business planning
Advice for the Recently Redundant
This is the first in a series of posts for those who have recently left the corporate world and are considering their alternatives. We will make a number of assumptions about such folks including:
- you have 10-20 years experience
- demonstrable success in your chosen field and a clear skill set be it in sales, marketing, logistics etc
- your skill set is complemented by management experience – perhaps a national or international sales manager or country/regional manager
- this means that you’re used to budget responsibility
- you’ve negotiated a redundancy package that has bought you 1-2 years breathing space
- nevertheless you have a personal overhead base (Mrs Moneypenny’s descriptions of her children as ‘cost centre 1′ and ‘cost centre 2′ comes to mind though there are those for whom this may translate as a yacht instead!) and therefore will need to find an income stream or two … and anyway you’d be bored if you didn’t
We won’t look at the corporate choices you could make afterall that’s what you’d work with a head-hunter to review. Instead we’re going to look at how you might apply this skill-set in a number of other ways and how this translates into the development of a set of income streams. In particular we will look at:
- the corporate bod turned consultant approach to leveraging your existing skills and network into an income
- the senior manager turned non-exec board director with portfolio of SME boards to sit on
- being helicoptered in as part of investment package to an SME … the angel or VC’s board representative, with or without an executive role
- starting your own business either in the sector you’ve been working in (thus leveraging your network and your knowledge of the supply chain) or in a.n.other sector of your choice
- looking for a senior role in a small but fast growing company that needs to boost its management, sales, marketing and finance skills (these are the most common holes that need filling)
We might also touch on the way you can use money and skills as an angel investor in other businesses. We will no doubt also cover some of the misconceptions and traps that people commonly fall into.
First of all however you have the challenge of becoming a little more self-sufficient i.e. now that the IT department isn’t there to keep your laptop running there are practical issues you need to solve quickly and with least hassle so that you come across as professional in this wider world of business and entrepreneurship. So lets answer a few of the commonly asked questions:
- Yes, you do need a business card. No you don’t need to hire designers or printers nor do you need to worry about logos. There are many DIY business card tools online that will send you printed cards as the output. We are fans of MOO as the cards are good quality (cardboard not too thin), the templates are simple and if you want something either with a logo or a picture on the reverse you can just pick from images you upload to flickr.
- No, you don’t necessarily need a title. If your qualifications indicate an expertise that you will be making use of e.g. chartered surveyor then sure put ‘Chartered Surveyor’ under your name on a card. However if you’re not really sure what you’re going to do and might put your toe in the water with a few different approaches why bother to have a title at all. Just explain yourself when necessary. Indeed picking a spurious title may in fact be off-putting … for ‘Independent Consultant’ read ‘freelancer’ for example.
- Yes you need a laptop, mobile phone and (depending on where you live) car. On the whole people you’ll meet won’t actually care what make or model of hardware you’re sporting. They are not signifiers of status in the SME or entrepreneurship world. In fact we’ve come across cases where driving a Porsche will lose you business because the client interprets it as a sign that the driver is spending the fees they are being charged on this not on the products and services being delivered.
- Now that you don’t have the support of an IT department you will need to get better at looking after your kit. You might want some help on this one. The big names such as PC World will gleefully sell you service contracts by the likes of Geek Squad but, as with most other forms of insurance they make their money on the monthly contract that you promptly forget and don’t use. In the last few years a whole lot of small firms have sprung up who operate on a very local basis and provide technical support to SME’s. For example, Axos Assist work within a 25 mile radius of Thames Ditton. You may not need a service contract but just knowing who to call to fix the crash/delete/panic is very useful.
- You may need a CV but it will look different to one you’d use to win a corporate job. A CV is after all just a calling card and a summary of skills. There are things which can work just as well e.g. a report you’ve written on a sector or challenge, a piece of research you’ve done (which by the way will probably necessitate you calling a bunch of people you’d like to meet anyway to pick their brains and later report back to them the findings). The key point to think about amongst all this practical advice is WHAT DO YOU WANT TO BE KNOWN FOR? or put another way what work would you like to get paid to do and why would someone buy you rather than anyone else they meet in the street? Do you want to get paid to do, to think, to challenge people, to innovate, to invent???? Have a think on that. It is the answer to these things that needs to sing out from your CV, report or other calling card (by the way you might want to be known for several things, that’s fine, you just need several different calling cards … you are no longer defined or limited by your job title!).
- You will undoubtedly need to meet more people so work out where they hang out (both online and offline). If your network has essentially been your sector colleagues and clients and your internal colleagues then there are bound to be gaps. A paid membership of Linkedin might work as it will allow you to introduce yourself to people. For some sectors Facebook is used as a business tool. There are almost certainly networking groups in your area .. try a few out (do you really want to commit to a year of once a week 7am breakfast meetings without knowing who attends?).
