andrewnicol.net

264 |365 Design and Builds

If ever there was a great example of businesses not being able to predict the future it would be this one. In this photo, I was at a meeting at Link-up Paint Supplies, but when it was first built it was made to be a courier depot for CourierPost. I happened to be the Operations Manager at the time.
 
The inherent problem with ‘design and build’ developments is they can take a number of years to design and build them. In this time business can change significantly. In CourierPost’s case it grew significantly from the time they said yes to the time they moved in, and it was too small before they moved.
 
I’ve experienced the same thing at Agoge. From both businesses I’ve learned that moving into existing buildings can reduce the risk of getting it wrong, but there is always trade offs.

258 |365 Success fades

Went in search for the Addington Coffee Co-op, took a wrong turn and ended up driving past the old abandoned Wood Bros flour mill. A quick google search reveals “The mill opened in 1891 and was powered by steam, lit by electricity and serviced by the railway line next door. The storage buildings pictured here were built in 1924. By 1936 it had the largest output of flour in the South Island. In 1970 Wood Bros Limited sold the mill complex”.
 
Wood bros no longer exists as a company.
 
It’s a reminder that even the most successful companies of their era, like the people who run them, will eventually fade away.

244 | 365 Social Enterprise

A Social Enterprise is a business that makes profit to effect social change by giving its profits to a charity or cause. It has been touted as the way increase funding for charities beyond donors.
 
At first glance it seems easy. Set-up a business, make money, give the profits away.
 
The reality is a lot harder. As a business you still need capital, profit and cash. Did I mention cash!
 
Added to that is the complexity of trying to tell an honest story about what you do (do, as in actually do, not plan to do). There is also inherent social and brand responsibilities to actually deliver profit to the cause, as many of your customers purchase from you because of your story. Finally social enterprise is generally driven by the conviction of founder, which makes failure so much hard.
 
For the record I consider myself a social entrepreneur. I love business and long to make social change through it. Social enterprises are not impossible, just significantly harder.
 
A couple of cool social enterprises are Café Agora (www.agora.net.nz, where this picture was taken) who sell Wurld Water (www.wurld.org.nz) check them out.
 

239 |365 One great reason to fly Jetstar.

The old adage “you get what you pay” is true. I fly with Jetstar because they are really really cheap. There is simply no other good reason.
 
Case in point. I arrived at the airport 40 minutes before the flight to see it was delayed by 50 mins. The next time I look it’s a 1:20 delay. Then 20 mins later it’s a 1:50 delay.
 
Fearing I wouldn’t get to Christchurch in time for my flight home, I went to Air NZ website booked a flight that left in 40 mins and landed on-time in Christchurch 90 minutes after my planned time.
 
I looked later and the Jetstar flight I was booked on arrived 3 ½ hours late.
 
Service – Nil
Communication – Nil
Reliability – Nil
 
The lesson, if you are looking for one. When flying on Jetstar always book on the first flight of the day. They generally manage to get their planes back to the right places over night.
 
Will I fly Jetstar again? YES
 
My next flight to Christchurch is in two weeks. I booked a few months ago for $4 each way. We just booked Jim on the same flights for $35 dollars one way. The same flight to Christchurch on Air NZ, at the same time, $399 one way.

209|365 Leaving my mark

My signatures are funny things. For instance I have four scribbles I call a signature. I have my initials scribble, my ‘Andrew’ scribble, my general letter scribble and my bank scribble. The picture scribble is none of the above, but they are all different, all unreadable, but all my mark.
 
The use of signatures date back thousands of years. They are my mark, a thing that identifies me. In the flick of a pen I acknowledge my agreement, my commitment, my obligation.
 
Today, I was thinking as I signed a new large contract we won recently, how most people sign very few things. Signing letters has been replaced with email, or txt, or verbal. Signing cheques replaced with pin numbers and credit cards.
 
Personally, when I sign a document, I make sure I am comfortable with my obligations and commitment, because it is ‘in writing’.
 
Yet my verbal commitment should always be just as strong as my signed commitment. My word should carry the same weight as my mark.

175 | 365 Numbers

Numbers are a strange part of our business and society. Even if you’re not a ‘numbers person’ and hated math, you generally spend a significant amount of time dealing with numbers. When a baby is born the question straight after their name and sex is generally, ‘how heavy?’

