2. Management consultants are like business doctors. They diagnose
business problems, recommend prescriptions and execute these
recommendations when clients are unable to. Value adding management
consultants are resource rich professionals with transferable commercial
aptitude and deep research knowledge of your entire market.
Business
Y MARKET
Business
Z
Business
X
Managementconsultants
3. Our focus
There are 5 main areas of management
consulting. Alexander Bain’s focus is on strategy.
Our target audience are businesses within all
sectors of the SME (small and medium sized
enterprise) market. We provide strategic
decision making, strategic development and
execution advice. Our expertise includes:
Organisational strategy – modern growth and market entry
best practices
Functional strategy – modern sales & marketing, operations,
technology and financial strategies
4. Why there are growth challenges
Many traditional business practices have
evolved, though few in-house management
teams are aware of these evolutions or are
experienced in implementing new strategic and
management methods and tools (eg. lean
techniques, business model canvas, exponential
organizations process). Their growth initiatives
are therefore likely to under perform, have
budget overruns or be abandoned entirely, even
after investment has been made.
5. Case Study 1:
Business A, a 20+ year old private service company in the energy sector has 100+ employees and annual revenues in
excess of £5m. The board has decided to develop technology to grow the business. As an established business internal
resources include a full management team, a network of clients, suppliers and distributors across the energy sector
globally along with strong stakeholder relationships. The management team has developed a 3 year business plan that
incorporates the technology strategy, and the Finance Director (FD) has been asked to source finance for the initial
investment of £162k. The business is highly geared but plans to support its marketing and any subsequent costs from
existing budgets.
The FD has some concerns about the business plan and have engaged management consultants to review it for some
fresh perspective.
Our diagnosis: Although the plan provided a comprehensive explanation about the technology, why it was necessary
and what it would achieve together with the projected returns there were some evident gaps. These projections were
established from desk-research and solution-led surveys. There was no evidence that existing customers would pay the
listed price, or that the technology would be revenue generating within 6-months of launch as projected.
Our prescription: Test hypotheses around the shared problem and your solution by discussion around the problem.
Identify who among your current mailing list might be potential users. Ask them about the problem and existing
solutions; why they don’t fully work. Ask why technology hasn’t been used before to solve this problem. Once the
initial hypothesis testing is concluded create a minimum viable product, using purchased application programming
interface (API) which cost less than £200 per month. Test how users interact with the software. Measure whether its
use based on 3 things (validate it - how frequently did they use it, quantify it - how much money and time was actually
saved, qualify it - how much easier was the process). Use pre-order selling to determine the price point.
6. Case Study 2
Business E is a failing television channel financed mainly by private equity but also supported by
government grants. Their viewership is down, investors are displeased and there has been a recent
management fall out. They had engaged a research agency in 2010 to conduct a comprehensive report
on their industry. The report revealed that the typical viewer was aged 45+ although the largest
advertising budgets were projected for the 18 – 45 market. Following the research they explored live
internet-based streaming to attract an international audience (specifically diaspora), to improve viewer
numbers; that too had been unsuccessful. They wanted different strategic ideas.
Our diagnosis: Although old, the independent research report proved useful as it held some important
observations about the client and the industry.
Our prescription: There was quantitative evidence that the younger audience was not interested in the
current line-up. As there was no budget for further research our recommendations was based on the
aged report and some follow up desk-research. We identified target programming categories, ranked
these by attractiveness and introduced a few contacts who could be involved in the new programming.
A brand retirement was suggested, as the aged image had a reputation with the target audience that
would be difficult to shift.
7. Case Study 3:
Business C is a start up. It’s founder is an experienced Human Resources professional who has recently
qualified as a life coach and trainer and will soon quit corporate life. The founder wants to build a
business around the new qualification and replace a 6-figure annual income in 2 years time. A prepared
business plan executive summary suggests this can be achieved by utilising the established network of
HR professionals to scale. As the client had never started a business before, given the 24-month growth
goal, some guidance was sought on the formulated strategy.
Our diagnosis: The executive summary documented a robust strategy however the offer being made
was not sufficiently unique or differentiated. The implementation process suggested there was little
room for flexibility on price or ‘breathing room’ to get feedback on the value proposition from a non-
existing audience.
Our prescription: Don’t rush into scaling. Start the business in an informal way, engage with your
audience. Utilise the lean model for identifying some differentiating factors. This can be achieved by
specifically focusing on pains existing coaches currently do not solve. Learn the industry buzzwords and
how the audience use them. ‘Listen in’ on social media forums, groups and communities for ‘pain’
expressions eg. I don’t know how to <one of your industry buzzwords>, I wish that this could happen
with <an industry product/service> or where can I find <one of your industry buzzwords>. These are
good conversation starters. Fast growth from start-up is possible but is usually as a result of a deep
understanding of the problem to be solved through ongoing engagement with the market to be served.
