Sales Projections – Newbie vs Reality
Want to immediately identify yourself as a total sales/revenue noob? Make the following statement while talking to an investor (or a peer, the postman or your dog) about how your derived your revenue projections:

“We estimate that we can capture X% of the current market which will generate $YYY millions.”
Gut check moment….do you know what is wrong with that statement? No? Here it is, plain and simple. True sales projections are derived as a result of understanding how many opportunities a sales person can close in a given year. This includes online marketing/sales efforts. Even if a sales person is not directly contributing to a sale (like converting a website member to a paying account), there is a metric that one needs to derive to form the foundations of revenue projections. You need a formula based in reality.

By saying that all your company needs to do is capture a percentage, you are telling the other party that you have not gone through the thought process of how opportunities will be generated (above the funnel), how they will be converted (in the funnel), how long it will take to convert, what revenue will be generated per account, and when you will lose that customer (below the funnel).

This is the difference between a ‘Top-down” and “Bottom-up” strategy. Top-down strategies are basically WAGs (Wild Ass Guesses) stating some unrealistic percentage of market as a revenue number. Bottom-up strategies use reality to derive a revenue figure. When the VP of Sales conducts an annual sales meeting with his/her team, the individual sales people in the room don’t commit to sales figures based on a percentage, they think about the cycle of “bagging and tagging” a new customer. They also think about attrition rates and incremental revenue from their existing customer base. They consider all the factors that lead to a sale and then, based on lead generation, provide a projection that is a reflection of reality.

For example, Dr Suess starts a new company selling moss covered credenzas. He hires a marketing person to start generating inbound sales leads and then finds a sales person to close them (I am overly simplifying this, so go with it!). Dr Suess asks the sales person how much revenue he can “close” this year. The sales person pauses and thinks to himself;

“It takes me 2 weeks to get a meeting with a new lead, another month to ship them a sample, then a couple more months for them to decide. The first order is normally 10 units at $1000, assuming a first time buyers discount of 50%, which will take another month to run a credit check, set them up in our system and get the actual order from the customer. So it will take me about 4 months to close each new account, generating $10,000 per customer. I think I can find and handle about 10 sales over the course of the year so that makes $100,000 in revenue.”
He then tells Dr Suess he can generate $90,000 (giving himself a little wiggle room) in the next year. Dr Suess nods approvingly and writes down this number as the sales persons commitment. Let’s just assume the cost of living in Whoville is VERY low and profit margins are high.

The thought process the sales person went through is Bottom-up. It is based on his real experience selling credenzas and is therefore more realistic. If he had taken the Top-down approach the number might be completely unattainable. If the market was $100,000,000 and he made the noob mistake of saying he could close 0.5% of the market, he would have signed up for a revenue figure of $500,000. Given the sales cycle, what are the chances this sales person would close 50 account in a year? Slim to worse-than-dead.

This is why, when people talk about potential sales as a percentage of market, most people think they are just throwing out a mentally-lazy number and haven’t done the math. Someone with experience would state a number and maybe talk about how that number was derived. The beauty of a Bottom-up approach, especially when seeking investment, is this level of understanding helps the entrepreneur also deal with the wonderful question, “If you doubled your sales staff, how much more could you make?” Translation, “I am interested and might be inclined to give you more money because I trust your analysis.” Not a bad problem to have.

Hope you have a great 2011

GW

The 'accidental entrepreneur'

Hi Folks,

Hope you are all well and have had a good break over Chirstmas and Newyear (as I write new year is still to happen). I had stopped posting for a while as I was visited by my insurance underwriters off my unemployment insurance (HBOS ) and asked how much money was I making with my Blog?...well that was a laugh...but to keep things on the up and up and make sure I did not upset HBOS again, I decided not to write again until I had a new job, which I have a temporary ( 6 months) contract with a microelectronics packaging company http://www.optocap.com/ good guys, I have worked with them in the past on two projects, one for a microdisplay company ( http://www.forthdd.com/) and another a stealth CPV company, these guys are just through an MBO so it is interesting times ahead for them.

Now to the post of today....I saw this article on the http://www.bbc.co.uk/ website wrt an entrepreneur, who stumbled in to starting companies, he makes some interesting comments, so enjoy:

WizPatent's Casey Chan: The 'accidental entrepreneur'


The commercial success of a medical research project led orthopaedic surgeon Casey Chan into the world of tech-start ups

By his own admission, Casey Chan stumbled into entrepreneurship.
He trained in engineering and medicine, but now divides his time between lecturing and researching at the National University of Singapore and creating new technology companies.
While working as an orthopaedic surgeon, Dr Chan became involved by chance in a research project to increase the strength of bone cement used in joint replacement surgery.
The system he designed turned out to be a commercial success. He believes the opportunity gave him the first taste of developing technology into a commercial product.
Dr Chan's latest innovations, WizPatent and WizFolio, arose after he wanted to patent a product but needed to sort through existing, similar patents to check for infringement or copyright issues.
"It's not just a matter of getting the documents," he explains.
"There's a whole series of knowledge management after you have gotten the documents."
Dr Chan found the process frustrating.
"The difficult part is making the decision on what you have retrieved, which means you need to decide which are the patents that are relevant to what you need to do.
"Then you need to organise it so that you can make a final decision based on your analysis."
The cumbersome procedure led him to develop WizPatent, a software system for managing patent documents.
It allows users to download and sort patents in an orderly fashion.
Demand
Dr Chan launched WizFolio soon afterwards to help users organise other forms of digital documents that can be cumbersome to manage, such as research papers.
"I've been developing software for the last 15 years," he says.
"And I've found that developing software is not any different from developing any other commercial product.

"My advice for people who are starting up…is it's very important that they actually pay themselves”
"You go through a whole series of processes. The first thing is identify if there is a need for such a product.
"Don't go and try and commercialise a product because you think it's a good idea or because the technology is cool. You want to make sure there is somebody that wants the product you are making."
Dr Chan believes his previous experience with start-up companies in Silicon Valley in California was invaluable when it came to creating his own company to launch WizPatent.
"I talked to a lot of other people that had been starting their own companies and then I invested in a number of these companies and got to know the process," he says.
But he admits that his lack of marketing drive has hampered the success of his company.
"The launching of a product is something that we don't do very well as entrepreneurs and that is one of the major deficiencies I consider myself as having," he says.
"If I were to do it again, I'd probably raise some funds from outside investors and hire a marketing team. I think that's very, very important. We did not do that, so right now we are just breaking even."
Failure
"I often think that jaywalkers are good entrepreneurs," says Casey Chan.
Casey Chan believes that all entrepreneurs experience failure repeatedly and that eight out of 10 new businesses "are probably going to fail".
"There's a lot of lessons to be learnt from a failure," he says.
"But you want to be able to get up from a knock-down position… to utilise the learning that you have derived from that particular failure."
For those reasons he is adamant that entrepreneurs should never leave themselves financially vulnerable when starting up a company.
"My advice for people who are starting up… is it's very important that they actually pay themselves. What you don't want is an entrepreneur who failed and is not able to recover from it."
Personalities
Indeed, Dr Chan believes many entrepreneurs fail due to unexpected considerations.
"The biggest challenge I have, in terms of a start-up, is actually not the technology itself," he says.
"It is dealing with the personnel.
"When you are in a start-up company, every employee is a key employee and managing that is the hardest thing."
He says he has first-hand experience of the consequences of not getting this right.
"I have been involved in a number of start-ups. Many have failed, and many of them failed not because of the technology. They failed because of personality."
The experience has taught him that in start-up companies "the whole arrangement has to be very transparent".
He advises that particularly in collaborative ventures, everyone should get a "fair deal" and that agreements should be put in writing.
Ultimately, however, Dr Chan believes entrepreneurship is about risk and risk-taking.
"I often think that jaywalkers are good entrepreneurs," he says.
"They tend to take the risks and they want to get things done very quickly."

