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Case Study 1:

ABC Plumbing Ltd. A Special Forces Approach to Breaking through the Business Tipping Point

Profile Interim Managing Director Date 2007-2008.

The Assignment: A 12 week Interim M.D. position to assess the feasibility of growing a commercial plumbing & heating company over & beyond the business tipping point of £1.6M annual turnover.

Background Synopsis. Family run 14 year old business, previous 7 years as a Ltd company. Originally commenced trading as one plumber & a van. Original plumber holds 70%, his wife 20% & his brother 10% of the company shares. Company had grown organically during the previous 7 years to achieve an annual turnover of £1.6 M. Three shareholders work in the business. Number of full time employees at commencement of my contract in January 2007 was 20.

The Problem: Typical family run business managed by hard working trade’s people who had no business academic skills. Although the company had grown organically year on year, it had reached a plateau and hit the ‘Tipping Point’ and was not making any profit. The company directors were enjoying a comfortable living from their non-extravagant salaries, but had never received any shareholders dividends or bonuses. The company had no strategic business plan in place. Business development skills were non-existent other than the company had an excellent service delivery record with their clients.

This in turn led to repeat & word of mouth business which fuelled the growth. The M.D. owner recognised his business academic skill limitation & was concerned & astute enough to seek outsourced business consultancy help. This identified the requirement of a skilled interim M.D.

The Challenges.

• Limited resources
• Lack of business qualified support staff.
• Coping with the small business ‘Just in Time Mind-Set’
• Overcoming the director’s psyche of comparing the salaries of top management to the salaries paid to site employees
• Being frequently distracted and/or delayed by having to action menial tasks because support staff were unqualified

Assisting any small family run businesses is notoriously difficult. This was an especially tough assignment as it was a roll up your sleeves and get down in the trenches type of operation. The directors had no business academic qualifications and limited I.T. skills. The administrators had limited I.T., and virtually no business skills. Facilitating change was sometimes problematic as the family directors occasionally closed ranks behind the scenes.

The Project:An Extremely Clear Mandate To Grow The Business. Despite never having made a decent profit, the Company was in reasonable shape and debt free. It had an enviable reputation for delivering a top quality service within the North West UK construction industry. I recognised the early potential for controlled growth & expansion. In a very short time scale, an in-depth analysis was undertaken of the organisation, finance, structure and sales & marketing.

The intention was to prepare a strategic growth & expansion plan. The critical areas to e addressed were quickly identified by conducting an almost forensic investigation into the company’s Modus Operandi.

As a former trainer of global Special Forces personnel it was clear to me that I would have to de-train, and then re-train the management team to become Corporate Special Forces in order to grow the business.

My Appointment Brief As Interim M.D.

1. Increase the turnover.
2. Increase profitability.
3. Prepare the company for investment.
4. Formulate ‘Mission Specific’ strategic business alliances.
5. Free up the owners time in order for him to focus on other business activities.

My Action Plan:

1. Complete & immediate immersion in every aspect of the business to identify ‘The Way Forward Strategy.’
2. Conduct a forensic investigation into monthly expenditure & implement immediate substantial cost savings.
3. Completely re-structure the company from a small business to a medium size enterprise.
4. Prepare the company for change and manage every step of the change very carefully to ensure success.
5. Fire all inherited underperforming and/or unqualified consultants, i.e. marketing, PR & business to business, etc.
6. Outsource immediate business consultancy to identify additional revenue generation schemes.
7. Hire the right kind of management personnel who brought added value to the company. i.e. Former bank manager as full time finance manager. Former Area Director of a PLC construction company. Senior Estimator from a large UK construction company.
8. Address nonexistent quality assurance issues.
9. Obtain various business development financial grant subsidies.
10. Prepare the business for investment.

2nd Phase of plan.

After 12 weeks as Interim M.D. the shareholders recognised the value in what I had brought to the company. The owner and former MD realised his company were on track for growing beyond the tipping point. I was asked to join the company as their Business Development Director to continue managing the growth & expansion of the company. I anticipated a 12 month contract.

