Category: Strategy

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What Does It Mean To Be A Consultant Or Real-Life Researcher?

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Sunday, 6.13pm

Sheffield, U.K

There’s a story about how a Japanese company invented the first bread maker that you could use at home to make one loaf at a time.

No one had managed to create one so far. The way in which bread was kneaded by human hands seemed impossible to replicate with a machine. Perhaps it was just impossible.

So, one of the engineers at the company went to work for a bread maker for several months. He learned how to make bread and spent his time learning all the steps – the mixing, the kneading, the rising and everything else that goes into making the perfect loaf.

Then he went back and came up with a design. In the 1986, 84 years after Joseph Lee patented the first bread machine, the first bread makers for home use were released.

This little story illustrates something about how modern organisations work in real life that we often miss.

On the radio a few days back someone described how all organisations are now information processing machines. That isn’t a new concept, however. The Western approach has always seen companies as machines, as things that can be directed and programmed and controlled.

This is because of how much the scientific approach has influenced everything we see. The success of science in dissecting everything around us and explaining how things work according to laws and rules has made it the natural way to think about things.

Which is why you hear people talking about hypothesis and experiments in the context of startups and businesses. That’s straight scientific thinking. Reductionist and absolute and on a search for truth.

So, when you get consultants, especially those with a scientific or engineering background, coming into an organisation to improve things – you get a very strict, scientific approach to things.

I’m guilty of this. I saw many problems as technical ones – ones that could be solved with the right application of logic, mathematics or programming.

The thing that people like us miss is that human situations are not like scientific ones, especially stuff like physics.

The difference is that when you come up with a theory about how the earth and moon move around the sun, the sun, earth and moon don’t really give a damn what you think and don’t change how they act.

When Trump comes up with a theory about how to solve the U.S trade deficit, you get a global standoff that turns into history in the making.

The difference is what happens when people are involved.

So, as a consultant, you really enter into a real world problem situation carrying some ideas you have, perhaps a framework and methodology that you think you can apply here.

Like the guy learning how to make bread, you also take part in the situation, doing things, working on things, changing things.

The difference between you and everyone else is what happens next.

This action also enables you to reflect on your involvement and learn from what is going on.

Now, you could be an armchair consultant or book writer – advising from a safe distance.

But, almost by definition, what worked for you in another situation is not going to work in this one, because the people involved are different.

You can’t step in the same stream twice.

The Japanese have a view on this – they believe that you learn through direct experience as well as from other sources – learning with your body as well as your mind.

As a consultant, you learn more through experience in the problem situation, because your reflection then lets you pull it all together, perhaps presenting your findings to the company and peers.

Importantly, it also helps you refine your own ideas, framework and methodology, giving you more that you can use the next time.

This model is adapted from Peter Checkland’s writing on action research, and is something many consultants do without realising this is what is actually happening.

Some, unfortunately, are too blinkered to realise that this is how the real world operates and instead try and ram through solutions that are based on reductionist and engineering principles.

Those people… you just have to wait for them to fail and leave.

Real change happens not just with the mind, but when you immerse yourself in reality – the reality of the company you are working with right now.

It’s about being open and prepared to learn, rather than an impartial provider of expert advice.

That’s how you’ll probably fix the real-world problem your client is facing.

Cheers,

Karthik Suresh

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What Do You Do When Things That Are Obvious Are Also Wrong?

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Friday, 8.48pm.

Sheffield, U.K.

I’ve been having a few thoughts about the purpose of this blog.

Why do I write it? What’s the point? What am I trying to do or sell or achieve or become?

The sensible answer, the one that is most Zen, is that writing is a practice. A practice like meditation or learning to play an instrument, or running. When you’re doing it, there is just you and the words and nothing else really matters – not the world, not readers. You write for you.

A different answer is that some of us just have to write – we just do. Anne Lamott, in her book Bird By Bird, writes about famous writers and why they write – because they want to, because they’re good at it – because God made them that way. Whatever works for you.

And then there is another reason – sometimes it’s by writing that we figure out what we think. And it’s by reading other people’s writing that we learn new things. And this whole writing and sharing thing just helps us all get better at dealing with the world around us.

Because… not everything we think is true is.

Like I found out today.

The kids, let’s call them A and B, were arguing over a toy. B had the toy all day and A wanted it now. So, one grabbed it from the other, the dispossessed screamed, there were tears and fighting and lots of noise.

All very normal really.

So, what would you do to make things right? Well… get them to share perhaps? Read both the riot act and tell them that they’ll each get it for a set amount of time and that’s that. Get the timer out and on.

