Jul 14, 2023 | Communication, Leadership
Our corporate culture demands that we forecast outcomes in the early stages of almost any project.
Accountants feed on the IRR numbers, and these outcomes find themselves incorporated into all sorts of budgets for which people are held accountable. They change from being a forecast, an assessment of what might happen given a set of assumptions, to become a set of predictions, upon which people careers have become dependent.
Not a good outcome for building a culture that is supportive of innovation, which by its very nature is risky.
Prediction and forecast are often wrongly used as similes.
A prediction is a statement of what will happen.
The sun will rise tomorrow.
A forecast is a statement of what the forecaster believes will happen. It will be subject to all sorts of variables and new information, but it is the best guess given the circumstances.
I have written many business plans that included forecasts, my best guess at what the future would look like. Those best guess forecasts then tend to become the targets, against which performance was measured. This has usually resulted in a balancing act between the IRR numbers, and the forecasts being as low as possible to get a guernsey. Neither is a healthy way to make resource allocation choices.
If you want a prediction about the future, go to the local fair and pay somebody with a crystal ball to tell you. If you want a forecast, find someone who has records, and a routine that updates those records on a fixed timetable, adjusting as they go.
I strongly encourage all my clients to do a weekly 13 week rolling cash forecast. What always happens is that over time, the forecast of the weekly cash balances become increasingly accurate as the many variables become better defined and understood.
Often it is a matter of the choice of words.
Current governor of the Reserve Bank, Philip Lowe chose to set a specific time frame around his forecasts relating to interest rate rises when he said in March 2021 that ‘the cash rate is very likely to remain at its current level until at least 2024‘. This forecast became a prediction upon which people based their decision to buy a house. After all he is the Reserve bank governor so should know.
Had he just altered his words a little to be more specific about the caveat contained in the term ‘very likely’ to something like: ‘the odds are that interest rates will hold steady for some time‘ it would have remained a forecast, and he might have retained his job when it come to the end of his current contract in September.
For what it is worth, in my view, he should retain his job. He is a talented, experienced and highly qualified economist, not a political wordsmith.
Addendum. Within an hour of publishing this post, it was annpounced that Philip Lowe was to be gone. No extension, pick up your money and go. Nice words all round about how great he was, but piss off, here is the gold watch, go away.
The irony, at least it is to me, is that the current deputy has been appointed in his place. Irrespective of the qualities of the deputy, the job description calls for a culture change in the reserve. Appointing someone to lead that change who is now top cocky because they were able to leverage the existing culture to their benefit is an utter nonsence. A failure of any understanding of the basics of leadership and culture change.
For me, it evokes visions of deck-chairs and icebergs.
Jun 28, 2023 | Branding, Communication, Marketing
No business I have ever seen has enough in their marketing budgets to do all they would like to do. Therefore, they often start cutting bits off ‘willy nilly’ to reach a budget that can be managed.
There is a better way: Basic marketing 101, which most SME’s ignore to their detriment.
What problem do you solve.
The more specific the problem you solve better than anyone else, and the more specific you can be about those who are likely to have that problem, the more able you will be to focus your limited resources productively.
It appears easy at first glance to articulate the problem, often it is way harder than it seems. The key is to articulate it the way a customer would, rather than the way you speak about it internally. That way you have a chance to avoid the drill or the hole confusion.
Your brand.
Those who have the problem and may be inclined to pay someone to solve it for them, need to be aware of your brand, and the offer you make that will solve the problem for them. You must figure out the best way to reach these people in such a way that you may be able to at least add your brand to the list of options they have for consideration. Preferably of course, your brand is the only one they consider.
Trust.
There must be a reason for someone to pick your solution in preference to others that may be available. If that reason is price, then in most cases you have already lost by winning that race to the bottom.
Trust is hard won, and easily lost, but plays a crucial role in any sales process.
For most SME’s doing more than one thing at a time is challenging, so they tend to throw money at all three without adequate consideration of the best options they have to leverage their small budgets. There are many service providers out there who have all sorts of creative and verbally attractive ways to spend your money, but very few will go to the trouble of walking through this minefield with you.
It is easy to be overwhelmed, most are.
However, thinking about the process in these three buckets offers the opportunity to weed out a lot of the ‘noise’, although it is not easy.
The line that trips many up, even those who spend the time to deeply consider these three buckets, is the breakup of the budget between the two very different types of expenditure inherent in the whole process.
First. The resources you spend to build the brand, such that when someone is aware of the problem and is in a mind to consider solving it, your name comes to mind.
Second. ‘Activation’. The tactical means you use to swing the choice your way at the point of the transaction.
The first is long term, and very hard to measure except with hindsight, by which time the horse has bolted. The second is more immediate and subject to at least a modicum of quantitative measures.
The starting point should always be your objective.
Is it to generate leads, is it to build brand awareness, is it to build trust, and where do all these, and other points in the customers decision processes overlap?