The First Year Results.

1. Increased core business turnover from £1.6 to £2.4M.
2. Formulated a new secondary revenue generating E-commerce business, which blasted every month’s financial target out of the water. Business was quickly developed from a conceptual idea to generate extremely high turnover of £2.5M per annum.
3. Positioned the company to win major PLC contracts. Signed a 3 –year preferred partnership deal with a PLC which guaranteed a minimum of £2.5M over a 3 year period commencing May 2008. This created long term income stability.
4. Increased work force from 20 to 55 in 12 months.
5. Positioned company for a £5M annual turnover in 2009.
6. Awarded best plumbing & heating company 2007.
7. Awarded Investors in People & ISO9001.
8. Achieved all 5 elements of my business brief.

The Key Lessons.

1. Industry standardised structures, i.e. pyramid, matrix, divisional etc are not always suitable for every company.
2. Opening up a clear & concise communication chain bridge between directors, managers, office & site personnel keeps everyone motivated & committed.
3. Delegate and monitor/control as much as possible to make staff responsible & involved, (motivated.) Feedback is essential.
4. Create shared objectives for senior managers & not individual objectives which could conflict with other manager’s objectives.
5. Conduct full and in-depth due diligence prior to hiring every outsourced consultant.
6. Don’t allow senior management’s ignorance of new technologies to inhibit growth from other revenue generation streams like E-commerce web based sales.

As I write this chapter (January 16th 2009,) UK based Lloyds TSB Bank announced that business confidence has hit a 16-year low. A survey of almost 3,500 companies by Lloyds TSB also revealed that expectations for profits are the worst on record as the UK heads for a full blown recession. The vast majority of businesses surveyed expect a drop in sales, orders and profits this year.

John Maltby, managing director of Lloyds TSB Commercial publicly stated that "British businesses have had a rough ride in recent months. With demand on a downward spiral, its small wonder that they are feeling pressure on their finances and that confidence is at such a low ebb. The cocktail of rising prices and falling demand is taking its toll on small businesses. It's only the fact that businesses have been careful not to overstretch themselves, as they did in the late 80s and early 90s, which is preventing even more firms from facing cash flow problems. “ Firms suffering from harsh trading conditions in recent months are being forced to make tough decisions in order to survive in 2009, said the report. A growing number of firms have been hit by a ‘dramatic’ fall in orders and sales, which took an inevitable toll on profits, the report said. The last 10 months have seen several major banks crash as well as hundreds of major companies being forced into administration. Major high street businesses like Woolworths, Waterford Glass and Wedgwood announced the loss of tens of thousands of jobs.

Icelandic bank Landsbanki has gone into receivership, and been taken over by that country’s financial services authority. The move does not mean that the bank has gone bust, but receivership protects it from having to pay its creditors. The London Scottish Bank - based in Manchester, oddly enough - has gone into Administration. The FSA intervened to stop the bank accepting deposits because the bank didn’t have the cash it needed to continue operating.

Experian, a research company that monitors retailers closely, calculates that 1,087 non-food retail businesses collapsed in the 12 months to the end of November, a 17 per cent increase on last year. Stalwart of the High Street, Woolworths, has gone into Administration. The 99 year old store is perhaps the biggest casualty so far in the economic downturn so far. Many will point out, however, that the store has been struggling for some time rather than this arising purely from the “credit crunch”.

Deloitte have been appointed as Administrators, and they will be trying to sell off the business, in full or in part. It is expected that stores will stay open and trading at least until the New Year, but beyond that, uncertainty hangs over the 800 branches and 30,000 employees. Children’s clothing retailer, Adams, is the latest high street store to go into Administration. The move comes after a secured creditor began proceedings against the 75-year old company. The firm employs 3,200 people in the UK and has 225 branches. High St music and entertainment chain, Zavvi, has gone into administration. The store was formed after a management buy-out of the Virgin Megastore chain and had 114 branches in the UK. It is thought that it was badly affected by the collapse of Woolworths as it used Woolies owned Entertainment UK as its main supplier.