Only then will there be a scalable value proposition fit.
8. Case Study 4
Business D is a leisure boat service provider that offers daily tours, weekend chartered tours and short-
term leasing. It is a family business that was started 2 generations before. They operate within an area
where there is high traffic from tourism. It is a highly competitive and revenues are unpredictable due
to weather conditions. Ticket prices are mandated by a controlling association and the length of the
tour means that there could be only 3 tours per day. Growth is essential for survival and the young
owners wanted some ideas on how to scale operations.
Our diagnosis: During an onsite visit, joining the tour as a passenger, we discovered that a few
customer problems and a number of minor growth opportunities were evident. A number of
passengers had asked the first mate to take photos for them. Passengers would take annual trips.
Young children were bored after a short time during the journey. The boating industry is a community.
Our prescription: A re-examination of the traditional boating business model. Consider strategic
partnerships such as franchising eg. Sailtime or affiliate relationships with a number of luxury boat
sellers. As some sellers would offer prospects free private tours, propose you host these. For each sale
(on average £300k) you can then get a commission. Introduced a ‘let me take your photos’ session for
every trip; a free service using your own high tech digital camera, or for a set fixed fee with sailing props
provided). Use the photo experience to build an independent database of happy passengers which can
be used to get further feedback, build online communities and test a number of future service
enhancers. Trial a tip-based themed entertainment segment for all tours with kids.
9. Case Study 5:
Business B, a high end 15 year old, owner managed hair and beauty business has partnered with a
make-up line in order to stock its own branded range of make-up. Staffed by 6 stylists the salon plans to
grow by diversifying into retail. The salon already distributes an exclusive range of haircare products,
which stylists use and recommend to clients during consultations. The makeup line commits the
business to a quarterly rolling minimum order of the new product for the next 3 years. Other
investment costs included design and print of branded labels and posters to advertise the products in-
store. The investment was financed by retained profits as the owner is averse to debt. It has been 9
months since introducing the new product. Sales are slow and there is excess stock from the first order
still onsite. Early termination of the contract involves paying a hefty exit fee. There is a strain on
cashflow as working capital was used as growth capital. The owner has approached other salons in the
area who have shown an interest but won’t commit to purchasing as the product does not bear their
own brand.
Our diagnosis: Legal advice confirmed that the exit fee would apply. There was no alternative Business
B was committed to selling the stock. For a price the wholesaler could re-label the product.
Our prescription: Before considering growth, contact a management consultant for a business ‘health
check’. Such a consultation will also help in considering the full consequences of strategic decisions and
identify some alternative routes to the goal should things not go exactly as planned. There are a range
of scenarios to solve the overstocking problem. A form of growth capital should have financed the
growth and that option is always open. An online Ebay store could be used to sell excesses monthly.
Pilot tests should be run for two new channels; (1) re-distribution to neighbouring salons and (2) a
makeover campaign; clients are more likely to buy what they have tried and seen results with.
10. The kind of problems we solve
• Stagnant or dwindling revenue streams
• Under performance in high potential markets
• Low click through rates on e-mail marketing
• Non-converting marketing messages
• Non-performing growth initiatives
• Weak value propositions and market fit
• Business plans that fail to attract funding
• Failing business models
• No or low growth strategies (3 year CAGR < 20%)
• Expired or no market research
• Inaccurate target markets
• Incomplete hypothesis formulation for business model testing
• Non-converting minimum value products and services
• High risk innovation with show no or little return on investment
• Losses (not all losses are bad signs)
and many, many more
11. Action you can take now
Call us to arrange a no-obligation consultation.
0203 – 150 – 0757
Follow what we say on LinkedIn
www.linkedin.com/alexanderbain
www.linkedin.com/rhondaabest
Join the scaleupcrowd, a new growth driven
community with free resources and advice on how
to use modern management techniques effectively
12. Alexander Bain is a pioneering management consultancy focused
on solving the complex problems faced by small and medium sized
businesses.
Every year about 80% of new businesses fail. Extreme uncertainties
and rapid change in markets, mean that those that survive death,
rarely grow although billions is spent annually. Statistically less
than 1% of all businesses actually achieve exponential growth. To
turn such results around there needs to be significant,
transformational change in the way businesses operate.
Alexander Bain’s approach is unique. While we commit to our own
research we also learn and value the findings of those who have
already dedicated years into these changes, and provide insight to
our clients and followers on the newest proven strategic and
management methodologies, and more importantly how to use
them to scale. Learn more about us at:
www.alexanderbain.co.uk