- The sooner you can get to a point of feeling comfortable explaining where you’re at now and the areas you’re exploring the sooner you’ll find ways to explain to others how the skills you’ve acquired corporately translate into value in other settings. You’ll also find that many outside the corporate world have a certain amount of reverence for ‘big business’ which may come as a surprise to your inside track on the political machinations, time wasting and general mismanagement that you’ve seen along your way
- You might want to make use of something such as Tactile to keep track of the business leads you meet … you don’t necessarily have to treat this just to track ‘customer’ leads but you do need a way to view the strands of discussions you’re pursuing.
- Find 2-3 people you can talk to about the routes you’re considering. These might be people who’ve been self-employed for a while, entrepreneurs, family friends etc. They probably won’t be corporate colleagues. This simply because unless they’ve worked out side corporates they won’t have much understanding of the challenges you’re now facing. You want a few people around you who have working knowledge of your new world. People you can use as a sounding board for new ideas or simply to act as a pick me up when you’re having a tough patch.
This is a bright new world you’re entering, freed from the shackles of hierarchy and the gag of the PR team. All you have to do is work out what role you now want to play, who would value this enough to pay you to do it and where you find such people. We’ll come on to that and the business models you’ll need to consider in the next post.
Investment Matters – Creative Industries meets Investment Finance
This summary video gives an overview of the challenges of connecting Creative Industries to Investment structures that were covered at Investment Matters in 2008. The message of the need for a bridge or a translation between the values of the creatives and the values of the investor clearly came across fairly strongly the question is what will people do differently as a result … watch to find out.
Investment Matters, British Embassy, Brussels, 2008 – courtesy of CIDA and the ECCE programme
What business risks should you care about? free planning tool
How can you work out what the threats to your business are, how to recognise it if they happen and make plans to minimise the impact of these risks? Here are some tips from MyCake on conducting a risk assessment, and look out for the free download at the end of the post.
Most large businesses plan for such eventualities and put processes in place to lessen the impact should they occur. Sometimes this means training of staff, succession planning for senior roles and sometimes it means building a financial reserve to pay the costs of rectifying a situation should it arise. The principle applies to small businesses as well though the processes are probably a little simpler. Here’s how we suggest you go about it….
What are the risks your business faces?
- What or who does your future depend upon for success?
- Which of these do you have control over? … consider both factors which are internal to the business and those which are external (you probably have less control over the external ones)
- Are these factors stable or in flux? (i.e. is it actually a risk or is it stable)
- For those in flux what are the chances of a change for the better or worse? (i.e. risk level)
- What are the impacts of worse? (i.e. potential impact)
What can you do about these risks?
- How would you know if it were heading that way (i.e. what are the markers?)
- How could it be averted?
- What is the contingency plan?
- What would the costs be if you had to rectify these challenges? (consider what it would cost if you nipped it in the bud vs. if you caught it later on)
Here is a Risk Assessment Table for you to make use of so that you can look at all your risks, prioritise the ones you need to prepare a solution or contingency plans for and share the plans with your team. You could also use this approach to brainstorm the risks with your team as you might perceive the risks and solutions very differently.
Managing your sales pipeline of new work ~ free tool
How do you gain an overview of the forward pipeline of work for your business and therefore work out what the priorities are for winning new work vs. research & development vs. admin vs. time for a holiday?
We’re fans of online CRM systems such as Tactile but if you’d rather there is a more manual way of doing things.
First of all you need a long list of all the possible clients for each of your products and services. Depending on how long this list is (i.e. 10′s vs 100′s) you might want to prioritise them according to how easy you think it would be for you to sell to them and the volume or scale of work they might buy/commission.
It is a good idea to do some homework on each of these to see what they already buy that overlaps with what you offer … so if they’ve just placed a large order with someone else or recently signed a contract with a competing agency then they’ll probably end up lower down your priority list.
Once you have a shortlist of priorities it is mostly about being clear as to what you’d like them to buy and tracking the stages of conversation you’re having with them. Here is a client status and planning tool that you might find useful. See the yellow notes for our thoughts on how to fill in each column. You might also want to add a column where you record your thoughts on the chances of winning the work (one way to show this is the % chance of the project/sale happening).
On the second sheet in the tool you’ll find a layout for you to use to track the phone calls and emails you make to each potential client. This means that not only can you track your activities but if others in the firm speak to them you can track this too.
You might also like to consider how long the list of possible sales needs to be in order for you to win enough to stay at the same level of business revenue vs grow the company? If you track all your leads over time you’ll be able to spot what percentage you tend to win … and therefore how many new leads you need in order to win enough work. In the service based creative sectors this is probably somewhere between 15-25% of all early stage conversations … just as a very very rough guide. If you’ve been receiving a lot of press coverage for your work of course this percentage will probably increase but you might not want to build in a higher win rate as necessary to fund the costs of the business!
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