Ernst & Young have been appointed as administrators and are planning to continue trading and to sell the business as a going concern. Whittard of Chelsea is reported to be on the brink of going into administration. The company - over 120 years old - is the latest retail chain to feel the effects of the credit crunch. It’s owned by an Icelandic investment company called Baugur which has had its credit lines severely strained. Furniture chain, The Pier, has gone into administration. The company, which has 31 branches, has reportedly suffered in the difficult trading conditions, and with the stagnant housing market, less people requiring furniture and furnishings.

Toy and stationery distributor, J A Magson, has gone into administration. The company has a nationwide profile and employs 200 staff. Difficult trading conditions are reported to have forced the move and Leonard Curtis have been appointed as administrators with the intention of selling the business as a going concern.

In the midst of this corporate doom and gloom culture that I entered Valatech Ltd a small IT computer sales company based in the North West of England. 10 months after joining Valatech the company posted the following memo to its employees.

1. Valatech Ltd is currently vying for the number 2 slot in the Merseyside County top 100 league of growth businesses 2008-2009.
2. Valatech’s turnover is on track for a 200% increase on our previous year.
3. Profits have increased.
4. Valatech strategic business growth plan projects a further 300% increase in annual turnover during 2009-2010.
5. Valatech Ltd is the UK’s largest e-tailer of computer & IT related products with over 200,000 products for sale. Visit our web site at www.pconestopshop.com
6. By July 2009 Valatech Ltd will become the UK’s largest e-tailer of security related products with over 200,000 products for sale. Visit our web site at www.asecurityonestopshop.com
7. The number of Valatech employees has quadrupled during the last 10 months.
8. Merseyside job centre indicates Valatech Ltd are one of a very few companies hiring new staff in the current economic downturn. What is it that determines a small company growing exponentially during a global credit crunch, when other long term well known UK business are failing? The answer is simple. I implemented The Art Of Business War into their business, and both director partners embraced the concept. While just about every other business battened down the hatches in an attempt to weather the credit crunch storm we adopted a very proactive and aggressive growth strategy.

General Patton once stated, “When in doubt, attack.” I like a plan based on simplicity and absolute clarity, so we attacked the market. One of the first things I noticed was there were very few competitors attacking the market with us, which was fantastic for Valatech. I conducted research and gathered business intelligence which highlighted gaps and weaknesses in the market. I introduced diversification, and identified new income generation revenue streams. We stormed the initial part of our growth plan faster than General Patton’s Third Army push through France and Germany. Read the following case study for more information.

About The Author:

Dr. Mark D. Yates is an entrepreneurial solution provider & corporate trouble shooter. He provides his unique Special Forces approach to International business management. He is active as a corporate trouble shooter, interim managing director and a business to business consultant who has provided his professional services to companies in 41 different countries. He specialises in business growth and expansion, formulating strategic business ventures and company turnarounds.

T: UK. 0151 343 0000
C: 07736 777553
E: drmarkdyates@aol.com

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Case Study 2:

Valatech Ltd - Information Technology Company

Profile Interim Business Development Director March 2009

A Special Forces Approach to Fast & Exponential Business Growth

The Assignment:A 16 week Interim Business Development Director position to implement a proactive business growth and expansion plan to increase annual turnover by 50% and increase profits. This assignment to be conducted at the beginning of the 2008 financial downturn labelled The Credit Crunch by the media.

Background Synopsis. 5 year old British business. Two directors, each retaining a 50% shareholding in the company. Company had grown organically during the previous 5 years but the annual turnover had remained the same. This company had reached the financial tipping point plateaued and was not experiencing any growth. Both shareholders work in the business. Number of full time employees at commencement of my contract in was 3 plus 1 part timer.

The Problem: Typical two person partnership run business managed by two very Information Technology product knowledgeable, hard working men who had no formal business academic skills. Although the company turnover had grown organically, it had reached a plateau and hit the ‘Tipping Point’ and was not making any real profit. Both company directors were particularly focussed ensuring their business maintained its current level of activity. They both maintained non-extravagant lifestyles and were extremely frugal.

