CRISIS or OPPORTUNITY?
New Year’s Eve, 2019. The World Health Organisation country office in China receives a report of a pneumonia of unknown cause. Around the world billions are welcoming in a new decade and futurists and predictors are busily writing articles about what the new decade has ahead for us all.
Some numerologists wax on about it being a year of vision and accomplishment as the year will be a perfect year for us all.
Political commentators worry themselves over the forthcoming US election and in the UK Brexit is still on the agenda. Greta Thunberg is continuing to push for greater climate change awareness, Prince Harry is getting ready to live in LA and be the champion for the ‘Woke’ generation.
Chinese horoscopes called this year the Metal Rat Year, a year of vast productive and ingenious energy.
Horoscopes, psychics, futurists, authors, and commentators all made predictions for the coming year ranging from the negativity of political disaster and the positivity of future prosperity.
No one would have believed nor predicted the global pandemic or foresaw that the entire world would be affected by the same problem.
Few even considered the possibility on that New Year’s Eve, that The Disruption was already on its way.
And yet, across the world, people were already carrying the virus around the planet.
Even the 2019 Netflix documentary predicting a pandemic that could kill 33 million people in a 6 months period was off the mark too, although so much of what it said, has come to pass, fortunately, not the size of the death toll.
Bill Gates was right in saying there is going to be a viral pandemic that comes out of the wet markets in China. However, despite his prediction that a virus would be the next global catastrophe in 2015, he was commenting after the Ebola outbreak in Africa that worried us all so much at the time and his comment about the perils of a pandemic were largely ignored.
Even when reports started appearing in January, the majority of governments and people around the world carried on, without paying it too much concern. I am reminded of a passage from The War Of The Worlds, by H.G. Wells. It’s slightly edited for brevity. It comments on the lack of reaction from the rest of England to the arrival of a Martian invasion force. Read this and think about how the world reacted so sluggishly to the coming pandemic.
The most extraordinary thing to my mind, of all the strange and wonderful things that happened upon that Friday, was the dovetailing of the commonplace habits of our social order with the first beginnings of the series of events that was to topple that social order headlong. If on Friday night you had taken a pair of compasses and drawn a circle with a radius of five miles round the Woking sand pits, I doubt if you would have had one human being outside it whose emotions or habits were at all affected by it.
Even within the five-mile circle the great majority of people were inert. I have already described the behaviour of the men and women to whom I spoke. All over the district people were dining and supping; working men were gardening after the labours of the day, children were being put to bed, young people were wandering through the lanes lovemaking, students sat over their books.
Maybe there was a murmur in the village streets, a novel and dominant topic in the public-houses, and here and there a messenger, or even an eye-witness of the later occurrences, caused a whirl of excitement, a shouting, and a running to and fro; but for the most part the daily routine of working, eating, drinking, sleeping, went on as it had done for countless years–as though no planet Mars existed in the sky. Even at Woking station and Horsell and Chobham that was the case.
In Woking junction, until a late hour, trains were stopping and going on, others were shunting on the sidings, passengers were alighting and waiting, and everything was proceeding in the most ordinary way. A boy from the town, trenching on Smith’s monopoly, was selling papers with the afternoon’s news. The ringing impact of trucks, the sharp whistle of the engines from the junction, mingled with their shouts of “Men from Mars!” Excited men came into the station about nine o’clock with incredible tidings and caused no more disturbance than drunkards might have done. People rattling Londonwards peered into the darkness outside the carriage windows, and saw only a rare, flickering, vanishing spark dance up from the direction of Horsell, a red glow and a thin veil of smoke driving across the stars, and thought that nothing more serious than a heath fire was happening. It was only round the edge of the common that any disturbance was perceptible.
This would be a fairly accurate way to discuss how the world was that New Year’s Eve 2019. You could change some of the text and it would have matched how unprepared everyone was.
