Are you listening to your young employees?

#Lesson 7: Don’t underestimate youth
This is an article series based on lessons learned from my great mentor Lionel Morely Joel. Read the first article to understand the background and then dip in and out of the lessons as you please. In this lesson, the day one entry-level employee was better than a whole team of senior execs.

I clearly remember Lionel once saying: “If you don’t listen to youth, then you are going deaf.” But it actually wasn’t until a few years later that his message about listening to young employees truly sank in.

As one gets older (and I definitely talk from experience here), one should become wiser, otherwise you have wasted a lot of years. However being wiser does not mean that you know it all, by any means. And young, inexperienced but very bright people may not know much yet but often they will know more than you expect. We just forget to ask them. Which I did once, but never since.

A fair few years on from my early days being mentored by Lionel we were holding a company conference, some two hours out of London. It was a great success and at the conference we announced a new project. We were moving into new sector, one we were sure had huge growth potential. But one area we were struggling with was a name for a club that was a key part of this project. We had put the challenge, linked to a financial incentive, to the executive team to think of a name, but as yet this hadn’t yielded any winning suggestions.

I was leaving this conference, and had just got in the car, when there was a knock at the window. I rolled down the window and standing there was a very young sales executive who had recently joined the company. “Mr Thomas,” she said. “If you are driving back to London could you give me lift?” I didn’t know what to say, other than yes.

As we got on our way she began talking about her life: why she joined us, her aspirations, how hard it was to get a job. At every interview she’d been told to come back when she had more experience. How the hell do you get experience, she said, if no one will give you a job in the first place? As she talked, I realised we had hired a very bright and dynamic young lady.

As we approached London she asked me whether she could ask a question and I said sure. “Why does this company only think new ideas can come from older, experienced managers,” she challenged. “Why is that?”

I asked her what she meant. She told me the whole company was talking about the new club and the executive’s bonus for whoever came up with the right name. “Well,” she said. “I have a name for the club.” I asked her to tell me, and so she did.

I said nothing for 10 minutes. This young lady had done what not one senior executive had. She had nailed it, and I think I was too embarrassed to admit it. I thought back to Lionel’s advice and how right he was on this occasion. The next day at the executive meeting I told the team, who unanimously agreed it was right. She won the prize and I learnt a lesson. Don’t ignore youth, if you do – then do so at your peril. Don’t ever get carried away thinking because you are older, senior, wiser, etc. that you know it all, because you don’t.

The following week we set up a new committee (a think tank) – the only criteria for being on that committee was that you had to be under 25 years old.

So open your ears, and your mind, and open yourself up to the potential that could be lying untapped in your business. Or you might find the enthusiasm and insights of youth fall on deaf ears and your business misses out because of it.

If you could use some help getting the most out of your staff and developing your company why not contact me for a no-strings chat to see if I’m a good fit to help you and your business.

Why you, and your management team, need to know the accounts inside out

Lesson #6: If you don’t know the key KPIs that drive your business – you don’t know your business!
This is an article series based on lessons learned from my great mentor Lionel Morely Joel. Read the first article to understand the background and then dip in and out of the lessons as you please. In this lesson, why you need to know your accounts better than the accountants.

Even though I didn’t have much of a schooling I was always good at maths, I’m sure in no small part thanks to the market-stall education I received, where I needed to be very quick with figures. It was quite an education, and if you’re interested in a bit of a laugh you can read about one of my favourite stories here.

In any case, back to today’s lesson. After a few years under Lionel’s tutelage he thought that I should run the monthly management accounts meeting, which basically told us how the company was going and how each magazine was performing. Lionel would still chair the meeting but I was to run the agenda. At the first meeting under this new structure Lionel did something that he had never done before. He stopped the meeting mid-flow.

“Eddie,” he said. “I want to ask you some questions about this month’s report.”

He then went on to ask me 10 questions about the management accounts reports and specifically about the key KPIs of the business. Although I was good at maths and understood figures, I hadn’t spent much time digesting the reports and could only answer four of his questions correctly. He closed the meeting, calling it a waste of time. As I went to leave (quickly), I heard a soft “Eddie stay behind please.” (Here we go again, I thought.)

He explained that it took the accounts team a long time to provide us with those figures and that they were our lifeblood.

“They tell us where we have been, and where we are going. They are our road map,”he said. “And the best you could do was answer four out of the 10 questions I asked.”

And so he said that I must learn the key KPIs that made Newbourne profitable, and that I must go through the management accounts every month with these in mind. I had to go beyond just reading them. I must understand and question them. And never again ignore them. He provided sufficient stick to get me to do it: warning that at next month’s meeting I would again be asked 10 questions, and he expected me to get nine out of 10 right.

Luckily I did. And this one lesson, more than any other, has stood me in incredible stead for a career at the helm of businesses. From that day I have always scrutinised the monthly accounts; always made sure I understood the key KPIs that make a company profitable (normally there are only two to three really key ones).

Many times business leaders and executives undervalue the role the finance team play in a business. They spend days compiling figures so directors and managers have a real understanding of last month’s result (good or bad) and the trend for the year. They can provide insights and prescriptive information that is so critical to business planning. So when you think about your key players in your team don’t undervalue your finance team and the figures they provide you with. But equally don’t leave it all to them; you should know your business’s finances inside out and what stories these little figures are telling you. Even at the market stall we knew our key KPIs. Do you know yours?

Next: How listening to your young employees will improve your business.

If you could use some help getting to grips with the finances in your business why not contact me for a no-strings chat to see if I’m a good fit to help you and your business.