They allocated themselves a weekly wage not far above minimum wage. Neither of the partners had ever received any shareholders dividends or bonuses. The company had no business plan in place. Both directors were very astute and they run the business by ‘flying from the seat of their pants’. As such the business was reactive rather than proactive and the predominant focus was to ensure the weekly wage bill, rent and running costs were met. Business development skills were non-existent other than the company maintained an excellent customer service relationship with their clients.

This in turn led to repeat & word of mouth business which fuelled the growth. The partners recognised their business academic skill limitations & were concerned & astute enough to seek outsourced business consultancy help. This identified the requirement of a skilled interim Business Development Director. It is worth noting that both partners had witnessed my business growth expertise first hand in another local business which they provided in-house IT consultancy to.

The Challenges.

• Extremely limited resources.
• A non supportive bank.
• No sales or marketing budget.
• Lack of staff, particularly business qualified support staff.
• No strategic business plan.
• Overcoming the director’s psyche of running a business just to pay minimum wages to directors & staff.
• Being frequently distracted and/or delayed by having to action menial tasks because support staff were unqualified.

Assisting any small partnership businesses is notoriously difficult. This was an exceptionally tough assignment as it required a ‘back to Ground Zero’ approach before I could begin to look at growth and expansion. It would also require ‘business change’ which is often fiercely resisted by existing small business partners.

Despite having no sales & marketing budget, no support staff, no sales team and no business growth expertise, the business did have one redeeming factor and that was the two individual business partner/directors. Both of these men were fantastic business visionaries who had plenty of fantastic business ideas for growth. They just didn’t have the tenacious leadership qualities or business savvy to exploit the ideas. It was a bonus to discover they were prepared to listen, especially to some of my ‘out of the box ideas.’ Despite neither of them having any military background they were also very receptive to my Special Forces Art Of Business War Strategies.

The Project: An Extremely Clear Mandate To Grow The Business. Despite never having made a decent profit, the Company was in reasonable shape and other than a small bank overdraft debt free. It had an enviable reputation for delivering a top quality service within the North West UK Information Technology industry. I recognised the early potential for controlled growth & expansion.

In a very short time scale, an in-depth analysis was undertaken of the organisation, finance, structure and sales & marketing. The intention was to prepare a strategic growth & expansion plan. The critical areas to e addressed were quickly identified by conducting an almost forensic investigation into the company’s Modus Operandi.

As a former trainer of global Special Forces personnel it was clear to me that I would have to de-train, and then re-train the management team to become Corporate Special Forces in order to grow the business.

My Appointment Brief As Interim Business Development Director was to

1. Increase the turnover.
2. Increase profitability.
3. Identify new income revenue generating streams & identify funding to assist in the growth of these new business areas.
4. Job creation.
5. Organise professional business training & arrange funding to pay for it.
6. Prepare the company for investment.
7. Formulate ‘Mission Specific’ strategic business alliances.
8. Train & mentor the two directors.

My Action Plan:

1. Complete & immediate immersion in every aspect of the business to identify ‘The Way Forward Strategy Plan.’
2. Conduct a forensic investigation into monthly sales purchases & negotiate substantial cost savings for bulk buying.
3. Completely re-structure the company from a small business to a medium size enterprise.
4. Prepare the company for change and manage every step of the change very carefully to ensure success.
5. Outsource immediate business consultancy to identify additional revenue generation schemes.
6. Hire proactive sales personnel with skills in E-commerce trading.
7. Address nonexistent quality assurance issues.
8. Obtain various business development financial grant subsidies.
9. Prepare the business for investment.

2nd Phase of plan.

I implemented a whiteboard chart of transparent and measurable key performance indicators. Most noticeably I designed a very proactive 3 year business growth plan. The primary focus was on achieving a first year 50% growth on annual turnover, 2nd year 100% growth & 3rd year a further 100% growth, with an in-line increase in profits. When I unveiled the plan with its monthly projections, the partner’s bank manager indicated it was an overly optimistic growth plan which could never be achieved and would fail especially as we were at that stage in the middle of a recession.

