Author Archives: Nigel Lockett

About Nigel Lockett

Nigel is a senior academic, experienced manager, entrepreneur and community leader. He has previously worked as a senior lecturer at Brunel University Business School, business development manager at InfoLab21 and relationship manager and lecturer at Lancaster University Management School. Nigel also has more than 20 years' experience as a company director, with a track record in managing start-up, joint venture and social enterprises. He has successfully designed and delivered innovative programmes in entrepreneurship, innovation, strategy, e-business and technology enterprise and was the founding director of an MSc in e-business and innovation.

Specialties
+ Entrepreneurship
+ Innovation management
+ Universities in open innovation
+ E-business

Is the emergence of the ‘Networked Entrepreneur’ anecdotal or really significant?

networkI meet more and more successful entrepreneurs who seem to be able to create real entrepreneurial opportunities and exploit them by using their networks. Interestingly, they are so good at this they create new networks if their existing ones can’t deliver. Combine this with the intrinsic ‘network power’ of the Internet and things could get very interesting!

I can think of three good examples of the former and hundreds of people who might get the latter.

So, what do I mean by the ‘Networked Entrepreneur’? They build innovative companies around core service offerings, which in addition to using ‘in house’ assets, integrate with their business networks. At first glance they seem ‘conventional’ but their ability to deliver is based on developing and managing these networks. No opportunity becomes too big and they can emerge in unexpected areas and win new business. The ability to manage or orchestrate these networks becomes a key skill.

Examples [pictures!] speak louder than words:

  1. Jonathan Hick, founding director of The Directorbank Group. He recognises opportunities across multiple sectors and knows the right people to exploit them. If you don’t believe me just look at his portfolio.
  2. Victoria Tomlinson, founder and Chief Executive of Northern Lights PR. She is establishing a new way of doing ‘PR’, which is based on her company being at the centre of a highly skilled and specialised network of service providers and senior business leaders. Of course Victoria builds a reputation in existing sectors but seems to be able to ‘leap frog’ into new ones.
  3. Tim Lockett, founding director of Deliver Net. (Yes, I know blood is thicker than water!) He is building a market leading company in a specialist sector by working in partnership with group customers, suppliers and technology providers to take costs out of the supply chain and empower the customer to really manage ‘cost in use’. Tim has probably forgotten the last time he talked to a customer about the price of a product.

And, who are the ‘hundreds of people’ who might understand the power of the Internet?

Many of my students instinctively see this way of working and that the Internet can be a key tool in achieving success. Well, of course they are the ‘Internet generation’. What they often lack is the market knowledge. However, all they have to do … is just find the right partner!

And, by the way, what are you doing to develop your ability to orchestrate networks better than your competitors?

Is the new coalition government going to be good for small business?

thumbs-upWith all the talk of hung parliaments, national interest and stable government it is easy to forget that the ‘enterprise show’ must go on! Small businesses provide nearly 60% of private sector jobs and over 50% of UK turnover. Over half a million people start their own business each year. We are clearly an enterprising nation. So, what might the new Conservative – Lib Dem coalition mean for small businesses and entrepreneurship?

If we had to use one word to describe each party’s approach to enterprise what would it be?

  • Conservative = the Markets. Tends towards supporting the City, reducing the national deficit quickly, reducing regulation for businesses and reducing NI and tax. Going greener.
  • Lib Dem = the Individual. Tends towards local accountability, splitting banks and creating a Post Bank, reducing the national deficit, reducing regulation for businesses, supporting social enterprise and reversing NI increase. Gone green.

But, what do small businesses and entrepreneurs want?

Simply, anything that will free them to be more enterprising and create jobs. That means reduced regulation and bureaucracy, access to finance and fairer taxation. As well as, wider recognition of the role they have in innovating and creating the jobs and wealth that fund public services.

With George Osborne as Chancellor and Vince Cable in the Treasury with responsibility for business and banks, what are my ‘top ten’ predictions?