I’ve done that before. Several times.

But, there has always been something odd about the result of this approach. They don’t seem too happy about it. A, in particular, has always been really unhappy about using a timer.

And I wondered why – surely it’s the obvious and fair thing to do – what other way would you go about doing this?

So, I typed these words into Google “why don’t some children like sharing toys using a timer” and came up with a blog article by Heather Shumaker called Throw Away your Timer: Why Kids Learn More when they Don’t “Share”.

Here’s what happens when you tell a child to give up a toy that he or she is playing with because the timer has gone off.

You’re forcing them to give up something when they’re not ready to do so. The good act of sharing that you’re trying to teach is associated with feeling bad as they lose something when they’re not ready.

It’s obvious really. You’d feel cross if someone took something away from you before you were ready to give it up. It’s like being mugged. Hardly a pleasant experience.

Heather says that what you should do is let the child that has the toy keep it until he or she is done with it. Wait till they are ready to give it up willingly as they move onto playing with something else.

The other child will need to learn to wait – and that doesn’t feel great either. Waiting – or deferred gratification – is, however, one of the most useful skills you can teach your child.

That’s the basis of the marshmallow test where kids that could wait when they were small went on to achieve much more later.

So, rather sceptically, I tried this approach. Kid A, who hated timers, was happy with this and let B play with the toy – although a little sad and convinced B would never give it up.

Ten minutes later, however, the two were sat playing happily together and A had the disputed toy.

So… in this experiment this approach worked. And it worked better than the sharing approach which seemed like the obviously correct way to proceed.

So back to the purpose of this blog.

The articles are about stuff that is interesting – to me anyway. Sometimes it’s management, sometimes it’s marketing, sometimes it’s about parenting skills.

There’s a lot of pressure in this world to be defined, to have clean edges, to be very specific about who you are and what your brand is all about.

But the real world isn’t like that. It’s messy and there are weeds and cracks and all kinds of unstructured, undefined and generally messy things.

IBM on LinkedIn said something like 80% of all data will be unstructured by 2020. Well, duh, the vast majority of data must be unstructured now. Think of all the words ever written and films and poems. Structured data is probably a minority of what’s actually out there.

Life is complex and obvious things are not always right.

And I think this blog is just one way to help me figure things out.

And if I’m lucky, like Heather’s article, it might help other people if they happen to have a similar question one day.

Cheers,

Karthik Suresh

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Are You Preparing For The Changing World Of Work?

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Thursday, 9.24pm

Sheffield, U.K.

Of course you are. Why wouldn’t you be?

If you’re running a large organisation, putting the systems in place to help your team work anytime anywhere has been a top priority for your IT team.

It’s also been the priority for the last tech giants for the last decade. And now you can run your entire business from the cloud.

If you’re a newish company, that way of working must just seem natural.

But here’s the challenge, as I see it.

A Google funded study in 2010 found, perhaps unsurprisingly, that collaboration and innovation are closely correlated.

So, encouraging the first should help with the second.

So, how do you go about that? Well, you start by providing the tools that organisations like Google sell – according to them anyway.

And that raises other issues, and perhaps some of these are familiar to you as well.

In most organisations, the balance between having room to create and innovate and the need to be secure and locked down usually ends with everything being locked down.

You’re free to do anything you want, as long as it’s in Microsoft Excel or Google Docs.

And that is increasingly not very much. In the online version of Excel, for example, you can’t really do much with macros or automation. Getting started is harder in Google docs.

Many employees in companies are probably frustrated.

Frustrated because they know what good should look like, but they’re working with tools that are so limited for security reasons that they might as well be working with a typewriter for all the increased productivity they get.

Now, that’s not an easy circle to square. Yes you’d love to give all employees a free rein to do whatever they like. But you don’t want your system crashed or open to anyone, especially someone who decides to delete all your data because they have a grudge.

I know of many organisations that still struggle with simple tasks – like doing a mail merge. They still have to edit and send out documents one by one.

At the other extreme – you have some who say that what you need in a company to be innovative is people that wear t-shirts that say things like “Safety third”.

The first time someone actually has an accident, however, the lawyers will come in and close everything down.

It may be that we’re in the middle of trying to reconcile and understand this new way of working.

Or – more likely – we’ve simply had this problem all the time. How do we get people and machines to work better together.

And the place to start is – we don’t.

Machines are good at repetitive, mechanical tasks.

People are good at creative and social tasks.

We should start by getting machines and people to do what they are good at.

It’s only when we have to get machines and people working together that we should, very reluctantly, put them together.