Trouble ahead for the Cleantech markets Europe wide

I was reading an analysis from Citi group on the prospects for the European Utilities to meet there extraordinary capex demands
being faced by the Utility Sector in the decade to 2020 as it tries to meet the
enormous costs of government imposed environmental regulations and embark
upon large scale asset replacement cycle, this directly impacts the Cleantech sector, the summary below makes an interesting read, it points to still more reductions in the cost of energy required, and the capex, if companies are going to survive through the next decade




The €1trn Euro Decade –European Utilities
European Utilities sector is facing a decade of unprecedented investment
requirements. Across the five major markets (UK, Germany, France, Spain,
Italy) we estimated that the investment requirements totaled €800m in the
decade 2010 to 2020, and across the EU as a whole the figure could easily top
€1trn.
One year on we revisit this issue and ask what has changed? Unfortunately for
the governments of Europe who are driving the capex surge and are relying
upon the Utility sector to deliver their very expensive environmental policies,
the main developments in the past 12 months are all negative for capex. The
main developments are:
1. Costs up: Estimates of the total capex spend required by 2020 to
meet environmental targets and replace/re-new aging assets has risen
from €800bn to €938bn for the five major EU markets. Rising
equipment costs and additional requirements on Utility companies in
areas like energy efficiency have outweighed the delay in some
replacement expenditure;
2. Risks up: Events in Spain and Germany over the summer have
substantially increased investor perception of political risk in the Utility
sector in our view. This is particularly damaging where Utilities are
making very large investments in order to meet government
environmental targets. Much of this investment is fundamentally
uncommercial and relies upon government directed subsidy. If
companies do not have complete confidence that the subsidy regime
will be maintained beyond their investment pay-back period then
investment will not flow in our view.
3. Woeful sector performance: Since March 2009 the European Utility
sector has underperformed the wider market by 26%. Of particular
worry to policy markers should be that the underperformance has
been concentrated in the large cap generation based Utilities – the
very same companies who are expected to do most of the heavy lifting
on the capex front. The European Utility sector has been significant
de-rated both relatively and in absolute terms. This suggests that
equity investors are much less confident over the sectors future cash
flows and reflects a substantial increase in the cost of equity.



Can the Sector Finance €938bn?

From the Citigroup Global Markets report they have built a sector wide model to try and ascertain how much balance sheet headroom exists to fund the required capex. We assume that companies seek to maintain at least an A- credit rating and that power prices average
€55/MWh. With these assumption we calculate that the sector would have a
funding shortfall of €277bn that would need to be met largely through issuing
equity if it were to meet the total capex spend requirement of €938bn. Given
the cost of equity faced by the sector, such a level of equity issuance is, in our
view, highly unlikely

How lessons learned in other can help the emerging Industries

How lessons learned in other Industries can help the emerging Industries:

I was at a CPV conference a couple of years ago in San Diego, and one of the companies presenting, went through how they had improved the productivity and quality, and I was amazed at how rudimentery the techniques they had used to achieve it, and they thought this was "rocket science". This articel might help some off you who are struggling a bit to increase profit, or are struggling to get yours mind around product costs etc, and remember these techniques can be used even when outsourcing product.

A better way to measure shop floor costs

The CEO was coming to visit, and the senior plant manager at a large biotech production facility was uneasy. The latest numbers from the Finance Department hadn’t been good: the plant’s labor costs were rising, while margins were slumping. When the CEO asked what was going wrong, the manager could only describe his difficulties getting his hands around the problems.

As he explained, standard accounting measures based on the cost of goods sold meant that he couldn’t tell for sure whether margins were declining because fluctuating production volumes were reducing operating efficiency or because variations in the mix of high- and low-margin products were bringing down the plant’s average margins—or both. He thought the numbers should be better, given his knowledge of what was happening on the plant floor, but he had no way to dig into the operating details to explain quarter-on-quarter changes in productivity. That would require a much finer-grained understanding of the many components of product costs. The CEO gave the plant executive three months—until the next operating review—to come up with a better answer.

The plant manager knew he faced a devil of a time parsing the many activities of the biotech facility. For starters, the plant had seven distinct production areas and thousands of stock-keeping units (SKUs). In one laboratory-like section, PhDs mixed customized chemical products by hand. Elsewhere, fermentation and cracking lines processed biologic inputs. In another wing, staffers surveyed a continuous stream of capsules and vials as they passed through a fully automated production line. An assembly line for medical instruments occupied one wing; other areas housed testing and packaging lines. Some product families had hundreds of SKUs because of slight differences in key ingredients or concentrations. Swings in the monthly volumes and mix of production compounded the difficulty of pinpointing cost problems.

Imprecise cost accounting and its distortions

This plant was complex, but its problems are common. The issues facing its managers resemble those bedevilling myriad processes used in the fabrication of semiconductors, the production of specialty chemicals, and other applications with thousands of SKUs and complex production environments. Similarly, in our experience many managers who oversee shop floors consider traditional cost-of-goods-sold accounting—the widely used measure of operational performance—a blunt instrument. Fixed costs for capital equipment and inventory charges, for example, are averaged across SKU groups, masking changes in variable costs. When products are scrapped, that could often be due to poor forecasts by the marketing and sales functions, an issue that should be recognized in productivity measures. In most factories, multiple products often pass through the same production lines and share the same workers, making true cost assignments difficult, so the averages applied distort the true cost picture. Volume and mix swings accentuate the problem. Finally, when output volumes rise or fall, costs often don’t follow in lockstep, since there’s a time lag in consuming inventory.

The effects of getting measurements wrong can be substantial. Without good cost data, it’s hard to decide how to price products or even how much to produce. A hazy understanding of which production areas in a plant perform poorly leads to bad investment decisions. Multiplied across a large corporation’s manufacturing footprint, even minor plant-level miscalculations can have a significant impact. That’s a serious handicap in the current economic climate, since slower growth and more intense competition put a premium on operating efficiency. In plants we have examined, true costs vary from those assigned by traditional cost-accounting methods by 30 to 100 percent.

A new basis for measuring costs

The plant manager, knowing that he had no time to waste, quickly put together a team of experts, from a variety of functions, with the best knowledge of the plant’s processes and costs. The members of the team divided up the tasks facing it. Some undertook full-day fact-finding missions across the plant to get a more detailed understanding of the way processes flowed and the production staff was configured. Others pored over data on the cost of materials, labor, scrap, and overhead. After two months, the group had a plan for tackling the issues.