From then on numbers are the measure of growth, of development, of test scores, of financial stability, of success. Business is judged by numbers, evangelists record salvations by numbers, churches measure growth by numbers.

And yet.

It is almost impossible to truly measure the must important things by numbers. Good Marriages. Personal growth. Spiritual transformation. Or even happiness.

And yet.

We continue to measure by numbers.
 
[Numbers - Today was a day of numbers, of forecasting the next financial year, like I really have a clue. Will it be 1 or 2 or 4 or 2 or 2? Shot was taken at agora last night]

The most trusted of 2007...

There I was waiting. Killing time, hanging around for my appointed time at the doctors. Having parked myself on a padded bench seat not much more comfortable than an old church pew I search for something to read.

I flick through a readers Digest (June 2007) and discover an article about the most trust New Zealanders and Brands.

Top Brand is Cadbury, which is interesting because unlike Whitakers they don’t make “good honest chocolate”. In the bottom slot at number 25 was Palmolive. A couple brands of interest to me are New Zealand Post at #14 (a number I am sure they would like to improve), and Farmers at #24 (which actually really surprises me given their history).

Anyway the #1 most trusted person in NZ in June 2007 was …#1 Sir Ed (No surprise). He rates above Sir Peter Snell (#4), Queen Elizabeth (#19), Sam Morgan (#30), Helen Clarke (#58 ironically the most trust politician), Matthew Ridge (#71).

Now of the 75 people who were on the list, who do you think is at number #75? None other than Bishop Brian Tamaki.

Yip.

Want to say more but wont.

Makes you think a little about what it is that make people trust you or your brand.

I think words like consistent, authentic, connected, reliable and considerate would come to most people’s minds.

These are words that normal kiwi’s don’t associate with politicians or Palmolive or Brian Tamaki.

I am sure they all think they are trustworthy its just people don’t believe them.

If people don't believe your message. They dont trust you.

Freight Week 2007 (www.freight2007.com.au)

Andrew Nicol here

I am heading to the Freight Week 2007 (www.freight2007.com.au) in Melbourne starting the 17th September 2007.

If any people from New Zealand or Expats stumble across this post, give me a call or drop me a line and I’ll buy you a beer.

I am attending the following sessions

• Freight Careers Day (Mon)
• Freight Expo (Wed)
• Safety Day (Thu)
• Innovate/Collaborate (Fri)

Interested in catching up and discussing the implications to the NZ market.

Email:   andrewn [at] viewpoint [dot] net [dot] nz  (spam avoidance)
Phone: +64 7 957 7609
Or post a comment with your email address

   

Agoge at the MHL Expo

By way of a mini advert. Below is a very basic video/powerpoint of agoge's key messages at the MHL Expo.

MHL Expo in Auckland

Last week agoge had a stand at the Materials Handling and Logistics Expo, which coincided with the ISN Safety Show. According to Forkliftaction.com over 2700 people attended, which I suspect that number is optimistic.

Forkliftaction is quoted as saying “Not everyone felt the addition of the Safety Show alongside MHL was beneficial. Louise O’ Neill of RT Equipment, distributors of materials handling equipment and forklift attachments, says the safety show detracted from the materials handling and diluted the quality of visitors.

She tells Forkliftaction.com News that future participation by RT Equipment would depend on whether the MHL show was big enough to stand alone next time.

She believes that while her company did not get any sales leads at the show, it was a good way to get in touch with their existing dealers and create more awareness of the company.”

Imagine going to an expo for 2 days and not getting sales leads!

All up it was very successful for agoge. It cost us roughly 5 times the cost of a magazine ad which might generate 1-2 leads.  We got a round 170 leads, with probably 20 - 30 very qualified leads. The leads didn't just come to us, we had to go after them and ask for details. A lot of stands just stood around hoping someone would ask them what they do.

There are a couple of things that the expo made me very aware of, firstly the lack of younger people in our industry and secondly the difficulty small/medium logistics companies have in introducing simple cost effective technology. I will write separately on both of these next week.

42 Below Ad

In case you haven't seen it. Here is the 42 below ad that they run off-shore. I saw it a couple of years ago. It is a classic take at how others think about NZ from the other side of the world.

I love it. It is edgy so I thought I would post it.

Disclaimer: drinking 42 below may be linked to the killing of your brain cells ... blah blah blah.  You can view their other ads here.. (CONTENT WILL OFFEND)

VC: The ones that got away!

