John Leach – An interview with Carter Corson

16/03/2015

John Leach, Chief Executive, Winning Pitch, describes how it is always important for entrepreneurs to consider the emotional as well as financial costs to growth.

Click here to the article and more from Carter Corson

In your work you talk about “profitable, sustainable high growth”. What does sustainable refer to?

One of the key things around growth is that it all starts at the top. When we talk about high-growth businesses and organisations, what we’re referring to are those that can sustain 20% growth each year. This level of growth usually pivots around an individual who has a high degree of energy and wants to take the business to places where other entrepreneurs don’t want to go.

It begins with a mind-set driven by a genuine intention and ambition toward growth. There are many individuals who state that they want to grow but there’s a lack of genuine commitment. There are many people who talk about growth who are actually hallucinating rather than visioning.

Sustainable growth starts with genuine, sustainable intent that is actually followed through with strong execution. Sustainable intent translates into building the right team, working out the business model, financing it in a feasible and taking calculated risks.

There is a common misconception that entrepreneurs are nutcases who play the lottery with the family jewels. In fact, successful entrepreneurs are very much about assessing risk rather than taking risk. This gives them clarity in deciding what mitigating actions are required to avoid doing something calamitous.

When we talk about entrepreneurship, do you think that we sometimes over-focus on the individual? Can we lose sight of how while individuals may be the driving force behind a company, it takes a team to build it?

It does indeed start with the individual. The founders who grow their businesses into something quite special are the ones who have a high degree of self-awareness. However, it is important to think about the DNA of a great team, which I call the Thinkers, Doers, Sellers and Controllers. When you first set up, the founder is all of those things but they typically have a natural orientation to one or two of them. Successful entrepreneurs build a finely tuned engine that has an even mix of all four. Self-awareness is such an important part of the growth equation. You can’t do it all yourself – the minute you try to, you have a serious problem. You really need to build a team around you that is significantly better than you in lots of different areas.

Often, entrepreneurs can suffer from an imposture syndrome. They end up sitting in the board room thinking “everyone in here is smarter than me”. In reality, they have got themselves that far by being clever enough to have the right people around them. That is such an important part of the mix. .

In the UK there are 4.8 million businesses. There are only 36,000 that employ over 50 people. Why? Because it is so difficult. To grow beyond 50 you have to really be good at managing and building, which means recruiting while retaining the right talent. When they have 25 or more people, many entrepreneurs give up, sell up or they choose to downsize. Ultimately, sustaining profitable growth is a leadership challenge and this is a big problem for the UK plc. It comes back to the issue of recognising what skills needs to fit around the top table and who needs to sit in the right seat.

In a recent report, the problem of ‘leadership capability’ was cited as the second most important reason for the failure of UK businesses to scale up…

Absolutely. What you do when you start-up on your kitchen table is very different to when you are running a business of 150+ people. You have to develop and change.

I explain it as the Mind-set Staircase. Your mind has to make various transactions across the staircase where you go from being a founder, to a social worker once you have more employees. Then you assume the role of a strategic manager once you have other layers in there that are dealing with the numerous aspects of managing a business. That is one of the main reasons people don’t grow. Entrepreneurs say “the more people I employ, the harder it gets”.

Again, finding the right talent to sit in the right seat is crucial. I am a non-exec on four fast-growing businesses. In each of these, the first challenge to address is the people/talent issue. Often we find we have the wrong people, so invariably we start to look at the team. In most instances it has grown and has a product and a market, but the team running it is not fit for purchase. In many instances, we work on team dynamics – getting the right people doing the right jobs while building a culture that is conducive to innovation and success. That is one of the hardest things to do in business.

For entrepreneurs, what do you see as the emotional costs to growth?

Growth is more than just a series of spreadsheets showing financial projections. There are a lot of decisions that need to be made that impact on people around the entrepreneurial team – family, kids, wives and husbands. When making an executive decision, very often there is a difficult conversation going on back at home: “I need £200,000. I am going to re-mortgage the house.” “What does that mean for us?”

These are emotional decisions and they start to weigh heavy. There is often not only a financial cost to growth, but very often there is a medical cost. I see so many health-related complaints with ambitious people – anxiety, high blood pressure and ulcers. We never read about this but within my own networks, I see the impact that running a business actually has. It ends up running your life. This means you have to be mentally resilient, being capable of switching off and or to cope with uncertainty. Because we are British, we don’t talk about these things.


