Category Archives: Unemployment

Osborne’s employee rights sacrifice, equity for all scheme

Do politicians really think through the ideas they float?  Do they have any idea of the realities of business and especially the entrepreneur?  Come to think of it, do they have any idea of the complexities of business?Osborne's employee rights sacrifice, equity for all scheme

As a retired businessman who ran, bought, created and sold businesses, large and small in over a dozen industries, I have a reasonable knowledge of the problems facing business owners and the people who work in them.  I also spent many years in the layers below the top to have a fair understanding of the issues that face employees, what concerns them and what doesn’t.  Let’s start with the problem that Osborne is purporting to solve, the great employee rights and employment law burden.

Before the current edifice of employment law was created and forced onto business the policies that determined how employees were recruited, trained, paid, promoted, cared for, pensioned and fired were largely at the whim of the employer.  What this meant was that all of these factors were points of differentiation that clearly separated good employers from their bad competitors.  Working for Unilever in the 1960’s I enjoyed benefits and practices that would still be regarded as outstanding even today.  Has the welter of employment law really made things better for the average employee in the average company?

Consider first that small and medium businesses (SME) account for 99.9% of all enterprises and 58.8% of private sector employment.  To the vast majority of these businesses employment law brings little benefit over and above that which enlightened owners and managers strive to achieve without the aid of the law.  But it also brings huge compliance costs and the threat of many disgruntled employees running off to employment tribunals.  Today a malicious ex-employee can wreak havoc upon a good employer.  Maternity leave can also create a nightmare for small companies.  There will always be bad employers just as there will always be bad employees.  We must ask ourselves what we have really gained by forcing policies borrowed from some of the country’s (and the world’s) largest companies onto our SMEs.  And that is before we should ask ourselves what role corporation tax and employers national insurance contributions do for employments levels.

So, if Osborne is recognising at least part of the problems facing employers here in the UK with his equity for rights proposal, shouldn’t we be applauding his scheme?  Sadly, I don’t think we should.  I believe that it is another dose of borrowing concepts of best practice from the largest corporation that will do nothing for the 58.8% of private sector employees who work within the SME sector.  And nothing for the company owners of these businesses.  Let me explain why.

There are already employee share ownership schemes that are used by large companies.  Usually these shares encourage employees to save and should they leave or require the cash then there is a very liquid market waiting to buy their shares.  The risk, of course, is that the value of the equity falls (remember Northern Rock).  Overall these schemes do not represent more than a fraction of the total equity of the company and do not carry voting rights or eligibility for dividends.  Are they effective in engendering concepts of ownership amongst participating employees?  Or are they just a savings scheme?  Would such a scheme encourage employees of these large companies to give up their rights?  And would having two tiers of employees be of real benefit to the company?  You decide.

However, when we turn our attention to the SME sector the problems become significant.  In privately owned companies equity is usually guarded closely by owners or can be very limited in number (£100 companies are quite common).  The reason for this is quite simple.  For those owners who wish ultimately to sell the business to achieve a return, then they wish to retain the largest percentage of equity they can.  For those businesses that are run as family concerns then there is little intention to sell and equity is often held in a web of different generations of family members and trusts.

There could be attractions for an SME to set up such a scheme as a means of opting out of employment legislation.  Any benefit for the employee could be completely illusory.  Why?  The issued value of any shares provided in such a scheme is likely to be low and any return only available when (and if) the company is sold.  Given that there is no market in equity held in privately owned shares, any departing employee (for good or bad reasons) would be at the mercy of the company in deciding a price for buying them back.  The cost of setting up such a scheme would be quite high.  Would it raise meaningful sums for a startup or early growth business?  Not a chance.

Of course there are already businesses run as cooperatives but these are tiny in number.  There are also those businesses who run employee share ownership schemes, these usually being very large companies with differentiated cultures and attitudes towards employees.

In my view if Osborne really wishes to help both private employers and employees he should scrap swathes of employment legislation (as it frequently strangles employment opportunities in 99.9% of private enterprises).  He should also reduce or eliminate corporation tax and employers national insurance contributions both of which act as a tax on employment.

Time to scrap the idea, George.  conference season is over for another year.  Just go and talk to a few SMEs before the budget.

Image courtesy of guidetowomen.wordpress.com

The Business of Life Chapter 28 – when it’s so much harder than you imagined

Unlike many MBI candidates I had met or heard of who merely waited for a referral from an accountant, lawyer or VC (usually whilst they continued to job hunt) my strategy was concentrated on researching the market to find the hidden opportunities,  those businesses that had yet to be put up for sale that I could convince to sell to me.  So, I was pleased and surprised when I received a referral from KPMG to a business that they knew was being put up for sale.  My months of hard work were beginning to pay off  and it meant that I was being taken seriously as a buy-in candidate.Staying-the-Course (The Business of LIfe)

The company concerned, a paper processor, was housed in an old Yorkshire mill (yet another one) and, as the name suggested, it processed large rolls of paper into toilet rolls, kitchen paper, napkins and the like.  It also had a small trade recycling old clothing into cleaning cloths for the engineering businesses that had once been plentiful in the area (destined to become the legendary oily rags). I can’t now recall the name of the paper processing side but the rags were sold under the trade name of Hyman Wipes, something that has stayed in my memory.  Can’t think why.

My heart sank as I toured the old premises filled with machinery and employees that looked for all the world as if they were from the same vintage.  The finances were not disastrous but the business would struggle to stay healthy and there was no way that it would be able to repay the debt I would have to take on to buy the business, let alone any investment in new equipment.  However, if I could buy not just this business but one or more of its competitors then there would be considerable scope for rationalisation into a small group of businesses in the same sector (with increased profits flowing in due course).

After writing up the notes of my visit and sending these off to Phil, I set about researching competitors that would be likely targets.  I soon had a meeting organised with the owner of another paper processor that seemed a likely target.  He was wary and would not agree to my visiting his premises but instead met me at a nearby hotel.  We played cat and mouse for an hour or so but it became clear that there was not going to be a meeting of minds.  Back in my office I spent more time analysing the sector.  It was clear that the smaller companies in the paper processing industry were under attack from far larger players who would be completely out of my league as acquisition targets being mostly owned in turn by yet larger companies.  I met with Phil, took him through my findings and we agreed this was a sector best left alone.

Shortly after I got a call from a partner at Grant Thornton inviting me to an event they were staging at their offices in Northampton.  The evening centred around presentations from a number of experienced representatives from corporate finance lawyers and banks.  This included some useful additional information.  But the real value of the evening was the opportunity to meet other MBI ‘wannabees’.  Many private businesses that came onto the market were retirement sales and it was not uncommon for two or more shareholding directors to be attempting to exit at the same time.  It was impossible at that stage to guess all of the possible functional skills I was going to need in a future business but it was almost certainly going to include a finance director.  So, I was delighted to meet Mark over a coffee during the mid evening break.

Mark was employed as a finance director and wished to become part of a successful MBI team.  He quickly impressed me both with his commitment and enthusiasm for our common goal and with his knowledge of corporate finance.  Some ten years my junior and with a young family, we formed an immediate bond.  With an accounting qualification and Plc experience, Mark seemed to have a good grasp of the challenges of running businesses.  Following a further meeting at which we explored each others values and beliefs in more detail we agreed to team up for the task ahead.  We were also realistic enough to agree that if either of us came across an opportunity that didn’t include the other then we would go our separate ways with no hard feelings.

Despite being based some 150 miles apart we soon fell into a productive working routine.  I continued my processes of identifying likely targets and an initial financial analysis and would send a batch of information to Mark who would challenge my assumptions and verify  (and correct, where necessary) my findings.  I was also heartened to find that Mark was able to offer pertinent comment and ask searching questions across the wider business spectrum.  Together I was convinced that we would make the core of a credible buy-in team.

