Monthly Archives: September 2011

Why Business is like Football

For our US readers, we actually mean soccer, the national sport of the UK. We think running a  business is much like running a football club. So, if you think like a football manager can you get better results:

1. The whole team is important. The striker or your top salesman gets all the plaudits, but can he score or sign that big deal without the rest of the team? Dont underestimate any position. No function or position is unimportant, don’t let the star player take all the glory. A right back is just as important as the centre forward, the warehouseman is as important as the salesman.Footballs

2. Let the Players Play. When Sir Alex sends the team out, there is not much he can do for the next 45 minutes. Are they fit? Are they well briefed? Are they confident? If so, let them play. Can you imagine stopping every few minutes and re-assessing the play? They would become confused and wait for the boss. The same happens at work, so train them and let them play.

3. You get bad results. Strategy and objectives are written down, and there is a general direction, to an agreed place. But, every now and again there will be a bad result, or a string of bad results. Dont let them distract you from the main objective.

4. Success requires real Teamwork. Go and sign Rooney for your Division 2 team. You will still win nothing. He will be frustrated and ineffective. You need a team, of not exactly equals, but complementary players. Players that can operate at a similar level, and inspire each other to play better.

5. Half time IS the time to re-evaluate. It used to amuse me that companies write a 3 year or 5 year plan every year. Was the strategy so wrong last year that we rewrite it? But, despite a game plan, and an objective, you can not predict the oppositions every move, so there will be a time for re-adjustment. Half time in football, every quarter in business.

6. Set targets. The best football teams have clear targets. We will qualify for Europe, or top ten finish. then they work out a plan. They estimate the points won for each game, and measure against that plan. Same in business. MAke sure you set the targets.

7. You never have enough money. Never. No matter who you are in football or business, there is always that extra player you need, or the new sales team, or the new product. Live with it. Everyone else you are in competition with has the same problem.

8. Know the opposition. Study their best plays, and keep an eye on their plans. what are they good at, and not so good. Where are their weaknesses. then attack them, and defend against their strengths.

9. Be more focussed on what you are doing than the opposition. So, follow number eight, but don’t be obsessed. If a football team thinks only about stopping the opposition, it becomes negative, fans desert the team, and players become dissatisfied. Same with business, good players want to win on their own terms.

10. The next game is the most important. Dont let setbacks upset the plan. Brush yourself down and get on with winning the next match.

I am sure there are plenty of others, feel free to add your own reasons why managing a business is like managing a football team. We manage several here, from selling Giant Jenga to Footballs, and at times we have bad results, like the  weather in June and July, and sometimes need a new striker, but its never dull.

Why is the Euro so strong?

We make our Climbing Frames with timber from the Ardennes in Belgium. Of course we pay in Euros, so the exchange rate is critical to the profitability of our Climbing Frame business.

When we first started it was 2007 and we paid at an average of 1.49 Euros to £1. By 2010 it was 1.08 to £1. It recovered as we recovered and the Coalition made the city think they had things under control.Euro Collapse

For this year we budgeted Eur1.20 to £1, but for most of the year it has been stuck at 1.15. That is despite the Greeks, then the Portuguese then the Irish then the Greeks again, then the Italians, then the Greeks again, all making the City boys think that the Euro was in imminent danger. And today we hear that the Slovenian Government will fall, so we have new member of the ‘Troubled’ Group.

So, if the Euro is in such trouble, and it is only days until the French banks need to be recapitalised, and weeks until the inevitable collapse of the Euro, then why is it so stong?

Why is the Euro not back towards Eur1.4 to £1?

If it went down vs the Dollar and the Pound would it not help the Southern European states? Or would it hurt the Germans too much. To be honest, I do not fully understand what is sustaining the strength of the Euro, except perhaps that the Bank of England likes the weak pound, and more QE helps to keep it low.

A lower pound helps exports so could boost the economy. But it also boost inflation, and is not that also a big danger to us?

You know what? I am glad I am not in the Government or the BofE. Do they really understand what is happening, or what will happen next? I don’t think so, It seems to me that it’s a matter of hope for the best.

Also, having known now for some months that the economy was taking a new backward step, I think the government knows too at last. Listen carefully to Clegg and Cable. They are using lightly coded language but you being softened up for Q3 GDP going backwards. When they say that things are tough, and unexpectedly more difficult, they really do know now. I predict that Q3 will be -0.4%.