Spinouts – Scaling Up

26/01/2015

This blog was written for Spinouts UK Quarterly Journal 2015. You can join their distribution list by emailing research@ycf.co.uk

Most spinout companies from universities have the ambition to be companies of scale. If they are to win significant investment at an early stage, they will need to demonstrate that they have a ‘road map’ to enable them to establish a strong position in their chosen market.

However, this ‘road map’ passes through different stages, each of which places different demands on the company founders. Initially, the spinout founders will be immensely relieved to have completed the spinout process itself, with the knotty issues of IP ownership, and the relationship of the academic founders with the university. The next stage is generally one of spending (on prototypes, clinical trials, and other proofs of technology) rather than selling. As a very broad generalisation, academics in spinout companies are more comfortable with the ongoing research and development (which is in many ways similar to their academic work) than in market analysis, recruitment and team building, or the management of premises, financial records, and all the other administrative tasks which are essential to get a startup company on its feet.

The next stage is growth. For all young companies, whether spinouts or not, there are natural barriers to growth. Winning Pitch identifies the most important of these as the emotional cost and the financial cost.

The emotional cost to the individuals involved is usually manifested in self imposed pressure, and in the uncertainty that demands resilience and mental toughness to keep going when the inevitable road blocks are presented.

A scale up company is defined as one that grows its employee or turnover at a rate of 20 per cent per annum over a three-year period, and the financial costs of doing this can rack up very quickly – the cost of recruiting new talent, and of raising finance, professional fees, new premises, IT infrastructure and administrative costs can shoot through the roof. Costs must be controlled and the execution of a growth plan needs to be effectively choreographed – clear roles need to be defined, people need to be accountable for delivering on their tasks. Very rarely can growth be achieved without impacting on profitability.

This is why the majority of the 500,000 of last year’s new startups will never go on to employ one person never mind 10, and also why over 99% of UK firms employ fewer than 50 people. Very often it’s the financial cost of growth that holds individuals back.

What does this mean for academics spinning out a new company from a university?

The main point to recognise is that no one entrepreneur can build a business alone – it takes a team, combining the different skills needed to grow the business. The second point to recognise is that as the team grows, different leadership challenges emerge as the culture of the business evolves. At Winning Pitch we refer to the ‘growth staircase’, with different challenges as the number of staff increases. When the company reaches 7-12 people, the entrepreneur has become an ‘entrepreneurial social worker’. At 25 or more people, the business culture becomes ‘the team vs. the mob’. With 50 or more staff, the business needs to evolve towards a corporate culture, where processes need to be standardised and continually improved, with less scope for individual innovation. Individuals who can take a company through all these stages are rare indeed, and academic entrepreneurs do well to realise that at some stage in the company’s development, the business will be best served if the reins are handed over to others with practical experience of running a large and growing company.


Interview with Avensure HR

30/10/2014

I recently did an interview with Avensure HR for their new website HR24. I thought I would share it, so you can either follow this link or read the Q and A below: http://avensure.com/hr24/industry-news/john-leach-interview/

1. Tell us about a usual working day?

The day starts at 6am with a 3 mile walk over the Lancashire Moors with my black Labrador Buddy. This gives me time to think about the day and what I am going to do. Work is based on the ethos of 20% thinking and reviewing, 80% just doing. I am usually at my desk for 7.30am following up on emails and arranging appointments with customers, partners, associates and individuals/organisations who can add value to the WP offer. I am constantly in search of the next big idea and that involves quite a bit of experimentation. The day usually ends at around 7.00pm with a 45min walk with the dog, which gives me time to reflect and think about tomorrow. After dinner (8.30pm ish), I will then spend at least another hour or two researching and following up emails from the day. I don’t differentiate between work and play as work is my life, my hobby and I just love the buzz of moving things forward. Bed at around mid night!

2. What’s Winning Pitch’s proudest achievement?

Winning a £10M contract when we where only 2 years old as a business. A great motivator for me is when people tell me something can’t be done. I usually respond with the comment – “ I will show and prove to you that it can”

3. How many employees work for Winning Pitch?

We currently employ 120 people. I guess within the next 12 months we will be moving towards 200

4. Are the majority home or office-based?

We operate through offices in Salford Quays, Liverpool, Gateshead, Leeds, Cardiff and soon London. All staff are office based but the nature of the work means that they spend a large proportion of their time on the road.