The truth is that we just did not think it would happen to us. It is a by-product of a curious mind trick that we humans play on ourselves. It is called the Optimism Bias.
The Optimism Bias makes us believe that the disasters that befall other people will not happen to us. It is what has, for thousands of years, allowed warriors or soldiers to fight on a battlefield. The notion that the bullet will not hit me is entirely down to Optimism Bias. This is what allows people to sign up for the army or march to the battlefield. Once on the battlefield, different motivations take over, however the Optimism Bias is still present.
We believe that we are more likely to experience a good outcome that a bad outcome. This explains why smokers continue to smoke, despite warning labels, scientific evidence and even the evidence of their ill health. Smokers just do not think that they will get cancer from smoking. They belive it will not happen to them. The same can go for drink drivers, extreme sports enthusiasts and even those thrill seekers that take selfies from the top of very tall buildings.
Optimism Bias is skewed towards the younger and, the elderly. Did the world have national and governmental Optimism Bias that led to the belief that ‘a global pandemic wouldn’t really happen to us’?
It is more than possible that this is the case. It is also not a vote winner to spend large sums on money preparing for an event that might not happen during their term in office.
Thus, the world partied into the night, like the passengers on the RMS Titanic heading towards an iceberg.
Four months later, millions are infected, hundreds of thousands will have died, and the world has changed.
Make no mistake, this has changed the world.
This is The Disruption.
For the first time, every human being on the planet was united against a common foe. Will we, like the people of Earth at the end of The War Of The Worlds have a different viewpoint? After this pandemic, will we view things as the narrator did here?
At any rate, whether we expect another invasion or not, our views of the human future must be greatly modified by these events. We have learned now that we cannot regard this planet as being fenced in and a secure abiding place for Man; we can never anticipate the unseen good or evil that may come upon us suddenly out of space. It may be that in the larger design of the universe this invasion from Mars is not without its ultimate benefit for men; it has robbed us of that serene confidence in the future which is the most fruitful source of decadence, the gifts to human science it has brought are enormous, and it has done much to promote the conception of the commonwealth of mankind. Be that as it may, for many years yet there will certainly be no relaxation of the eager scrutiny of the Martian disk, and those fiery darts of the sky, the shooting stars, will bring with them as they fall an unavoidable apprehension to all the sons of men.
The broadening of men’s views that has resulted can scarcely be exaggerated. Now we see further.
The analogy is clear. We must learn from this and prepare for future onslaughts, less we have another Disruption.
So much is obvious. If you are a regular reader, you will know that I write about personal development and offer business advice, so why the foray into discussing the Covid-19 Pandemic?
Simply put, this has a been huge lesson for us all and I am NOT referring to preparing medically for the next pandemic, for there surely will be others now the genie is out of the bottle.
The title of this article is After The Disruption – Crisis or Opportunity?
This refers to your mindset. How you have reacted and how you will act going forwards will define the rest of your life.
Where is your mindset going to be? Will you still think as they did BC (Before Coronavirus) or will you change your thinking to be relevant to life AD (After the Disruption)?
There is a sense that what was so very important BC, is less so AD. The concerns of celebrity, sporting achievements, soap operas, gossip amongst communities, office politics, the pursuit of profit before all else, seems facile and shallow.
We have seen just how easy it is, for an organism that cannot be seen by the naked eye, to bring all of humanities efforts to almost a complete stop.
We have been humbled in a manner not that different to the bacteria that killed the Martians off at the end of The War Of The Worlds.
In another moment I had scrambled up the earthen rampart and stood upon its crest, and the interior of the redoubt was below me. And scattered about it silent and laid in a row, were the Martians–DEAD!–slain by the putrefactive and disease bacteria against which their systems were unprepared; slain as the red weed was being slain; slain, after all man’s devices had failed, by the humblest things that God, in his wisdom, has put upon this earth.
So, here we are.