Meanwhile, I had been having further meetings with 3i and formed an initial relationship and agreed a working methodology with Paul, an investment director and Mark T one of his managers.  The understanding was that I would continue my work in identifying likely targets and would bring to them an investment proposal on short listed businesses we were intending to approach.  In this way we would know, in principle, if 3i were likely to back a serious bid.  There was a danger in this approach that had been put to me by other successful buy-in managers.  This was that there was a risk that 3i could take the opportunity and go with another (preferred) buy-in candidate leaving me empty handed. I put this possibility to one side, reasoning that I had to build a relationship with 3i that demonstrated my professionalism and commitment to them.  If I demonstrated I didn’t trust them (by floating potential deals around a selection of VCs in an effort to find the best deal as others had advised) how could I expect loyal backing from them?

Having been working on the basis that I would have to do all my own work in identifying targets, I was surprised when I received a call from Mark T.  Would I be interested in taking a look at a business (Halifax Fan) they knew was on the market?  There would be no commitment that they would either support a bid or that they would go with me in the event that they did.  We agreed to meet.  I had previously advised Mark T that, amongst a few other industries, I was specifically targeting the engineering sector.  It had already become apparent to me that many medium sized engineering companies lacked modern sales and marketing skills, often resulting in no or limited export markets.  My believe was that I would be able to bring these skills to such a business.  I was pleased to find that the company in question was an engineering business and it was based in Yorkshire.

We met at the premises of Halifax Fan for an introduction and an exploratory look at the business.  It was an interesting company that specialised in the design and manufacture of fans for a variety of industrial uses often employing unique designs for challenging applications.  It was profitable but what was really interesting was that the owner (who wished to retire) had deliberately constrained the growth of the company as he didn’t wish to have the bother of additional employees.  I could immediately see growth potential plus it also had the ability to grow via acquisition.  Having come away with a great deal of financial information I arranged a further visit to progress matters in a couple of weeks.  Meanwhile, Mark and I started work on our analysis of the financial situation and into the specialist market for industrial fans.  A further meeting with 3i soon followed where I presented our initial findings and plans and got a green light to submit a comprehensive business plan.  Following further adjustments our plan was accepted and we waited anxiously as it went to the investment committee for approval.  A week later I learned that approval had been gained and 3i submitted our joint bid to Halifax Fan.

We knew that other interested parties might be bidding and Mark and I waited anxiously once more following weeks of work.  A phone call another week later dashed our hopes.  We had been significantly outbid.  I was disappointed but I was also heartened that we had been taken seriously by 3i who took the bad news with a shrug and the question, “What else are you looking at?”  Mark and I pushed on with our list of prospects.

I had given up on the lighting industry following many unproductive approaches over the previous months but a chance conversation with an old colleague reawakened my interest.  “Do you know Neville is dying?” was the question that took me by surprise.  Neville had been a customer of mine for many years,  running a well respected lighting distribution business.  I also knew Neville well as I had taken him on a study tour of a selection of US & Canadian electrical distributors some years previously.  Notwithstanding the sensitivity of the situation, I called Neville, conveyed my sorrow at his illness and best wishes and after a brief conversation said I would like to buy his business.  My approach was referred to his chairman who I met some days later and learnt that the business had already been put discretely on the market.  My pitch of venture capital backing, knowledge of the business and personal credentials succeeded in gaining me an acceptance into the process.

Over the next few weeks I met with the management team, collected information,  visited the retail operations they had and burned the midnight oil with Mark carrying out detailed analysis and pulling together our basic financial projections.  We then applied various sensitivity exercises to stress test the model before I wrote up a very detailed business plan which I submitted to 3i.  We agreed an offer, the plan went off to the investment committee and, once approved, our bid was submitted.  I knew that our price was realistic and our plans (including selling off the retail side and acquiring other distributors) were rational.  I had even found time to approach and have initial discussions with our first post acquisition target.  However, a few weeks later our hopes were dashed once more as we received the news that a trade competitor had outbid us by 100%!

During this period (mid 1996) I was still processing large numbers of potential acquisition targets through my financial and strategic appraisal model.  Following this latest setback, I stepped up the pace, extending my networking and research activities.  Over the next six months we worked on dozens more potential targets, analysing them and their markets and got down to the shortlist with several others only to miss out to trade buyers who, once more, heavily outbid us.  It was clear that although many trade buyers had no magic dust to sprinkle on a business they did have the ability to carry out immediate rationalisation and effect synergies with their existing operations.  I was confident that my development plans for our targets were sound and we also had a ‘Buy & Build’ post acquisition strategy to acquire other competitors.  The problem was that we couldn’t (and 3i weren’t prepared to support) pricing the benefits of a potential subsequent acquisition into our initial bid.  I knew this made sense as it would have raised the risk factor sky high.

As 1996 drew to a close I realised I had spent 18 months working to buy a substantial business using venture capital.  I had spent months in the most intensive efforts to locate and analysis targets, reviewing hundreds of businesses in the process.  I had become increasingly more creative in my approaches to extend my networking and increasingly more professional in my research, analysis techniques and business planning.  I had been almost to the altar on three occasions only to be heavily outbid.  Attempting to buy businesses from larger companies was also not working as, once more, competitors were willing and able to pay far higher prices.

So, at the end of my first full calendar year there had been no result.  Instead I was beginning to experience growing tension between the work necessary to bring a suitable target deal to completion & the mundane task of earning money.  To put matters in perspective I was earning at a rate that was acceptable but I knew I could be very much more successful at the role of consultant if I didn’t have to spend time chasing acquisition targets.  On the other hand, buying a business was my unwavering goal but I couldn’t spend the time at it that I needed because of the need to earn money.  This tension was made all the worse by my practice of doing whatever I attempted to the best of my ability.

Before Christmas closed the business world down for the holidays, I put together a detailed presentation for Paul at 3i laying out everything I had done with a detailed appraisal of what was working and what wasn’t and reconfirmation of my goal of acquiring an engineering business.  When we met I shared with him the frustration I had in being diverted from the task by needing to earn money but ended with a commitment to bring them a deal we could complete together in 1997.

The Christmas holiday was a welcome break with the family but it proved just too tempting to continue working as my goal was constantly at the front of my mind.  I couldn’t remember wanting anything in business as much as I wanted this.  I knew I could succeed as a consultant but, although I enjoyed the work and gave it everything I had in the time available, it really wasn’t what I wanted to do long term.  It was becoming brutally clear that I had entered a marathon not a quick sprint.  Could I stay the course in the year ahead?  Or was I chasing rainbows?

 Image courtesy of thebridgemaker.com

The Business of Life Chapter 26 – casting off the chains

On my first morning at Selmar Industries I arrived early.  After a quick word with the few managers and office staff who were in at that time, I went on a tour of inspection.  The company was housed in an old textile mill on the outskirts of Brighouse in West Yorkshire almost at the end of a tightly wooded valley.  The buildings were a veritable rabbit warren with both offices and production facilities spread across different levels connected by tight and twisting passageways.  A new warehouse had been added to the rear of the site some years before and the yard outside appeared to be a dumping ground for disused HGV trailers.The Business of LIfe Chpater 26

Following a brief session with the management I held a series of meetings for both office and production staff.  After laying out the realities of the present situation, I went on to share my personal values and inform them that we would be working together to turn around the fortunes of the company.  I then held a series of individual meetings with all of the board and management team.  The highlights of my new team were Jeff and Neil (not my group MD), sales & finance directors respectively, professionally capable, enthusiastic, committed and nice guys.  They also proved to be extremely loyal.

