I is for Independent) advised to liquidate some of my ISA assets prior to the crashes. Interestingly, the advice is to buy ISAs now in readiness for the inevitable upturn, not cash ISAs though as the returns look pitiful.

It will be interesting to see how the two companies do as a result. One thing is for sure, in the glossy world of marketing, measuring the return on corporate image campaigns on TV is notoriously difficult and full of flannel - worse still in the midst of a recession. It could be a bold move or a very silly one by each company.

And Finally - Ta Ta for Tata?

It's launch time for the world's cheapest car, the Indian Company Tata Motors built Nano. It measures 3 metres, has no radio, air conditioning, air bags, or power steering but it does come with 5 seats, 4 doors, a massive 33bhp, a 624cc lion of an engine at the rear and a wheel rather than satellite navigation for guidance.

All for the paltry sum of 100,000 rupees or to you, guv, £1,366.

You may think this is a stroke of genius by its makers in the heart of a recession, particularly when one of the associated stories tells us that a chauffeur who has driven many a swish vehicle for his employers, has in fact never been able to buy a car for himself. However, Tata is also taking a horrendous gamble.

The firm is struggling heavily under a mountain of debt and falling sales and made a loss of 2.6bn rupees for the quarter October to December. It is also having a problem getting a further $2bn of loans on top of the $1bn it borrowed to buy the Jaguar and Land Rover brands from Ford Motors as late as last June - they could not have made a more worse mistake in terms of timing. Worse still, the Nano is 6 months late and there has been associated problems with production after Tata got into a spat over the site of its proposed factory in West Bengal and switched to the site to a new one in Gujurat. That new factory will not be available to produce that car for another year and so production is at a reduced level than anticipated from its other factories.

The real problem is that the numbers simply don't add up. Even if it were to sell 250,000 cars this year, it will only add around 3% to the company's revenues. Further, at the bottom line, it is likely to take 5 to 6 years to break even on the product.

As they say, there is such a thing as bad business and revenue is vanity, profit sanity. While the car may well revolutionise the lives of a lot of Indian people who have never afforded transport in the way we take for granted in the further developed world, it is perhaps another ill-timed strategic move for a firm already in the grips of financial hardship.

It really could be a gamble that ruins the company.