The survivors, the recoverees, the people that made it through. Let us be clear, as dreadful as the Covid-19 has been so far, it pales into insignificance to some of the extremely deadly virus’s out there.
It really could have been worse.
How does all this relate to business? I want to look at how Optimism Bias affects businesses, for it can make and break a business and I’ve not yet come across a business that is aware of it.
I want to make a clarification; Optimism Bias is not necessarily a bad thing. In fact, almost all huge breakthroughs, scientific or business, have been affected by Optimism Bias.
Did Albert Einstein have Optimism Bias when he decided to create ‘the world’s most famous equation’? Did Steve Jobs have Optimism Bias when he created the iPhone? Did Michelangelo have Optimism Bias when he created the Sistine Chapel? Closer to home, did Ben Stokes have Optimism Bias when he faced that last over in the 2019 Cricket World Cup Final? It is nice to live life thinking that good things will happen to us. But by acknowledging the Optimism Bias and being aware of how it affects us, we can make better decisions and avoid potential pitfalls.
When we create a business plan, how often are we using Optimism Bias? We have a dream of setting up and running a business. We think it is a terrific idea, so of course, we think that the customers will have the same opinion.
I think that it could be said that without Optimism Bias, many hugely successful businesses would not get off the ground.
I think that it is Optimism Bias which drives entrepreneurs to start their own businesses.
In Cellular Attitude – The 9-step guide to a happier life, I write that ‘having a positive attitude drives positive events towards you’. Optimism Bias is a by-product of positive attitudes.
If you think you can, or you think you can’t you’re right…
Optimism Bias, the belief that our product or service is the best and that our enterprise will succeed because of this can be really very dangerous.
Let me explain…..
When we create our business plan as we are setting up our business, wait.. what? Are some of you reading this sheepishly because you did not create a full business plan before you started your business?
OK, let me back track, when we create our basic sales plan, in advance of writing our business plan, we are.. what? Some of you reading this didn’t make a sales plan?
And, there, dear reader, is the evidence that Optimism Bias exists…. The idea that you can successfully run a business without a sales plan or business plan is such an example. I am sure there are businesses that are doing well that have never had a structured plan for sales or their business. However, the statistical evidence supports the assertion that more businesses succeed and are more profitable when they have a business plan and an accompanying sales plan.
I am a huge fan of Optimism Bias. I think it is a huge indicator that someone has a robust positive attitude.
So, let us look at how we use Optimism Bias and how we can learn to avoid the dangers of Optimism Bias in sinking our business, our savings, our sanity, and our relationships going forward.
Optimism Bias states that your business will succeed. Excessive Optimism Bias states that your business will succeed without business planning, sales planning, sales activity, monitoring KPI’s, evaluating data, checking the validity of the results, being willing to pivot the business, being open to changing things that aren’t working, trying new sales and marketing efforts, reviewing the processes, preparing management accounts, keeping track of costs, looking at margins, etc, etc.
Irrespective of your business’s current state or position at the moment, particularly as we are in the middle of the Covid 19 pandemic, I would like to invite you to look at your business again, in light of the changed circumstances and taking the effect of Optimism Bias into account.
In many respects EVERY business should look at everything as if it were a start-up again. After all, we are all going into the unknown. Use the same procedures that you would if this was a start-up. Think LEAN, everyone! (You should read Lean Start-Up by Eric Ries). My advice is to consider treating your business as a RESTARTUP!
Let us re-write your sales plan, your business plan, your mission statement and re-set your KPI’s to ensure that you are ready and able to take advantage of the very real OPPORTUNITY that this pandemic has sent us.
In business, if you do what you’ve always done, in this new era, you will certainly not get what you’ve always got.
After The Disruption, will your business be ready to RESTARTUP?
At this point, it might be worth my answering the question ‘Who am I to proffer such advice?’
In no particular order, I am a motivational speaker, sales trainer and coach, business coach and mentor, author, private pilot, and father to an incredible daughter, that’s also my business partner.
