Innovation: communication and inspiration in the organisation

 

The overarching theme of this blog is to show that better use of the skills and creativity of the UK advertising and communications sector would benefit society as a whole as well as business.

But even I admit that, with all the creativity in the world, none of us could stop the floods which have dominated our media landscape – even if, as our austere Prime Minister said, ‘money is no object’.

However, one doesn’t get the impression that the relevant parties were communicating very effectively with each other: Continue reading

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The London Airport nondecision fiasco

 

In business, it is essential to be fast on your feet, identifying new opportunities and reacting to threats as quickly as possible.

In public life, decisions are taken far more slowly, if at all, and, often, for all the wrong reasons.

A prime example of this has been the lack of a decision to fulfil the market need for the expansion of London Airport. Continue reading

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What UK politicians must learn from the Hoover Free Flights Fiasco

 

Oh dear, I have a feeling this will be my angriest post since ‘DLA Disgrace’ in September 2011. Hang on to your hats…

As an independent candidate at the last UK general election in 2010, it was only when canvassing started that I realised that, overwhelmingly, immigration was the most important issue concerning the voting public.

And, even worse for me, having taken the time and trouble to publish a 27-page ‘personal manifesto’ covering what I considered to be the most important issues of the day, I realised that I had not addressed the most important of all – immigration.

So it was that, at my first hustings, sitting alongside Labour, Conservative, LibDem, UKIP and other candidates the first, the very first, question the audience asked:

‘What do you think about immigration to Britain and what would you do about it?’

Instantly, I was aware of a frantic shuffling of paper under the table as all the other candidates scrambled through the cribsheets supplied by each of their party HQs to find the relevant tab and spout their party line.

Me? I had to think.

Slowly, but with brain whirring frantically, I rose to my feet and said:

‘I don’t know how many of you have read or seen Alan Bennett’s play ‘The Lady in the Van’. To me, it is a metaphor for immigration. It is one thing to have a lady in a van park in your driveway for three months and stay fifteen years. But you can’t have fifty of them, can you?’

So, I argued, immigration is as much to do with management control as strategy:

1. Define the numbers.

2. Control the numbers.

How so?

The Hoover Free Flights Fiasco

The Hoover Free Flights Fiasco is recognised as the biggest disaster in the history of the UK sales promotion business.

In 1992, Hoover was losing money and under pressure to sell off the excess stock that had piled up in their warehouses. A sales promotion campaign was developed whereby customers who spent over £100 on any Hoover products would receive two free flights to first, Europe, and then, disastrously, America.

At this time, the days before budget airlines, the value of these flights was estimated to be £600 – far greater than the £100 that Hoover invited customers to spend.

As we know, the UK public are not stupid. They were ‘wowed’ by the offer – and flocked, in droves, to their nearest Hoover stockist.

Comedy ensued:

Wedding couples were given up to six vacuum cleaners as wedding presents as their generous friends and family gave away the Hoovers and kept the free flights.

A Hoover customer blocked a Hoover service van into his driveway for 13 days – an action worthy of Alan Bennett himself.

‘Instead of spending a little sucking new customers in, they spent millions blowing away their good name.’ said the BBC.

‘A major snafu of EPIC proportions’ said the PR man.

‘Hoover sucks’ said disgruntled customers, as the company tried to worm out of the offer.

Ooh how we laughed.

From comedy comes tragedy:

The Hoover Free Flights Fiasco ‘brought one of Britain’s most famous brands to its knees’.

The damage to Hoover’s reputation was ‘incalculable’.

Three Hoover bosses were sacked.

In 1997, five years later, ‘court cases threaten to open the floodgates to more claims’.

All of Hoovers UK factories were closed, ending a 50 year history.

Hoover’s whole European division was sold to an Italian company called Candy.

Standing back from the comedy and the tragedy of this, what lessons are to be learnt from a more professional, objective analysis?

And what on earth has the Hoover Free Flight Fiasco go to do with immigration?

Well I can tell you.

In the trade, it is called redemption.

For, in the sales promotion arm of the marketing business, there are two key steps:

1. Define the numbers.

2. Control the numbers.

Haven’t we heard this before?

Redemption is where, having defined the offer, a calculation is made as to how many customers will take up – redeem – the offer. In many cases, redemption is a comparatively low percentage of sales. Many customers don’t see the offer as worth bothering about.

Thus, professionally speaking, Hoover’s mistake was not only to make an offer that exceeded that value of the sale price of their product but also to miscalculate – disastrously – the level of redemption.