The rest of the board and management were way below the level of competence I had been used to and, to be honest, made my heart sink.  They offered a veneer of support but it was barely masking an underlying denial of the dire situation the company was in and any personal responsibility for their role in it.  To say that I sensed a potential resistance to change would be a vast understatement.  Quite the saddest situation I found I had inherited was that of the administration director (who I’ll call ‘P’).  How he ever came to be promoted to this level was a mystery.  It would transpire that whatever hour I arrived in the office or left, he was always there.  Though supportive and loyal, I found that he was way out of his depth and was working 18 hour days in an effort to survive.  Knowing the urgent task I had on my hands to stem the haemorrhaging of cash, I decided to make no immediate personnel changes, there would be time later.  I knew ‘P’ was out of his depth and tried to protect him as best I could but he ultimately resigned.  A couple of years later I discovered from an HR consultant that my predecessor had engaged her to carry out an assessment of the board.  She had found ‘P’ to be so far below average intelligence, she simply didn’t know how he could even hold down a clerical role.  Nothing had been done.

The product ranges of the three companies in my group included domestic and commercial battery chargers, cable reels and power cords.  The business also produced small transformers on a sub-contract basis for another company in the wider group.  The battery charger business had been a market leader (and perhaps still was) but it suffered from a number of problems that were at the heart of the group’s problems.  Sales were highly seasonal with winter producing a demand at least five times that of the rest of the year (more in an exceptionally cold year – and one of those was about to strike).  Production had to run flat out throughout the remainder of the year to build stock as it was impossible to produce sufficient to meet demand as it occurred.  Thus this major division of the business consumed cash for nine months of an average year.  Selling through high street multiples and producing own brand for some of the major retailers it was subject to intense price pressures.  With its many export markets it also had significant foreign exchange risk.  These problems were serious enough but they proved to be compounded by sheer internal incompetence as I was to find out.  The other two companies demand patterns were not as seasonal but were also subject to severe price competition especially the cable business.

Having been intrigued by the trailers in the yard I requested that they be opened for my inspection.  This revealed a horror story of incompetence and connivance.  Each trailer (and there were five or six) was crammed to capacity with components and the largest single category was injection moulded casings for battery chargers.  These casings were either for obsolete lines or had retailers’ own brands moulded into them.  The own brand versions were for current production models but we had lost the business and they could not be used because of the branding.  This was in addition to the warehouse that was also stocked to the rafters with raw materials.  Upon further investigation I found that this stock was sitting in the balance sheet at full value!  This meant the true losses of the company (£3m in the previous financial year) were even higher than the accounts showed.

Horrified, I summoned the members of the management team who were connected directly or indirectly to forecasting or ordering stock to the yard and asked for explanations.  Unsurprisingly, the excuses flowed with much finger pointing but mostly in the direction of my predecessor.  When I raised the subject with Neil (my boss), stating that we had to write these off he growled, “Make some profits first to write them off against!”  After continued investigation the causes became clear with system disconnects and plain incompetence at the root of most.  Many issues could be rectified without delay but others took much longer to uncover and put right.

If the stock situation was bad then the production processes were at least the equal and arguably much worse.  The main production floor housed five production lines for battery chargers, transformers and cable reels.  Two separate facilities existed on different levels for cables and commercial battery chargers.  The first impression of the main production floor was of a state of chaos with people, components and finished goods everywhere.

As an example the cable reel line had fifteen people who seemed merely to be getting in each other’s way.  Finding that one member of the technical department was a trained production engineer I took him down to the production floor and showed him the line.  His response was to tell me that he had done the original line balancing and that it called for only eight operatives.  When I asked him what had happened he claimed that my predecessor, when output needed to be raised, had simply thrown people at the line.  This time the excuse sounded true and I agreed to strip the line down to its original eight members.  The very next shift the slimmed down team increased output and kept it rising over the following weeks.  We started work on the other lines.

I turned my attention to the cable line that produced relatively simple standard products with moulded plugs and sockets at each end.  The process had a history of problems and never seemed to run to plan.  The production supervisor was Marion, a lady who seemed to carry the problems of the world, not least of which were related to her personal life.  I asked her to join me in her small office and asked her what she felt could be done to improve quality and output.  She looked wordlessly at me with world-weary eyes that were deep set, spoke of little sleep and many problems and shrugged.  It was clear that she had once been if not beautiful then perhaps at least pretty.  But a broken nose, black ringed eyes and poor skin had long since robbed her of any claim to looks.  I asked her again. She stared at me with those dark eyes showing a mixture of  suspicion and confusion and murmured, “I dunno.”  It was Friday and I suggested she had a think over the weekend and if anything came to mind to let me know the following week.  She walked off back to the line.  I went home that night despairing.

Arriving shortly after 7.30 the following Monday morning I found Marion waiting outside my office.  “You serious what you said on Friday?” she blurted out, “You really want to know what I think?”  We went into my office and I sat her down and assured her that I was, indeed, really interested in any views she might have to improve the line’s performance.  “No-one’s ever asked my opinion of anything, ” was her response, “but I’ve been thinking all over the weekend and this is what I think.” What followed was a succession of ideas that sounded sensible and easy to implement.  “Go ahead then.” I replied.  Her eyes came alive, “What?  Can I?”  Improvements followed quite quickly and were maintained.

An intractable problem was the night shift that was required to meet demand for the sub-contract transformer work.  Due to uncertainty concerning its future my predecessor had made a not unreasonable decision to use contract labour.  A contract had been signed with a local firm who recruited and bussed in the required labour from neighbouring towns each night.  The assembly tasks were relatively straightforward and the day shift was reasonable in its output and quality.  But the calibre of the people we were getting to work the night shift was dire.  I arrived in one morning to find that an entire night’s production had been lost to ‘an incident’.  It transpired that two of the crew assembled the previous night had been rival drug pushers who had decided to set about each other with machetes!

Output and cost of production slowly improved and the end of the financial year showed a reduction in the losses.  However, as soon as one problem was solved continued investigatory work revealed yet more.  We were by then winning more distribution but price competition was eroding any benefits gained from the lower production costs we were then achieving.  Component quality problems continued to be a problem especially the injection moulded components that came from another company in the wider group.  Attempting to resolve these problems always led to counter allegations of constantly changing demand, which I would invariably find had some substance.

Quite apart from the challenges of solving the cash drain problems of the battery charger business, we also had an unacceptably high level of product returns for damaged and faulty goods.  Carrying out a detailed inspection of our product packaging I found that the quality of the board used had been reduced to something that was totally inadequate for such a heavy product and many products were arriving at retailers damaged.  I then decided to test a number of our products myself taking a different model home each evening and attempting to follow the instructions.  My experience quickly proved that the instructions (even in English) were simply ambiguous at best.  God only knows what the myriad additional translations had turned them into but an unacceptable quantity was being returned as faulty purely because the instructions were unintelligible. .

 Into the second financial year it was becoming clear that with increased competition and the power of major retailers driving prices ever lower our efforts to improve UK production efficiency were never going to be sufficient.  With the greatest of reluctance I decided that the only future for the brand was to outsource production to the Far East.   Having made contact with several potential manufacturers, I headed out to Hong Kong with Jeff our technical director.  During that trip we visited many factories in mainland China, all were dispiriting places and, which combined with the fledgling infrastructure and teeming population, produced a hellish vision of a dystopian future.  Yes, it seemed we could achieve lower invoiced prices but quality and the lengthy supply line troubled me.  By the time we returned to the office the decision had made itself.  We had already received, via another route, a leaflet from an unknown Chinese manufacturer offering their products to us.  ‘Their’ products shown on their full colour leaflet were the samples we had left in China with our brand names carefully concealed!  It was just too risky to take the chance but events overtook me anyway.

By this time we had managed to pull the losses back to a break even position but added to the pressures within my business, our parent company was struggling to survive.  Neil my boss, with whom I had established a super working relationship, arrived early one Monday morning a few weeks later with bad news.  The group had decided, without reference to me and despite our elimination of £3m of losses, to close our operation in Yorkshire and merge with another group company.  I was informed I was to be made redundant but first had to oversee the sale of our cable business, again something that had been arranged by the main board.

