Friday, October 26, 2012

'Keep changing the rules'

If it did nothing else, yesterday's North Kildare Chamber Annual Conference fired up a geyser of optimism in the Killashee Hotel.

Against the background of the toughest financial situation faced by small and medium enterprises for decades, a stream of speakers talked up the opportunities possible, and how they might be accessed.

The key theme came early, with Hugh Cooney of Enterprise Ireland emphasising that 'successful businesses focus on innovation'. "Research and Development is essential for innovation," he urged. "And we need to continually innovate to compete globally." He said the upcoming innovation centre being established by Kerry Group in Naas should he 'held up high' as a model for industry in Ireland.

Enterprise Ireland is targeting 'mobile entrepreneurs' for investment, and also women in business. Opportunities in Sports, Communications and Financial Services are there, as there are in Agriculture, especially with the planned elimination of milk quotas. Noting that SMEs are the 'bread and butter' of Irish business and will be the major contributors to future growth, Cooney asked all present to become 'ambassadors for Irish business'.

Despite coming from a background of where he 'used to be' described as one of Ireland's most successful entrepreneurs, Brody Sweeney was sanguine about his 'riches to rags' experience, and expressed himself 'optimistic for the future of Irish business'.

He retailed the 'humiliating experience' of going around to landlords 'begging for lowered rents' for his chain of 350 O'Briens Sandwich outlets, before the business went into receivership. "I succeeded in negotiating down about a third of them, then I realised that the landlords were in just the same position as us, in hock at high prices to their banks, who in turn simply said it 'wasn't their problem'."

Always an entertaining storyteller, his subsequent up and down and up again attempts to get back in business were engaging. And frank. "It's no fun to have to acknowledge that you have failed, and you can be so crushed by the situation that you can make terrible decisions. After the receivership I was beaten up, didn't want to ever start another business."

But he did. Because like anyone else in business, he has a family to feed. Sweeney currently has a chain of four-becoming-six 'Camile' Thai takeaway food outlets in Dublin, catering for the internet generation 'who want food delivered to their laptops' instead of cooking for themselves. "And we're opening in London soon," he revealed, raising echoes of his previous global enterprise.

The former O'Briens emperor detailed what he had learned as the three key attributes of a successful business person. One, they take personal responsibility for the enterprise, its successes and failures. Two, they are prepared to do whatever it takes to make it work. And three, successful people have a plan. But even with all that in place, there are still no guarantees. "We're on a journey, and none of us know what the future brings. But one thing is sure, today is not the destination."

For Irish businesses not exporting, there's a 'very bleak' home retail market, John Whelan of the Irish Exporters Association warned those at the Conference. Noting that the country needed a lot more exporters, he outlined areas of opportunity in Transport, Tourism, Insurance, Back Office, and Financial Services. "Computer Services is our biggest services export, and the easiest to get into. Business services is also very big." Ireland also has successes in the food and drink industry, especially in recently-emerging big markets. "Russia, for instance, is the second largest market for Jameson whiskey, after the US."

Whelan said that Africa was becoming a very big consumer area, and many countries like China were moving in there to pick up the business. "We have a strong record in providing aid to the region, but we need to get smarter about opening up the business opportunities." He had blunt advice, though, for small businesses trying to access big new overseas markets. "Don't try and do it alone. Use a strategic partner already in the market. There's less cost, and much less risk."

How to break out of the natural human habit of doing the same thing all the time was the focus of Dave Cagney from Pfizer in Newbridge. "It's like a river following the shape of the land. Eventually it forms a gorge in our lives, and we're rooted into it."

His recipe for getting people thinking innovatively includes having them juggle balls at meetings. "Fun around the table helps people think creatively. Innovation requires using both sides of the brain. You can form a habit of doing things differently and get new things."

In a rapid-fire but fascinating presentation, Google's Cera Ward left participants in no doubt that consumer habits have changed and are continuing to change, because of the internet. The headline figure was sobering. Of €4bn spent by Irish consumers through the internet last year, €3bn left the country. "There's a big prize to be won," she said. "Two out of three people use a search engine before buying. You have to have a strong web presence, or people will buy from your competitor." In particular, businesses increasingly need to have a mobile version of their website, as the smartphone is becoming a major part of the consumer's pre-buy investigations. "Depending on product, between 10-20 percent of searches are now being conducted on mobile devices."