Does that sound bonkers. Completely unreasonable?

Well… let me ask you this.

If you weren’t able to get to your mobile phone all the time – perhaps you left it at home – just how much more work would you get done without being interrupted?

Cheers,

Karthik Suresh

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What Do You Need To Know To Be A CEO?

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Wednesday, 9.42pm.

Sheffield, U.K.

Would you want the top job – to be in charge – to be the one with the responsibility?

Shakespeare said it best – Uneasy lies the head that wears the crown.

The thing is… even if you never want to be the CEO of a massive multi-billion dollar organisation, you’re still the CEO of something. Your own life. Your family – even if it’s a joint role.

And it’s worth taking the effort to think like a CEO – to think like a person who has the responsibility for making decisions, allocating resources and deciding strategy.

Because… as the saying goes, you’re either working towards your own goals, or you’re working towards someone else’s goals.

So, what are the key things you need to know – distilled from this McKinsey interview guide?

1. What’s your direction of travel?

All strategy comes down to this question – which path are you going to take, which road will you follow?

Is it the one with the footfall, or the one less travelled by?

You can dress this up as vision, mission and lots of other buzzwords, but the first decision you make is to look around and point in the direction that you think is the right one.

2. Where did you start?

You’ve heard the saying, if you don’t know where you’re going, how do you know when you’ve reached there?.

Well, if that’s point 1, the point following closely behind is knowing where you started from.

The ambition of the vast majority of professional managers is to manage their numbers.

They need to set and meet targets – they’re under enormous pressure from the markets and investors and stakeholders and those kinds of people.

Beware of people who always make their numbers. As Warren Buffett wrote, people who always make their numbers will at some point be tempted to make up their numbers.

If you want to make real, meaningful change, you need to be clear on where you started.

That’s your baseline. And that is fixed. Although, as we know from painful experience, nothing is really fixed. A number can be anything you want it to be.

I read a story of a young person who went to his family accountant to be trained. He did the accounts as the rules said, and showed them to the accountant.

The accountant laughed, called his uncle and asked how much profit they wanted to report this year. Then, the accountant reworked the numbers to make that figure work, staying within the rules.

So, perhaps it’s best not to worry too much about accounts.

Cash flow, on the other hand, that’s another thing altogether.

3. Culture – what’s that?

Well, chasing point 2, culture is about the belief system that builds around you as the CEO.

A CEO that encourages gaming, like in the accounting example below, will end up creating an organisation where gaming is considered a normal way of operating.

Bernie Madoff anyone?

On the one hand, creating a good culture is pretty easy – just treat people as they would like to be treated.

On the other hand, it’s a chaotic and constantly evolving function of social groups, and organisations are more about politics than about achieving any real rational purpose.

And because most of us know what we want but find it hard to appreciate what others want, we’re sort of blind to what needs to happen.

But that’s something you can learn by simply opening your eyes and ears. As Yogi Berra said, you can observe a lot by watching

4. Then, it’s all about you

This is simple. What skills are needed to do the top job.

Then, do you have those skills?

5. What do you need if you’re not going to fail?

Many people think that being the CEO is about being the boss – having final say in everything.

That only happens when you also have control – when you’re the founder or have a controlling share or both.

The rest of the time you have people breathing down your neck. You’ve been hired to fix things, or grow the business, or make money. So why aren’t you?

You need to be clear on the non-negotiables, the red lines of your career as the boss.

Do you want final say on hiring? Do you get to tell the Chairman that his or her kid can’t just get a senior job?

You need to be clear on what you need to get the job done – no questions asked.

6. Are you going to make friends with everyone?

As the boss, you’re going to be the face of the company, inside and outside.

You’ll need to be friends with the cleaning crew, the administrators, the consultants, the contractors, investors, shareholders… the whole bunch of people that all want some time or attention from you.

Are you the kind of person that likes that? Or can at least cope with that? Or be really good at that?

You really need to be the kind of person that goes and sees what’s happening at the front line. That mucks in. That has facetime with as many people as you can.

They won’t come to you – you need to go to them. At least that’s what you need to do if you see your job as CEO as serving and enabling your team to do their best work.

Because… when it comes down to it you don’t actually do anything as the CEO – whether you succeed or not depends on whether everyone else around you has the tools and ability and drive to do their best.

So, perhaps the most important thing you should do as CEO is remove the things that get in the way of the people you rely on.

Cheers,

Karthik Suresh

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What’s Going To Happen To Our Investments After BREXIT?

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Tuesday, 10.35pm

Sheffield, U.K.

It’s probably time to start thinking about markets again.