Clearly, the key was developing a radically detailed understanding of what happened to costs as the product mix and volumes shifted. The team mapped out three steps to accomplish this goal. First, it would define new product pathways and subpathways—granular “factories within factories” that made it possible to assign costs more accurately. Next, using a regression analysis of historical data, the team would detail cost drivers for each subpathway, an analysis based on past relationships between input costs and output produced. Finally, to account for dissimilar products, as well as for changes in the product mix and volumes, the team would define standardized “manufacturing units” (see below) that would allow productivity to be measured across time periods.

Using pathways to fine-tune product segments

The team grouped the plant’s product lines into pathways according to their common characteristics, such as the types of workers handling them and the processes used to manufacture them. In some cases, different pathways share labor or machinery. These high-level pathways, for example, separated biologics from chemical solutions and from instrument assembly. To delineate costs clearly, each pathway had its own measure of output: grams of gel for biologics, milliliters for chemicals, and pieces for instruments. The result was a set of distinct product families, each comprising several narrowly focused lines that shared common traits.

Building profiles of cost drivers

The next step was to identify cost drivers for each subpathway to help estimate input costs by the amount of output produced. Team members mined data on materials, labor, capital costs, scrapping charges, and other costs for each subpathway’s finely tuned production units. The team used statistical estimates to build these profiles, because materials and labor costs don’t rise and fall in linear fashion as output changes. (A 15 percent increase in the output of chemical solutions, for example, raises total hourly wages by only 10 percent, thanks to scale economies.) To estimate these cost and volume relationships, the team performed hundreds of regression analyses on historical cost data.

With the pathways and information on cost drivers in place, the factory team could accurately assign the amounts of chemical and biological compounds, labor inputs, and in-process scrap that went into, say, the creation of a vial. Take the example of a shop floor area that processed both vials of chemicals and biologic capsules. Traditional accounting averaged labor costs for this area across all the biologic and chemical products that passed through the line; only minor adjustments were made for variations in the mix or in volumes. The new data on cost drivers, by contrast, made it possible to measure labor costs down to a fraction of a penny for each of the more precisely defined product pathways.

Standardize output with manufacturing units

These new metrics gave a highly accurate picture of how costs varied within each pathway when volumes or the product mix changed. But the team still had no way to get a broad picture of productivity fluctuations across the entire facility and across time periods as mixes and volumes changed. This was an apples-and-oranges problem: as the mix of vials and capsules fluctuated, there was no meaningful way to add vials measured in milliliters to capsules measured in grams across time periods to get a baseline output figure.

With pathway and cost driver analysis, the team could assess productivity change across periods by modeling the predicted production costs of each pathway and comparing them with actual incurred costs. To solve the apples-and-oranges problem, the team denominated these input costs in standardized manufacturing units, which allowed costs at the most granular levels to be rolled up to pathways and, critically, to the site level. This approach provided the big picture on costs and changes in productivity (for a before-and-after example, see the interactive exhibit, “Product pathways reveal true costs”).

Product pathways reveal true costs

Pathways and standardized manufacturing units reveal how costs vary when volumes or product mix change.

Here’s an illustration. In a base quarter, the biologics pathway might produce 1,000 grams of gel at an expected cost of $500 (in direct and indirect labor), the chemicals pathway 500 milliliters at an expected cost of $1,000 (also in direct and indirect labor). The computation assigns a value of 1 manufacturing unit for every $50 in production costs, so the first pathway earned 10 manufacturing units ($500 divided by 50), the second pathway 20 ($1,000 divided by $50), for a total of 30 manufacturing units. If in a subsequent quarter, the actual cost of producing 1,000 grams of gel fell to $450, the cost per manufacturing unit would fall to $45, from $50—for a productivity gain of 10 percent. Similarly, changes in total costs in other pathways can be compared with regression-expected costs and the totals rolled up across pathways for a view of overall productivity change at a site.

Applying the lessons

At the next quarterly meeting with the CEO, the new metrics were in force. Repeating the pattern of past meetings, the Finance Department reported numbers that seemed to show persistent problems. Labor costs and the number of labor hours worked had fallen, indicating a falloff in business. Meanwhile, raw-material inputs had skyrocketed. Using the newly developed pathway cost numbers, however, the plant executive showed that production volumes rose substantially in the instruments line but had dropped significantly for chemicals. The production of instruments involves high costs for materials but not much for labor—the exact opposite of the pattern for chemical products. That explained how the cost of goods sold could climb in the face of declining hours.

What about productivity? An analysis based on manufacturing units showed that it had risen by 5 percent. While the product mix had shifted substantially, total output, as measured by manufacturing units, had risen by 3 percent; the inputs used to produce those manufacturing units had fallen by 2 percent.

The CEO incorporated the new metrics into company-wide reporting practices, and the gaps between operations and financial-performance measures diminished across the organization (see sidebar, “Managers’ checklist: Locking new cost measures into company practice”). A clearer picture of product margins allowed management to drop a range of poorly performing SKUs and to shift resources to higher-margin products. A more detailed understanding of costs led the company to realize further economies by shifting some production to sites where higher volumes would help absorb high fixed costs. The new measures also entered the company’s performance dashboards, and factory managers began tracking leading indicators of productivity, such as in-process materials scrap and labor utilization rates, on a daily basis.

In the wake of the recession, the demand for increased operating efficiency remains high. But disparities between financial and plant measures of costs and productivity exist at many manufacturing facilities. A better alignment, based on the enhanced gathering and analysis of data, can improve efficiency and provide a stronger foundation for pricing and product strategies.

About the Authors

Jon Duane is a director in McKinsey’s Silicon Valley office, where Nazgol Moussavi is a consultant and Nick Santhanam is a principal.The authors would like to acknowledge the contributions of Susan Ringus, an alumnus of the Pittsburgh office, to the development of this article.

Spinning out a business is just the start

I found an interesting article in the scotsman today it was praising the number of start ups produced by Edinburgh University spun out during 2009, but if you dig down some interesting statistics can be found, the investment raised across the 40 companies equates to £75k, this was raised across public bodies and financial institutes, if we looked at the funds under management in Scotland by the financial sectors this not a even a blip on the P&l, and that cash does not go far, at one of the hi-tech business incubators you can pay £250 /SqM a month for accommodation/lab space.....

The really interesting piece of information, but not from the Scotsman but one of the comments was that out of "111 companies employing, on average,3 people, at least 2 of those 3 will be the technical originators". I would agree with this comment, and it points to the need for these companies to be able to access, the commercial skills and resources to help them build there companies, but will not be able to as they do not have the financial resources to do so, if Scotland wants to generate jobs, and see us getting out of this hole we are in there needs to be a rethink in how these start ups are financed and supported.

What is the answer, I am not sure, (But I have a few ideas), but unless we get it fixed soon, there will be a large attrition rate for these start ups, yes it is good to see Scottish innovation, but it will be better to see lower unemployment and more international Scottish companies.

GW

Does Your Service Suck?

