This newsletter is written for entrepreneurial leaders who want to learn about the moment we are living in but don’t have time to read broadly; who want to grasp the key themes; and who want to create better ways of advancing their mission. The Weekly Distillation covers a broad range of topics with the intent to curate the key narratives of the week, how they fit the broader themes of society and to pose questions that help you to think deeper on the application in your context. You can read more about the key themes I see here.
People once said………….
“I was Margaret Thatcher in the school election during the 1983 General Election.” - Liz Truss
“Restoring price stability will take some time and requires using our tools forcefully to bring demand and supply into better balance. Reducing inflation is likely to require a sustained period of below-trend growth. Moreover, there will very likely be some softening of labor market conditions. While higher interest rates, slower growth, and softer labor market conditions will bring down inflation, they will also bring some pain to households and businesses. These are the unfortunate costs of reducing inflation. But a failure to restore price stability would mean far greater pain.” - Fed Chair Jerome Powell
"The government is conducting a criminal investigation concerning the improper removal and storage of classified information in unauthorized spaces, as well as the unlawful concealment or removal of government records," - DoJ Affidavit
"Affidavit heavily redacted!!! ... WE GAVE THEM MUCH. Judge Bruce Reinhart should NEVER have allowed the Break-In of my home." "WITCH HUNT!!!" - Donald Trump
“The foundation of every state is the education of its youth.” - Diogenes
“My training was with some old British communists who had organized unions in the '60s and '70s. And their philosophy was, if you can't drink a pint with a man, how are you gonna get him to go on strike and risk his life?” - Boots Riley
“I have the simplest tastes. I am always satisfied with the best.” - Oscar Wilde
Skim it in a minute
Strike off the unions?
We thought those days had gone. Strikes galore. Workers downing tools (or keyboards) and going home not to return for a few days or weeks, dependent on how negotiations go. I’m trying to remember the strikes that have taken or are taking place - the binmen (trash collectors) in Edinburgh, the Royal Mail postal service, the train drivers and workers, the London Underground, the teachers and nursery workers in Glasgow and other parts of Scotland, the council workers in Edinburgh, the telecoms sector (BT), Airbus, Network Rail, Felixstowe Port, Cooperative Funeral Care, University of Dundee, Bus workers, Dock Workers in Liverpool, exam board AQA, Criminal Law Barristers - and potentially coming up is the Royal College of Nursing, various universities, the civil service, teachers, firemen, journalists, British Medical Association and on and on and on.
Here’s what would happen if I went on strike. I’d phone it in. Shortly afterwards I’d get emailed my P45 and be looking for a new job.
This is what happens when a union is in place and exercises its power. I never got the point of unions - until I worked for a very large corporate and understood how for some of the junior staff, having people who could collectively argue for your employment rights might protect you in a way that your employer never would.
But just for a minute, let’s go back to labour markets 101.
We live in a country where you can change jobs. It might not be fun, it might mean moving, it might cost money. But it is possible. If I don’t like a job (perish the thought), I can up sticks and move to a new employer. I don’t have to go on strike to do that.
We are in an exceptionally tight labour market. People are moving jobs and being given massive pay rises, better terms, remote working and generally greater flexibility.
So let’s say I am one of those train workers who went on strike earlier this year. The train company wanted to remove an employment right that said if a worker was interrupted during their break from work, they got to start the clock on the break time again from scratch. I may be unhappy about it - but I still have the option of looking for a new job, I don’t have to go on strike.
And this is what is hard. Everyone knows that 10% inflation this year and possibly 18% next is brutal for the cost of living. Many of these workers will need a pay rise to be able to pay the bills, heat their houses, travel to work and feed their children. Every employer out there needs to have compassion for the lowest paid in their organisation and should be pre-emptively addressing it.
But there are new jobs in the market that will pay more. Be flexible. Take a risk. Leverage the freedom we have in the job market in the UK, and not just blame your employer and ask for that 8-10% pay rise (which is probably less than you’d get if you moved anyway).