We’ve had years of plenty. Since the lows of March 2009, where the FTSE fell below 4,000, we’ve had steady increase in its valuation.

And, ten years later, seven months from now, the UK will leave the European Union. What do markets think about that?

It’s a strange thought that there are people in work who started after the financial crisis of 2008. For them, the world has only become better.

For those of us who experienced the crisis, it seems like a long road to recovery and now we ask whether we’re going to encounter potholes, speedbumps – maybe a sinkhole or two. What’s going to happen?

Also, what tools do we have to look at what’s going on and what we can do about it?

For a start, too much information is probably a bad thing.

There’s a study by Paul Slovic looking at the relationship between information and effectiveness in decision making.

No information means you’re just taking a punt – your chances of success are pretty random.

Some information, say 5 -10 pieces, results in a decision that is sort of in sync when it comes to effectiveness and your confidence. Say you’re right 22% of the time based on this information and you’re 20% confident – that’s in line.

Much more information will not radically improve your hit rate – your accuracy. But it will dramatically increase your confidence.

And that’s a problem. More information may well make you more confident – but more because you look for information that confirms your biases than what is actually happening in reality.

I don’t really take in much news. On the rare occasions that I do, I’m not sure that I get anything more than a mass of conflicting opinions masquerading as fair and objective journalism.

Let’s go to where the truth is.

And the truth is in the markets. That’s where people show how they really feel about what’s going on.

Two countries, the U.S and the U.K are both pursuing isolationist policies. How are the markets taking it?

Well, the U.S appears to be taking it well. The S&P 500 is on a steady uptrend.

Perhaps the U.S is fundamentally sound. It’s the largest market in the world, with abundant and cheap natural resources. It’ll do just fine on its own.

The U.K is in a less fortunate position. It’s smaller, cannot dictate terms to its neighbours and can’t rely on support from China or further afield.

Its success depends on how well it negotiates and how well it engages with the rest of the world.

And the politicians so far appear to be doing a pretty poor job of it.

Or so the markets seem to suggest. The FTSE is heading down. Lots of euphoria in May, it seems, with a nice bull run, but since June that’s evaporated and we’re seeing a down trend.

I think this is something to watch carefully. It looks like things have turned.

And not for the better.

Personally, from an asset allocation point of view, I’ve ended up being quite UK light – around 8% in the UK actually and 82% U.S weighted with the rest scattered around the world.

I don’t see anything that’s going to make me change my mind yet.

I’m not looking forward to seven more months of this.

Cheers,

Karthik Suresh

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Why Trying To Respond To What’s Going On Is A Bad Idea

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Monday, 9.25pm

Sheffield, U.K.

It’s easy to fall into the trap of thinking that what you do is unimportant – to get intimidated by the very visible success we see others having all around us in a connected world.

Let’s say you’re starting a business and it’s in a pretty competitive industry like software development? How are you going to compete against everyone else out there?

You see this all the time, especially in new areas. For example, there is an emerging literati of blockchain, big data and machine learning specialists that seem to be doing very well, if you look at their presence on social media.

And you inevitably get marketers who come along and ruin everything.

Take reciprocation, for instance. That’s the idea that if you do something nice for someone else, they’ll feel obligated to you and do what you ask.

The basic idea is a sound one – be a nice person. Do things for others without being asked.

What this turns into is a series of posts that tag an influencer, praising them, with the aim of getting the influencer to thank the praiser and lift them into the limelight.

You’ll find a number of methods like this that promise to help you “growth hack” your way to success. Need content – just reach out to a hundred influencers, get their thoughts on the subject, compile that into a book and you’re on your way.

There are two fallacies at work here, and a knowledge of investing principles will help you identify and step around them.

The first is this – if you’re finding something out for the first time on the internet, the chances are that you’re too late to profit from it.

Many people invest in stocks the wrong way.

They see a stock going up and up, and get excited. They see it being covered in the paper – on the news – in tips in newsletters. They pile in, eager to ride that baby up.

Then, it turns and sinks. They’re sitting on a loss, panic and sell.

Buying high and selling low is not a good investment strategy.

But somehow it becomes the default strategy of many people.

If you don’t think you’re one of them, check to see if you sell much on Ebay. Do you buy (or does someone in your house buy) lots of nice things that they never wear and then sell them on Ebay later?

Do they calculate the loss they’ve made on buying new stuff and selling it second hand? Or are they overjoyed over the amount they’ve made selling on Ebay?

If it’s the latter, perhaps you shouldn’t let them manage your investment portfolio.