This a fundamental part of your business, it could stop that all important repeat business or word of mouth business, and it does not take much to make a customer paying or not dislike your business. Companies underestimate the power of customer service...think about the last time you called your favorite bank and got a call center in a far off non english speaking country , (not all are bad) This article suggests a low cost method to see what your own company is like, or if you like I can have a look for you.

Does Your Service Suck? Do Business with Yourself and Find Out

By Michael Hess

How many of you put your own business through its paces, either as an actual customer or a spy? I’ll bet not many, and for those who do, probably not often enough. It may seem like obvious, old-school stuff, but there’s no better way to see how you really look to the world — and to test the quality of your service and your people — than to “do business with yourself.” If you never look in from the outside, it’s like being in a room with no mirrors: Your fly might be down, and everyone knows it but you.

There are many ways to test your own company. I urge you to do at least a few of the things below at least a few times a year. For these self-examinations to be effective, it is critical that you approach them without defensiveness, pride, ego, or company-think. Just be Joe Outsider, be honest with yourself (the odds provided below are based on brutal honesty), and be prepared to say, “Boy, we really stink at that.”

• Give yourself a call: Most automated customer service systems drive customers crazy. Typically the level of insanity is directly proportionate to company size, but even small companies have been known to serve up some telephonic hell. So ring yourself up and try to accomplish a few phone service goals. And above all, test how easy or difficult it is to get to a real person quickly.
  Odds you’ll be OK with it, 59.5%. Odds you’ll be thrilled, 19.4%
• Pay yourself a visit: If your business involves walk-ins, well, walk in. Of course, in a small business where everyone knows everyone, this is a silly idea… unless you are really good with disguises. But if your company is larger or has multiple locations, and you can get away with it, do the age-old “secret shopper” test (or have a trusted friend or relative do it). See what it’s like to be a visitor on your planet.
  Odds you’ll be OK with it, 71.7%. Odds you’ll be thrilled, 30.9%
• Surf your site: If you have a website and you don’t use it yourself, you are missing (or avoiding) one of the simplest and most important self-tests for any business. You must make the time, on an ongoing basis, to surf and test every nook, cranny, function, and feature of your site. I guarantee you will find things that need fixing.
  Odds you’ll be OK with it, 79.1%. Odds you’ll be thrilled, 20.8%
• Buy yourself something: Whether by phone, online, in person, or even by mail (yes, there are people who still do that), complete a transaction with your company. Browse, get assistance, buy, and even return/exchange. Again, if you might be recognized, use a trusted shill. But one way or another, you absolutely must test the customer experience from start to finish.
  Odds you’ll be OK with it, 72.1%. Odds you’ll be thrilled, 26.9%
• Sell yourself something: This is for advanced players. Most companies give “cold-callers” the runaround, and many treat them like dirt. Sometimes it’s hard not to, when for every reasonable call there are many more unwelcome and often annoying solicitations. But people who sell you things are part of your business. And if your goal is to run a business with class, this is a challenging but necessary element of it… perhaps the ultimate test. Can you accommodate legit inquiries, while dispensing with pests efficiently yet as politely as possible?
  Odds you’ll be OK with it, 38.8%. Odds you’ll be thrilled, 9.6%

There are other tests as well: See what people are saying in online forums and social media, read your literature and your press, talk to customers, employees and suppliers. Create a detailed checklist of the things you want to test (phone courtesy, hold time, ease of online checkout, delivery, etc.) and grade yourself honestly.

One of my favorites: The “google suck-test.” Go to a search engine and enter “[your company name] sucks.” Hopefully nothing will pop up about your business. Plug in just about any major company or brand name and you’re almost guaranteed to see plenty. Take it as a cautionary tale. I do it from time to time and am proud to say Skooba Design has gone its entire ten years without sucking. It’s the only time I don’t want search engine hits.

One way or another, find a way to see your company from as many outside perspectives as possible.

Do you test your own business? If not, stop reading this and start doing business with yourself. But if you do kick your own tires, I’d love to hear how you do it and what you’ve learned.

from BNET

Career Coaching on a budget

I came over this post on Career Coaching and it resonated with me, I have mixed feelings about using a Career Coach, no doubt they know there stuff, and can tell you how to dress, how to speak, how to mingle, how to think, but then I think at the end off all that coaching, who are you really, it is not you. I would rather take time out and evaluate, do a SWOT analysis on yourself if you need a structure, but understand what are your core values, and your strengths, play to them and look at how to combat your weaknesses, that's what Sir Richard Branson did, he built a team around himself, guys and girls who were best in class at what they did, and he led them, that's what a good entrepreneur should look to do, understand yourself, and then build the team, or tool box that strengths the weak part of your game, and "γνῶθι σεαυτόνgnōthi seauton" OR "KNOW THYSELF"

Your Best Career Coach: The Future You

The best coaching you’ll ever get will not come from another person. It will come from inside you.Take a deep breath. Take a deeper breath. Imagine that you’re 100 years old and you’re getting ready to die. Before you take that last breath, you’re given a wonderful gift: the opportunity to go back in time and talk with the person who is reading this blog post today, to help this younger version of yourself have a better life — both personally and professionally.

What advice would the wise 100-year-old you — who finally knows what really mattered in life — have for the you that is reading this blog post? As you think of the older you, whatever advice comes to mind, just do that.

In terms of performance appraisals, this is the only one that will matter. At the end of the day, the only person that you will need to impress is that old person that will one day look back at you from the mirror. If that old person thinks that you did the right thing, you did. If that old person thinks that you made a mistake, you did. You don’t have to impress anyone else.

Some good friends of mine had the opportunity to ask old people who were facing death what advice they would have for their younger selves. Three themes emerged:

1. Be happy now. Don’t wait for next week, next month or next year. A common regret of old people was, “I got so focused on trying to get what I did not have, I failed to appreciate all that I did have. I had almost everything. I wish that I would’ve taken the time to appreciate it.”

I ‘ve asked thousand of parents around the world to complete this sentence, “When my children grow up, I want them to be…” One world is mentioned more than all of the other words combined — no matter what country I am in. What is that word? Happy.

Do you want your children to be happy? Do you want your parents to be happy? Do you want the people that love you to be happy? Do you want the people who respect you at work to be happy? Then, you go first. They want you to be happy, too.

2. Build relationships and help people, especially friends and family. When you’re 100 years old and you look around your death bed, no fellow employees will be waving good-bye. You’ll finally realize that your friends and family are the only ones that care. They are the ones that matter.

Of course, building relationships and helping people are also keys to ultimate satisfaction with your professional career. I have asked many retired CEOs an important question about their professional lives, “What were you most proud of?” So far, none have talked about have large their offices were. All they talked about were the people they helped.

The main reason to help people has nothing to do with money, status or promotion. The main reason is simple: the 100-year-old you will be proud of you if you did — and disappointed in you if you didn’t.

3. If you have a dream, go for it.

If you don’t try to achieve your dreams when you are 25, you probably won’t when you are 45, 65 or 85. None of us will achieve all of our dreams. The key question is not, “Did I achieve all of my dreams?” The key question is, “Did I at least try?” Old people almost never regretted the risks they took that failed. They almost always regretted the risks that they failed to take.