In simple business terms, it is a question of forecast v reality. And, as anyone who has managed a business knows, you get your forecasts wrong and you pay the price.

The Labour Government and Immigration

Two months ago, in November 2013, Jack Straw, who was our Home Secretary in 2004, admitted that throwing open Britain’s borders to migrants from other new EU states that year had been a ‘spectacular mistake’.

At the time, Britain was one of only three EU to allow free migration for workers from EU accession states including Poland, Hungary and the Czech Republic. Ministers expected up to 13,000 a year to move to Britain but, by 2006, at least 600,000 immigrants from East Europe had been let through our doors. In 2010 alone, the UK’s net migration figure was 252,000.

But immigration is not just a European issue. Sir Andrew Green, head of the Migration Watch think tank, said: “There’s been a lot of focus on EU migration. The reality is this – in the Labour years there was net foreign immigration of three and a half million. Only one in five of those was actually from the European Union.”

Three and a half million?!

You what?!

The Coalition Government and Immigration

In August 2006, the Conservative shadow immigration minister Damian Green said: “These figures make it all the more urgent that the government takes an early decision and stops ducking and diving on the issue of Bulgaria and Romania entering the EU.”

Did you get that?

The Conservative Party identified the problem in 2006.

And now we learn that David Cameron has slammed Labour’s decision to permit workers from new EU members states to come to Britain in 2004 as ‘a monumental mistake’. He made the comments as he announced plans to ban EU migrants from claiming benefits for the first three months after they arrive in the UK.

This was on 27 November 2013!

It gets worse. This week, in January 2014, we are told that the ‘UK Cabinet is split on EU immigration’.

Isn’t this all a bit late?

As anyone who has run a business knows, if you let problems fester for over seven years you will pay the price.

The Immigration Fiasco

Our politicians – all of them – have made such an appalling mess of immigration that they, as they themselves like to say, ‘not fit for purpose’.

What is it about immigration that I’m not getting?

As a country, does immigration really divided us on political lines? Is there really a left and right view on this? Capitalism v socialism? White collar v blue collar? Private school v state school? What is all this? Call me naive, but aren’t the good people of Great Britain more united on immigration than our Oxbridgian political leaders like to portray?

Do you know anyone – anyone at all – who wants nil migration? Not one immigrant?

I don’t.

Don’t we all know that millions of our fellow Britons live abroad; that most immigrants are honest, decent people who are happy to have here; that some immigration is fine, as long as the numbers are controlled – and that our political masters have mucked up again?

And why is this all about EU migration? What about our friends in the Commonwealth, whose languages, cultures and histories we share and who fought alongside us for the freedom for people like me to write things like this (against, as it happens, other EU countries)? Don’t we owe them a debt of honour?

Have our politicians got a grip on all this?

Or have they shown that they are the last people who should decide these matters?

For surely, just like the redemption of a sales promotion campaign, immigration is a question of balance:

1. Define the numbers.

2. Manage the numbers.

It can’t be that difficult, can it? First, you calculate how many are going to leave our shores in any given year. Then you get an independent economist to forecast the prevailing issues and work out how many immigrants you can admit by social class, by age, by profession, by country of origin. There are experts who do this kind of thing for a living and, if they muck things up, you can fire them.

It is very important that the people who police the numbers are accountable for their performance. Who has been accountable so far? How many people, like the bosses of Hoover, have been sacked?

Surely letting three and a half million people into our country by accident eclipses even the Hoover Free Flights Fiasco in its gross incompetence? Isn’t balance the last thing we are going to get from our adversorial, divisive political system?

And surely, like interest rates, where Governor of the Bank of England heads a committee of non-political experts to i) define the numbers and ii) manage the numbers, it would be better to keep the politicians away from this key issue. All they would have to argue about would be the proportions of immigrants allowed in within an independently calculated annual total.

For when it comes to immigration, politicians aren’t going to solve the problem are they?

Let’s face it, politicians ARE the problem.

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Why things can only get worse in 2014

 

The dawn of a New Year is a looking forward to what is to come and for reflection, a time for taking stock.

There are two things we know will happen during 2014:

First, a relentless, inexorable, incessant and, I hope, respectful stream of ‘content’ will mark the centenary of the First World War. For me, with luck, this will include the development of film script I have written with WW1 themes – but Harvey Weinstein hasn’t called me yet and we are running out of time.

And we know that, with every day that passes, the nearer we are to the next General Election in May 2015. And the more our politicians will be looking to score points against each other.