The point here is this. By the time the general public realises that something is happening with a stock, the thing that is happening is well on its way and close to petering out.

For a dramatic demonstration of this, just check out what happened to crypto last year and then what’s happened this year.

Most of the stuff on the Internet tries to get you to empty your wallet in return for learning how to make money on the Internet.

All the hacks you’re picking that rocketed others to success are ones that are unlikely to work as millions of others like you try and take advantage of them as well.

As Warren Buffett wrote about poker, “If you’ve been in the game 30 minutes and you don’t know who the patsy is, you’re the patsy.”

Don’t be that guy.

The second fallacy is thinking that you can predict the future and call the next big thing.

Many investors try and call sectors. Blockchain is the next big thing. A VC is going to raise a $50m blockchain fund. A startup has raised $30m in 31 minutes. So, it must be hot and worth investing in.

It’s incredibly hard to outperform the general market. You’re going to fail over 90% of the time.

Yet people persist in trying to do that. They argue that active investment adds value, even though the majority of active managers lag the market once their fees are taken into account.

The only people who get wealthy from actively managing your money are the managers.

So, what can you do to hold on to your money?

Most successful strategies are a variation on sticking to your knitting. Buy the whole index. Put the same amount of money in each month. Keep it simple.

Focus on your behaviour – not on what the market is doing. The market is there to serve you, not to guide you.

Okay… so what does that mean for me?

The point is that you can look at what’s happening around you and decide that the way for you to succeed is to do what other people are doing.

But – the chances are that kind of thinking isn’t going to work.

It isn’t going to work because by the time you see how the trick is done, the magic is gone.

Instead, you’re better off focusing on the work – the stuff you do that makes you feel like you’ve had a good day at the office. Or the workshop. Or the shed.

If you focus on the work, then one day it may lead to people getting to know your work, appreciating your work, spreading the word and eventually result in a raving fanbase who follow your every word.

If you try and build the fanbase without putting in the work – by trying to do stuff that you think will appeal to them – you’ll end up creating a shallow and insipid copy of someone else’s magic.

Real investors don’t chase trends.

They get in position, do the research and get ready. And then a trend comes along and lifts them up.

Do work that matters to you.

Then it won’t matter whether you get anything else. It’ll be gravy.

Cheers,

Karthik Suresh

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Why Using Force Multipliers May Be The Smartest Thing You Do

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Sunday, 9.40pm.

Sheffield, U.K.

I got in touch with a few people some weeks back – a cold outreach for a service offering.

The details aren’t important – the point is that I was making a cold contact.

What are the success rates for that kind of thing?

Let’s look at what mailchimp says about email – it looks like open rates hover around 20% and click rates around 2%.

This approach had a 71.43% response.

Which was kind of a holy crap moment.

It also got me to thinking about what happens next. Clearly, when someone is courteous enough to acknowledge you then you have a responsibility to go back with something that is relevant to them.

This is something professional salespeople disagree with violently. On some social media platforms anyway.

They argue that it isn’t their job to do any research into a customer. No – once someone puts up their hand and expresses an interest, the salesperson’s job is to engage with that customer, have a conversation, understand their needs and move towards a close.

I think the real reason for their displeasure is simpler.

Doing research is hard work. It’s boring and time consuming.

Wouldn’t it be easier to have a research assistant go out and collate all that boring stuff and highlight the good bits so you can flick through it while waiting in the reception for your prospect to come and get you?

Let them do the hard work of educating you?

I did the research instead. And it took an hour for just one prospect. Multiply that by the number in your pipeline and the hours stack up pretty quickly.

which finally brings us to the idea of force multiplication.

It’s very much a military concept, the idea that you can “fight with limited resources and win”.

What do you think a consultant setting up a sales function would advise me to do?

Well – they’d probably say we needed resources. A CRM to track the prospects and everything associated with them. Trained salespeople to engage with prospects. Admin and research staff to help the salespeople.

You’d need a budget – probably a few 100k.

That’s sound strategy. It’s the application of overwhelming resource to the specific problem that you have. And it will fail.

It will fail because big strategies need a number of things to go right – as explained here – and the changes of that are slim.

A better strategy is to look for force multipliers. And there are three that stand out.

Systems that automate the right stuff

What do we do when we carry out research?

These days, it’s all about Google. Type in the term, read the first page of results and you’ve got a pretty good idea of what the prospect is all about.

You could do this manually – click, read, click back.

That’s how I spent the first hour.

Then, I wrote some code.

That goes off, gets the results and pages and sticks everything into a single file, which I can read quickly and pick out the main bits.

The result – research time down from an hour to around 5 minutes.