The UK Government needs to step up and take this on much more aggressively. The private sector is showing ongoing wage restraint, which it can do as unions have all but disappeared in many sectors. But the number of strikes is getting out of control and the consequences to the day-to-day business environment are growing. Are we going back to the days of Thatcher taking on the miners? Arguably that was a recognition that we could not continue to subsidise an unprofitable industry, now it’s about needing a wage increase to offset much of the pain of inflation. Unions are not serving the country well and a stronger voice and action against their growing number of strikes is needed.
Educating a child
I just finished reading a book I was given years ago, “The Promise of a Pencil by Adam Braun”, telling the story of his dream of building schools to educate children in some of the poorest parts of the world, and how it succeeded and scaled beyond his wildest dreams. I rolled from that book into Bezonomics, looking at Amazon’s rise to greatness and what it means for the future of the world and business. I’ve also found myself in the last week in conversations about WeWork and Uber, two companies that I tend to avoid due to the failed moral compass of the founders and the implications for the culture of both companies.
What links these together for me at the moment is reflecting on the question of not how should you educate a child but what should you educate a child in. It used to be that in early years you focused on reading, writing and arithmetic (the 3 R’s - ironic, as they are actually an R, W and an A but the fact that schools call them the 3 R’s perhaps says a lot about schooling - they could have gone W-A-R instead, just as memorable). How critical is it really that you can write? My Primary School reports usually went - excellent pupil, awful handwriting - that never changed but it also never massively hindered me. And reading? Every great reader became great by reading and reading and reading.
Skill 1 that is critical for the future workplace is maths. Maths leads to the ability to enter computer science. Maths opens doors to rocket science, physics, chemistry and architecture. Maths opens the door to finance and engineering and innovation. Maths is an entry pathway to AI, Web3, economics, R&D and solving major world problems.
Skill 2 is resilience. In this millennium we have had the dotcom crash, the financial crash, Covid, war in Ukraine, 9/11, the Long War against terrorism, global inflation, fake news, political division, radical social movements, the arrival of mobile tech and apps, Web 3, remote working etc etc etc. Change becomes the constant factor of the context. Those that can take what life throws at them and be content, or be resilient, will do better than those that crumble in the face of chaos.
Skill 3 is flexibility and adaptability. One day you might be a rocket engineer, the next you might be sent half way around the world to be a climate scientist. One day you might have a solid investment portfolio, the next you are struggling to make ends meet. One day you might have your health, the next not. Change has always been present, but the current moment has greater and faster change and those that can adapt with it will do better in the workplace.
Skill 4 is a moral compass. Personified in Adam Neumann and Travis Kalanick, when this is lacking the company goes off the rails quickly. I can think of others in my own country that I will not name. I want to see leaders that know what is right and what is wrong and are prepared to do right, even if it costs their company or them personally. We need people who can lead their companies to a place that they do business the right way - not lying, paying their taxes, honouring their staff, caring for their communities, building products and services that do what they say they will, paying a fair wage, firing those that break the rules continually, keeping their word, honouring those that came before them, having compassion on those who are suffering and refusing to condone immoral behaviour in the workplace. Sexual harassment is never ok.
Skill 5 is ambition. Somehow we have raised a generation(s) with a high sense of entitlement. Is it a surprise when we bring up our children by telling them they are amazing and nothing they do is wrong, when our schools reinforce this by saying that everyone is a winner, and when universities tell them that they are the hope of the world and the workplace is waiting for them with open arms? Shock horror - when they arrive, they find it hard (as I did at the start of my career, to my shame) to accept that they are the bottom rung and hard work, service, teachability and humility is what is being sought. The answer is not resentment, but ambition. Not to climb over your colleague’s back, but to be better every single day. To prove that you can do it and to push yourself beyond your limits. We have begun to accept it’s ok to settle. You can be better.
These 5 skills is what I would love to see our education system churn out. EQ is important, as are languages, art, poetry and music. However, for the majority of workers in the future, the 5 skills and attributes are key. Lay down the health and wellbeing, the gender re-categorisation, the focus on climate strikes - and pick up the focus on maths, resilience, flexibility, morality and ambition. Do this and we might just raise a generation that genuinely could transform the world.
