AN ARTICLE BY ALLAN LEIGHTON

Post by **TrueBlueTerrier** » 16 Nov 2008, 07:12

How your firm can make it through the downturn

Tough times such as these call for tough measures
Allan Leighton

http://business.timesonline.co.uk/tol/b ... 161795.ece

WE are all managing our businesses through times of unparalleled turbulence. We’ve got bubbles bursting simultaneously in property, equities, commodities, hedge funds and private equity.

Consumer confidence is plummeting, commodity prices are seesawing and it is becoming apparent that the emerging economies will not save the developed world. Meanwhile, businesses of all sizes are finding that price and value are to the fore and competition is getting fiercer.

We are living in a very different world now and we all need a plan to see our businesses through. Everyone running a company - small, medium or large – should be asking themselves what they are going to do over the next 18 months to get through this economic tsunami.

- Put your business through a cash marathon: cash has always been king – now it is more than king. If you have £1m in cash today it will buy you what £5m would have done a year ago. I call it the power of five. If you have cash, its power has gone up fivefold.

I’ve been putting my businesses through a cash marathon and I’ve been telling other businesses over the past six or seven weeks to go away and do this. They have been coming back to me and saying they found more cash in the business than they thought they would. You may be amazed at the results if you take these measures.

- Improve your productivity: finding productivity improvements is another way to create and save cash. Real productivity improvement is about finding out how to do more for less – not how to do more for the same.

Increasing scanning speeds at the tills in a shop is a good example. The job gets done faster and you are creating more time for the person at the till to get on with other things. That’s doing more for less.

Look at all the ways you and your staff spend their time and your money. Finding one big way to improve productivity by 10% is rare, but you can do that by looking round at a lot of small things. Ask your staff to suggest ways to improve productivity.

- Bargain hard: recognise that the world has changed. Say to yourself I’m not going to buy anything at the price I would have done a year ago. This is now a buyer’s market – whatever you are buying. Most manufacturers are in a very difficult position and time is on your side. Things will get cheaper. You should be looking for 20% off everything.

Make harder bargains with yourself, too, by raising your hurdle rates. Set yourself tougher targets when you invest in new equipment to shorten the return on investment. Can you find ways to get your money back in four years rather than five or six?

- Cut costs and waste: there’s a lot of waste in businesses, whether that’s wasted time, money, effort or energy. A good example is inventory. Most people keep too much of it. That’s cash you can free from your business. Focus on cutting back your inventory and look at every product line. Get rid of the ones that aren’t moving.

When times are good we all get fat and lazy. Have you looked at your energy use? Look at how you are paying your suppliers. How fast are you paying them? Can you improve the payment terms?

- Don’t fall prey to the dilution solution: if there are 10 things that make your business work, don’t make the mistake of thinking you should trim back slightly on all of them. Invest in the things that work and are productive and get rid of the things that are not.

That can apply to your people, too. Don’t just cut back on everyone’s hours. It’s harder for small firms to get rid of people because they are close to them, but this is a time to be tough. If you employ 10 people they will not all be equal. Sometimes you have to get rid of people to protect the business and the remaining jobs it creates.

We are in uncharted waters, but people who take this opportunity to tighten up their business will emerge from the down-turn with a competitive edge that will serve them well in the future.

Allan Leighton, who is best known for transforming Asda from a £500m company to one sold to Wal-Mart for £6.2 billion in 1999, sits on the board of nine companies, including Royal Mail, Selfridges and BSkyB. He recently published the bestselling business book On Leadership, and has appeared in The Times Power 100.

As part of a personal pledge to raise £1m for Breast Cancer Care, Leighton has invited Sir Stuart Rose (Marks & Spencer), Jacqueline Gold (Ann Summers) and Val Gooding (Bupa) for an evening of conversation and debate. The dinner event takes place at the London Intercontinental hotel, Park Lane, on November 27.

The speakers will share their stories of the challenges, successes and setbacks they’ve faced to get to where they are today. Single tickets cost £250 and tables of 10 cost £2,250. For more information visit breastcancercare.org.uk/ onleadership, call 020 7960 3554 or e-mail specialevents@breastcancercare.org.uk .

Stormproof · Post by **Stormproof** » 16 Nov 2008, 07:22

What a p***k! :lfo He's holding a debate for big firms on how to screw the workforce over even more. :lfo Its just a shame he has'nt lost all his money :lfo

nelson · Post by **nelson** » 16 Nov 2008, 08:05

That could have been written by a 10 year old. If that is his best then he needs help :lfo

norbert · Post by **norbert** » 16 Nov 2008, 08:11

k66yla wrote:What a p***k! :lfo He's holding a debate for big firms on how to screw the workforce over even more. :lfo Its just a shame he has'nt lost all his money :lfo

the bit about scanning faster was typical ASDA - what a f**king joke ? ! - this one was on the front of " The Church Times " once - all soft soap and self publicity - in reality the Emperor's New Clothes

How about stop being such a w***ker Al ? :lfo - save on Opticians' fees and having to pay to have your hairy palms waxed ,don't pay to go to your Seminars and don't read your articles in the Murdoch Papers like The Sun & The Times - never buy any of them - The Hillsborough 96 - sack your useless egomaniacal RM middle mangers with their mad-cap , money saving schemes and pathetic attempts at self - justification

a few self improvement tips :lfo - try looking up the following in a Dictionary , one - dimensional , vacuous , venal , cynical opportunist , spiv , sharp - suited conman , self obsessed , egotistical rubbish

axeman · Post by **axeman** » 16 Nov 2008, 09:49

Got to agree with you there norbert big 'al' is a total knob

oypostie · Post by **oypostie** » 16 Nov 2008, 12:19

Ask your staff to suggest ways to improve productivity.