Bessemer Venture Partners is perhaps one of America's oldest venture capital firm, carrying on an unbroken practice of venture capital investing that stretches back to 1911.

They have a "Anti-Portfolio" section on their website discussing some of the names they have passed on in the Venture Capital stage. Just small names like Apple, eBay, Fedex, Google to name a few.

Check it out here, its mind blowing to think about how much money they missed out on.

[Hat tip: Idealog]

When Google or TradeMe dies.

I was chatting to someone the other day (Jim or Alf or Vivek or all of the above) about how Google or TradeMe or Microsoft will eventually have their day. There is a day coming that they will not be the biggest or best, and there is a day coming when they may not exist. It may not be in the next 5 years but the day will come.

Do you think it is possible to take on tradeMe or Google? SkrentaBlog offers 12 tips to taking on Google. Have a read, some of them are really applicable to taking on any huge company, product or service. Comapnies like TradeMe or Telecom or Manpower. Here are a couple of the highlights.

# 1, A conventional attack against Google's search product will fail. They are unassailable in their core domain. If you merely duplicate Google's search engine, you will have nothing. A copy of their product with your brand has no pull against the original product with their brand.

#2, Duplicating Google's engine is uninteresting anyway. The design and approach were begun a decade ago. You can do better now.

#3, You need both a great product and a strong new brand. Both are hard problems. The lack of either dooms the effort. "Strong new brand" specifically excludes "search.you.com". The branding and positioning are half the battle.

# 9 Your product must look different than Google in some way that is deliberately incompatible with their UI, for two reasons. One, if you look the same as them, consumers can't tell how you're different, and then you won't pull any users over. Two, if your results are shown in the same form as Google's, they will simply copy whatever innovations you introduce. You need to do something they can't copy, not because they're not technically capable of doing so, but because of the constraints of their legacy interface on Google.com.

# 10 Your core team will be 2-3 people, not 20. You cannot build something new and different with a big team. Big teams are only capable of duplicating existing technology. The sum of 20 sets of vision is mud.

A quest for an ingenious business

In business I believe that Ingenious means providing remarkable and inventive and edgy and stunning service.

Ingenious companies care about their customers and are truly creative about meeting their needs. The type of service they provide gets noticed and talked about and ingenious businesses are known to be the experts, the geniuses, the elite, the ONLY place to get that service.

Read my full post at viewpoint.net.nz

One person makes all the difference!

Just one person in any one company can make it or blow it. One person can sent you away feeling like the most important person in the world or make you feel like they don’t value your business.

Yesterday Alf & I were flying to Christchurch for the day. We had a heap to discuss prior to getting their so I left Hamilton on the 6am flight to Auckland to connect with the 6:50 flight to Christchurch. Alf was on this flight joining me in Auckland and I had preallocated a seat for him next to me, because we were checking-in in different cities.

My Hamilton flight always gets in after the Christchurch Flight is boarding and I am one of the last on the plane. I get onboard and some other guy is in the seat next to me! So texting Alf I find out he is in 17d. I explain to the cabin assistant Alf had been preallocated into the seat next to me, and could me be moved into the seat opposite. He said he will check with the Captain and while he is doing that some other guy comes from the back and sits in that seat.

Now the cabin assistant has a choice. Does he try to make something work, or just walk away. There are after all spare seats in row 2 behind me, and I’m sure one of them wouldn’t mind moving forward to row 1. He can help me or bug the snot out of me and do nothing.

He does nothing and says nothing further.

Alf and I missed out on really quality time together that we will never again enjoy :( (secretly I think alf planned it to get some sleep) and we arrived in Christchurch less prepared than we should have.

Oh, the airline was Air NZ, not that this is a surprise because there is no other alternative for me out of Hamilton.

It all comes down to one person. How often does one person blow it in agoge and we don’t know or care? How often do I blow it?

Oh one last point. The guy sitting next to me heard all of this. He could have offered to move to the seat opposite (before the other guy came up), and been closer to the door, and had more leg room. Personally I would have offered to do that. But he said nothing and in a funny way I feel sorry for that guy.

42 Below Vodka sells out!

Susan Wood got all excited tonight about 42 BELOW selling out to Bacardi for 77c per share (a 33% premium). She seemed to imply that once again a Kiwi company made good and got the better of a big foreign national. - YEAH RIGHT.