For the next month or so I worked with the accountants sent in by the purchaser in the due diligence information gathering process they were conducting.  The sale concluded Neil informed me that I would have to work out the remainder of my contract (in some capacity) but ‘could take reasonable time off to seek other employment’.  The conversation turned into one of those blood on the walls events as I fought to achieve a clean financial settlement instead of working for another 10  months in some spurious role.  Not being able to reverse what was clearly a decision forced upon Neil by a cash-strapped main board, I engaged the services of a law firm specialising in employment matters.  A few weeks later I walked away with a cheque having compromised on a slightly lower sum.

This time there was neither rage nor sadness but simply the realisation that I needed to take stock afresh.  I had proved once more that I could achieve what required but to no avail.  Seeing the writing on the wall over the previous few months I had been quietly testing the market once more and had got to offer stage with a small US corporation.  However, my research on the company told me that I might well be going from frying pan to fire.  I was now 49 and had begun to feel that my corporate days were over and it might be better to draw a line than suffer the same fate again in a few years time.  My mind went back to Norman and his CVC backed purchase of GTE Sylvania and the decision wasn’t hard to make.  Reviewing my knowledge and experience I decided I could achieve a management buy-in (MBI) and I would.  I phoned the Americans and informed them I was withdrawing.  I then called all of my head hunter contacts to let them know that my time as an employee had come to an end.

I had barred and shuttered the route back into employment and, with my mind clear of distractions, I could concentrate on achieving this major new goal.  Could I do it though?  Could I really convince the venture capital community to back me with the millions it would take?

 Image courtesy of businesspundit.com

The Business of Life Chapter 25 – when it’s time to pick yourself up

The flight back from Geneva that evening gave me some time and space to get my thoughts together.  There was none of the rage I had felt when I had been fired from Akai 13 years previously.  Instead, what I felt was a mix of great relief and sadness.  The sense of relief had been something I expected, as working for Norman and Eddie would have filled me with horror.  This feeling was vindicated later that same year when a friendly head hunter shared his experience of dealing with Norman  But more of that in due course.

The sadness was an unexpected sensation.  I had spent all those years working for a company in roles that had provided me with enormous challenges, to which I had usually been able to rise.  The company had given me a superb business education, which I have since come to realise was peerless.  It had also provided me with rich and complex problems on which to apply my new found knowledge.  I still count some of the solutions I arrived at to be amongst the greatest successes of my career.  It was sad that middle management had not always been able to step back from their personal positions and embrace a new reality.  Strategic thinking had been subordinated to the protection of personal gain in many cases.  Nevertheless, I knew I was going to miss the company, the challenges it had provided and the people; even the ones who had frustrated the hell out of me.

One worry luckily I didn’t have was financial.  At least I was confident that I would find the next position before money became a problem.  With the savings I had accumulated and the severance pay I had received life wouldn’t be too bad.  I was under no illusions though as the UK was still recovering from a nasty recession.  For the moment I put that from my mind as I had more immediate matters to deal with.  I had an apartment in Geneva with more stuff accumulated over the previous year than would fit into a suitcase and I had to get it back home.  I made plans to drive over in a few days.  Speaking to a couple of my old team I discovered that they had already had a farewell lunch together but on hearing I was returning for a couple of days they decided to do it all over again – with me.

So, after a few days catching up on my sleep and delighting in being back home with Denise, I headed back over the Channel and through France to Geneva for the last time.  The lunch was bitter-sweet.  I was touched that they were all prepared to give up their time to meet with me once more.  It was apparent though that a number felt a lot less philosophical about the situation than me and it was clear that at least a couple were going to find it very tough to get another position as good as the one they had lost.  One saving grace for them was that Swiss welfare payments were a whole lot more generous than the UK but only for a time.  When the hugs and kisses were over we went our individual ways and I began the long drive back.

Back home in Yorkshire my first priority was to shake off the excesses of too many meals and probably too much to drink.  So, Tilly our Rottweiler joined me for long jogs across the moors around our home and gradually I began to feel good both physically and mentally.  Without a break I started work full time on the hunt for the next position.  In the following 6 months I travelled 20,000 miles attending interviews, networking and researching the market.  Contacts I had made were unstinting with their time and advice and the many head hunters I either approached afresh or renewed acquaintance with were generally extremely helpful.  Together with the advice I had previously received from Max, I was becoming more focussed and more professional in my approach.

Discussing the very exact profile a client had drawn up for a position I was reviewing with an extremely helpful recruitment consultant he suddenly enquired, “It was the same Norman that had run FKI that bought your old company, wasn’t it?”  When I nodded he went on, “God you had a lucky escape!  I had a brush with him a few years back.  He contacted me and said he was looking for half a dozen MDs.  Well”, he went on, “I thought Christmas had come early, so I asked Norman to let me have candidate profiles and I’d get back to him with a plan and an invoice for the amount we charge upfront.”  It seems Norman had responded, “Don’t waste my time with stuff like that, just get me the candidates and I’ll see if I like any of them.”

Things were certainly a lot tougher than they had been the last time I was ‘between positions’.  I was that much older, that much more senior and the number of openings higher up the greasy pole were that much fewer.  It became clear quite quickly that, despite my extensive contacts, I wasn’t going to walk into a senior role in the industry I had just left.  I think I was known as someone with strong views and a different perspective on things and that didn’t appeal to many.  In any case longevity in position was a hallmark of the industry I had been in and there was no game of musical chairs to join in.  Moving industries once again looked the most likely route back into gainful employment.  This bothered me not one jot as I had already worked in 6 diverse sectors and had found problems were invariably generic.

Drawing on the experiences I had accrued in my role in Geneva I reflected on the behavioural skill set that my role had really needed.  When I compared this with the psychometric feedback I had received over the previous few years, I realised that I had really been a square peg trying to fit a round whole.  Whilst the experience and knowledge I possessed had been more than sufficient for the role, my behavioural profile lacked the key political skills required.  I had the influencing skill alright but I clearly lacked what Phil Thurston at Harvard had referred to as ‘rat like cunning’.  My first approach to a problem or resistance was usually to summon the power of logic and rationality.  If that didn’t work I rarely shied away from a full blown, full frontal attack.  I could build and receive the loyalty and support of a team, I could understand the biggest of pictures and what was required to solve the underlying problems.  Yes, there was much I could learn of politics but, as I saw things, I was far more suited to leading than being led.

But my mind was beginning to move in a different direction.  During the final months in Geneva I had started to think of working alone as a consultant and had sounded out a few people I knew who had created successful careers in this way.  The advice had been to specialise rather than risk being known as a jack of all trades.  The obvious specialism was marketing strategy and I was pondering the prospect of setting up and promoting my own business when, in one of those amazingly serendipitous moments, my phone rang.

The call was from Gerard, the finance director of an old customer I had known for many years whilst with SylvaniaUK.  He explained that they had a problem he felt I might be able to assist with.  Was I interested in meeting to discuss the situation?  A few days later I travelled down to Croydon to meet Gerard and Steve, the MD of Jerrard Bros PLC.  The company had been founded by Steve’s father and uncle, had done well for many years but now required a new supplier of a key product.  Would I help them?  I said I would let them have a proposal.  During the visit it became clear that the company had reached a plateau over the previous few years and I probed for reasons.  I said I would also let them have some thoughts on working with them to address this issue also.  A couple of weeks later and after some good natured negotiation we had a business relationship based on two projects.

Almost straightaway I received two more approaches for significant projects and following discussions, proposals and more negotiations I found myself engaged to complete both.  One was a feasibility study for a foreign manufacturer looking to enter the UK market and the other was assisting a company looking to acquire one of my old, major competitors.  Very quickly I became extremely busy and drew a halt to any idea of seeking a new employed role.  I revelled in the freedom of working on projects that interested me at my own pace (although to agreed deadlines).   By now it was summer and I fell into a routine that, when I wasn’t travelling, I often cycled long distances in the Dales.  I would start early and return by midday and then work through until mid evening.  I had always found cycling conducive to thought and now I could actually keep fit whilst doing something I really enjoyed and apply my mind to various problems at the same time.