Go on then Allan. Practice what you preach

dropbag_clone · Post by **dropbag_clone** » 16 Nov 2008, 13:23

- Improve your productivity: finding productivity improvements is another way to create and save cash. Real productivity improvement is about finding out how to do more for less – not how to do more for the same.

Why stop there....
REAL PRODUCTIVITY IMPROVEMENT IS ABOUT FINDING OUT HOW TO DO MORE FOR NOTHING!

Is it OK if I claim my bonus now?

Post by **rhino49** » 16 Nov 2008, 13:55

We have had religious, political and animal rights extremists - now it seems we have a "money at all costs" extremist to contend with. Treat him with the contempt he deserves - we are not living in the same world as him and his greedy ideals, the sooner he ends his association with OUR business the better for all - employees, managers and customers.

Allan Leighton has turned a reliable, soundly financed business whose profits supported other government services into a shambolic feudal monster that devours respect and loyalty and sh***s out despair and uncertainty about it's future. Go and play monopoly you prick - where you won't hurt the British public and it's servants and with a bit of luck you might end up in jail.

Night Tonic · Post by **Night Tonic** » 16 Nov 2008, 16:45

I guess big Al would say "Sticks and stones" as by your definition he has already screwed you over. Laying your head on Billy's bossom may make some feel comforted but not many believe in the so called powerful union now, and some have got more sense than to waste money on union fees.

Yahoorsur · Post by **Yahoorsur** » 16 Nov 2008, 16:49

gawd elp us,alan gives us proles the benefit of his wisdom and we are soooo ungrateful,we are not worthy of his insightfullness,his compassion and his god like abilities,he should take off to a far distant land where his undoubted messiah-like talents will transform the world into an eden like paradise

........What do you mean that he has f****d off to Canada?,I await the results of his sojurn with great interest

Post by **TrueBlueTerrier** » 16 Nov 2008, 17:09

I think sometimes people overplay the 5th columnist card a bit too much.

Post by **TrueBlueTerrier** » 16 Nov 2008, 17:11

Yahoorsur wrote:What do you mean that he has f****d off to Canada?,I await the results of his sojurn with great interest

Apparently Loblaw (the company he's running in Canada) are making a surprise turnaround. I predict a few years of massive profits followed by large deficits. A Yo-Yo system, where have we seen that before.

k979aaa · Post by **k979aaa** » 16 Nov 2008, 17:28

TrueBlueTerrier wrote:
Yahoorsur wrote:What do you mean that he has f****d off to Canada?,I await the results of his sojurn with great interest
Apparently Loblaw (the company he's running in Canada) are making a surprise turnaround. I predict a few years of massive profits followed by large deficits. A Yo-Yo system, where have we seen that before.

If he :lfo f**ks with the canadian's they will feed him too the bear's!. The bear's will not need feeding till christmas 2012!. :lfo :lfo :lfo :lfo :lfo :lfo See everything has a use even BIG AL. :lfo

Post by **rockytony67** » 16 Nov 2008, 18:41

Night Tonic wrote:I guess big Al would say "Sticks and stones" as by your definition he has already screwed you over. Laying your head on Billy's bossom may make some feel comforted but not many believe in the so called powerful union now, and some have got more sense than to waste money on union fees.

Calling him Billy now? your views on paying union fees would hold more weight if you didn't go around calling the GS a pie eater, then complaining that people who do make this site anarchic.

"I just pray that the pie eater doesn't tackle negotations as misinformed as many seem to be. Mail volume is what WE process - not what we handle, and it is down. Still, put your name down for the union negotiating team- you've nowt to lose." 2/4/08 Night Tonic

"Pre-pie days dvbuk55. Just imagine him inflated with a super-sized bicycle pump :)
Still, at least his pie bill is covered. Would hate to think of him as wasting away" 8/5/08 Night Tonic

"There was a time when CWU logos appeared in abundance on here. Following the modernisation agreement, Hayes became Mr 'pie eating' man etc so I'm never quite sure at times what RMC actually represents other than an anarchic knees-up." 23/10/08 Night Tonic

Hopefully most people have got more sense, and pay into there union(warts and all) then listen to an agent provocateur like yourself

Night Tonic · Post by **Night Tonic** » 16 Nov 2008, 19:20

Not ony have you money to burn but too much time on your hands, a description some would attribute to Crozier and Leighton. lol