Author: Ed Reid, The Alternative Board UK
Many business owners of big businesses believe they don’t need business support. They believe they are too big to fail – which all too often starts with the idea that they are too big to learn anything new. Recent years have seen the administrators called in to once sound businesses: Carillion, Toys-R-Us and Maplin.
Why do big businesses fail?
Carillon’s collapse would have had a big impact on up to 30,000 SMEs. We’ve also seen Toys-R-Us and Maplin close the doors and – especially in the case of the now renamed Toys-Were-Us – it seems that arrogance and complacency and a ‘too big to fail/nothing to learn’ attitude were largely to blame.
I often use the question ‘why not?’ on my blog, referencing the well-known quote from Robert Kennedy: “There are those that look at things the way they are and ask ‘why?’ I dream of things that never were and ask, ‘why not?’”
But in business today ‘why not’ – to borrow from SWOT – isn’t just about strengths and opportunities, it’s also about weaknesses and threats.
Could this business start-up I’ve just read about disrupt our industry so much that our whole business model is outdated? Why not?
Could our customers decide that sitting in a traffic jam for thirty minutes to drag children round a toy warehouse isn’t how they want to spend a Sunday morning? Why not?
Today you have to think the previously unthinkable. Not doing that and believing your business model is inviolate – and Toys-R-Us seems to have been the perfect example – is to signpost your own downfall.
With the company having closed its doors there are plenty of anecdotal stories – from former employees and executives – emerging about the decline of Toys-R-Us. Was it simply competition from Amazon? Or did it go deeper than that?
Of course having Amazon as an alternative didn’t help. But all the stories point to Toys-R-Us seeing themselves as ‘king of the toy jungle’ and simply not giving their competitors enough respect. Add in a failure to lock-in the loyalty of their customers, a determination to open new stores whatever the cost and tales of wholesale fall-outs with their suppliers and the story only had one possible ending.
Right now the directors of every failing company seem to have an instant explanation. ‘Picking the low hanging fruit’ might well mean reaching for the most easily available excuse. Competition from Amazon – uncertainty caused by Brexit – fall in the value of the pound – and (my personal favourite) customers changed their shopping/buying/spending habits.
What no-one ever seems to say is that it was rank bad management. Customers and clients are always changing their shopping/buying/spending habits: with the greatest possible respect that’s why you get paid so much – to anticipate those changes and do something about it.
Why would big businesses benefit from business support?
It is my privilege to work with some very talented and very successful people: that includes members of TAB boards up and down the UK, and franchisees both here and overseas. Without exception they have one thing in common: they know that they don’t know everything. They’re willing to learn and they’re willing to listen. They accept that ‘why not’ could overtake their business – as it can overtake any business today.
You are never too big to learn and – bluntly – you are never too big to sit round the table with other business owners at an advisory board. If we’d had a director of Toys-R-Us as a member then very quickly – in his first meeting would be my guess – someone would have said, “You know, last Christmas, we bought all the kids’ present on this thing called the internet. From a site called Amazon. Took half an hour, delivered them the next day…”
The loyalty of your customers, not opening stores for the sake of opening stores and working with your suppliers might well have been mentioned as well…
If you’re a big business looking for some extra business support, TAB has worked with thousands of businesses of every size to improve owners’ profitability and personal lives. Find out more about our business support services.