During my job hunting process I had followed a highly targeted approach seeking opportunities that had not even been advertised.  Each day I would scour the business press looking for news items concerning major companies that were either contemplating or had made major investments or acquisitions.  Whenever I came across a situation where I felt I could add value I would write to the chairman or chief executive (often to their home address so my letter wouldn’t be screened by a secretary).  I would either compliment them on their success or wish them luck with their plans and then spell a short but precisely targeted couple of sentences laying out how my experience could assist.  I would follow these letters up with a call aiming to achieve a meeting.  Several of these approaches got me in front of senior people.  I hadn’t succeeded in getting a new job from this approach but I decided I could use the experience to win new clients.

Another opportunity for creativity had arisen when I lost out after being down to the final two for a position running a national chain of builders’ merchants.  Having invested the time to carry out a great deal of background research on the firm and its competitors I thought it would be foolish to waste it.  I called the new MD, introduced myself as the guy who came second, congratulated him and suggested we meet as I had a proposition.  He was sufficiently intrigued to agree to meet me.  When we met I made the suggestion that as he was busy getting to grips with a big new role there was a way I could help.  He listened very carefully to what I had to say about the industry, the position of his company and the issues I had identified.  He considered for what seemed an age and then said he would be pleased to receive a proposal.  I went away and submitted a detailed proposal for a very focussed consultancy project.  He accepted but not before something else got in the way.

Towards the end of my period of applying for jobs I met a head hunter with whom I had established a good relationship.  Out of the blue he called me months later to say he had an assignment he felt was well suited to my experience.  We met and I listened to the facts he laid before me.  His client was Ross Group a small UK PLC with a number of businesses in electrical products.  They were seeking an MD for one of the group companies, Selmar Industries, itself a group of three businesses manufacturing in West Yorkshire.  The previous MD had departed after running up losses of £3.0m.  Smelling a dead horse, I declined to take matters further.  However, a couple of weeks later he was back on the phone pushing me to meet the Group MD at the company’s factory, “It’s just down the road from you, I’m sure you’ll get on famously with Neil and if you still decide it’s till not for you, well fine.”

The following week I duly arrived at Selmar’s factory, which was housed in old mill premises in a tight, wooded valley on the outskirts of Brighouse.  My heart sank; it looked a tip.  However, my head hunter chum was right about Neil with whom I quickly established a rapport.  He had also worked in major corporations and there was a basic understanding between us over how businesses should be run.  Nevertheless, after several hours of discussions I politely declined to take matters any further.  A week later Neil came on the phone to chat and pressed me to meet the chairman, “Nothing to lose, see what he has to say, eh?”  A long trip down to Basingstoke the following week produced a firm offer, which I rejected.  They responded with an improvement and promises.  By this stage, I have to admit, it had become something of a game, so I pushed on and won more concessions.  Finally I accepted but not before I had negotiated approval to continue my work with Jerrard Bros.

I was back running a group of businesses and was confident that I could improve them.  Would it work out?  Or had my pugnacious nature set me up for trouble again?

 Image courtesy of Eliasbadi.com

The Business of Life Chapter 22 – Saved by the Bell

Some years earlier our European finance group decided to implement a new IT system, which like most such schemes, was late and over budget.  Finally the UK was selected to be the first to implement the new systems.  An external team was parachuted in to attempt to do in a few short months what should have taken a year or more.  It was obvious that the system hadn’t been fully developed and the implementation process was horrendous and continued to be subject to endless fixes, that unknown to all, would leave gaping holes.

Another decision that was taken under heavy pressure from Europe was the appointment of a new Financial Director for the UK (who shall be nameless).  Recruited in Brian’s time, Nameless came with glowing recommendations from his previous (internal audit) role. He initially appeared to be competent but over time I began to realise that his interpersonal and management skills were severely lacking and had brought this to the attention of Claude the VP Finance in Geneva.  What I didn’t realise (until it was too late) was that he also lacked key functional skills that I might have spotted had I been more experienced.  Whilst preoccupied with the pricing & margin scenarios that were playing out at the time I discovered that we had suffered a stock loss that Nameless had not revealed to me.  The loss was not huge in relation to our business but large enough (at $250k) and the brown stuff hit the fan.  Suddenly, everyone in head office was an IT and an accounting expert and making known opinions on the UK situation.  An accounting hit man was put in to get to the bottom of it.  The process rumbled on for months with the interim result that Nameless was fired and I would make a big mistake.

By this time the stock loss had become a cause celebre within the company and it was being used to settle scores.  In the middle of all this Gregg had made one of his lightning lunchtime raids on me and demanded to know if I had known about the stock loss prior to it becoming public knowledge.  My mind was in turmoil.  If I admitted that I had known nothing of it, I would demonstrate that I didn’t have my hands around the accounting and IT functions in the UK (which was true enough).  On the other hand if I said I was aware of it but hadn’t blown the whistle, I could stand accused of being complicit (which I wasn’t).  In a snap decision that haunts me still, I lied and claimed I had been aware of the situation earlier.  Ultimately, it became known that the loss was a paper one and stock had never physically disappeared.  The issue had been faulty IT and accounting systems that couldn’t reconcile all the components of a transaction with the physical stock.  The head office IT and Accounts people were in full CYA mode and Claude never forgave me for making known that his appointment (Nameless) was a very poor manager.  He was also ‘retired’ a short time later but I came out of this episode badly.

Early in 1992 Gregg met me for what transpired to be the most open conversation we ever had.  He shared with me his view that I was a very bright strategic thinker and a loyal manager.  He went on to say that he felt I’d had a terrible set of problems to deal with but was too much of a nice guy who did not fight enough, “Nice guys come last!”  It was clear from other comments he made that a fairly comprehensive image destruction job had been carried out on me by others in the head office team.  He went on to share with me the news that he intended to integrate my company with another in the group (Linolite) and that I was not being given the role of heading up this new structure.  I put up a spirited defence but to no avail.  Gregg said that his view was that I had done a fantastic job in the past but that I might have been out of my depth with all the problems I’d had to deal with, “Anyone might have been.” he said and then added,  “but I don’t want to lose you from the organisation.”   I had worked tirelessly (and yes, in difficult circumstances) and could not have spent more time with either our customers or my people or had more support from them.  I was deflated.

I was duly served with notice of redundancy but simultaneously what I considered a non-job was created for me.  I had to sit on the sidelines, in a shiny new office, as my company was merged with Linolite by Gregg’s new protégé.  The only factor the two businesses had in common was that they both sold via the distribution channel and I could only disagree with the manner in which the businesses were merged.  My non-job was boring in an extreme and I took full advantage of the outplacement programme that was also offered to me.

My consultant, Max Eggert, was the most fascinating character who had the most profound and beneficial effect on me.  Max put me through a battery of psychometric tests and the words he used to describe me from the results were, “tough, strong leader, stable, assertive, competitive, change agent, highly creative, socially strong, relaxed, self-assured, secure, open, self-sufficient, warm, enthusiastic”.  These were very similar to results that I had been given some years earlier by a Professor of Psychology at Yale (Vic Vroom) describing me as,  “a strong leader, visionary, with a participative and informal style and a transformational leader”.  I felt somewhat vindicated, that I had been in the right role and decided that I would use my severance package to take a full time MBA and start afresh.  I applied and was accepted for the programme at Bradford Business School to start in the October of that year.  However, events soon took an unexpected turn that led me to decline the offer.