I voiced my opinion that I had every intention of not only achieving the growth, but of blowing the 50% growth figure out of the water. The bank manager looked at me as if I had three heads. I took his head shaking as an indication of someone who had heard this all before but had yet to personally witness anyone who had achieved it.

Given that implementing business change into any company is notoriously difficult. I also introduced frequent laser focussed directors meetings and a monthly staff meeting. After 16 weeks as Interim Business Development Director we blasted all four monthly projections and the partners recognised the added value which I brought to their company. They recognised that my business success was clear and apparent and that retaining me would really lead their business into exponential growth and long term sustainability.

It was clear the company were on track for growing beyond the tipping point. I was asked to remain with the company as their Business Development Director to continue managing the growth & expansion of the company. I anticipated a 12 month contract.

The First Year Results.

1. Increased core business turnover by over 250%.
2. The company went from nowhere to being placed as the number 1 growth business in the County of Merseyside’s top 100 growth companies.
3. Formulated the first new income generation e-commerce web site business which In 4 months of operation became the largest e-tailer of computer & information technology parts & products in the UK with over 200,000 products for sale. Received matching funding for the development of this business.
4. Formulated the second new income generation e-commerce web site business which In 4 months of operation became the largest e-tailer of security parts & products in the UK with over 200,000 products for sale. Received matching funding for the development of this business.
5. Quadrupled the work force with industry specific specialists.
6. Achieved all 5 elements of my business brief.
7. Sourced external financial investment for business growth, job creation & long term business sustainability.

The Key Lessons.

1. Money is not everything, but it’s right up there with oxygen. If you haven’t got any your first priority is to find some.
2. Be audacious, nothing in business is impossible providing you use audacity.
3. Praise is more valuable than blame.
4. Attack the impossible business opportunities, as the impossible places are usually the least defended.
5. Conventional business strategies are not always suitable for every company. Controlled & creative risk taking is essential to success in any business with the stakes worth the winning.
6. Opening up a clear & concise communication chain bridge between directors, managers, shop floor workers keeps everyone motivated & committed.
7. Delegate and monitor/control as much as possible to make staff responsible & involved, (motivated.) Feedback is essential.
8. Create shared objectives for senior managers & not individual objectives which could conflict with other manager’s objectives.
9. Don’t allow senior managements ignorance of business growth to inhibit growth from other revenue generation streams.

Footnote:

Much of the rapid but sustainable success at this information technology company was achieved because the 2 partner/directors embraced my Art of Business War Strategies. They were great listeners and when presented with detailed business intelligence were able act decisively. Without doubt I enjoyed every single day working with these two partners, in fact I would comfortably state they are two of the finest business owners it has been my pleasure to work with.

About The Author:

Dr. Mark D. Yates is an entrepreneurial solution provider & corporate trouble shooter. He provides his unique Special Forces approach to International business management. He is active as a corporate trouble shooter, interim managing director and a business to business consultant who has provided his professional services to companies in 41 different countries. He specialises in business growth and expansion, formulating strategic business ventures and company turnarounds.

T: UK. 0151 343 0000
C: 07736 777553
E: drmarkdyates@aol.com

Case Study 3:

E-Commerce Web Site.

Achieving Exponential Financial Growth From A Bespoke E-Commerce Web Site

By Mark D. Yates, Business Development DirectorFeb 1st 2008

The following is a synopsis of a live business case study conducted during 2007-2008.

In June 2007 I was approached by the MD of the company I was contracted to. He and a salesman friend had a conceptual idea for a secondary income generation stream from their business. They had no idea how to develop the concept. The idea was to try and create an e-commerce web site selling products nationally via the internet. It is worth noting that it was not even a well thought out idea. Other than being able to type and send an e-mail, neither of these two gentlemen were skilled in any IT or internet sales.

I was tasked with the following:

1. Conducting a feasibility study.
2. Providing the project management skills.
3. Organising due diligence.
4. Attending IT & E-commerce training seminars.
5. Researching & identifying suitable expert partners who could provide the technical expertise.
6. Providing proof of concept.
7. Identifying financial grant aid to kick start the new business.