Don’t live in denial. Have the courage to face the truth and deal with reality

Lesson #5: Don’t be afraid to change course, even when you are in front.

This is an article series based on lessons learned from my great mentor Lionel Morely Joel. Read the first article to understand the background and then dip in and out of the lessons as you please. In this article I discuss the dangers of complacency.

Over the years, there have been amazing success stories of companies who knew they needed to make changes in order to prosper. Not many of us know it but Twitter, Pinterest and Instagram evolved from apps that never gained traction in their previous incarnation. Nor that Suzuki’s origins were in looming and Nokia’s as a paper mill. There are just as many who didn’t. Blockbuster and Blackberry anyone?

Within our group of publications at Newbourne we had a publication called The Baby Book (not the most intriguing name), and it was a very successful publication. We distributed 650,000 copies to expectant mums through 250 UK hospitals. Uniquely at the time, we over-printed the front cover with the name of the hospital, and inside the front and back cover we inserted information specific to each hospital, such as visiting times. So to the expectant mum it looked like the publication was produced by their local hospital.

This was 1975 and no small task to personalise a book for 250 hospitals, but it worked really well and was extremely profitable. Moreover, this one publication generated more than 100,000 reader inquiries per annum, from mums asking for more details from advertisers. After five years we had a database of more than 500,000 names, which in turn allowed us to earn additional income from list broking (there were no data protection laws like today).

At the same time, the Midwives Association were very concerned about the amount of advertising material being made available to mums, so they were calling for more and more and restrictions to be put in place. One day Lionel called me into his office and said we needed to start looking for alternative distribution channels to reach mums. He believed within two years the hospital distribution of The Baby Book would be severely restricted if not stopped entirely.

“That won’t happen,” I disagreed. It was our most profitable title, we had good relationships with all the hospitals and the hospitals wanted the book so why change course?

Lionel insisted we start to plan for such an eventuality, so within the next two years we launched two new baby publications, with very different distribution channels. We now had our contingency in place, and of course (as so often happened), Lionel was right. The Midwives Association’s voice got louder and slowly eroded our distribution at hospitals, to such an extent that within three years only 100 hospitals were still taking personalised copies of The Baby Book.

The lesson was very simple. Just because you are in front it does not mean you are going to stay there, especially if circumstances beyond your control are looming in the background.

Thinking of print publishing more generally is another good example, this time where a whole industry failed to look ahead not just a single company. Through the newspaper industry ran “Rivers of Gold” (recruitment, real estate and classified advertising). Then websites started being launched, not by the publishers but independently. I remember a very well-known newspaper publisher saying to me that a recruitment website wouldn’t work. He thought it was a waste of time (how he regrets that statement now) and he was not alone. The Rivers of Gold were deep, many thought endless, and by the time they realised what was happening for many it was too late.

Custom publishing was no different. In 2009 at Edge (formerly Edge Custom Media), where I was CEO for seven years, we were doing really well, winning many new clients and all looked good. But it soon become apparent that custom publishing was going to be affected to the migration to online publishing just as much – or more – than mainstream publishing. So we decide to completely change direction and transform ourselves into a content-marketing agency.

“Why? When you are doing so well, winning all these new accounts. Why change, why reposition?” one of our major competitors asked me when we rebranded. But thank God we did. Edge made it through the transition and through the financial crisis, while many of our original peers were not so fortunate.

So what is it that separates those companies that evolve and prosper from the rest? I think author Steve Tobak puts it well:

“The truth is staring you right in the face. Every company I’ve watched go down the tubes in agonising slow motion – from Sun to Blackberry – had one thing in common: executives and directors living in denial. Don’t live in denial. Have the courage to face the truth and deal with reality.”

The world is changing at such fast pace, what is successful today can become irrelevant tomorrow. It’s more difficult to predict the future than ever before, but if you stick your head in the sand, one thing’s for sure you will get run over.

Next: Why you need to know the finances better than your accountants.

If you could use some help wrestling with challenges in your business why not contact me for a no-strings chat to see if I’m a good fit to help you and your business.

The power of persuasion

I’ve alluded before to the rather interesting, though dubious, types of employment I had before I got a ‘proper’ job. So as a slight aside today I thought I’d share with you a funny story about the power of persuasion from when I was 16 years old and working for a guy who had a market stall on Petticoat Lane in London. The stall sold anything you wanted to buy, and plenty you didn’t want to buy until we’d convinced you that you did. Say what you will, the market-stall education I had certainly taught me more than a few things.

Anyway, one day the boss turned up with lorry full of ladies’ perfume. We opened a bottle. It was [insert expletive] awful. We tried to sell them, and failed. We often had our friends in the audience as we stood selling things, to make fake purchases to get the ball rolling. That normally got people buying stuff but not this time: even if you hadn’t bathed for a week you would smell better without this perfume.

I said to the boss that we would never sell these, ever. So we put them side as waste of money.

Four weeks later the boss told me to get the perfume out.

We’re going to sell it all today,” he said.

I was dubious. But after we set up and began to gather an audience, suddenly the boss brought out a well-known beauty magazine. As he opened it up, there – in the inside cover position – was a fabulous looking advertisement for our perfume; with a price tag five times more than what we wanted to sell it for before. (Remember at this time there were not many rules around what you could and could not do with advertising.)

Once he held up the magazine and the audience could see the perfume in this well-known publication, they felt the product had been validated. So then we began to sell:

“Normally X; yours for only X today,” we called.

We sold the lot, and for double what we’d originally planned to. We had a lot of very strange smelling customers over the following months.