No one else can tell you how to find happiness, who to love or where to find meaning. Only you can answer these questions. The best coachingthat you will ever receive will not come from any other person, it will come from inside you. So, what advice would the “old you” have for the you that just read this post? If you don’t mind sharing your thoughts with other readers, I’d love to hear them.

By Marshall Goldsmith
Bnet

Gordon Whyte say's be prepared

This article below emphasises a motto I learned with a young boy scout, Be Prepared. Your Industry may not be the Solar industry, but just ready through it and see how easy it is to get caught out.



Polysilicon supply chain issues emerging as spot prices rise,
says Barclays Capital


Just when it was safe to say that the severe polysilicon shortages from a few years ago were long-gone and that a era of oversupply boded well for users in the solar industry, issues have emerged within the supply chain that are forcing spot prices higher once again. According to a report from Barclays Capital financial analyst, Visal Shah, checks have shown that spot prices have risen to as high as US$70-80/kg, yet spot prices were at US$55-60/kg range, only a few weeks ago. Bottlenecks were said to have appeared from polysilicon through to wafering, according to the analyst.

Shah noted in his investor note that there were several issues most likely affecting spot prices at the moment. There have been polysilicon supply issues due to production halts due to technical problems such as fires at LDK’s polysilicon plant, which Shah said had meant the plant needed to be shutdown recently.

This had led to LDK attempting to secure as much polysilicon for its wafer production operations due to strong demand for wafers.

Another producer in China, Xinguang had shut operations completely, while it worked to replace old production equipment and systems originally supplied from Russia to modern technology that would enable the company to compete better in the future. Barclays Capital said Xinguang’s capacity before the shutdown had been 1,200MT/yr.

The well documented recent power outage at an REC run plant was also cited as a catalyst behind polysilicon shortfalls and higher demand for spot polysilicon.

However, the report also links capacity mismatch issues at the wafer and cell segment of the supply chain notably that checks has shown that ingot capacity currently exceeded wire saw capacity, which remained ‘tight.’

In periods of high-demand for wire saw systems, lead times can extend considerably due to the complexity of the machines and set-up times before entering production. Although key equipment suppliers such as Meyer Burger and Applied Materials HCT arm have added capacity over the last few years to meet the last major wave of orders, the current wafer capacity additions are on a completely different scale than those seen in 2007 and 2008.

Barclays Capital noted that one customer of Applied Materials HCT arm had equipment scheduled originally for delivery in February, 2010 but received the order five months later.

Although common practice to multiple-source wafering equipment, demand for equipment is high and difficult to find suppliers without supply constraints as all equipment is usually made to order.

Shah also noted that there had been an overall higher than anticipated wafer and cell capacity additions in July to August timeframe yet manufacturers were unable to obtain polysilicon, especially on the spot market.

Shah believes that most polysilicon suppliers have contracted nearly 100% of the volumes to long term contracts in order to avoid the sharp swings in spot market, leaving suppliers unable to fulfil increased demand from the spot market, despite attractive prices.








Talk soon Gordon

why VCs don't get entrepreneurs

It has been a while since I have posted here, I will get back to regular posting now, it has been a busy time the last 6 weeks, after being made redundant, I took a week out to recharge and analysis the last job with www.narec.co.uk , it was interesting and a challenge, opened my eyes to the failure of the government to manage these sink holes for our hard earned taxes, but that is another story, anyway the article below, stirred me to step up my search for my next job, which is more and more looking like it will be outside the UK...hope you enjoy the article... " class="headline">William Chase: Down to earth

Spud king William Chase

The founder of Tyrrells tells GB how he won a prestigious international award for his British-made vodka and explains why VCs don't get entrepreneurs.

It might come as a surprise, but the world’s finest vodka is distilled and bottled less than 50 miles from Birmingham.

Chase Vodka was named best in show at the San Francisco World Spirits Competition, beating 249 rivals from Russia, Poland, Sweden, France, the US and every other vodka-producing country. It’s produced in Herefordshire under the supervision of William Chase, still a ‘humble potato farmer’ as he describes himself, but probably better known as the man behind Tyrrells Crisps, which he sold for £40 million to private equity firm Langholm Capital in April 2008.

While he’s clearly immensely proud of his vodka’s international standing, Chase does his best to tear down any shreds of mystique surrounding what goes into it. ‘It’s all down to the equipment,’ he explains, adding that the spirit is turned from liquid to vapour 50 times inside a traditional copper still with modern add-ons. ‘We could make up stories about how it’s all about having exactly the right kind of potato, but when you’re mashing it up, distilling it...’ He has a habit of not finishing sentences, but the implication is clear: one mashed-up spud is pretty much like another.

In fact, that’s not entirely true. A large part of the appeal of Chase Vodka, and Tyrrells Crisps for that matter, is down to the fact that the potatoes that go into it come from Chase Farm in Herefordshire. That’s how he can be confident it is ‘pure, as good as it can be, fully traceable’. But in the vodka’s case, the distillation process and the lack of any filtration afterwards is the real key to its success. It comes at a price: Chase Vodka costs £33 a bottle, and Chase intends to hold the premium. ‘That’s why we’re in no rush to expand,’ he explains. He sells about 1,000 bottles a week and annual sales are around £1 million.

Slow burner

A late developer as an entrepreneur, Chase’s fame and wealth has come in the fifth decade of his life. The first 40 years were very different. ‘All the decisions you make in life, the crossroads – whether to go to university or not, the people you meet, how you get into one occupation or another – I find it fascinating,’ he says, the rhythm of his speech like a winding country road. ‘When you’re young, it’s all about the glamour – you might want to be a fireman, an airline pilot. I wanted to be a farmer. But I couldn’t make money. I tried as hard as I could, but I couldn’t make enough to have a nice lifestyle.’

'I didn't want to sell my brand at Walkers prices'

Though Chase’s account of his early days is softened by the success he has enjoyed since then, life was certainly no rural idyll. He borrowed money at the age of 24 to buy his father’s farm and struggled for years to try and make it work. By 1992 he was paying his bank ‘about 30 per cent interest’ on his loan, a consequence of the very high rates of the time and the fact he had exceeded his agreed limit. ‘That nobbled the business,’ he says. ‘I sold the car and started again with nothing.’

He now sees the bankruptcy as a formative experience – ‘it did me a lot of good’ – but it took him another ten years to hit on his winning formula for Tyrrells. In the meantime he made a living as a middleman ‘supplying supermarkets with pretty-looking potatoes’, an increasingly successful business as giants such as Tesco grew in strength and became fussier about the look of their products.

Love-hate relationship

Chase’s relationship with supermarkets has always been complicated. After a well-publicised fall-out with Tesco in 2006, he was depicted by newspapers as the winner of a David and Goliath struggle against the retail giant’s bully-boy tactics. In fact, he speaks highly of the soon-to-retire Tesco CEO Terry Leahy and believes that supermarkets ‘did a lot for the food industry’ in the 1980s by cleaning up hygiene standards and offering families food that was consistently safe to eat.