Sales funnels
“There are no unique selling points anymore”. This is what I found myself saying to a very experienced marketer recently, who looked at me with puzzlement, as behind her I could see her very experienced VC husband nodding in agreement with me. USPs are a favourite of marketeers. Like most of business teaching, they have gone by the wayside with the rise of China, the flattening of the world through the internet and the lower cost of creating a business these days. That doesn’t mean that much of the teaching is useless though - and one area that still holds good is sales funnels. I’ve seen this technique used in £250 sales through to £2,500,000 sales.
A sales funnel is simply a process for tracking sales leads and then the process of going through to conversion into a client and payment. For a £250 sale this is often fully automated and is often a ‘click funnel’. For a £2.5m sale, this will be fully personal and often involve multiple people and a long period of time. I love sales funnels, and the data that goes with them.
From creating a sales funnel, you can track the conversion rates and realise very quickly (through some Googling and benchmarking conversion rates) at what stage of the funnel you are falling off. Let’s say that you need 5 sales, and you initially identify 200 possible leads, contact them all and 100 reply, 25 engage in clarifying conversations and 5 buy - then great. My advice would then be broaden the number of leads - build the top of the funnel and go wider. Run events, attend conferences, grow your social media, advertise etc. If the ratio had been 200-100-25-1 I would be much more focused on why people are not buying. Is it a price issue, the value not clear, failing to close, the product not being good enough or the company not being credible - by understanding the reasons that the sales don’t happen, the business can focus on improving that ratio through tackling the issues.
I was working on 4 funnels this week, some for me and some for other organisations. In one case the issue was capacity to convert interested clients to contracted clients. In another it was a high level of leads but a lack of discipline to push the leads through the funnel. In the 3rd it was a low final conversion rate and so needed a broader funnel. By creating the funnel, the age-old question of how do I get more sales, becomes a more granular question and the action that is taken becomes the new hypothesis to test.
Build funnels. In the next few months of challenging economic conditions, having a more disciplined sales process will help massively.
Whisky week
I drank no whisky this week but the word was in probably every second conversation I had. From hearing firsthand about the 54th planned new distillery in Scotland (none of these are yet distilling), to discussing 9 figure projects, to a trip with the founders up the fantastic Port of Leith Distillery (opening early 2023) despite my fear of heights, to a request for help from a fascinating new distillery, there was no shortage of new prospects or excitement. I’m now aware of 18 parties looking to buy a distillery.
Here’s my takeaways:
New distilleries are continuing to be planned faster than they are being completed. But most of them remain small. The newer ones are having to fight harder to be innovative. Net Zero is a big part of the story
Anyone selling a distillery right now is likely to get a very very high price. But there’s still a mismatch between what buyers want and what sellers are prepared to put on the market
The picks and shovels arguments are strong just now - warehousing, bottling, logistics, labeling, caps - there are opportunities to make money in these spaces and some companies are beginning to step in here in a big way.
There are increasing grumblings in the industry over casks and in particular cask investment. Unsavoury new entrants are threatening a lot of false selling and many distillers are rapidly distancing themselves from what might be coming. Not all cask brokers are unsavoury, but the reputational risk for many is a concern
Inflation is leading to production being cut back but also massive cost inflation in the new builds. Forecasting at the moment is proving to be really difficult and scenario planning is much more in vogue.
I’ve been working on a few projects this week that might enable me to bring my writing of this newsletter and other writing more into my day-to-day job (this remains a personal newsletter for now), or at least partially. More to follow in coming weeks. Today I took most of the day off and enjoyed co-ordinating a major Nerf gun battle at a children’s birthday party. We’ve managed as a family to have one Saturday at home on our own since July 2nd so definitely feeling a need for new rhythm of weekends. This summer season is now over and future stability is welcomed. Next week involves a rare meeting in my hometown of Dumfries, lunch with a guru of the whisky world and more writing. Enjoy your weekend and thanks for reading.
Interesting as ever, Duncan. I find myself torn on the issue of pay at the moment. Most of those striking have the biggest problems hurtling towards them in terms of cost of living. I wonder whether (as ever) there is more balance here - after all, if everyone takes your advice and moves, the replacements are going to cost more than existing staff and (probably) without the same experience.