Playing cards by yourself is usually a way to win, but it does not translate into a real game. For that you need a real appreciation of the barriers to winning, and often partners.
Call me when you need a partner who inderstands the game.
Jun 26, 2023 | Communication, Marketing, Social Media
On first glance, the only purpose of a blog post, or indeed any sort of content that comes into your inbox, is to provide some impetus to encourage you towards a transaction.
That remains the case, but if that is the only reason, we have arrived at the point where AI can spit out posts by the dozen that purport to serve that purpose.
Not a good place to spend your time if you are on the receiving end, and it serves to degrade the expected standard of all posts.
By contrast, a post that evolves from an idea, problem, or situation faced by a real business, which is intended to offer some level of insight into the way forward can be of immense value, when the right people find it.
Therein lies the attention challenge of those writing posts intended for the latter reason. How do you get the attention the effort reasonably deserves?
If, like me, you do not care much for the attention, or the lead generation potential of posts, you can then produce them with an entirely different objective.
That objective is to clarify your own thinking sufficiently to be able to articulate it to others. That clarification and articulation is what makes the research, thinking and writing of a post valuable. Whether others see it, think about it, and take some sort of action as a result, is an entirely different challenge.
Posts on StrategyAudit are all of the latter type.
Ideas come from anywhere, and have been the fodder for posts on StrategyAudit for 15 years. There are ideas everywhere. The most useful are those that come from the challenges being faced by those I interact with in some way. These always force creative thinking, the application of one of many ‘mental models’ I have accumulated over 50 years. They often stimulate a creative perspective on what are often mundane and common problems faced in varying ways by all businesses, so are ‘grounded’ by those real situations.
It seems to come back to the thought expressed by Kevin Kelly in an essay in 2008 thinking of the same challenge, as yet not powered by AI, that all you need is 1000 true fans.
Social platforms set out to prevent you doing that by favouring ‘on platform’ communication, while penalising posts that take a reader away. LinkedIn is very explicit about this. Put in a link to an outside site, and you get stuck in ‘LinkedIn Gaol’, just an algorithmic means of severely limiting the number of feeds your posts are fed to. I have been in LinkedIn gaol for years, the only way to see all I write about is to subscribe on the website.
The only way to grab attention is to deserve it, and have those few who find you to refer to others who might benefit. It is a long game, built one by one.
No AI here, guaranteed organic!!
Apr 24, 2023 | Communication, Marketing
So called ‘Content Marketing” or alternatively, ‘inbound marketing’, has become the poster boy of marketing. It has attracted marketing budgets like a magnet in an iron filings factory.
Often, we see content that has been produced for contents sake, without any analytical consideration or real value. It has become so easy to produce superficial generalities that pass uninformed scrutiny using AI tools, that ‘thinking’ is becoming rare.
Creating content that will deliver a return is an investment, and like every investment, marketers should be looking for a return, seeking to improve the performance of the resources they deploy.
Just making assumptions, no matter how obvious, can end up badly.
As a young marketer, I made the huge mistake of assuming that consumers could see the pack of a product I managed through my eyes, and were as desperate as I was to rectify the damage it was clearly doing to a good brand.
That assumption was a huge mistake that nearly ended my budding marketing career before it really took off.
The point is that we are now just all creating content, assuming our current and potential customers can read our minds and see the value in it, be overwhelmed, and just buy.
Never happens, you must build a framework within which your content makes no assumptions. Following are a few seemingly simple steps:
Have goals for your content.
It does not matter how beautifully written and illustrated your content may be, if the reader does not know what you want them to do with it. When you want them to try a product, tell them. When you want them to sign up for a webinar, or free e-book, tell them.
Write for the persona.
Content with a commercial intent is different from being a journalist telling a wide story. You need to engage a very specific group of people and convert them to a transaction. This is best done by a skilled salesperson looking them in the eye, but the second best is great content that they see as written for them. To achieve this, you need to be very certain and specific of the desired audience. First step is creating those personas, and when you have them, write to them as you would a friend.
Write to a calendar.
This comes from knowing your audience and the markets they are in. If you are selling real estate, it makes more sense to write about the great outdoor entertaining area in spring, than the huge log fireplace which will keep the house warm. Keep that one for the autumn. It is also the case that your committed audience come to expect some sort of rhythm to your writing. Once a month, once a week, every day, whatever it is, establish and keep to the rhythm so that it becomes part of their lives. I consume a wide range of the content of others, the only common factor is that they all have a predictable rhythm.
Have your own voice.
Ensure you have a tone of voice that is consistent across all the platforms you use. I always recommend that my clients write their own content. They may have it researched, drafted, and a first draft edit by others, but they do the writing. In that way it is them speaking as close to one to one as they can get to the individuals in their audience.
Have your own ‘Home base’.