Cost = $0.

The right kind of information

Information is the key to winning these days, not resources.

Take the response rate I started with.

The only reason for that is because I reached out to the right segment. A group of people that had a good chance of being interested in what I put in front of them.

And the problem many of us face is that we’re swimming in information and don’t know how to extract the important from the rest.

But again, that’s possible with the right systems. With a little bit of code I can figure out which companies are similar, which ones are worth going after and who is the right person to contact.

All that stuff is available now – often for free.

Anyone who doesn’t bother to spend the time getting the information they need is going to going to the next stage much harder.

Network based operations

Networks are interesting. Very interesting.

Take a typical large company. It’s going to be hierarchical – mostly. Orders come down. People do what they are told to do.

The typical company ossifies as it grows – it becomes slower, less responsive, less receptive to feedback.

A network operates differently – and many professional services firms use a model where they bring together the right group of people to work on a project, rather than just giving it to a department where it’s probably going to be done badly.

Modern armies do this – operate with a mission based approach rather than an orders and directives based one.

Let’s say you’re a graphic designer. If you team up with a copywriter and reach out to marketing directors, you’ll probably be much more effective than if you’re trying to do it all by yourself.

If you want to scale, then perhaps you need to bulk up your team with artists on Upwork, and focus on designing and selling propositions and outsourcing the artwork.

You could, all on your own, have the same impact as a large agency, but with a fraction of the overhead.

That’s a force multiplier.

The aim is to win

The problem with many strategies is that they’re about getting in position, getting resources aligned and deployed.

But that’s not the point.

The point is that you want to win – win your battle with the fewest casualties and fewest resources deployed.

The first approach is just the mindless application of force.

What you want to do is to look for opportunities where you can multiply what forces you have already.

Cheers,

Karthik Suresh

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How Do You Know What’s Working And What’s Not?

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Saturday, 9.16pm.

Sheffield, U.K.

Do you know how you learn? How does your brain work when it’s busy learning?

I remember watching a TED talk – can’t find the reference now – but it had a concept that stayed with me.

Our brains create new connections when we learn, literally rewiring our brains as we go through the learning process.

But, it doesn’t happen all at once. Learning or experiencing something for the first time lays a chemical trail.

Doing it more lays down more chemicals – more connections – more wiring that is related to what we’re doing.

This simple concept – the idea that how much we learn is linked to the amount of related wiring that’s built up in our brains – leads to certain logical positions.

1. Not everything in life is equal

When you’re young, you might have the time to do lots of things. You might be good at a sport, enjoy certain classes, be sociable.

Very soon, however, you start having to make choices.

At University, given the choice between playing competitive sports at a high level, achieving high grades and having a sizzling social life, you’ll end up picking any two.

And even that’s probably hard to do. You might end up putting one first.

2. Where you are is because of what you did

There’s a rule when you’re doing customer validation – trying to find out if your product has a real market or not.

Never ask someone what they would do.

For example – would you buy my new vegan rice cooker that also grills chicken?

You might say that you might…

But here’s a better question. What kinds of kitchen appliances have you bought in the last year?

That’s going to tell me a lot more about the kind of person you are and what you actually need in the kitchen.

What you’ve already done is the best predictor of what you’re going to do in the future. Once again, the trails you’ve laid down are the clue to the trails you’ll take.

3. It’s unlikely that things will work the same way exactly

Think of the last forest you visited.

Did you follow a trail? Several trails?

Were those trails identical to any other forest you visited? Were the trees obliging enough to be in the same places? The rocks situated exactly right?

The trails emerged – as a result of topography, footfall, perhaps plans drawn up by whoever was responsible for looking after it.

And the thing with lives and companies and organisations and countries is that they’ve been built up in this way.

In any company, for example, there is probably a general structure – a hierarchy of some sort – but the character and nature of the company is set by the unique people that make it up – and their lives and unique history.

And here lies one of the problems of organisational development.

Say you want to change something or do something new. Perhaps put in a new ERP system.

In many cases you need to change the entire way the organisation works to fit in with the new system. That’s easier than adapting the system to the organisation.

And it’s really hard changing the way people work. It’s easier to change the people.

So, if you really want to change the way an organisation works, throw out all the existing systems and install a new one. But if you want to succeed, you’ll need to get rid of the existing people as well.

It’s easier to just start from scratch.

And this is why startups work – the established paths and trails of organisations work for them where they are. But they’re the result of a unique set of circumstances at a period in time.

Some of the principles may be timeless but the methods and specific activities are less so.