‘I have nothing personally against Tesco,’ he says. ‘If we didn’t have bar-coded, pre-packaged food, shopping as we know it physically wouldn’t happen. People will say “poor farmers” but the most important thing is that they want their food to be on the supermarket shelves and they want to know it’s not going to hurt their children.’

At the same time, Chase recognises that supermarkets’ buying power has made things very hard for farmers, forcing them to either go down the premium route, as he has done, or massively increase their scale and efficiency to drive down costs. ‘It’s tough out there,’ he admits. ‘When you are just supplying a commodity you’re at the end of the chain, and if there’s anything left for you then you take what you’re given.’

Crisp moves

It was this squeeze on prices that in the end drove Chase to the conclusion that he needed to move up the value chain – to create a brand that people would pay a premium for and keep it out of the mainstream supermarkets.

Tyrrells was born in 2002 with the help of a bank loan: the start of a ‘fantastic educational process’ that taught Chase about branding, marketing and PR, just as being a middleman between farmers and supermarkets had taught him how to use personal charm to get a deal done.

Chase believes passionately that ‘there is no book of rules in life – if you believe there is, nothing ever happens’. He got his crisps into Russia by sending a single container to a retailer, who came back for another one. Before long, the product had spread all over the country. ‘To get your brand overseas, people will say you need to pay listing fees, you need marketing, advertising and so on. All we did was seed it,’ he recalls.

There were mistakes, too. In the early days of Tyrrells, Chase tried to get by with a packaging machine that wasn’t up to the job and spewed out every other crisp packet onto the floor, wasted. ‘That almost caused the business to implode,’ he notes. In the end he had to buy a proven model.

Arguably, Tyrrells benefited most from Chase’s natural flair for PR. He lost half his potatoes one year due to flooding. Rather than drowning his sorrows, he took a boat out into the middle of a flooded field, took some pictures and sent them to all the newspapers.

Cut to the Chase

What really raised Tyrrells to prominence, however, was the spat with Tesco. The supermarket, not an official supplier of Tyrrells crisps, got hold of some and started to sell them at a reduced price. Chase’s objections were ignored until he sought legal advice, at which point Tesco unexpectedly backed down.

‘I didn’t want to sell my brand at Walkers or Kettle Chips prices,’ says Chase. ‘The next thing I knew I was doing about 20 interviews. It was a hell of a decision, a difficult thing to do.’ But it paid off: not only did Chase win the important battle to control his own prices, but the story was covered by all the major newspapers and the BBC.

Chase maintains that he had no intention of selling the business until he was approached by Langholm. ‘It just came up. I didn’t really want to sell. Some days anyway, I wish I’d never sold.’

Langholm had a persuasive argument. Its offer valued Tyrrells at £40 million, ten times its annual profits (sales were £14 million). For a man whose understanding of the value of assets had been shaped by decades of hard business experience, the offer was simply too good to refuse.

‘If a company is worth £40 million but just on its profits, not on its assets, it wants selling,’ he says. ‘At the time I was getting divorced and I thought it would help with all that. It didn’t, in the end.’

Goodbye Mr Chips

There is definitely a tinge of regret in how Chase talks about the sale. Although he still has a 20 per cent stake in Tyrrells, the deal with Langholm involved him leaving the company immediately.

‘A lot of entrepreneurs are mavericks, and the first thing VCs want to do is get rid of them,’ he muses. ‘Nobody prepared me for that – the fact that they see the entrepreneur as a total nutcase. They can’t deal with the fact that this person is coming into work every day doing everything by feel. They couldn’t possibly do things like that. Everyone has to be responsible, accountable. And of course they have to work like that.’

'I didn't really want to sell. Some days, I wish I never had'

It’s a bit like his view of the supermarkets. Both intensely practical and deeply idealistic, Chase understands why things have to be the way they are, but he can’t help a rebellious tendency to challenge the status quo. If someone gets out a laptop to show him a presentation, he tells them to put it away. ‘I’m not a corporate type. I’m quite arrogant about it. I’ll tell people I don’t want to see all that rubbish – just use your charisma and charm and see if you can sell me something.’

Tyrrells’ current management team, on the other hand, are ‘proper corporates who believe in a book of rules’. Though they still call him for advice on occasion, decisions are sometimes made he doesn’t agree with – like the launch of three flavours of crisps before the general election, one for each of the major parties. ‘That bombed. You must never get political. I had the idea for a credit crunch crisp – I thought it was a great idea but they didn’t do it.’

Fortunately, Chase still gets an adequate outlet for his creativity. The man who brought us parsnip, beetroot and carrot flavoured crisps is now selling marmalade vodka and has visions of potato-based cosmetics. ‘Premium cosmetics is a market I would love to get into, but it’s very difficult,’ he explains, before his sensible side kicks in. ‘Of course, vodka is number one. We don’t want to become a jack-of-all-trades.’

He hasn’t lost his flair for PR, either. Recently, he stepped in with an offer to save the government website lovechips.co.uk, which has been threatened with the coalition’s axe. If people didn’t know there was a government website to promote potatoes, they do now.

It’s typical of the way Chase likes to do things – audacious, attention-grabbing, but with an underlying message about his values, which for all his grasp of marketing remain firmly rooted in the soil.

from Growth Business

http://www.growthbusiness.co.uk/channels/entrepreneurs/business-leaders/1270728/william-chase-down-to-earth.thtml

Sales process for the Start Up

One thing you will have noticed when you talk to an investor is there passion for your sales projection, order book and customer sales funnel, nothing gets an investor ready to sign up and part with the cash more than a strong route to a growing market. The scary thing is if you were asked what is your sales order process can you show them ? from the initial enquiry through to the repeat order, do you have a customer satisfaction feedback process ? The process I will show here would be modified to suit your own business , but it captures the essence of what you should be doing...nothing complex just Keep It Simple Smarty.

An Intro to the Super-Simple Sales Process
extract from
Don’t Be Afraid of the S-Word
By Uzi Shmilovici

Fortunately, managing sales is actually much less daunting than it might sound. My company uses a very simple seven-bucket sales process. It goes like this:

1. Track and categorize new business leads. If you receive an email or a phone call from a prospective customer, you want to record the discussed project/deal in this stage. Try to understand where the leads came from. Tracking that will help you understand which marketing channels work best for you. Did they see your website? Hear you speak at a conference? Learn about you from a colleague or friend?

2. Determine the quality of the lead. All leads are not created equal. Upon receiving the lead, try to assess if this lead is qualified. More specifically:

* Do they have the budget to work with you? You can gently ask this in the first call or even mention your usual rates for such projects and evaluate your prospect’s response.
* Are they of the right size? If you’re used to working with startups on two-month projects, working with Fortune 500 companies on two-year projects might be unrealistic and unwise.
* Is the prospect serious about this project? Assess whether or not they are ready to pull the trigger. Is there budget allocated for the project? Is there a timeline for kicking off the project?
* Are you passionate about this project? If you have many potential leads in your pipeline, you may decide it’s not worth pursuing a project that seems too boring or not challenging enough.

Remember that client who said that we were “pretty expensive” for them? A qualifying question in the first phone call could have saved us many hours of working on this deal. If you decide that the deal is unqualified, you just save it under another bucket: the unqualified deals bucket. On the other hand, if it’s qualified, move it forward in the process to the qualified stage.