Content lasts forever once it is posted, it can continue to deliver for you, but it needs a home. The platforms out there make their money by collecting information attractive to advertisers, then restricting access unless you pay them for it. Facebook started with total access to the newsfeeds of those to whom you were connected, it is now down by most counts to less than 2%. LinkedIn has made huge changes since being bought by Microsoft as they progressively monetised the platform. All platforms are there to make a return, not to act as a public service. You must have your own home base, digital real estate that you own, that you can do with what you wish. The challenge of course is that you must figure out how to drive the traffic you want to your home.
Repurpose and resurrect your content.
Content once created and posted lasts forever, and can be used and reused many times, and in many forms, on the many different platforms. While the ‘half-life’ of content on a public platform like Facebook or twitter can be measured in a few minutes, content on your website is always there, can be found with a search, and can continue to deliver value for a long time. A number of my older posts deliver readers every day, many of whom stay, subscribe, and engage with the newer content as it is posted.
Leverage your analytics.
The free Google analytics package gives you a pile of information that can be used to improve what you are doing, and ensure it is finding the right audiences. Not using it is silly.
This is all simple to say, but very hard to do.
Like all things that are hard, it takes a considerable commitment to be able to stand out, be different, and deliver value that generates a return on your investment in content. You should recognise that digital marketing, if it is to be effective, is not ‘free’. Not only are you giving the platforms access to your eyeballs for further remarketing for their benefit, but you are also making the investment of your most valuable resources, time and energy.
You should always consider the return you receive from investments you make.
Header image credit: Dall-E robotic image generator
Mar 22, 2023 | Branding, Communication
‘If you want to change the world, change the metaphor‘. Joseph Campbell
Every storyteller knows how powerful metaphors are, we all use them to describe to ourselves and others, the complex situations and challenges we face. The tales our parents read us as children are all metaphors, almost always describing desirable behaviour. I remember my father telling me the ‘angry bee’ metaphor on several occasions as a kid. Once when I was losing a tennis match, and my temper, he said, ‘An angry bee stings, and dies. It was therefore better not to get angry’. (I later discovered it was a metaphor Seneca had used to try and persuade Nero that being a murdering pyromaniac would not be good for his legacy)
Metaphors can also be subtle uses of language that go largely unnoticed, but which can have a significant effect on the way we think about a situation. For example, ‘crime wave’ is an emotive term that may lead to someone reading the term conclude that there was more crime than if the numbers were simply stated. The latter lacks the drama and emotive impact of the former.
Similarly, President Reagans ‘war on crime’ drove a military type response to drugs that resulted in a huge increase in incarceration rates, but no reduction in the availability of drugs. The ‘war’ was won when the ‘enemy’ was stopped, while doing nothing to address the causes of them becoming enemies in the first place. (Americans seem to be very good at this sort of self- delusion)
There is a substantial body of academic evidence surrounding the proposition that the use of metaphors counts for much more than we would naturally assume.
A former client, an SME whose lifeblood was being able to get to the senior people in target businesses in a B2B environment, found themselves struggling.
Many of those he needed to speak to, build a relationship with, and persuade that his solution was one that could be deployed easily, were increasingly protected by personal assistants in various forms.
He referred to them as ‘gate-keepers’ which they were. Their job was to ensure as far as possible that their bosses time was not wasted, that distractions were minimised and that they only saw the most important things.
My clients product did not necessarily fall into the ‘must see’ category, and he was therefore often frustrated.
After several conversations, we changed the metaphor in his mental model of the PA as ‘gate-keepers’ to one where they were ‘enablers’. In other words, he took the view that his task was not to get to the MD through the gatekeeper, but to engage the gatekeeper and turn them into an ‘enabler’ and even an advocate for their product.
Once this approach was understood and implemented, the results were spectacular.
Consider for a moment the impact of the current usage of the words ‘War’ and ‘China’ in any political statement from proponents of the AUKUS submarine deal. The language and the resultant frame through which most will consider the merits of this project will be influenced by the usage of those two words. Had anyone in power used the term ‘industrial development catalyst’ or ‘nation building’ it would have significantly changed the nature of the ‘debate’ surrounding this decision.
Metaphors are a natural and very important component of our communication. We learn to understand them as children, using them automatically to communicate effectively.
What metaphors are you using in your communication?
Mar 17, 2023 | Communication, Sales
Goliath, contrary to the stories, usually does win, it is just that we simply never hear about it. There is no drama, no unexpected outcome, no backstory of how little, under resourced David beat the giant who had all the advantages, and got away with the prize.
We use these stories in marketing all the time, because they work, and we know they work, because they have been told to us as stories when we were kids, and we remember them.
They have meaning.
Go to a live event, with someone selling something from the stage, and you will always hear pretty much the same sequence: hardship, battling against the odds, a personalised stage of despair then some insight that shows them the path, which made them hugely successful.
Now they want to help you walk the same path, they offer a picture of what it will be like at the end of the path, you just must be brave enough to take those steps, to grasp the opportunity they are offering, which they know works, because they are the living proof.
Trouble is, just buying the books and courses of someone who has been successful does not make you successful.
In fact, the reality is usually that the only success that someone flogging a book or course has had, is in selling you a book or a course.
