Put all your eggs in one basket! | Issue #195
Why putting all your eggs in one basket is good for business growth
Has anyone ever told you it’s a bad idea to concentrate on a few big customers? It’s a line of thinking that we’ve heard before. Instead, this view suggests you should cast your net wide. A diverse spread of business is less risky with lower exposure.
That’s all well and good. But it’s not going to lead your business to rapid growth. We’re here to encourage you to take the risk. Be bold. In our experience, the thing that fast-growing companies have in common is client concentration. Putting all your eggs in one basket can be super helpful when you’re trying to scale quickly. Servicing a few, highly profitable organisations will put you on a rapid trajectory where the sky’s the limit.
If you have sluggish growth right now, it’s because there’s no revenue concentration. Your business is a disparate mix of lower-value customers with no mechanism to give you greater focus.
There’s no doubt it’s a hard egg to crack. But once you do, there will be no stopping your growth.
The Impact of Hybrid Work on Employees and Employers with Peter Cappelli
What does the future of your office look like? Are all of your employees back to work yet? Or do you have a hybrid approach to working?
That’s the question today’s guest, Peter Cappelli, Professor of Management at Wharton School, and director of Wharton’s Centre for Human Resources, has been researching.
Why do we go to offices and what don’t we like about them? In the wake of the pandemic, our thoughts around offices have changed dramatically, with more employees than ever before keen to adopt a hybrid approach to work.
But having zero offices and fully remote staff simply doesn’t benefit employers (or employees), yet according to the Financial Times, the UK is one of the last countries where offices have returned to ‘normal’, so what gives?
In this latest episode of The Melting Pot, Peter shares his thoughts on AI, the decline in employee training, and why it’s so hard to hire in the current market.
Recommended Podcasts
Insight, wit and analysis as BBC correspondents, journalists and writers take a closer look at the stories behind the headlines. Presented by Kate Adie and Pascale Harter.
Recommended Articles
Using Fiction to Find Your Strategy
By force of habit, most executives tune down their imagination when strategizing. This is counterproductive, the authors argue. Instead, they offer an alternative: Design fiction. A design technique that immerses executives and employees deeply in various possible futures, it uses artifacts such as short movies, fictitious newspaper articles and imaginary commercials to generate transformation roadmaps. Rooted in the future but helping to act in the present, design fiction results in concrete actions taken to adjust companies’ visions, strategies, and activities to create a better future.
Will Your Competitive Advantage Work in Other Markets?
When expanding into new, international markets, many companies assume that their existing competitive advantages will transfer over seamlessly. But of course, a strategy that’s been successful in one market won’t necessarily work in another. Through a series of more than 100 in-depth interviews with executives at multinational companies, the author identifies three hurdles that companies often face when attempting to translate an existing strategy into a new market: differences in the local competitive landscape, differences in local customer preferences, and limited willingness or ability to adapt to meet those local demands.
Why the EBITDA multiple is useful…but incomplete
Even though an EBITDA multiple is foundational, it doesn’t tell the whole story. In fact, there are six big caveats to the EBITDA multiple, and each of these needs to be factored into the resulting valuation.
Recommended Reads
Doughnut Economics by Kate Raworth
Relentless financial crises. Extreme inequalities in wealth. Remorseless pressure on the environment. Anyone can see that our economic system is broken. But can it be fixed? In Doughnut Economics, Oxford academic Kate Raworth identifies the seven critical ways in which mainstream economics has led us astray – from selling us the myth of ‘rational economic man’ to obsessing over growth at all costs – and offers instead an alternative roadmap for bringing humanity into a sweet spot that meets the needs of all within the means of the planet. Ambitious, radical and provocative, she offers a new cutting-edge economic model fit for the challenges of the 21st century.
Elite Sales Strategies by Anthony Iannarino
In Elite Sales Strategies, expert sales leader Anthony Iannarino offers his philosophy about becoming a commercial success. This guidebook suggests putting yourself in a “one-up” position, where you, as the salesperson, come to a client in a position of authority and strength, where you yourself are qualified to offer nuanced and helpful advice to companies that have put themselves in a “one-down” position, whether that be by bad decision-making, poor understanding of the marketplace, or bad luck. At its heart, this book suggests you find the advantages that you can provide that will, in turn, help your client become “one-up” themselves in their own field and ensure they achieve the better results they need.
News from the farm
The Melting Pot Live with Hermann Simon: Defeating Inflation
Has inflation stalled your growth or put you on a path to not achieving your annual OKRs?
Then you don’t want to miss The Melting Pot Live with Hermann Simon, founder and Honorary Chairman of Simon-Kucher & Partners, and expert in strategy, marketing and pricing. Take this opportunity to learn from a member of the “Thinkers50 Hall of Fame” of the most important management thinkers in the world.
Join us Tuesday, 28th June at 3 pm (GMT +1) for a LIVE episode of The Melting Pot to have all your questions answered!
MEANINGFUL ACTION FOR MONDAY
Don’t underestimate the negative impact of having the wrong people on the team
Often, I see leadership teams, transformed by the replacement or resignation of someone.
In the case of a client that came down to the farm this week, the replacement of even just one person has transformed the mood of the team, their appetite for risk, and the pace of change and growth. Take some time to think, does everybody on your leadership team have a positive attitude? Do they believe in your purpose and your BHAG? And if you’ve got people on your team that aren’t in sync with that, or are a bit negative or cynical, then you would absolutely transform organisation’s growth by getting a team full of people that share the purpose.
Upcoming events
CEO Bootcamp with Verne Harnish and Dominic Monkhouse – 12th -15th September
Need help to scale? This September, you can get it from the Scaling Up author himself. Meet Verne Harnish and Dominic Monkhouse at the FIRST ‘Scaling Up’ Bootcamp in the UK. A reinvigorating 4-day boot camp for CEOs and their #2’s to work closely with Verne and find the answers to those questions and uncover those opportunities you’re overlooking, which will truly help you move the needle in your business.
Join Verne and Dominic at Lucknam Park Hotel & Spa, near Bath (UK).
Quote of the week
“We’re not competitor obsessed, we’re customer obsessed.”
Steve Jobs
Dominic Monkhouse
Dominic offers business coaching and management development, strategy planning and organisational change, using tried and tested methods to launch your organisation onto an unparalleled growth trajectory. His programme is a function of his broad experience, his deep expertise and a proven process used by over 2,700 firms worldwide.