We know this because it has started already.

No sooner had the New Year dawned than David Cameron appeared on TV: ‘PM kicks off new year with pledge to increase state pension‘.

Then George Osborne announced a £25bn reduction in welfare benefits.

Nick Clegg marked out his own ground: ‘Tories making a ‘monumental mistake’.

Ed Miliband accused Cameron of ‘prioritising the privileged few’

Please don’t for a moment think that any of these announcements are for the greater good. It is too late for that. With the General Election in mind, our political leaders will spend 2014 dreaming up what they call ‘policies’ but are really just the terms on which they and their advisors think are most likely to win the most seats. The greater good will be the least of their concerns.

As it is New Year, let’s step back and take a wider view on these stakes in the ground and slinging of mud.

How will they affect the bigger picture?

Will the world be a better place?

Whose lives will be improved?

Will they make us happier?

Of course not.

Why?

In October 2011, in a post called ‘Catch-22 of a rotten political system’, I said this:

‘I am interested in the increasing divergence of our society – and, in a world where there is more connectivity than ever before, why there is such a disconnect between the real world and the Westminster Village’. It now emerges, by his Newsnight rant, that Russell Brand reads my posts. Dear Russell, he’s such a flatterer.

In that post, I argued the case for more innovation in finding solutions to the needs of society in the 21st century. Now, at the beginning of 2014, I am afraid the situation has become worse.

However idealistic their political motivations at the time, when David Cameron left Oxford University in 1988, Nick Clegg left Cambridge in 1989, Ed Miliband left Oxford in 1992 and George Osborne left Oxford, also in 1992, their commitment was to gain and retain power for the political parties to whom they had pledge their allegiance for life.

Thus, by 2015, their job is to win more seats for their parties. If they don’t, they will be sacked. So, now the opening salvoes have been fired, it is legitimate to ask if any of them have done anything to change the world or improve our lives.

Have they shown themselves to be creatures of vision, game-changers, prophets?

Have they found fresh, innovative solutions to our problems?

Not really have they?

Let’s look at this from a different angle:

In 2012, Unilever spent $8.3bn and Proctor & Gamble (P&G) $9.3bn on advertising.

In the same period, the UK Government were proud to reduce their marketing budget to £285m.

How is it legitimate for me connect these two seemingly disparate numbers? One is dollars, the other pounds; one is global, the other UK; one is commerce, the other government.

Well, let me tell you, despite the famous mantra of Lord Lever that ‘half my advertising spend is a waste but I don’t know which half’, these global marketing companies know exactly what they are spending their money on and why they are doing it.

With very few exceptions, all consumer marketing companies use specialist advertising and marketing agencies to better understand their customers, develop new products, grow their businesses and find more innovative, more creative ways to achieve their commercial goals.

While most of their advertising funds is spent on the media channels selected to transmit their messages, not one dollar of it would be deployed by Unilever and P&G without two vitally important factors: research and creativity.

How is it that government falls short of these crucial professional disciplines?

Why do politicians dream up new policies by the seat of their pants?

And what have I done to stir things up a bit?

The thinking behind this blog is that the business world behaves more professionally, more intelligently, more creatively and, yes, with more human understanding than our political masters.

It is a lonely road, this blogging business, researching what I can online and with no one to help define and refine any creative ideas I may have. But, through these posts, I have tried to challenge the status quo and apply creative thinking to the issues at hand.

You can skip these if you like, but here are some of the thoughts I have put forward:

1. Royal Mail

In two posts, one dated November 2009 titled ‘The Post Office – a parcels not a letters business’ and the other June 2010 titled ‘The Post Office – a storage and a delivery business’, I argued that local post offices could act as hubs for online purchasing, especially in rural areas.

Imagine, this Christmas, how mortifying it was to see Amazon ‘click and collect’ lockers in my local supermarket. Several Post Offices in outlying communities need never have closed at all.

2. Health

In two posts, one dated June 2011 titled ‘NHS: a sick future’ and the other February 2012 titled ‘How the banks can save the NHS’, I argued that, if government (i.e. you and me) can own 30% of the Royal Bank of Scotland, why can’t we take minority stakes in health service providers?

3. Banking

In a post dated December 2011 titled ‘A creative insight into the banking crisis’, I argued that City bankers should not be allowed to trade sums of money greater than they have in the bank. No one else in society can do this. Why should they?

4. Housing

In September 2012, in a post titled ‘Housing: how zero vat on the building trade would stimulate the economy’, I argued that zero rate VAT on the building trade would ‘kick-start the economy, generate thousand of jobs and clean up the black economy’.