The businesses in my business coaching programme, The Buccaneer Team, all start their journey with a comprehensive review of their sales plan, their business plan, the KPI’s for their sales activity and a review of their mission statement.
I’d like to share with you the initial sales plan creation document that I provide all ‘Buccaneers’. It’s a good way to test a start-up and create new business processes, goals, and activities.
Buccaneer Team Sales Plan Process:
PART 1: ASSUMPTIONS – Here is where we write the overview for the business
Please answer these questions as honestly as possible.
1: What are your target markets?
Do your target markets differ for different products and services? What will be your target markets for the new era?
2: What do your ideal customers & clients look like?
Who and what makes an ideal customer?
Has this changed since Covid-19?
The more detail you put into what your ideal customer looks like, the easier it will be to find them. List several types of customers and think about who would use your service and what benefits they will get from using you. Remember, think like a Start-Up!
3. Where do you find your customers?
Where will you find them?
What routes to market are you using?
What new routes to market could you try?
Do you think that customers buying methods will change because of the Lockdown and Social Distancing?
Make changes to your thought processes NOW!
4. What makes your customers buy your product?
Why do they buy from your company?
Why do they buy your product or service?
Have you ever asked your customers these important questions?
What benefits do your existing and new customers get from working with you?
5. Can you describe the benefits of your solution simply and easily? If so: Write them down.
If you cannot explain it to a 6-year-old, then you don’t understand well enough yourself. So said Albert Einstein!
Can you explain WHAT you do AND WHY your customers should buy from you? If you cannot do that, your business will struggle.
6. Do you understand your sales costs, margins, and profits? List a summary of the key overheads/ cost of sales/ profit expectations
How much do you need to breakeven?
What are your fixed costs, your variable costs and, importantly, what income do you need every month to a) survive b) live to your ideal base standard and c) thrive?
7. How much gross profit is required to breakeven – using that, what sales do I need?
How much profit do you need to show to breakeven?
Breakeven should be the costs in your business to include YOUR base income in point b) above.
From this you should be able to calculate how many sales you need to deliver to get to that point.
8. How much sales activity is required to a) break even and b) achieve the desired profitability?
Here is where you start to work out your Math Of Sales. This is covered in detail in my online sales training programme The Psychology Of Sales
Suffice to say, you will need to understand your Key Performance Indicators for your sales activity in order to build a good picture of your requirements. A key element of The Buccaneer Team coaching programme is how we teach you to build your sales strategy.
Who you speak to, what you say, how often you say it…? These are the building blocks of all businesses. The KPI’s.
PART 2: BUILDING THE TEMPLATE
- KPI’s – What are the activity KPI’s you will be working to?
As mentioned above..
Who will you contact, what methods will you use, what will you say, how many messages will you send a day and how often to each prospect?
There are many variables to consider. Many salespeople think that KPI’s are there for the managers to beat them over the head with a stick. Actually the truth is that all salespeople, and I include business owners in this, should really understand their metrics. I can look at a set of KPI’s and from it tell what problem each salesperson is having, what they are probably doing wrong and how to fix them.
Of course, that’s if the RIGHT KPI’s are being monitored, which is sadly so often not the case. I have lost count of the times that I’ve changed the KPI’s of businesses that I’ve worked for, worked at and consulted for. Use the KISS principle and change them SLOWLY. Lastly, educate the sales team. Teach them to understand their metrics, it will motivate them. Remember what Einstein said…. If you cannot explain it to a 6 year old…
- Market prediction for growth/ shrinkage in the coming year – What do you think is going to happen? This is extremely tricky and more so for a start-up. In many ways, we are all start-ups again. We can help your business restructure and re-set to be a LEAN Start-Up.
- Financial Budget – Costs to be calculated – Running costs/ purchasing costs/ sales costs/ marketing costs)
This should be simple to calculate if you have an existing business and more guesswork for newer businesses. Saying that, there’s plenty of businesses that, believe it or not, guess their running costs and purchasing costs, neglect to include the marketing costs, make no allowance for professional fees and have reduced margins as a result.