Soon after it was announced that our parent company GTE was putting the $2bn global Sylvania lighting business up for sale.  Whether my analysis of the industry and presentation to the President had played any part in this, I have no idea.  But I had clearly been correct in my analysis of the situation.  Another decision was announced soon after; that Gregg was retiring.  His replacement was Don, another American, and an accountant by profession from elsewhere in the organisation.  The European business limped on hindered by a hiring and firing freeze with rumours and uncertainties rampant.  I couldn’t have done too badly in my new non-job as my records show that Don awarded me a bonus for that year!  As my redundancy was effectively placed on hold and my salary was still being paid I continued to fill my days as best I could.  I ignored as many of the duties of my non-job that I could as they were futile.  However, events overtook me and a life changing event took place that demonstrated to me that I hadn’t learnt all the lessons from my psychometric testing that I might have done.

Early in 1992 I took a call from Alain, the European VP for HR.  I was asked if I would take on the role of European Product Manager for a group of our products and be based in the Factory in Belgium.  My heart sunk as this was a role that filled me with horror.  It had no line authority over the subsidiaries, their pricing or their activities but carried responsibility for the results.  It was also the product group that I knew to be struggling the most (and has subsequently been killed off by EU regulations).  I was never normally one to fail to respond when a challenge was put to me but I decided that this was a dead horse that would not respond to flogging.  I entered into a delicate process of negotiation, claiming that I wanted to assist the company but that the details had to be right for both parties.  I managed to drag the negotiations out for weeks whilst I did my research on life as an ex-pat in Belgium.  I pushed and wrangled, had meetings and more meetings and continued to delay until I had got to the point where I could procrastinate no longer.  Then, miraculously, at a minute to midnight, I was saved.

Alain came on the phone on the day I had committed to make a decision and said to forget Belgium.  Louis was leaving his role as VP Marketing in Geneva to run the operation in France.  This was the role I had wanted many years ago and I knew it would look good on my CV if things took a turn for the worse following a sale of the business (if indeed it ever happened).  I started to negotiate but it soon became clear that, given the circumstances, they were desperate to fill the role and I was the only one in the frame.  By the time we had finished I had on the table a salary in Swiss Francs that had doubled, a company flat with cleaner and all bills paid, a company car in Switzerland, the retention of my company car in the UK, business class travel to and from Geneva each week (or for Denise if she wished to join me in Geneva) and the guarantee of a severance package based on all this if I was made redundant from Switzerland (plus repatriation to the UK).  Delaying only for a discussion with Denise I accepted.

Would it work out?  Or had I gone from the frying pan into the fire?

Image courtesy of c&maccounting.co.uk

The business of life (chapter 16 – grim up North)

After just three months and 79 applications I had secured a new position that seemed to offer the future I sought.   Arguably it was at the same level as my previous role.  Yes, it had a narrower functional focus but it was with a division of GTE, a major US corporation, and I was earmarked as the replacement for the current UK managing director.  Sylvania Lighting, the company I was joining, was exclusively involved in industrial and commercial sectors that were completely new to me.  I had a lot to learn.

On a Sunday evening early in December 1980, I waved off my family who had spent the weekend with me in Yorkshire house-hunting.  I got an early night in preparation for the start of my new job the following day.  Sleep didn’t come easily due to a combination of an incredibly noisy heating system in my hotel room and the thoughts that kept crowding into my mind.  All of my marketing training and experience at this point (and the majority of what was taught at that time in the UK) focussed exclusively on consumer marketing.  The only information that my research had uncovered on marketing in industrial sectors was a very short pamphlet from The Industrial Society in London.  This was very different ground to the exciting sectors I had been involved with up to this point and the concepts kept going round in my mind as I struggled to sleep.

Feeling like death warmed over after what felt like only 5 minutes sleep I presented myself at the office and tried to appear bright and raring to go to John, my new boss.  Quickly introduced to everyone in my new team (all three of them) and the rest of the office based staff I took a briefing from John.  Having only acquired the manufacturing assets of an old established British company approximately 5 years previously, the business imported 85% of the range of products sold in the UK from other European group factories and exported 90% of our own factories’ output to the rest of the world wide group.  Following an initial period of UK growth sales had run out of steam.  Competition came in the form of Philips, Thorn & GEC, all long established and major companies.  My task was to construct a strategy to grow against these industry giants.

After sitting down with my new team I felt very alone.  They were warm, friendly and eager enough but had limited experience and low levels of initiative.  Meeting the rest of the management team revealed that Bob the finance director was the perfect caricature of the Scottish FD.  Mike the operations director seemed competent and friendly but both seemed somewhat reserved about my role. The really bright spots were Martyn the Sales Manager, a great guy with whom I shared photographic industry experience, and Andrew the HR director who I had met at interview.  I felt I could work well with these two.

I spent the remainder of the day trying to find industry & company information I could use for analysis & planning.  Before we left the office, Martyn suggested we had dinner together as we were staying in the same hotel (he also being in the process of relocating and a weekly commuter).  The evening was good fun and it became increasingly clear that we were going to have a great working relationship.  After a few pre-dinner drinks in the bar (it had been a long day), we sat down to eat and enjoy a bottle of wine.  Towards the end of the meal, Martyn waved the empty wine bottle and suggested, “Shall we have the other one?” I recall that I must have responded in the affirmative as I awoke the next morning with the most appalling hangover.  Somehow I managed to blag my way through the day, vowing all the time that I would never touch another drop.

Following my week in the hotel, John suggested I rent a flat as it would be both more economical and convenient for the time it would take to find and move into the house of my choice.  A large loft apartment was soon located in a quiet leafy suburb and it was suggested that I share with Cliff, an American student who was on secondment to us.  Cliff was an ideal flat sharing colleague as his interests and daily routines ensured we rarely ever met except in the office.  Immediately we moved in the key problem with the apartment became apparent – it was totally devoid of insulation.  With a combination of heaps of additional blankets & a huge electricity bill we would make it through a very cold winter.

Over the next few weeks it began to emerge that not only was John a curious character, but he was an absolute bully to his team.  The bullying took the form of a continuous need to be seen not simply to be the leader but to be right in any and every situation.  He appeared to be incapable of trusting anyone to carry out their role without his interfering.  That I knew little of industrial marketing I was well aware but John’s lack of understanding of the entire purpose and practice of marketing was verging on the complete.  This was however a deficiency that never prevented him from pontificating on the subject.

He was also exceptionally parsimonious; one of that select band who know the price of everything and the value of nothing but carried to an extreme. On one occasion he drove to London early one morning to attend a trade fair and drove back again that afternoon to show his face in the office.  He then went home, changed and drove down to London again to attend a dinner before driving back up to Yorkshire once more in the early hours.  The following day he made it known that he had saved the company money in this way (by driving around 1,000 miles in a day)!

However, the event that really began to send the doubts that were gnawing away in my mind into overdrive was the Christmas staff function.  John invited the whole management group to his house for drinks before dinner, which was fine but it merely served to demonstrate that his obsessive compulsive behaviour was not confined to the world of business (his poor wife….).  We then moved to a local pub where John had booked a function room for dinner.  The meal was simple and I kept well away from John and used the opportunity to become better acquainted with my new colleagues.  At the end of the evening I witnessed an event that, even today, I still cannot really believe I saw.  John went around the room collecting up glasses that still had wine in them and poured the contents into several empty wine bottles.  “Waste not, want not.” he opined when he saw that I was watching him.

Driving home for the Christmas break my mind was in turmoil with the conflicting experiences of the last month plaguing me.  The challenges of the job had got to me and I was convinced I could devise a suitable strategy for growth but it would not be a five minute task.  I had to have the freedom to explore on my own and I was growing less tolerant of John’s style by the day.  I had turned down two other roles and they kept returning to my mind; perhaps they had not yet made an appointment?  I realised that I would be in a very weak negotiating position if I pursued that route.  The four hour journey gave me plenty of time to mull things over and by the time I neared HenleyI had decided to give my role one more try.  I was a fighter and I was determined to make things work if there was a chance.

