Thursday 11 February 2010

Why the recession has been an entire red herring


All the recession has done is highlight the vulnerability of those businesses which would have gone bust anyway... This is the post that caused a stir over at BusinessZone

Here comes my tough love bit: businesses that go bust deserve to. Most of them run out of cash because their 'business model' (whatever one is!) is not sustainable. You don’t need a doctorate in business to figure that one out.

Yes, there was a change in circumstances. Yes, there was some bad luck. Yes, the toast landed butter-side down. But basically they ran out of cash. Here are the last four stories that were told to me. All very emotional and sad stories:
  • The demand for hotel rooms collapsed
  • The best customer went 'pop' taking you down
  • The bank decided it felt too vulnerable and wanted its money back
  • A bigger, better, cheaper competitor set up next door

The theme is consistently similar: "We didn't see it coming...", "no-one told us...", "we ran out of cash..."


There are no guarantees
All the recession has done is highlight the vulnerability of so many businesses. These were rocky businesses but their precarious position is disguised (or camouflaged) in a growing economy.


Healthy, unhealthy or simply not unwell
The opposite of a healthy person is an unhealthy person. But not being ill is not the same as being healthy. Loads of people are simply 'not unwell', just surviving. And so it is with businesses.


The opposite of a healthy business is an unhealthy business. But not being unhealthy is not the same as being healthy.


So how about your business? Is it:

a) Unwell?
b) Not unwell?
c) Positively healthy?

I suspect that there are many businesses out there that are simply "not unwell" – getting by and not being aware of just how tenuous the line between life and death is.

And, I'm sorry, but here comes some more tough love!


I am afraid that being "not unwell" is not good enough. You've heard the following before: There will be a shake-out in every industry. Only the fittest will survive. Too bloody right!


I am simply astounded at the sheer audacity of people who run average, mediocre, run-of-the-mill, me-too, look-alike businesses and seem to expect to make a living. They think they are owed a living because they work hard and are "in business".


Actually, the businesses that are doing well are simply doing the basics but they are doing them supremely well. And what do I mean by the basics?


Actually, I am not going to tell you.


If you don't know what the basics of running a business are then it is already too late. You are part of the "not unwell" and are about to join the living dead. The mere fact that you expect me to tell you what the basics are scares me to the core. How could you be in business and not know what the basics are? Ahhhh!


25 comments:

Bill Murphy (not) said...

Too right!

Christine S said...

The comments at the Businness Zone site are bizarre but not totally surprising when you consider that they come from a truly small business mindset.

The Craven approach is, on the whole, fair and reasonable. As I have heard you say, you "have been rich and poor and you know which one you prefer". The majority of your articles are "How to" or "What to do" articles which blow away most of their arguments. So maybe you are a bit smug or arrogant sometimes but I quite like that in a person.

If you weren't upsetting a few people then wouldn't be considered to be trying hard enough!

Ignore them - they are playing the "Poor Me" card without spending any time to reflect on what you are saying.

Chris

Karin H said...

Well Robert, I think your glad you got that of your chest! ;-)

Karin H

Marjory D said...

Not quite sure what the fuss is about. The businesszone commenters don't seem to make sense.

Your critics are not rational or consistent. They just look like Mr Angries wanting to moan at someon telling them how it is.

The Craven line is not of the tree-hugging variety but anyone seriously in business would be a lot more blunt about the realities of business.

Dennis Burn said...

The Robert Craven approach - tough love, devil's advocate etc - actually gets to to the heart of the debate.

Many poeple should not be running their own business. They do not have the skills, attitude etc to succeed. There is no shame in that.

It bugs me that everyone thinks that they deserve to run a successful business.

The stats talk for themselves and some business will fail at any time in the economic cycle. Or do we all want to be above average?

Sienna White said...

Mr Craven's views are tough to say the least. Having said that, his arguments showing how to survive are many and v convincing. So on balance he is OK.

Sienna

Julian T Rowe said...

Refreshingly direct and honest.

Having previously made all the mistakes RC highlights, I can say they are true.

The solution is equally true.

I suspect signing up fo RC's Business Club is a step in the right direction for management of all small and medium sized enterprises.

Marjory D said...

These are not the words of a smug self-satisfied Wally but of someone who has gone through all of this stuff. Talk to him for one minute and you will realise this. The reason his words create the reaction is because his words get too close to people. He hits them between the eyes and either you acknowledge this or fight it.

I am sure he is not too bothered if there is controversy over at Business Zone. After all he is the first to admit that he is not doing his job (making people think and challenging their assumptions) if he doesn't upset someone. You have to break eggs to make an omelette and so on.