Our business, Cellular Attitude, is extremely sales focussed; I believe all businesses should be.
We understand how to sell, so when we sell, we are confident of getting the order at the right margin that offers best value to the client but, crucially, achieves our desired margin. If you are confident in your solution and know how to sell professionally and ethically, you will be in a position to achieve your desired margin IF you have calculated correctly what that should be.
Work out your numbers.
- People – Who will do ‘what’ in the creation of the sales plan?
Are you a single person business?
Do you have people in your business that can help you?
Can you delegate any of the tasks to people you trust?
If you do, you have to check their work as it is YOUR business on the line here.
PART 3: CREATING THE SALES PLAN – Putting it all together
- What is the company’s USP? What is your unique selling proposition?
- What are the principles that you offer that separate you from the competition?
- What is your brand message? Is it simple and easy to understand?
What is the company’s MISSION STATEMENT?
- Where do you want the company to be in 12 months ?
- How many new customers do you want to bring in?
- Has the pricing and clear understanding for revenue been identified?
- Will there be any major marketing campaigns this year?
- What events will you do to generate sales and interest?
Use SMART GOALS here.
What exactly do you want to achieve financially in yr. 1, 2 and 3?
What will that be broken down across the different services and revenues available to you?
MEASUREABLE – How will you measure those sales?
ATTAINABLE – Can this be done? Do you have the structure and support in place to hit your targets?
RELEVANT – Have you made the goals relevant to the sales team? Have they bought into your vision?
TIMED – Have you created a step by step sales forecast that you can use to monitor the progress of the sales efforts?
Existing and potential
Who are your existing customers?
Who are you going after? A) low hanging fruit b) larger potentials
What demographics do you have to hand?
How will you approach these existing and potential customers?
How will you keep track of your sales data?
SALES STRATEGY & SELLING TACTICS
How many customers to contact every day?
How many ‘leads’ to be generated?
Activity targets/ conversion rates?
Medium Term: Quarterly reporting
Long Term: Annual reporting
Cost of sales:
Cost of production/ services/ expenses:
Cash flow & other forecasts
Who does what in the business?:
What KPI’s are you to follow?:
Trackable items: Weekly new customers/ leads/ google ranking. Monthly for the same.
Summary – The Ten Steps
So, in summary, we are potentially in a completely new business environment and this looks like it will continue for some time to come.
Here are my 10 steps to get the most out of this crisis and turn it into an opportunity!
- Treat your business as a RESTARTUP.
- Re-write your sales plan – Specifically considering the new trading conditions.
- Re-write your business plan.
- Review your mission statement.
- Review your financial goals.
- Re-set your KPI’s and follow them.
- Increase your sales skills. Read books or online training (or both). Create a new sales pitch to customers and create a referral request process for existing customers.
- Introduce improved productivity measures. Look at WorkV beta version at www.workv.co.uk or start using the Buccaneer Productivity pads https://www.cellularattitude.co.uk/?product=time-management-and-time-tracker-pads-2-pads-that-save-you-time . Take advantage of my free offer of online Time Management Training by emailing me. (Consider it a reward for reading this far!).
- Track your activity, your KPI and customer feedback religiously.
- Use your network (BNI, if you are a member), LinkedIn (We have a very effective process for this by the way), your existing customer base and prospective customers to generate referrals and find new business. We use some very effective processes to help our Buccaneer Team clients to get their business ready for the end of Lockdown.
- BONUS; Do not talk about doing it…. DO IT!
- BONUS 2; And when you have done it, keep doing it, again and again.
I hope you have found this interesting. If you would like more information, details of how to get the free online time management training course, details of our free initial consultation for The Buccaneer Team, information about our sales training programmes or where to buy a copy of my book, Cellular Attitude, please get in touch.