Back in Yorkshireafter a wonderful Christmas with the family, I started to review the task before me. The meagre information I had on industrial marketing (the one brief pamphlet) suggested that if it was not possible to differentiate the product itself (a cornerstone of consumer marketing) then attention should turn to differentiating everything other than the product.  It was quite clear that our product range was totally non-differentiated with every product made to a set of harmonised industry standards.  Construction of a complete marketing strategy that differentiated our company and our strategy was the great priority; it was what I had been recruited to do.  But I had John to contend with and I had to get him out of the way while I worked on the planning and then get him onside for whatever the solution transpired to be.

Then one of those serendipitous events took place that was to change things overnight. John called a meeting one afternoon and around six of us crammed into his office (in the old office we lacked even one meeting room).  With the heating pumping out and the windows and doors closed to exclude noise it soon became stifling; I undid the top button of my shirt and undid my tie. “We keep our shirts buttoned at all times in this office” barked John.  I was, to use a newly acquired local expression, gobsmacked and quickly responded, “That’s simply ridiculous.” and left my shirt how it was. John glared at me for an age and then moved on to what became another of his usual uninspiring meetings.  As the meeting concluded, without thinking and probably remembering the general office was considerably cooler, I did up my top button, restored my tie to full mast and walked out to the gents to relieve myself.

I had barely concluded matters when John burst in announcing, “I need to talk to you in my office, now!” Ready for a fight and thinking that I couldn’t take his petty bullying any longer, I followed and quickly became astounded back in his office.  “You disagreed with me earlier,” he started in on me, “in front of my management and wouldn’t back down.  But before you left my office you made it clear that you would comply with my rules and I just want you to know that I respect that.  Now, how’s the house hunting going?”  From that moment on, John changed his attitude towards me, even seeking my views in front of others and then making it clear that he would back them.  He also gave me the time and space to concentrate on my key goal, something that consumed my full attention.

Just as I was starting to enjoy my role something more serious occurred that rocked my world.  A couple of years back my old boss Gordon had introduced me to Norton Warburg, a financial investment and asset management company.  I had been persuaded by their presentation and seemingly very professional manner to place my savings with them for investment. The actual sum today would seem slight but it represented well over a year’s earnings for me then.  The money had been duly invested and it had produced not only a very good yield but, due to some highly effective financial planning available at the time, was very tax efficient.  I was relying on these savings to help finance my move to Yorkshire.  One Friday afternoon I had spoken to my advisor and informed him that I would require access to the money at short notice.  He came back to me with the suggestion that the Bradford & Bingley were offering a very good rate for short notice investments.  We agreed he should make the switch.

Early the next Monday I set out on my usual drive from Henley on Thames up to West Yorkshire.  Breaking the journey on the M1, I bought my usual copy of the Financial Times, which I started to flick through as I sipped my cup of the usual foul motorway coffee.  When I came to the business section I was stopped in my tracks by a story that indicated that over the weekend Norton Warburg had been placed into administration and that first indications were that it was doubtful that creditors would receive any recovery.  I went cold.  The thought of losing my savings was more than I could bear to contemplate.  I found a payphone and called their number only to be told that the administrator was not taking calls from creditors; I would have to wait until he was ready to make an announcement in due course.

I drove the rest of the way to the office in a state of shock.  There must be something I could do.  Surely, I couldn’t have lost all that money?  Or could I?

The business of life (chapter 15 – unemployed & on the hunt)

Back in Henley and unemployed I set about the process of getting organised for the job hunt.  My office was sorely in need of some love and attention and the first task was to have a tidying up blitz and reorganisation.  This accomplished, I had an orderly space to think and work.   Reviewing the experience I had under my belt and the skills I had acquired along the way, it seemed to me that I could move industries.  My self confidence being what it was I had never expended much time on using contacts (the phrase networking had yet to assume an audience if it existed then).  So, the Times, the Telegraph and the FT were scoured on a daily basis and applications sent off.  In the age prior to the PC it wasn’t easy to vary one’s CV but I made up for that with hand-written covering letters that were individual to each application.  My approaches varied a great deal and even included a lively personal recording made on tape for the position of MD for a regional radio station; it won me an interview but I failed to make it to the shortlist.

The records I kept at that time show I applied for 79 roles at or one level below the board across a very wide variety of industries.  Very few of these application were to companies in sectors I had previously worked in.  Of the 32 initial interviews I succeeded in obtaining, sectors included finance, medical, training, data management, truck hire, communications, incentives, consumer goods, wood products and many more.  These initial interviews led to 13 second, 5 third and one fourth round meeting and three offers.  Of the rejections I received only a small number of companies or consultants were good enough to provide a reason and these included; no foreign languages, no local authority experience and no MBA qualification.

Looking back at the names of the executive recruitment firms and companies I applied to, the vast majority only ever sent a very cursory rejection and many not at all.  Given the seniority of the posts being filled it seemed to me to be incredibly short-sighted of the recruitment consultants and head-hunters not to have been more engaged with their candidates.  I vowed I would never use any of the people or firms that treated me in this way when I returned to the world of work and I never have.  If they were foolish enough not to realise that today’s candidate is tomorrow’s potential client, then they would do without the very large sums I would spend on recruitment projects over the subsequent years.  Busy or not, they were simply foolish, short-sighted and just plain ignorant people (some of which I had the pleasure in giving personal rejections to when they came touting for business in later years).

Yes, there were frustrations along the way but every application, every interview and every rejection provided a learning experience for me.   Some of the interviews served to shed light on aspects that I ought to emphasise or downplay.  Some interviews were bizarre. One such occasion I remember well; arriving early (something I always tried to do) I was greeted by the consultant who welcomed me warmly and proudly handed over the last three years sets of company accounts for me “to learn about his client”.  Skipping the glossy bits I went straight for the numbers and it was clear that this “highly successful” business was on a downward slope of around 45º!  It had gone into the red, margins were declining, was consuming cash at an alarming rate and had only survived by wringing its creditors dry.  “Well, what do you think, eh?” enquired the inanely grinning consultant as he ushered me into his plush office, “Great opportunity or what?”  I explained that the client was technically insolvent and couldn’t last another 6~9 months unless a miracle occurred.  Given that the industry never made great profits, the business had no clear strategic advantages and no miracle was announced to me, I declined in the politest terms I could muster and made my exit.  Surprisingly, I got a call a week or so later saying I really ought to meet his client before making any final decision.

The concept of psychometrics was not well established at this time and I had never come across such a process before. Only a very small number of firms I met used such testing.  The first was a Swedish company who met with me in a Heathrow hotel.  A very studious, sombre and suspicious looking individual informed me I would first complete his “test”.  I duly did as requested and when finished, the sombre one took it from me with an aloof air and disappeared off into a far corner of the large room to score it.  The second rather more human individual started the interview off with a number of quick fire questions that seemed to have no continuity about them.  A little time later the sombre one reappeared from his corner, his expression as cold as a Swedish winter, announcing, “You are responsibility adverse!”  Somewhat taken aback, I countered as best I could with a response covering the depth and breath of responsibilities I had held and how I rose to the challenges.  “No!” came back the icy blast, “The test is saying this fact and the test cannot be wrong!”  The Swedes decided there and then that there was no place in their organisation for a risk adverse executive.

My other encounter with a questionnaire based psychometric test was at the offices of a major recruitment consultancy where I was asked to work my way through a long questionnaire comprising of a choice between pairs of phrases as to which was more like me.  A standard technique in many psychometric tests (I subsequently learnt), this process can be rather frustrating to the candidate as items keep cropping up paired against a different choice.  Certainly I found this approach entirely frustrating and I was continually going back and changing previous answers when I came across the pairing between “I love ice cream” and “I hate my mother.”  Not exactly having a love of the former, I felt couldn’t make a sensible choice, gave up trying and got no further on that assignment.  Despite acquiring qualifications in many psychometric instruments over the subsequent years, I have never come across this particular instrument again.