5. How do you keep employees engaged?

This involves a mix of things ranging from monthly internal bulletins with updates on what’s going on through to staff communication days twice a year, a big Christmas Party, team leader dissemination sessions and a policy of ‘the door is open and the phone always switched on’. Staff are encouraged to live by the ethos of ‘there is no such thing as a bad idea’ – this drives innovation and new thinking.

6. I think Robert Kiyosaki assessment that ‘when times are bad is when the real entrepreneurs emerge’ seems very true to what is happening here in Manchester. What are your thoughts?

Totally agree – been there myself. An ability to ride the tough times and maintain infrastructure and capability is vital. This means having something put away for a rainy day – sticking true to your purpose and vision is critical. Those entrepreneurs who come through the bad times emerge from the other end with lots of wisdom and in better shape. You learn how to run a tight ship and more importantly the lessons learnt create food for thought for the future. As Winston Churchill said “when you are going through hell, keep going”

7. In your experience, do entrepreneurs make good managers?

Entrepreneurs come in all shapes and sizes – what is vital for an entrepreneur is self awareness and knowing what you are good and bad at. What makes a great business is a good mix of “doers”, “sellers”, “thinkers” and “controllers”. I personally view myself as a thinker – I am certainly not a controller, but I know someone needs to do it.

Successful entrepreneurs in my experience are the ones who can build a multidisciplinary team. I would define that as good housekeeping without losing entrepreneurial flair.

So I guess the answer is some do and some don’t.

8. You’re an expert in helping businesses design growth solutions. How much emphasis do new companies put on HR strategies and people as key elements in their prospective growth?

Building a business is all about people. Staff first customers second. Many companies stall because the founder has failed to get the people systems and structures in place and as an organisation grows the HR strategy needs to get more and more sophisticated. Trying to build a business without the right HR foundations in place is like trying to build a tower block on sand.

9.  What are the common mistakes made by entrepreneurs?

There are so many where do you start? What is critical to success is having a clear vision, passion, innovative proposition, solid team, strong leadership, good governance, tight control on finances and cash, commitment to delivering great customer experiences backed up by a flawless reputation. The common mistakes I suppose are doing the opposite of the very things needed for success.

10. What makes you optimistic? 

Having a clear sense of purpose supported by clarity of personal and business intentions.


Sales: A profitable career

10/03/2014

The UK needs more sales professionals. It’s a core skill many of the successful business people and entrepreneurs I have met possess. They commit time, effort and energy learning how to sell, they train hard and learn how to build long lasting relationships and win-win outcomes with customers.

Those individuals who learn how to effectively sell will always have employment, they get the highest paid jobs and many often go on to set up their own business. They enjoy fulfilling careers and make a big difference to their employers.

The call centre and door to door commissioned sales, sales-rep provides the classic view of a career in selling – the reality is these can be both highly paid positions and they provide a grounding in the vital skill of having a great telephone or face to face conversation – essential to success and personal progression.

Train hard, learn, read and hone your sales skills – it will deliver a long lasting and profitable career.

We are supporting National Apprenticeship week. Find out more about The Winning Sales Academy >>>>

Get the right people sat in the right seat

19/02/2014

A highly effective team is built when a group of individuals are all playing to their own strengths. All too often the wrong person is doing the right job. In building a team we must strive to place people in the correct position allowing them to do what they do best. When there is a mismatch in a person’s skills and role under performance should not come as any surprise. Great care must be taken to ensure we don’t shoe horn people into situations and roles that don’t align with their capability. This will invariably lead to discontent and disconnection with the teams overall purpose. We should seek alignment between a person’s passion and their ability with the aims and objectives of the group. An important task for all leaders is to keep close to both the individual and team mindset. This is done by gaining insight into an individuals:

  • Personal and professional ambitions
  • What do they excel at?
  • What they don’t do too well?
  • What motivates them?
  • What turns them off?
  • Training and developing needs

We must be clear on what we want members of our team to do, this needs to then be articulated with clarity.