The company said the offer was an opportunity for 42 BELOW to become a global brand. "I think we as New Zealanders should be pretty rapt to see a Kiwi brand become an icon in the luxury goods world. The brand has always been unashamedly New Zealand and now with Bacardi's help our country's vodka brand is set to become a major global force," Ross said.

Good on Geoff Ross for selling, it wasn't making money anyway and it would be a very hard journey into the international markets without further backing.

I can't help but wonder however if we will ever see some sharp, innovative, iconic New Zealand brands actually stay on shore and still make it overseas. Unfortunately that sort of company wouldn't get to appear on Close-Up!

For the record I haven't even tried 42 BELOW, but this post is not about alcohol, it's about Kiwi companies selling out.

Choose the best Maneuvers

“The story is told of the battle of the Midianites near Mt. Gilboa. Gideon, during his personal reconnaissance of the enemy, noticed that their sentries were nervous.

To create panic in the enemy lines, Gideon planned a night attack with a relatively small force. Each of his 300 men was issued a trumpet, a pitcher, and a torch. Convinced that the Lord was on his side, he gave the battle order. The men lit the torches, hid them in the pitchers, slung their trumpets, grasped their swords, and quietly went to predetermined positions.

When the Midianites changed their watch at midnight, Gideon gave his signal. His men blew their trumpets and waved their torches. In the resulting panic in the Midianite camp, tribe fought tribe while Gideon and his Israelites stood and watched. And thus the battle was won by the strategy of an observant commander who understood how to confuse the opponent.”

With some stretch here are some thoughts that could apply to business competition.

• Personal reconnaissance gives the leader a feel for the right plan of attack, too often leaders don’t have a clue what is happening in the market place.
• Gideon did not attack a larger army head on, rather maneuvered to their weakness.
• He was clear on the actions required of his men. They all worked as a team.

Above all it comes down to using the right maneuver for the situation. He was mobile, flexible and superior at the critical point of attack.

Quote of “Sun Tzu – Strategies for Marketing”

Choose the best Maneuvers

“The story is told of the battle of the Midianites near Mt. Gilboa. Gideon, during his personal reconnaissance of the enemy, noticed that their sentries were nervous.

To create panic in the enemy lines, Gideon planned a night attack with a relatively small force. Each of his 300 men was issued a trumpet, a pitcher, and a torch. Convinced that the Lord was on his side, he gave the battle order. The men lit the torches, hid them in the pitchers, slung their trumpets, grasped their swords, and quietly went to predetermined positions.

When the Midianites changed their watch at midnight, Gideon gave his signal. His men blew their trumpets and waved their torches. In the resulting panic in the Midianite camp, tribe fought tribe while Gideon and his Israelites stood and watched. And thus the battle was won by the strategy of an observant commander who understood how to confuse the opponent.”

With some stretch here are some thoughts that could apply to business competition.

• Personal reconnaissance gives the leader a feel for the right plan of attack, too often leaders don’t have a clue what is happening in the market place.
• Gideon did not attack a larger army head on, rather maneuvered to their weakness.
• He was clear on the actions required of his men. They all worked as a team.

Above all it comes down to using the right maneuver for the situation. He was mobile, flexible and superior at the critical point of attack.

Quote of “Sun Tzu – Strategies for Marketing”

Origin Pacific falls from the Never Never Land

'The best way to make a small fortune in aviation is to start with a huge one'. I am sure that Mike Pero might have personally learnt this lesson after sinking $10 million into Origin Pacific. The full-blown disintegration of Origin Pacific last week, confirmed New Zealand’s domestic aviation market has become fully mature.

No one, other than a huge multi-national, has the resources to compete with Air NZ. They, along with Qantas who choose not to do regional, are the Super Powers in the domestic market and there is simply no room for ‘secondary [ugly] powers’, like Origin.  In the ‘business guerrillas’ camp we have small niche operators like Air2there, Sunair and Sounds Air. Each has very niche markets that Air NZ simply doesn’t care about or is too small to enter.

BIG question - Can you become BIG without directly competing with the Super Powers?

Short answer - No!; but the road of business is littered with companies that tried.

There is a place for specialists with a niche market, but ultimately they have to be prepared to stay as “guerillas”.

If you are not happy being a guerilla, then sooner or later you are going end up in the middle ground. To stay there and grow to be BIG, you will have to take it to the Super Powers. Once you reach the never never land of the Secondary Powers, you now must compete in price, service and features. If you can’t compete in that position for a prolonged period of time and if you can’t continue to grow month on month, you are near stuffed!