And with more than half of all retail sales expected to be done online by the end of 2014, there's both danger and opportunity. The opportunity can be grasped in a number of ways, the most important of which is to know what's happening by regular analysing of visitor patterns to a website. "Customer journeys on the internet are complex, clicking from site to site before converting to a defined search and purchase. The data can inform your marketing, your sales team."

Emphasising the small size of the home market, Ward gave examples of 'kitchen table' businesses which had grown substantial export markets. "Look at what you do as a global opportunity on the internet, and it can be huge." And her rules for success? Well, they're not really static enough to write down. "Never stop innovating, keep changing the rules, don't get left behind."

The absence of rules and regulations around 'The Gathering Ireland 2013' was also emphasised by Andrew Cowan, representing that Government initiative. "It's up to the steering groups around the country to do it themselves," he told the delegates, noting that there were already more than 850 'Gathering' events pledged around the country, with 4,600-plus ideas generated. And he had good news, of new grant money being available to local authorities and steering groups, ranging from €500-€2,500 per event. There are business opportunities attached to the Gathering, which is targeting four markets with strong Irish connections: the US, Canada, Britain and Australia.

"This isn't a new idea," he added, noting that the globally successful Rose of Tralee festival had been inaugurated with just the same thing in mind in 1959, when local businessmen with a budget of £750 put the concept in place. For 2013, the national 'event' will involve digital 'crowd-sourcing' and social media, as well as schoolchildren writing letters of invitation over the Scoilnet network. But it all comes down to one simple thought. Make the phone call. Ask the relatives, 'will ye come back for a visit?'. Like any sale, it won't happen if you don't lift the phone.

Eirgrid was the keynote sponsor of the Conference, and that company's John Lowry noted that the concept of the 'Smart Grid' in electricity transmission offered opportunities for innovative businesses with ideas to improve efficiencies in the technologies used. "We have just announced a 'Smart Grid Innovation Hub' to help entrepreneurs bring such ideas to fruition."

High quality and reliable electricity is key to attracting big businesses to the country, he noted, citing Intel as one such, which used as much power on its own as does the city of Galway. But the investment in energy for such companies must be made now. "We have to be ready for them when the economy turns."

Lowry surprised most delegates when he revealed that innovation to date has resulted in Ireland now being in a position to provide half of its energy needs by alternative and sustainable means. A 75 percent ability is envisaged by 2020. The opportunities for Irish SMEs are in generating, transmission, logistics, smart vehicles, and smart industry.

The final speaker, Gary Keegan of the Irish Institute of Sport, provided a fascinating insight into innovation by changing the mindset of a group or organisation. Drawing on his experience as the High Performance Director of the Irish Amateur Boxing Association, he punched home the importance of process in achieving performance. And he saw direct parallels in the mindset required to achieve in sport and achievement in business.

"Before Beijing, we had had a 16 year drought of medals in Olympic boxing. In the period before the programme started, we had won two medals at world level. In the same period after it, we won 52. We started with a group of ordinary people, and found extraordinary things within ourselves."

The process began with a 'hard look' at the situation in Irish boxing. It meant getting down to person level, and was challenging. "We found that we weren't fit for purpose." The keys to improvement included everyone in the team, boxers, coaches, physios, all 'visualising' themselves to be world class, standing on a podium.

"A critical success factor is to identify what you can control, and then control the hell out of it," Keegan noted, adding that working on strengths and nurturing character were key elements in the strategy. He detailed how the programme concentrated on turning values into behaviour, and getting across the fact that 'nobody is bigger than the system', including the management. "Behaviour that generates high performance has to be maintained from the top down."

His bottom line was that exceptional results are best achieved by focusing on performance, controlling the environment to promote challenge, and that the required high performance has to be defined.

Opening the Conference earlier, North Kildare Chamber President Eilis Quinlan had questioned whether the Government had been strong enough in dealing with the issues which have had the country in recession for five years, and seen personal incomes and business revenues 'fall off a cliff'. "We must ensure that Government knows that Kildare is a place to do business, and we all have to work together to succeed," she said.

Which made it all the more a pity that one of the Government TDs, present before the start of the event, had to leave very early to attend some Dail business. There was so much that could have been brought back to that same Dail if he had been able to wait. The positive vibes alone could have taken another half percent off our bond interest costs.

And besides, geysers of optimism can't be sustained unless there's an underlying and consistent pressure of encouragement. Which many of those attending weren't confident is coming from Government.