  1. Banks: Legislation to split investment from retail banking. New bank levy. Formation of Post Bank delivered through the Post Office network;
  2. Business rates: Automatic business rates relief for small businesses;
  3. Business support: Reduced role for Regional Development Agencies. Business mentor networks;
  4. Economy: Attempts to rapidly reduce national debt in order to increase financial stability;
  5. Finance: Increased access to funds from state-owned banks and government schemes;
  6. Green: New low-carbon schemes for small businesses;
  7. Public procurement: Increase access to contracts for SMEs;
  8. Red tape: Reduced regulation and bureaucracy;
  9. Tax: Reduced NI and simplification of Corporation Tax. Review of IR35;
  10. Training and higher education: Increased apprenticeships and work-based training. Increased university enterprise and collaboration with industry.

So, with George Osborne focusing on macro-economic and market issues and Vince Cable supporting businesses we can expect enterprise to matter. With politicians calling for responsibility, compromise and stability there is no doubt in my mind that, given the right environment, small businesses and entrepreneurs can deliver more than their fair share of new jobs and wealth generation.

Keeping on track – but not a train in sight

gpsVehicle-based satellite navigations systems (Sat Nav), which first started to emerge in the early 1980s, now represent a huge global market. In Europe alone sales in 2009 exceeded €1.5 billion. Many of the leading brands have become household names. For example, Garmin with global sales of $3.5 billion  and TomTom with global sales of $1.5 billion, in 2009. Not surprisingly, as the market grew so did both the number and size of suppliers – competition was very intense.

The systems rely on a Global Positioning System (GPS) tracking device, which can determine the location of a vehicle, person or anything else for that matter! The location is regularly recorded and transmitted to a central database using mobile cellular, radio, or satellite technologies. The position of a device can be displayed on a map in real-time or recorded to identify movements or routes. Whilst, we are familiar with car-based Sat Nav systems they have many other applications. From surveying to monitoring and from climbing to tourism.

The market for personal tracking has also begun to emerge particularly as a result of increased functionality of mobile phones. Such as, the Nokia N95 and Apple iPhone.  Specialist phone applications became available to take advantage of these new GPS-based features. For example, the LocoBlog mobile phone application and web site supported location-based mobile photo blogging. As users blog and upload images their location is tracked and displayed on website (www.locoblog.com).

The Apple iPhone 3GS, launched in 2009, provided a built-in digital compass with GPS technologies to find the direction of travel to orientate of maps. This service used GPS, Wi-Fi and mobile network masts to identify the exact location of mobile devices. This high-level functionality was incorporated into new iPhone Apps, many of which were developed independently. By March 2010 over 2,600 iPhones Apps that used GPS were available.

With so much competition surely gaps in the market wouldn’t go unnoticed by the larger players for long. They could expect to indentify an unmet consumer need and use their considerable resources to address it quickly. Perhaps this is why it was so surprising that Sara Murray was able to develop and launch her ‘buddi’ product and service under their radar (www.buddi.co.uk). Sara developed the ‘buddi’ after her daughter went missing in a supermarket and she had no way of knowing where she had gone. Sara could not find any product on the market that provided a discrete way of tracking vulnerable children. She developed a new device which was small enough to be worn discretely yet powerful enough to provide reassurance.

Like Sat Nav systems and mobile phones the ‘buddi’ used GPS technology to track people and combine this with emergency support. This kind of tracking device may be equally useful for vulnerable elderly people or lone workers as it is for children. Sara Murray was awarded Best Female Entrepreneur 2009 by the BT Business Essence of the Entrepreneur awards.

I think Sara has got that entrepreneurial ability to spot a good idea through having a personal experience. But, what makes her different from most people is realising that this was a real opportunity and then obtaining the resources to take it to market. I can’t help thinking that this won’t be her only enterprise!

Water, water everywhere but not a drop to drink

woman-drinking-waterIn the last 30 years sales of bottled water have grown to more than 1.3 billion litres in the UK and to over 9 billion litres in the US. This is of little comfort the estimated one billion people in the world who don’t have access to safe clean drinking water.