Now here’s the challenge if you want to be big, somehow you need to grow and yet maintain the nature of guerilla warfare. Making very strategic decisions about the markets, even specific customers you want, the service you will offer and the prices you will charge. If you can continually move the battle front, the Super Powers will struggle to fully understand what you are up to. They will respond with a defense that is already irrelevant as you have move to the next battle field and target.

In my opinion Origin was doomed to failure before their first flight left the ground. They tried to behave and act like super powers, then align themselves with super powers like Qantas, rather than establishing profitable niche markets and attacking and growing through guerrilla warfare.

The ugly one wants to grow up...

It has been said many times that the best defence is a good offence, and interestingly enough I think that this may well answer a comment to my last post.

So how does a company that sits in the small (guerrillas) section move from there to the ultimate goal of being 'big' without passing through the medium size? ...

Firstly, I think that it is important that the market that you are small or ugly in, is not fully matured. If it is you need to create or enter a new market. Secondly you must continue to grow, and by grow I mean primarily organic and then acquired. The most effective way and decisive way to grow big is to seize, maintain and exploit the initiative in a market that is either not fully matured or is a speciality.

A current example in the NZ news at the moment is Pumpkin Patch's result. They started as a small business and have grown to be a big business by NZ standards. They now have branches in Aust, UK and have launched into the US. Their strategy is to continually grow and add stores (similar in principal it seems to Michael Hill). They are continually on the offensive pausing only when entering new countries to get the delivery and marketing right. Once they nail that they rapidly grow again.

So to answer specific questions drawn from the comment …

• Medium sized - You need to pass through ugly to get to big, but I think you can actually get to big in one market and then realise you are small in another and expand again.
• Too long - Too long is measured by growth. If you don’t have growth into new markets and products and regions you will become irrelevant. This, in my opinion needs to happen at least every 6 months, if not 3 months.
• Risk – yip. Once you get to a crtical mass that Big brings the risk reduces significantly
• Acquisition – I think organic when small primarily with the aid of acquired.

By being on the offensive causes the competitors to react, by being defensive it causes you to stop growing. If that happens you are destined to be ugly (the never never land) or a guerrilla.

Some interesting lessons in this line of thinking for me and my role over the last couple of days.

The big, the small and the UGLY

The leader must take up a strong position, inspire others to follow him, discover where the enemy is weak and attack there. – The precepts of Ssu Ma Jang Chu – 400BC

In general, the marketplace looks like this;

The Super Powers (Big)
They own the territory, set the rules, and, like the 400kg gorilla, sleep anywhere they want. The big dogs get the biggest pieces of meat. The superpowers are in the production business – they are as concerned with protecting their position on the high ground as they are with gaining new ground.

The Secondary Powers (Ugly)
Their job is to get bigger so that they do not get smaller. They often achieve this by knocking off a lot of small companies rather than attacking the major powers. It’s easier to eliminate the weak than to attach the strong.

These secondary powers are in a vulnerable middle ground. They are facing attacks from both the big buys and the guerrillas. As an industry moves to maturity, the marketing action polarises to the big at one extreme and the small specialists at the other. The never-never land where you never want to be is a medium-sized company in a mature industry.

The Business Guerrillas (Small)
In third place is everyone with a small market share, specialists in a big market. These firms biggest threat is the 800kg gorilla.

What interests me from this quote of “Sun Tzu – Strategies for Marketing” is the never never land. In New Zealand I think it is fair to say that some markets have either fully matured or are very close. This leaves very little room for The Secondary Powers.

Take the shakedown in retail, there are very few medium sized businesses. They are either stores that are a part of one big group, or small boutiques that specialise. Recruitment world wide is a mature market, huge multi-nationals or smaller specialists.  In NZ at present there are a few Secondary Powers, but I am not sure that is a great place to be.

Within transport and logistics, I believe that the Courier Market has neared maturity, Freightways, Express Couriers and the rest. 3PL/warehousing continues to mature and make entry very difficult without being specialists.

Interestingly enough, the Transport industry is only over the last few years starting to show signs of maturing. There are more acquisitions, mergers and off-shore investment. There still remains a significant number of Secondary Powers. The challenge for them in the next few years either become big, or settle for being specialist, staying in the middle ground is never where you want to be!