5. Education

In February 2013, in a post titled ‘Education: every child has a talent at something’, I proposed the restructuring of the department of Health to include a Minister for Art in Schools, a Minister for Sport in Schools and a Minister of Schools in the Community. How is it that Britain still has the best schools in the world (if you can afford to pay) and some of the worst (if you can’t)?

6. National Debt

In March 2013, in a post titled ‘National Debt: who do we owe?’, I suggested the government might do what anyone else would do if our debts reached a level which was not repayable. We would negotiate with our creditors to reduce the debt to more manageable levels. As of this month, an IMF paper has warned of a mass write-off (the first since the 1930s).

7. Household Energy

In October 2013, in a post titled ‘Household Energy: what gas and electricity companies must learn from the oil companies’, I argued that household energy should be as easy, and transparent, to buy as petrol for your car – and as easy to switch suppliers as driving to the petrol station up the road.

Please do not think that I am highlighting these posts in order to crow or boast. They are no more than the musings of a lonely guy on a lonely road.

All I am saying is that, since the last General Election in 2010, there could have been more innovation and more creativity applied to the needs of society today.

And now it is too late.

It seems we live in a world where the people who sell us toothpaste and washing powder know more about the way we behave than the people who have the power to change the world.

Pity, isn’t it?

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A master class in the art of chairing a meeting

 

Lord Kingsdown died last month. He was best known as Chairman of the NatWest and then Governor of the Bank of England. I knew him as Robin Leigh-Pemberton and through playing cricket on the private ground at his estate in Kent.

They were happy days and a throwback in time.

Driving into the estate, and through a field to park in the long grass surrounding the ground; changing in the musty warmth of the ‘pavilion’ which, with no running water, was not much more than a shed; ambling slowly to the wicket to inspect the pitch; buffet lunch washed down with pints of freshly delivered Shepherd Neame (in the garage); and all in an air of genteel civility and the polite behaviour that Robin himself personified. Continue reading

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The difference between a product and a service

In my last post, I shared my experience of pouring hundreds of cans of beer down the drain in Vietnam due the high level of care Heineken take to ensure that every can of their lager meets their strict quality standards.

I mentioned several more of my favourite brands that, presumably, are managed in the same way: Johnson’s Baby Shampoo, Weetabix, Marmite, Heinz Baked Beans, Guinness, Laphroaig.

I am sure you have your favourites too.

Brands like this are known in the trade as Fast Moving Consumer Goods (FMCG) – and the CV of anyone who is anyone in marketing is strengthened by FMCG experience. Continue reading

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The difference between a commodity and a brand

An abiding memory of my career is sitting on a pavement in Saigon pouring hundreds of cans of lager down the drain.

As an expert in the potential of the Vietnam market, having been there once before, I was with a regional director of Heineken. He carried a widget on his key ring by which he could identify the origins of every single can of his beer, including full details of when and where it had been brewed.

Yet, even if the beer was only marginally out of date, we bought it from the shops at full price and into the gutter it went. Continue reading

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Household energy: what gas and electricity suppliers must learn from the oil companies

Here we are again.

Great Britain, I can report, has descended to the yaboo politics of yesteryear. Inept career politicians, none of whom have ever managed a business, biff-baff each other with naïve and unrealistic ‘policies’ to the detriment of us all – especially the old and needy. Continue reading

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How the UK Government ignored the most basic law of advertising

The Rt Hon Theresa May, Secretary of State for the Home Office has announced that she wishes to create a ‘hostile environment‘ for illegal migrants to Britain. But early attempts to do this run the risk of alienating those of us who have every right to be here.

In July, the Home Office, led by Ms May, launched an advertising campaign against illegal immigrants to the UK. The chosen message was as follows: Continue reading

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Max Mosley: are you an amateur or a professional in life?

These days, television programmes come round and round like race cars on a track. Gone are the days when, if you missed them, you missed them. And you can pause and rewind programmes too which means, if anyone says anything sensible, you can think about and transcribe what has been said.

This week, I have done this with an interesting interview with Max Mosley on Sky’s F1 channel.

You may not know Max Mosley but he has long interested me. I described my meeting his half brother Nicholas Mosley last year but have never met Max Mosley. Having said that, I feel I have known him since the mid 1970s – not least as the constructor of the car that Vittorio Brambilla crashed at the end of the Austrian Grand Prix which I attended in 1976 and described in my last post. Continue reading

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