The reality is that whilst people maybe good at specific tasks they may fall short on others. Or maybe as the ambitions and aspiration of an organisation grows, those of an individual may change or their own priorities may shift. This can often result in a person either outgrowing a position or in ambitious environments people can’t keep up – the issue to address is whether to redeploy an individual or support them in gaining new skills and competencies. Successful people remain connected to the emotional, personal and professional needs of their team. By doing this become hard wired into individual and team dynamics – it also helps you to judge and decide on what if any changes are needed. Make sure you have the right people doing the right things, this will only happen when you stay close to individuals in your team.


Leaders must learn to coach

08/04/2013

One of the biggest challenges entrepreneurs of growing businesses face is that of building a high performing team. So often founders fail to trust the judgement of individuals they employ or they consider others not to be as capable as themselves (self-awareness is a very important leadership attribute and very often founders lack it!)

The reality is people and teams operate with maximum impact when they are held responsible and accountable for their actions. When individuals feel that they have ownership of a task then there is a greater likelihood of it being successfully delivered. Empowering others means that you must dedicate time and energy to coaching staff and team. The busy day can all too often lead to us neglecting the personal development and training needs of others, particularly those that we need on side.

As a leader you must create space for coaching members of the team, ensuring they have the skills and motivation to perform the tasks needed to successfully grow. In your coaching role you must support others to achieve their goals, remembering these must clearly align to your own mission (win-win). Some simple steps can be followed in coaching others to perform:

Focus  and define – all coaching starts with a conversation, however it is vital to home aim on specific areas that need to be addressed. Aim to define very clearly key skills that need to be developed.

Explore the options– when the discussions become focused, explore the options and possibilities for what needs to be achieved. Challenge preconceived ideas. Lead by asking questions – don’t give answers

Action planning – get the detail on the table and work out what actions need to be implemented going forward – agree goals and don’t forget to write them down. There must be no confusion on what needs to be achieved

Remove hurdles – people will often see barriers and reasons not to change. Often these challenges are in the mind and don’t really exist. You must try to help individuals remove these hurdles.

Agree next steps – agree what has been agreed – actions and deliverables by when! Set a date to review the previous session. Stick to it


Building a high growth business – The Essentials

15/11/2011

I was really honored to be asked to present the fast growing business award at last weeks North of England Excellence Dinner. The winner was 3P Logistics and at the end of the ceremonies I made a beeline for the winner, Ian Walker, I wanted to get his view on what it takes to build a high growth company. It was clear the moment Ian started talking he had a passion for his business that was off the scale – it created an instant engagement which meant you had to listen to what he had to say. The guts of his story provided a truly fascinating insight into the motivators for setting up and growing a business. As well as passion, courage and bravery feature high on the list of special qualities – leaving a highly paid job when you have dependants can be an extremely scary moment in life, this is what sorts out the true entrepreneurs from the dreamers. This takes an enourmous amount of guts – fear is what holds so many individuals back from taking the leap.

A few years down the line new dilemmas and challenges are presented to entrepreneurs like Ian.  They become most profound at the point when the company is providing a comfortable life style – the internal conversations usually goes something like this, do I take more risk and go for it again and build an even bigger business? However, so few are willing to subject themselves to the burdens and stresses that got them to the well deserved position of a regular salary and the associated benefits that come with being your own boss.

Well my advice for those who decide to continue going for growth is, find a mentor first, someone you trust, then together work out how you are going to do it – the following are what I refer to as “The Essentials” –

  • Become future focused and prepare a strategy and game plan which sets the course for the next three years
  • Understand the best ways of financing growth, one that balances personal risk, commercial gain and control (or loss of control)
  • Effective leadership is core to success. Building a team/organisational structure you can rely on to support the business transition is vital
  • Embed disciplined management systems to provide an effective barometer of commercial performance – the bigger you get the tighter the controls need to be
  • Ensure you have created a customer focused culture, one that delivers innovative product and service propositions carrying higher margins
  • Ensure you have a differentiated business model  – one that creates real competitive advantage to support domestic and possibly international growth
  • Condition your mindset to win and success.
  • Ensure you have the support of your partner and immediate family

Having trusted advisers and being part of a network of likeminded people becomes an important part of the journey it also helps to maintain your sanity.