4. It’s easier to build where it’s easier to build

I used to think that you could change things easily. Put in a new system or process and that would fix any problem you had.

That was naive. I know that now.

It’s like trying to change someones mind. You’re better off just not trying. The only mind you can change is your own.

When it’s just you – you can change things quite easily. Some of the time anyway.

When you’re part of a team it gets harder. The only way really is to spend a lot of time training people in the right way from the start.

And then you need to realise that they will adapt whatever you teach to their own way, so rather than expecting perfection, you need to make sure that they meet a minimum standard.

Working with others is often about finding the lowest common denominator rather than peak performance.

If you’re working with an existing organisation, as a new CEO for example, you need to spend most of your time first watching what’s going on.

What is happening right now. Where are the trails and how are they laid out?

Take the picture above. It’s pretty obvious where the activity is. Where things are working.

A wise CEO would look carefully at the existing situation. Then, instead of trying to put something new in, they’d look for a compromise – an accommodation – that improves things.

Like widening a trail that is used a lot to make it easier for visitors.

Big bang change is seductive in its simplicity. But it doesn’t work.

What works is building on what’s already there – whether it’s your own unique set of skills and experiences or that of an organisation.

That’s the way to keep growing.

Cheers,

Karthik Suresh

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How To Select A Sales Strategy – Lessons From The Street

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Friday, 7.14pm

Sheffield, U.K.

We’ve just spent a few days wandering around Barcelona. Several miles and aching feet – looking at some stunning architecture, grand parks and fabulous views.

And then there are the streets.

The most famous one, La Rambla, runs from the centre down to the sea and if you’re interested in sales strategy has lessons everywhere you look.

Let’s start with the most obvious one – the one that smacks you in the face.

These are people who sell stuff on the street, from catapults for children, to fans and plastic trinkets and jewellery. They carry a small number of items, in a plastic bag or in their hands, and set them out on the street for you to look at.

They are presumably unlicensed sellers – as when the police turn up they disappear quickly.

Some have large sheets filled with higher value items like branded shoes and designer handbags – with an ingenious string mechanism that means the whole lot can be quickly bundled up and the seller can move on.

One would assume that these are counterfeit – but it’s not clear. There are signs saying that there is a fine for buying from blanket salespeople. But, when you overhear the negotiations for a pair of Nike shoes, for example, the price is not that far off a shop price to start with.

That may just be good negotiating practice – just like when one of them tells you that they made the object they’re selling themselves. It’s odd, however, that the police simply watch the sellers setting up.

What’s common to these sellers is that they are mobile. And they sell commodities – certainly when it comes to plastic fans and counterfeit stuff.

But how can such low value stuff sustain such a high number of sellers?

Presumably there is an organised system behind this. A warehouse where someone with little capital can go and stock up on commodities and then flog them on the street.

And the warehouse is where the big money is being made. Stuff that can be made for 7p in China lands in the warehouse, is presumably sold for 50-70p to the sales person who then makes 30p a sale.

Not a get rich quick strategy for the person selling on the street. But if you’re possibly in the country illegally in the first place, perhaps your only option to get enough money to pay for rent and food.

So what do others do – the ones that operate legally?

An interesting variant on the mobile approach is to add a custom element – like elaborate statue artists or street dancers.

There you’re paying them for a performance that they do – and essentially tipping them for entertainment.

Larger traders start moving to fixed premises and custom strategies catering to a general audience.

For example, the stalls on the street have Barcelona related stuff – magnets, figurines and cards. A lot of people like that kind of stuff as a reminder of their trip.

Or they’re food places – ice cream sellers, restaurants.

The thing with going fixed is that the better the location, the more you pay for your patch of real estate.

An alternative step is to go niche. On a different street, closer to the coast, you find people with stalls selling elaborate masks – the kind you’d use for a masked ball. Specialist places that cater to a niche clientele.

That’s one way to stand out.

But most of the stuff you see on the street is simple. You’re not really going to be able to do a complex sell on someone passing on the street. It’s mostly stuff that you either want or don’t.

Except perhaps when it comes to food.

There are lots of plastic food choices catering to tourists and, if you’re hungry and tired, you might go for the fixed price options just to get something quickly.

But it’s worth going off the main streets and looking for more local fare – stuff that is real food with atmosphere and local chat. Something that gives you a more complex experience than cheap food piled high.

When it comes down to it, sales is less about pushing and more about positioning.

The way in which you position your product almost leads inevitably to a particular strategic approach.

You’re never going to expect great quality from a street seller – and if you think you’re getting a bargain, you’re always going to be wrong.

