Exciting consultants are like fortune tellers. They take a quick look at your market, cast a brief glance over your competitors, interview a couple of people in your organisation – and then, using their mysterious powers, they tell you what your future looks like. Then they might rush to ‘facilitate a strategy development session’ with your top team, declare their work to have been a success, and head for the exit, leaving behind them a print-out explaining what you need to do to set the world on fire. But on the basis of what? Possibly not much more than intuition and positive-thinking clichés like ‘everybody can shape their future if they really believe in it’.
Boring consultants, meanwhile, are … well, boring. They don’t advise you to do something before looking at your numbers. They ask for data and study it. Then they ask for some more. They take another look. Then they ask you to look for yourself. When you think you’ve got the answer, they reply: ‘That depends, show me more data, let’s check that.’ They’re really not much fun.
But in the end, you’re better off with those boring consultants. That way you won’t be brainstorming strategy out of thin air.
Why brainstorming new approaches is not always a good idea
Most companies aren’t consistent in doing what they’re supposed to do. To achieve greater success, they just need to stick at it: they don’t need a ‘new approach’. Stay on that course, check the results, and continue. The rush to adopt new approaches isn’t justified; in fact, it’s pure escapism.
We’re not saying you shouldn’t innovate; we’re just weary of ‘brainstorming strategy’ when no one in the room has brought the latest data with them. Or they haven’t even looked at that data. Or they did take a look at it but didn’t really understand it. Or they did understand it but chose to ignore it because it wasn’t very encouraging.
Often it’s much easier to start afresh. And much more refreshing. But human history tells us that when we try to turn back the clock we often end up in a worse place than where we started. ‘Innovative’ ways of making money brought about the most recent financial crash and drove so many people into poverty. You might be innovative, but that doesn’t necessarily mean you’re doing the right thing for your business, your employees, or indeed wider society.
Why you need the boring data
If you look properly at the data, most of the time you’ll see the answer staring back at you. You don’t need to have novel ideas, you just need to understand what your data is telling you. But don’t just study the data once, when you do your strategy review: make it part of your routine.
If your sales numbers go down every spring, it could be just a seasonal thing. Get cash-ready for it. If your labour utilisation rate is low, you’re overstaffed. So stop hiring and monitor your resources closely. If the same clients buy from you every year, they’re your market: the people you should value and make the most of. Stop agonising over new segments of the market.
Before you leap into the brainstorming session, make sure (a) you’ve consistently done everything you were supposed to, (b) you actually understand what your data is telling you, and (c) you have a numerical feedback loop in place that shows you whether what you do has the results you expect.
Don’t screw the spreadsheet
We know there’s a dissenting view that says ‘screw the spreadsheet, use your creativity and intuition instead’. Indeed, what we often find in professional services businesses is a lack of spreadsheets, because they’ve been sacrificed in the name of supposed creativity. Sometimes there’s a data desert: not a single spreadsheet to be found anywhere in the office. One entrepreneur told us that whenever he tries to build a spreadsheet he ‘always gets the numbers wrong’, so he’d rather have none at all.
Don’t hide behind the attitude of ‘I let others do the boring number-crunching’. In an age when the geeks are ruling the world, that’s no longer sexy. In fact it’s downright unhealthy. You do need to crunch those numbers. Do it for as long as you’re confident you know what you’re looking for, then afterwards you can delegate the reporting.
Or, to put it another way, feel free to screw the spreadsheet at some point, if that’s what you really want to do – just make sure you have a spreadsheet to begin with.
Let the data speak first
Let’s now assume you do have some form of spreadsheet. Your numbers are in there. But, when you look at those numbers, might you be trying merely to confirm your prior assumptions?
A lot of entrepreneurs do nothing with their data apart from trying to support decisions they’ve already taken. Is that you? Or is it someone else in your organisation? Employees generally don’t see anything more in the numbers than their boss can, because they don’t want to rock the boat.
Get a third party to take a look at your numbers, without trying in any way to influence their perception. You’re either going down or going up; the data’s usually very clear about that.
If you’ve no idea what you should do next, take another look at your data.
Become boring. The age of intuitive innocence is over. If you want to do just one thing differently in your business, adopt the geekiness of Benedict Cumberbatch’s Sherlock Holmes: ‘Don’t know. Dangerous to jump to conclusions. Need data.’
And don’t trust fortune tellers.