Duncan Goose, founder of Global Ethics and One Water , set-up his new venture, in 2005, to sell ethical bottled water and donate 100% of its profits to installing a specialised water pumping systems called PlayPump . He recognised the potential … “The water market is an absolutely huge market in the UK, worth £1.5 billion” (Guardian, 22/03/2007). At one level Duncan’s vision is simple – use all the profits from selling water, to people who can afford it, to provide clean water for people who cannot. Clearly, there needs to be more to it than that. In his younger days Duncan travelled the world, in fact he was inspired by Ted Simon’s motorcycle journey in the 1970s, detailed in his book Jupiter’s Travels (1979). Duncan is in good company, actors Ewan McGregor and Charley Boorman were also inspired by reading Jupiter’s Travels. As you can image Duncan has his own adventures, including surviving Hurricane Mike that destroyed many communities in Honduras in 1998. Duncan recalled … “What really struck me was to make a difference we did not need a lot of money, just a little money spent in the right way” (Sunday Times, 01/12/2008).

One Water was conceived and launched in 2005 just at the same time as Bob Geldof’s Live 8 appeal was launched. Having created a vision and sharing it with organisers of Live 8, he faced the challenge of promoting and supplying it to individual consumers. Can you imagine how you would go about persuading retailers and supermarkets which have shelves full of numerous brands of bottled water to delist one and put yours it its place? Indeed, it was hard very work for Duncan but when Total became the first national stockist in 2006 others started to follow. In their first year One Water donated £70,000 to charities working in Africa and India. By 2008, this had exceeded £1 million. Then One Difference started expanding its vision to include other humanitarian issues in developing countries, such as HIV through the sale of One Condoms . Interestingly, Duncan has recruited other people to promote his vision, including actors David Tennant and Rebecca Lacey.

New Year’s resolution: Time to get closer to your customers?

meetingThere could be good news about the recession. There is growing evidence, both from the respected ACCA global survey (www.accaglobal.com) and recent O2 small business survey (http://bit.ly/6UGCZs), that business confidence is increasing. From the ACCA Q4/09 survey (http://bit.ly/4tyUZH) there is even optimism that Q3/09 was the bottom of the downturn. Although, we may still have a year left before recovery is really underway. O2’s survey shows 27% of small business is healthier now than this time last year and 59% are predicting better business performance in 2010. However, economic recovery and low consumer confidence remain key concerns. According to ACCA, last year the two big issues for small firms were falling customer demand and accessing finance (http://bit.ly/5ZoFeB). The government and banks continue to make reassuring noises about the latter but what can they really do about increasing customer demand?

But some small firms have already been reporting growth in sales and profits:
 

Thunderhead, which helps companies to integrate marketing to their communications with customers through automation, saw sales grow by 28% to £16m and Pre-tax profits by 47% to £2.9m (www.thunderhead.com). For details of the top 50 growing companies see Growing Business Magazine (http://bit.ly/7EtnhL)

Deliver Net, a specialist supplier to the community healthcare sector (www.healthcare.co.uk). Managing director Tim Lockett said, “We have seen our business grow in the last two years but it’s been hard work. We have spent as much time on finding efficiencies and reducing costs as we have on developing new business.” And the key to reducing costs and increasing sales? “E-commerce has been critical to both. We have supported our customers in moving their ordering online by bespoke product templates and budget control systems. In the end, they see the saving to themselves rather than us. We now receive over 70% of our orders online.” He added, “The number of customer service staff is down but warehouse and distribution numbers are up. We still employ the same number of people but process more orders.” And what about the future? “I’m optimistic. There are new customers in the pipeline and we can see new markets opening up. In the last year we have had to get better at what we do. This increased efficiency hasn’t gone unnoticed by our strategic partners. Yes, I’m hoping 2010 will be a good year.”