So, a street seller is going to have to push and persuade and charm you into buying from them.

You’ll be safe in a big chain store located in a shopping mall – but it’s not going to be exciting or different or anything you couldn’t get right here at home.

A bored sales clerk isn’t going to care too much whether you buy or not.

And between those two extremes are several sellers who are trying to get the right combination of characteristics to stand out and appeal to you.

The difference now is that you have the Internet on your side.

I found that I was checking Ebay to see what prices were for commodities on the street and finding it easy to step away when the quoted price was three times the price online.

The chances are that you’ll increasingly rely on recommendations from others to make decisions – from which hotels to select to the best places to eat.

So the sellers in the middle would do well to manage their reputation online – and many are doing just that. The statue artists, for example, display their Instagram information if you want to follow them.

Street selling is fascinating to watch – but it’s possibly the hardest, most time-consuming and lowest margin activity you can do.

It is a good way to learn if what you have actually has appeal – a good validation method when you’re testing the market.

But I wouldn’t recommend making it an core part of your route to market.

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What Is Your Job As A CEO?

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Sunday, 8.02pm

Sheffield, U.K.

I was thinking about what Tech CEOs have to do – what does the Chief Executive Officer of a tech firm need to think about and do every day?

Imagine you’re the CEO of a company. Even if it’s the CEO of your own one person business – you’re still in charge and everyone looks to you for direction.

It’s a scary position to be in – to be so completely and totally in charge. No one else that you can point to or blame. It’s not a position you can run away from.

In some ways it’s like being a writer or an artist. Every creative person, without exception, suffers from self doubt and isolation.

You’re making something – creating words or pictures or music. And when you’re done people will see the results of your work and judge you.

You have to get beyond those worries, push through them and create and be damned. The rest of the world doesn’t matter – if you create just for you.

As a CEO, you’re creating a business. More than anyone else in the business, the responsibility for shaping and bringing the business to life rests with you.

So, I was wondering, do tech companies have to do anything different? Are tech companies different in some way? What do you need to be aware of?

1. The basics – people, process, performance

Well, clearly there are the basics – who you hire, what they do and how well they do it.

And obviously, you must have a product.

Your job is to get the most out of your team, to motivate them, to work harder than them, to show them that you care – for the product and about them.

It’s a job where you need to have a lot emotionally invested in the business. It’s not like being an adviser or consultant – you are the business. To everyone that’s interested, anyway.

2. Be careful what you say

The thing with being the boss is that people listen to what you say.

In meetings, you’ll find people positioning themselves so they can watch you but you can’t watch them. People will hang onto your words and build on your ideas – whether good or bad.

What you say will matter.

Warren Buffett writes about this – it’s example number 3 of what he calls the institutional imperative – as follows

(3) Any business craving of the leader, however foolish, will be quickly supported by detailed rate-of-return and strategic studies prepared by his troops

No one will tell you that you’re doing something stupid. Not your employees anyway. Maybe your investors – perhaps some members of an independent Board.

But, if you’re aware that your every whisper can become a shout as it moves along the organisation, you might be more careful what you say.

3. Understanding markets and trends

A big part of your job is looking outside the company. What’s going on in the market, what are the trends?

Do you understand what your competitors are doing, which new firm is trying to turn your market inside out, and are you positioned to be lifted up by a trend or battered and tossed by it?

It’s things like knowing your Total Addressable Market (TAM), Served Available Market (SAM) and the Served Obtainable Market (SOM), and how you’re going to get to them.

As a CEO, your success depends just as much on what others in your market do as what you do – and you have a lot less control over them.

4. The big one – creator of culture

As a CEO, how you behave is how everyone behaves. Culture travels top down.

And that can be a shock to some people. If you’re an accountant or lawyer, accustomed to saying no or looking for problems, you’ll need to change your mindset to one that is more visionary and that can talk about where you’re going and what the opportunities are.

The things you believe in – whether you should rule with fear, or motivate with incentives – will become policies and norms and standards.

The types of attitudes you have – to the way people dress, what you expect from people in the workplace, how understanding you are about the challenges working couples with children have – will find their way into your company.

Your company is you. And the people in there will start to act like you act. So, you must decide how best to act – all the time.

Not a tech CEO – just a CEO

When you go through this list, nothing really jumps out as specific to a tech CEO.

It’s just skills that you need to have as a CEO.

Perhaps you also need to have an understanding of tech – but it’s more important that you understand the people you have on your team that understand tech.

When it comes down to it, being a CEO is about being the company.

And you’re just got to try and be a good one.

Cheers,

Karthik Suresh