Madge

Jim said...

Marjory/Madge

Robert's Poor Dennis article is the one they need to read. I think the link is
http://robert-craven.blogspot.com/2010/01/poor-dennis-story.html

Cheers

Jim

PS to those who haven't bothered, the Biz Zone comments are not too surprising. Mr Angry of Surbiton type stuff.

Jim said...

Here's some of those comments (unattributed) - handbags at dawn!!!:

- this "article" was completely devoid of any content of value or substance, just sound bites that anyone with any nouse could have come up with...
- The writer comes across as patronising and a smart alec. Unbelievable!...
- I am afraid I find your synopsis totally void of sincerity. It sounds like a load of codswallop spin in order to raise your profile and sell your self and the services you offer...
- Here is my "tough love" bit: Robert Craven, I find you an insult to all the unemployed people out there struggling to feed their families. And you wouldn't know what tough love was if it bit you on the butt...
- What a mean-spirit blog!
- I think you tried to list what you thought were the basics, realised you weren't really sure yourself, and bottled out of posting what might have been a useful list (might because maybe you don't really know either)...
- This is certainly an example of how not to blog...

Jim

Adrian J said...

Saw this on twitter and don't quite get this. Haven't bothered with looking at BusinessZone and don't think I will bother.

What is the fuss about? Someone delivers some home truths and off they go on one.

Can I suggest that we see more articles like this one which actually call a spade a spade. Even Mr Anonymous Jim from Business Link agrees.

More! More! More!
Bring on the Heavy Brigade!

Tom Doherty said...

Couldn't agree more! Say it like it is...

Jim said...

Adrian
Just trying to put a bit of balance into the debate. I know who I listen to and who my clients should listen to. Ironically this seems like it has back-fired on the BZone commentors. Their comments, in black and white, are their for all to see. As is Mr C's reputation. "Actions speak louder than words" - I have heard that somewhere before.
The rich tapestry that is the internet!
Jim

Sarah G said...

Today's Small Firms Summit (that I see you are talking at) is typical of the innitiatives that the Govnt needs to start listening to. The politicians are not in Small Business for the long game but for votes. Local lobbying will become more and more important. Stop whinging and take action! Or shut up -that's what I say.

Unknown said...

And that is pretty much what I said yesterday. A nice warm Burnley welcome and some good, honest discussion took place.

Good to see Business Link NW there happy to listen, talk, discuss and debate the way forward.

Robert

Jenny P said...

Please more posts like this. Part of the problem with the "Poor Me" brigade is their inability to take any kind of responsibility for what's happening to them. They lap up the freebies but fail to take the action required.

I suspect that Mr C's post is quite mild relative to what he could have said but then again he is always such a gentleman.

Jenny

Marjory D said...

Jenny - I agree.
Madge

Mark Humblestone said...

Maybe BL's role is to change attitudes of the 'poor me' brigade.
Mark

Charles L said...

Great post . Ignore the rest.

Chas

Peter E said...

Leave the whimps to their whimping.
Pete

Brad said...

Too bloody right.

Robert Craven said...

And that is pretty much what I said yesterday. A nice warm Burnley welcome and some good, honest discussion took place.

Good to see Business Link NW there happy to listen, talk, discuss and debate the way forward.

Robert

Tom Doherty said...

Couldn't agree more! Say it like it is...

Jim said...

Here's some of those comments (unattributed) - handbags at dawn!!!:

- this "article" was completely devoid of any content of value or substance, just sound bites that anyone with any nouse could have come up with...
- The writer comes across as patronising and a smart alec. Unbelievable!...
- I am afraid I find your synopsis totally void of sincerity. It sounds like a load of codswallop spin in order to raise your profile and sell your self and the services you offer...
- Here is my "tough love" bit: Robert Craven, I find you an insult to all the unemployed people out there struggling to feed their families. And you wouldn't know what tough love was if it bit you on the butt...
- What a mean-spirit blog!
- I think you tried to list what you thought were the basics, realised you weren't really sure yourself, and bottled out of posting what might have been a useful list (might because maybe you don't really know either)...
- This is certainly an example of how not to blog...

Jim

Adrian J said...

Saw this on twitter and don't quite get this. Haven't bothered with looking at BusinessZone and don't think I will bother.

What is the fuss about? Someone delivers some home truths and off they go on one.

Can I suggest that we see more articles like this one which actually call a spade a spade. Even Mr Anonymous Jim from Business Link agrees.

More! More! More!
Bring on the Heavy Brigade!