Vickers Laboratories, which has been manufacturing chemicals for over thirty years (www.viclabs.co.uk). CEO Julian Driver said, “Sales haven’t grown. But more importantly, we’ve been able to maintain profit margins and keep cashflow under control.” How has this been achieved in a recession? “Innovation has been at the heart of what we do. Most of these have been incremental but when you add them all up we have come a long way. We’re almost invisible! We have become embedded in our customers’ supply chains and add value to their service offering, which makes it counterproductive to move from us and if cash is tight we still get paid.” And what about the future? “Our markets are deliberately diverse and we are constantly looking for new business that is difficult!” Why? “Well, we are really a solutions company. Not chemical ones – we solve problems and that draws on our knowledge to health and safety and experience of reagents. And this protects our margins. So I’m quietly confident about 2010, even though I know new business is going to be difficult to find.”

What do they all have in common? In the end, they are all focused on process innovation. They appear to anticipate their customers’ needs. And the key to this? Get close to your customer. Or in the words of Mrs Wilson, the housekeeper (Helen Mirren) in Robert Altmans’ Gosford Park (2001), “What gift do you think a good servant has that separates them from the others? It’s the gift of anticipation. And I’m a good servant. I’m better than good. I’m the best. I’m the perfect servant. I know when they’ll be hungry – and the food is ready. I know when they’ll be tired – and the bed is turned down. I know it before they know it themselves.”

So perhaps 2010 is the year in which to get so close to your customers that you can anticipate their needs before they do – well at least before your competitors do!

Fertile soil for innovation?

fertileThe Food and Environment Research Agency (FERA) (www.fera.defra.gov.uk) is the UK Government’s main research-focused agency investigating sustainable food chains, healthy natural environments and protecting us from biological and chemical risks. Based near York, it has historically been shrouded in secrecy. However, this is rapidly changing. FERA now has an IP Exploitation Manager and spin-out companies located nearby. For example, Forsite Diagnostics (www.forsitediagnostics.com). The company develop and manufacture on-site test kits and is led by Chris Danks since its launch in 2007. Their ‘Pocket Diagnostic’ is the market leader for on-site plant disease testing used by growers, advisors and plant health inspectors. They certainly bring testing for potato blight right into the 21st century (http://bit.ly/7JlX0K)! But I wonder what Pippa Greenwood would say?

FERA and Forsite Diagnostics form part of a more general regional innovation strategy for Yorkshire Forward – the Bioscience Cluster (www.yorkshire-forward.com). It links universities, government departments and industry (there are over 50 companies and 3,700 life scientists work within 8 miles of York). This strategy is also supported by Science City York (www.sciencecityyork.org.uk)

But commercialising bioscience innovation is going to take more than locating firms near to FERA. Getting scientists, academics, venture capitalists and entrepreneurs to collaborate is going to be the key to getting innovations to germinate. Recognising that innovation is fundamentally about people and that it can be managed could be two of the first seeds to sow!

Dr Nigel Lockett

Director of Centre for Entrepreneurship and Innovation Management (CEIM)

www.bradford.ac.uk/ceim

www.nigellockett.com

Do business angels have wings?

wingsjpgThe Association of Chartered Certified Accountants (ACCA) (http://www.accaglobal.com) seems to think so. In fact,  Robin Jarvis, Head of SME affairs at ACCA, said ‘For years individual equity investors have been out of the limelight, first hit by the dotcom bust, then crowded out by easy credit and now discouraged by the economic climate’ in the Financial Times on 14th September 2009.  (http://bit.ly/8UCnyr)

The ACCA have proposals for helping entrepreneurs to create realistic valuations of their businesses, greater support for business angel networks and improvements to tax incentives, notably the Enterprise Investment Scheme.

Maybe it’s entrepreneurs that need wings to get their new ventures off the ground. Although, Geoff Britton, director of GBAC Accountancy & Business Service (http://www.gbac.co.uk), warns ‘Create an environment where businesses prosper’ but ‘don’t over-assist’.

But where do you find a business angel (with or without wings)? You could start with the British Business Angels Association (BBAA) (http://www.bbaa.org.uk) or if you are looking for something between business angels and venture capitalist, at British Private Equity and Venture Capital Association  (BVCA) (http://www.bvca.co.uk) or you could try MMC Ventures (http://www.mmcventures.co.uk)

Time to belt up and get ready for take off!