3. Gather the requirements for the project. This will usually involve securing documents from the customer and/or meeting them face-to-face to gather the requirements. The purpose is to confirm that you want to do the project, and to gather enough information to write a quote.

4. Prepare the quote. If a deal arrives at this stage, you want to win it. Particularly, if you are juggling a number of quotes, it’s wise to set reminders so you don’t miss any deadline. Failure to submit a quote on time signals to your potential clients that you are not professional and unable to handle even a straight-forward follow-up.

5. Close the deal. Nothing can guarantee that you will actually win a deal but two crucial best practices can definitely increase your chances:

* Confirm receipt of the quote, and respond to any concerns. Call your prospect to check that she received your proposal, and to see if she has any questions. You don’t want to lose the deal because of a simple misunderstanding about your approach or pricing.
* Follow up again, and demonstrate your expertise. Set a reminder for yourself to follow up with her within a couple of days. When you make that next call (or email), try to pepper the conversation with a few comments that demonstrate your knowledge and generosity.

6. Celebrate. Congratulations! You’ve won the deal! Keeping track of all the deals you close will help you understand what kind of deals you typically win and will help you improve your qualifying process. Also, try to understand where those deals originated. If 80% came from your portfolio website on Behance, then you should keep growing and improving it as it is a major source of business.

7. Or, analyze and regroup. Lost the deal? Ugh, bummer. But, this is a great opportunity for you to learn why this happened. Try to understand and keep note of the reason for every deal you lose. Losing too many deals because you are expensive? Maybe you should consider lowering your prices or, better yet, seek a different type of customer who can afford your high-quality work.

How much can following this process improve your sales? 10% improvement? 500% improvement? I’ve seen both. It depends on how effective you are, how good your work is, and how much you care about making the sales happen.

As my friend said, we are all selling at the end of the day. So, stop being afraid of the S-word. By finding a way to balance your creative role with giving sales the proper attention, you can improve the projects you’re working on and grow your business.

Gordon Whyte

Customers, What do they really think about your company

Customer feedback or not

I have myself lost track slightly of my customers in times gone past, once the PO is placed and the Invoice paid it's on to the next fire to fight, funding event, board meeting, flight to catch, in a small early stage company 2 to 3 employees, it is hard to follow up regularly, if your cutomer based is more that 40 companies, you end up priotitiseing the customer base and chaseing up the next order, you never take too much time to get to know what your customers think about you, what you could do better, and where there buisness is going etc, these things are taken care off when you grow and can afford a biz dep person, but until you get there , it's up to you. I myself spend time now and make it a point to touch bases on the phone with the main customers regularly every couple of weeks..and the rest by email every 4 to 6 weeks, I have found that this has improved the business and customer retention.

This article below details customer feed back questions, some you should know the answers too anyway, but others are interesting it can be found on the Bnet UK webpage>

10 Customer Feedback Questions You Need to Ask Yourself

Lots of organisations invest a lot of time, money and effort in getting customer feedback. I also think that lots of organisations waste lots of time, money and effort in getting customer feedback.

Why? They ask the wrong questions, they ask lots of questions, but don’t actually listen, or they listen to the answers and then do nothing about what they hear.

I’m all for getting customer feedback –- it’s a great source of ideas, opportunities, improvements, and it demonstrates to your customers you care, provided you do listen and then take action.

Too many organisations simply get boxes ticked, go through the motions, and ask questions that don’t make them too uncomfortable.

So, just to get you thinking, here are 10 questions you might want to consider asking your customers that challenge the status quo and possibly improve your performance, attitude and relationships.

1. What attracted you to us originally? This helps get a view of how you are seen in the market place and what are the things that appeal to your customers.
2. What would you do if we weren’t here? This may give an insight into the value they place on you as a supplier — Would they actually notice if you disappeared?
3. Can you name one particular individual who has impressed you in our organisation? This highlights your customer champions, and maybe some of your unsung heroes. If they can’t name anyone, what does that say about the way your people interact with your customers?
4. What one thing could we do better? Just one thing -– it may highlight their priorities and key issues.
5. Why do you buy from us? This highlights your strengths –- some of which, you may not be aware of. Be careful how you phrase this one. You might sound as if you’re doubting yourselves.
6. If our business was the best in the world, what would it look like? This one stretches the imagination, and even though you may not be able to deliver exactly what they say, it may give you a few ideas about what they see as important.
7. Name one thing that we do or don’t do that irritates you –- The key is doing something about it.
8. Who can we learn from? This helps you identify who your customers see as role models, and might just point something out that’s not happening in your industry you could learn from.
9. What would you say to someone else who asked you about us? Their initial response to this is often a revealing one.
10. What is the one thing we should never stop doing? This one tells you what they really value about you.

You may feel you can’t ask these questions to your customers. That’s not a problem, as long as you can find some questions that you can ask.

Article by Andy Hanselman he is an independent consultant specialising in improving business competitiveness. He has authored two books: ‘Thinking in 3D – Creating A Business That’s Dramatically And Demonstrably Different’, and ‘Revolutionise The Profitability Of Your Business’, and is currently writing his third, ‘Maximising Customer Relationships’.

Negotiation:- Make or Brake the business ( deals and wheels)

Negotiation:- Make or Brake the business:

Deals and wheels


I have been absent for a while from blogging , I have been joining the other 8% of the population in the UK who are looking for there next job. I did see a post on negotiating deals and it struck a cord with me, I remembered how it was always hard to get the techie guys to negotiate prices with suppliers they just accepted the deal and cost the company. I am not saying that everyone should negotiate the cost, but it is a good habit to get everyone to participate in who is dealing with a supplier or customer, build the culture.

I used to ask the Tech guys did they always take first offer when buying a car? it is a life skill that will stand you and your company in good stead for the future. I have negotiated with the 800lb gorillas, www.tsmc.com , www.umc.com , www.smics.com ,www.appliedmaterials.com LDK, REC to name a few, and following the golden rules of strategic supplier negotiating I have managed to get better service and pricing, a lower price may not be the best way forward, but better terms, free design help, failure analysis to mention a few all can be bundled as a better deal.

These are the few gems I picked from the post by Martin Gaston on BNET
( http://blogs.bnet.co.uk/sterling-performance/2010/05/04/a-bluffer%E2%80%99s-guide-to-negotiating/)


1. Tell it like it is

If you’re sending mixed messages to your supplier, they won’t know you’re unhappy. Be clear about what you can afford and what you expect. If you think a quote is too high, say so. Don’t be afraid to be honest.

If you’re unprepared to buy at a certain price then tell them you’re not interested and then return to the negotating table to work out a better deal.

2. Do your homework

If you’ve been dealing with a supplier for a long time, have you actually sat down and considered the costs of switching to another business? Are there hidden costs to switching that your supplier’s all too aware of — or could you do better with another business. Knowledge can be powerful — and may be all you need to get a deal re-evaluated.

If you’re looking to renegotiate a contract, do your homework and demonstrate you’re already aware of the what’s on offer in your market and of the alternatives available. If you can demonstrate where your supplier is falling down on service, they’ll be forced to do better or risk losing your business.