It is also worth noting that as the idea was conceptual, and neither of the two business partners had any academic business skills; there was, and still is no formal business plan in place. I did however design a project management and business action plan for them. Initial research produced a motivational factor which was a little snippet of business intelligence from two competitors. This intelligence identified the concept had scope if produced and managed professionally. The partners’ wildest dream was that the E-commerce site would generate £1M turnover in its first year of trading.

It took me three months of research, training & due diligence. I interviewed web design companies from across the UK, and also interviewed the largest search engine optimisation company in the country. The first thing I identified was that 99% of web design companies who say they provide E-commerce web sites ,are not skilled enough to create web sites specifically designed to generate exponential financial growth within a short period of time. Furthermore I recognised most of the web design companies I interviewed would seriously struggle to service high income generation e-commerce sites once they were up and running.

I identified that the project needed expert proven partners in E-commerce web design, search engine optimisation, key & ad’ word researchers, script writers, graphic designer, data input and sales staff.

Summary of Events:

1. I was first presented with ‘The Idea’ in June 2007.
2. I identified the project would cost approx’ £65k to 70k to take it up to pre-launch status. This included salaries & expenses for two full time staff and one to two data input clerks. It also included furnishing a three person office.
3. The Search Engine Optimisation Company provided me with statistical cash generation forecasts for different levels of monthly spend.
4. The partners agreed to invest £35k each for the project, i.e. £70k to take it up to pre-launch status.
5. I organised a business grant for 40% of the initial start up costs. The actual initial cost to pre-launch was £48.000.
6. A further monthly management consultation fee & Search Engine Optimisation fee of between £2.500 to £10.000 would be required to generate exponential sales.
7. Although the web site was not complete, a business decision was made to green light the site & start revenue generation in late September - October 2007.
8. We commenced with a monthly spend of £2.500. This was quickly ramped up to £10.000 per month.
9. Sales targets were smashed every month to date. Sept – October 2007 - £141.500 sales. November 2007 - £185.300 sales. December 2007 -£99.300 sales. January 2008 - £215.800 sales. This is a monthly average of £183.400 in sales from a standing start. Sales will increase as the company experiences natural organic growth through Google search engine placement
10. Targets have been revised to accommodate an annual turn-over of approx’ £2.5M and the site is still not complete.
11. 3 new full time office staff service the business with some outsourced management consultancy.
12. January 3rd 2008, a former investment fund manager was recruited to deal with the sheer volume of financial documentation generated by sales orders. After three weeks of analysing the financial data, he advised me that this new business was an amazing cash rich business.

Immediate benefits:

1. Immediate cash generation from launch date.
2. Fantastic profit margins.
3. Cash rich from advance payments.
4. Income generation while the directors sleep.
5. Hundreds then thousands of new clients which we could never have sourced through conventional marketing.
6. Fantastic word of mouth referrals.
7. Product discount rebates for selling high volumes of products.
8. Back end sales.

Most Valuable lesson learned: Despite the core business being established for many years, this new E-commerce sales site quickly overtook our core business in terms of monthly turnover in just four months of trading. If you are looking for exponential sales growth in a short to medium time frame, then don’t procrastinate, and don’t hesitate because you have limited computer and/or e-commerce skills.

Once the professional team is in situ everything else runs like a conventional business. This is a proven concept for generating high revenue streams from the Internet.There is a precise science behind developing and managing a high income generation e-commerce web site. I fully project managed this development from conceptual idea to launch date. I’d be happy to offer the same service to Albion on a consultancy business.

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About The Author:

Dr. Mark D. Yates is an entrepreneurial solution provider & corporate trouble shooter. He provides his unique Special Forces approach to International business management. He is active as a corporate trouble shooter, interim managing director and a business to business consultant who has provided his professional services to companies in 41 different countries. He specialises in business growth and expansion, formulating strategic business ventures and company turnarounds.

T: UK. 0151 343 0000
C: 07736 777553
E: drmarkdyates@aol.com