Graphology is extensively relied upon in France for recruitment purposes and I had my first encounter during this time.  Applying for a position with a Belgian company, I was interested to note that the advertisement stated that the covering letter had to be in the applicants own handwriting.  I duly complied (as it was what I was doing anyway), sent off my application and was pleased to receive an air ticket the following week for an appointment in Brussels.  As soon as I was introduced to the chief executive he stared intensely at me for a short while as he shook my hand and announced, “I simply had to meet the man who owns this handwriting!”  He never elucidated despite the meeting lasting several hours and I didn’t get through to the next stage.   Many years later I had my handwriting analysed purely for professional interest and was intrigued to see many facets of my character accurately picked out.  Unfortunately, there were also an equal number of behavioural traits claimed for me that were utterly wrong!

At the beginning of October of that year I applied for the role of marketing manager with the UK arm of aUS corporation. Most of the roles I had applied for were above this level but it was a lean week for advertised positions and a combination of characteristics led me to apply.  The company was in an industry I had never worked in before (industrial lighting), it was a small part of a huge corporation (GTE now Verizon following a merger with Bell Telephone) and it inferred significant growth potential. Still wearing my hair shirt from the glamorous, highly spending days of consumer electronics, the role probably met a subconscious desire for atonement.  The consultant advertising the role was one I had never come across previously and in the first meeting we had he grilled me hard but listened acutely to my responses.  It was akin to a tough squash match against an opponent just that bit better.  What I learnt that day made me very interested; the company was a major US & global player in its sector, relatively new to the UK,  had manufacturing here, was currently building a vast new factory and was looking for someone to replace the MD over the next couple of years.

In the next month I had two more interviews in the shabbyWest Yorkshire offices with the European and the UK HR directors plus the MD.  Despite the old offices (they clearly didn’t waste money) I liked even more of what I heard.  The business had started well but had reached a plateau and they wanted someone who could create a new marketing strategy and build theUK brand.  The new factory was indeed vast, with spacious offices and, yes, the MD was singled out for a wider European role over the next few years.  Knowing I would have to leave my beloved Henley onThames, I took the opportunity on the second visit to look around the area and fell in love with Wharfedale.

Several days later I got a call asking if I would fly to Geneva to meet with the European Marketing VP (Louis) and the UK MD (John).  An early flight got me intoGeneva for lunch in a luxurious hotel overlooking the lake and Le Jet d’Eau.  I don’t think I ate more than a mouthful as it seemed like the questions were designed to come at me just as my fork was on its way to my mouth.   I was grilled again for several hours before we decamped to the office the other side of the lake where the negotiations began. They wanted me and by this stage I definitely wanted to join.  When I got on the flight back to Heathrow that evening I had an offer in my pocket to join Sylvania Lighting that I was pleased with.  The downsides were that I had to move the family toYorkshire, my new boss was a curious individual and I had zero experience of industrial marketing.

Was this the best move for me?  Would it work out?

Image courtesy of Farm4.Static

The business of life (chapter 14 – taking stock)

In August 1980 our Olympic Team made their way back from Moscow with a medal haul that included 5 golds (making us ninth in the table below Hungary, Romania and Bulgaria…..), the miners were once again threatening to strike (for a 37% wage increase), GDP had plunged by 1.8% and inflation was over 20% once more.  The Abba hit ‘Winner Takes it All’ was topping the UK singles chart reminding me that losers take nothing save what they learn from their experience.

My career had come to an ignominious halt at the age of 34, after 15 years of continuous success in each and every role I had undertaken,.  I had been fired, let go, out-placed, canned, released, suffered position elimination or whatever euphemism you care to use.  The initial emotions were a combination of relief from the stress of a role that had become hellish followed by profound shock.  These feelings of numbness then lasted for a few days before pure, frustrated rage took over.  My wife suggested that we take a short holiday to visit her parents in Scotland and I agreed.  Even after all these years I am still horrified at how I let my rage build up in my mind and show in my driving on the trip up to Perth on a busy Sunday afternoon.  I can only think that I was suffering temporary insanity and that someone or something was protecting our family that day.

The beautiful Scottish countryside soon started to work its magic on me.  Being a London lad who grew up surrounded by towering tenements, the joy of being amongst hills and mountains is something I never cease to find humbling in an extreme.  There is an incredible feeling of  the permanence of mountains that never fails to bring the fragility and pettiness of my insignificant life into perspective.  I slowly began to unwind and take stock.  Yes, I had been correct in my choice of communications strategy and all of its elements.  I had also been smart enough to monitor the return I was getting on every pound of my budget.  So I knew that I had achieved incredible value for money and results, not just by realigning brand image but also by raising awareness across the general public.  These improvements in awareness and image had resulted in dramatic increases in sales and allowed us to establish Akai in the vital new sectors of home video recording and racked HiFi systems. My financial planning had accurately projected our cash requirements and managed to keep the bank onside through the most trying times.  I had successfully planned and executed the moves to our temporary and new premises without a hitch and brought warehousing and servicing in-house.  These were the pluses.

Being brutally honest however, and looking at the negatives, I realised that there were aspects of my role that I had neglected or performed less than satisfactorily.   Without a shadow of doubt, I had simply been promoted too far, too fast and with insufficient training in a number of less than glamorous but key areas. My administration systems were woeful and unless I had a keen interest in an area I had tended to ignore it until it became a problem.  What I didn’t realise at the time was that, whilst I knew that a combative personality, intense competitiveness and ambition had driven me on and played their part in my success, other aspects of my personality conspired against me.  It took me many more years to realise that a lack of real listening ability, cultural understanding, guile and political skills had also played a significant part in my downfall.

Looking critically at my role at Akai I deduced, at the time, that not having total control of the business (as I had had in my two previous business management roles) had hampered me.  But when combined with an almost complete lack of political skills, I had been hamstrung.  Critically, I also  realised that I had not built a support group that I could rely upon for honest and appropriate advice as I had been fortunate enough to have in my previous roles.  The relationship I had had with Andy when he worked for me in the RAV business had never been one that I had been comfortable with; I felt that he had merely tolerated me.  With the move to Akai he had clearly sought to exploit the friction that grew between Yokose and me over strategy.  Whilst my relationship with Gordon had been a cordial one, and he had certainly been responsible for twice promoting me, his hands-off approach to the business and lack of guidance to me had not helped.  I probably made a convenient sacrifice once the going got tough. I had clearly been suffering from hubris and the inability to realise that which I didn’t know (the unknown unknowns that Donald Rumsfeld would admit to some twenty years later).

The more I tried to understand what had gone wrong (and this was something that I continued to mull over for many years), the more I realised that I had never taken the time to really analyse all the things that had gone right for me.   The intervening years have taught me that the actions taken in pursuit of a goal may not be the only factors that produce the result.  It has also become very clear to me that just because something worked once (or twice or more) it is no guarantee that it will always work.  However, I realised enough at the time that I had to become even more analytical and learn to take a far broader view of situations. I vowed to change.

Back in Henley a sense of calm and freedom settled upon me and helped produce some of the happiest months I can remember from that period.  I had time to share with the family, time for myself to regain fitness (rowing and running) and time to plan for the next stage in my career.  Yes, the UK economy was worsening as it slid into the deepest recession since the second World War but that didn’t worry me.  Despite the shortcomings I had become aware of and the hair shirt that I had donned, I knew that I had a CV full of solid results and that the business world more than ever required those who could prove they could deliver results.  I was confident that I would win that next step on the career ladder and pushed the doubts on my shortcomings to the back of my mind.  I had enough money to last a year or more and I was determined that the next role I got was going to be a serious step forward.

I had a single new goal to focus on.

 Image courtesy of The Guardian