3. Be realistic

It’s natural to want to want as much for as little as possible, but it’s also worth thinking about whether or not your demands are realistic. The economic climate might require that you cut costs, but it’s also important carefully to maintain service levels.

If you go into a negotiation with an unreasonable set of demands, suppliers may see your business as more trouble than it’s worth. What is essential? What can you live without? Answer these questions before you speak to your supplier, or you may feel railroaded.

4. It’s about compromise

You might be tempted to walk away from an unfair quote, but instead of closing down the negotiations entirely, think about what you’d be prepared to compromise to hit your financial targets.

It might sound obvious, but negotiations are about essentially about give and take — if you’re unprepared to give anything up, you and your supplier lose out.

5. Say what you mean

… and mean what you say. There’s no point in threatening to ditch a software provider to go open-source if you have absolutely no intention of doing it, for example — it’ll just make you look silly in the eyes of your current suppliers.

Be honest, upfront and consistent with your message then you’ll find yourself cultivating better results and working relationships with your essential suppliers.

I hope this helps.....

and any leads for a new job for myself will be rewarded :)

Have a good week

Thoughts on Technology Transfer

I have been looking at technology transfer methedology of late, I have transfered technology in the past, for a selection of companies and universities, and I have assembled some thoughts on the technology transfer from academic institutes and a proposed model that I have used many times in young companies.

University technology transfer - why so difficult?

Universities produce lots of research, patents, and base technologies. Few of them ever make it to the commercial market. Yet, lots of recent college grads start companies that bring amazing innovations to market. Why the disconnect? The obvious conclusion is academic versus business thinking. Not so fast. If that were true, corporate research labs would transfer most of it's research into new and existing products. The truth is a very small percentage of corporate research ever makes it to market.

The biggest factor seems to be the fundamental differences between research and product development. Research focuses on advancing technology without being constrained by business requirements. Product development starts with examination of customer needs and business requirements, and matches existing technologies to the problems.

Technology Licensing - Most big universities have Technology Licensing Offices that handle technology transfer on behalf of the university. MIT in Cambridge has one of the best TLO's I have worked with. VCs are constantly looking at technologies from universities more so in North America, but my guess is they represent less than 5% of the companies they fund, probably much less. What are the issues with TLO deals?

• Disagreement on value of technology
• No proven customer/market fit for the technology
• Key technology researchers will not transfer with the technology
• Complicated Intellectual Property (IP) ownership issues
• Long term royalties that may not make sense for the product evolution

Its All About The People - VCs invest in people not technologies. Entrepreneurs have a balance of business sense and technology smarts that is very rare. Matching entrepreneurs to technology wizards is where VC firms add a lot of value. They have a list of serial entrepreneurs that they know and trust. Magic happens when they match these entrepreneurs to cool new research.

So how do you handle the technology transfer once you have the IP agreed, well you can use a model such as the Stage-Gate Process

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The Stage-Gate Product Innovation process is a carefully designed business process – the result of the world’s most comprehensive research into understanding what discriminates product success and failure. Pioneered and developed by Dr. Robert G. Cooper, it is the world’s most widely implemented and trusted product innovation introduction process.

A Stage-Gate Process is a conceptual and operational roadmap for moving a new-product project from idea to launch. Stage-Gate divides the effort into distinct stages separated by management decision gates. Cross-functional teams must successfully complete a prescribed set of related cross-functional tasks in each stage prior to obtaining management approval to proceed to the next stage of product development.

So I hope this has given you some things to think through when you are ready to do soem technology transfer, or you could give me a call


Regards
Gordon

I am looking for a problem to solve, a company to build..and to keep in the good books with the bank and money lenders :) at the same time

"I am looking for a problem to solve a company to build..and to keep in the good books with the bank and money lenders :) at the same time"

I would like to enlist the help of my readers in my search for a new position, I have started to look for a new role, so if you have a challenge in your business or need some help and think I can be off assistance please feel free to get in touch, or if you know someone else who could use my help then by all means let them know as well. The other thing would be if you are looking yourself for a new role then please feel free to get in touch or maybe if you are local we can meet up and maybe we can help each other out at the same time. I have inserted a personal summary and a brief synopsis of the last three years work in the Solar Industry as a starter. I hope you all have a good weekend and keep the faith.

LinkedIn Profile : http://uk.linkedin.com/in/gordonwhyte

Summary Gordon Whyte ( Cert Mgmt (Open) )

Entrepreneurial senior operations executive, who has managed multi-disciplined teams delivering complex projects worldwide in high technology based businesses, including Multinational and start up businesses. Has selected and managed sub-contract manufacturing businesses, utilizing low cost countries and mainland European organizations, (including semiconductor foundries, PCB board manufacturing, discrete active components and sub assemblies), has introduced new products from feasibility study through to commercialization with supporting cost reduction and product reliability programs in place, within an aggressive time to market and budgetary framework. I have managed multi site operations and where necessary rationalized operations to meet the businesses strategic short term and long term objectives. I have raised over $200m in investment through Venture Capital,Government funding. Areas of technology worked in, Semiconductors, Cleantech, Display, Electronics, bio-technology,Telecom

• Feasibility study of Solar Technologies as they are applied in the field, understanding the ultimate cost of energy for a variety of technologies.
• In depth review of the concentrated solar industry to pin point the competitive technologies and develop a wining strategy for the LGBC technology.
• Feasibility study of setting up a low to medium concentrator manufacturing facility in the UK, Spain and Asia.
• Developed financial models for all the above scenarios, modeling cost of product , cash flow, capital expenditure and running costs.
• Worked with the turnkey suppliers of solar cell manufacturing lines to develop project plans for the deployment of 20/40MW manufacturing lines, these are companies like Centrotherm, Rena, Oerlikon.
• Led the acquisition of an existing solar cell manufacturing line in central Europe, and developed a plan to run in-situ at its present location.
• Led on the acquisition of the equipment only of the above solar cell manufacturing line, while finding a location in the UK to support the operation.
• Developed the supply chain for the operation, working with chemical and wafer suppliers, contract negotiated with the major wafer suppliers, like REC, LDK, NORSUN and other Asian suppliers.
• Led Business development and helped secure with the team over 20 new customers.
• Developed business plans and engaged with the Investment community to raise funding
• Promoted the business at trade shows and conferences around the world

• Managed the research and manufacturing business unit that would have been the technology provider.

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Some links to help with your jobsearch:
LinkedIn http://tinyurl.com/329oyh>

The second site I'll recommend is Recruiters OnLine Network, an online network of professional recruiters. You can freely search through posted jobs and find recruiters based on their focus or what they recruit for.

Recruiters OnLine Networkhttp://tinyurl.com/32km45>

Next is career resource site that offers tools, tips and more to help you manage your career. Its name is JibberJobber and it allows you to keep track of all of the information that you collect during a job search.

JibberJobber - <>http://tinyurl.com/2svuef>

The fourth, and last web site, is SimplyHired. They are what is called an aggregator. They comb, search and gather job postings from hundreds of site and it is freely available and searchable at their site.

SimplyHired - http://tinyurl.com/drtz5