Three entrepreneurs reveal their business drivers

Wednesday, June 15, 2011 | Posted by: Fiona Cullinan
Categories: Thought Leadership | Tags: innovation, business, entrepreneurs, women in business, business models, magazine, management, car industry, franchise, marketing, advertising, automotive, elevate, Elevate magazine, psychology, business drivers

Elevate magazine interviewed three business leaders who are using fresh approaches to drive their business forward – from measuring emotions and optimising serendipity to implementing a return to human switchboards.

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1. THE EMPATHIST
Ten years ago John Kearon set up BrainJuicer  – a company that bases market research on reading the emotional response of subjects to an idea. The company has 10 offices around the world with turnover increasing by 40% each year to £14 million last year.

“We are all unreliable witnesses to our own motivations. We carry around all sorts of little delusions and how we feel is in fact a better predictor of our actions than what we actually say we will do.

At BrainJuicer we have created the first validated means of measuring emotion. We mine different disciplines, such as psychology and behavioral economics where there have been breakthroughs in understanding, and use them to measure people’s emotional response to an ad or product.

The drumming gorilla for Cadbury is a good example. If you ask people whether they will buy more chocolate as a result of seeing the ad they say, ‘I love the advert, but I’m not going to buy more chocolate.’ We tested it and predicted that it would work – and it did. It has been Cadbury’s single most successful advert ever because people felt joyous about it.

We also test new product concepts with predictive markets – using the wisdom of crowds. Humans are social animals, so we’re all good at predicting what other people will do. It turns out that you get an enormously accurate method of feedback when you ask a crowd about something – even when they’re not the target audience. We get a crowd of 500 people and ask them to play a game buying and selling shares in the ideas we’re researching and the result is much more discerning than traditional models.

From time to time you have to tell clients the bad news that their advert has created no emotion. If the only real response to an ad is neutrality then you need to throw it away and start again – it’s just no good.”

2. THE FACILITATOR
Jane Davies OBE is the CEO of Manchester Science Parks. Her background in management and the Foreign Office has been used to good effect at msp where forging connections locally and internationally has encouraged them to expand and drive local business. At a micro-level, she tries to ‘optimise serendipity’ within her team through organising sports and social events.

“I’m probably more closely involved in the economic development activities of the region than other science park managers; we have a seat at the top table and are seen as a vital part of what goes on in the city.

And what is unique – I won’t qualify – is the business model, which has a tripartite shareholding structure; one-third commercial investors, one-third local government investors and one-third university investors.

This has been the strength of the science park because we have had to have agreement from all three sectors to our strategic objectives, and nobody’s been able to drag us off onto their agenda. So we haven’t become an extension of the university estates department, we haven’t become a business park with no connections with the university, and we haven’t become an economic job-creation scheme with all kinds of public sector bodies sitting on the park just in order to fill the space. We’ve managed to stick with this idea of us being a science park, of having high-tech entrepreneurs, start-up businesses that we can support.

On the micro level, our businesses grow and prosper within an ecosystem that provides the networks that allow researchers, entrepreneurs and professional advisors to meet each other. We organise events and that might be a pub quiz or it might be five-a-side football, but it just helps people to meet and find others who might be able to help them. My predecessor coined the phrase ‘optimising serendipity’, and that I think is what it’s about.

Long gone are the ideas that the web would make this thing about physical proximity unnecessary – it’s nonsense. You can’t work in an innovative way with somebody that you don’t trust, you have to build a relationship first.”

3. THE TRADITIONALIST
In 2004, John Tordoff took over as chief executive of the family-run car business that was set up in 1946 by his grandfather. JCT600 now has 21 franchise partners in the north of England, and after weathering a difficult year in 2008, posted a £9 million profit for 2009.

“We’ve been taking a measured approach to growing the business. We always had a vision that we don’t want to be the biggest, we want to be the best. That’s the vision that’s run through the company for a good number of years and it’s as true today as it has ever been.

We invest a lot of money in good facilities. It keeps our franchise partners satisfied because we’re prepared to put our hands in our pocket. It keeps the customers happy that we are not just taking their money and spending it on yachts in the Mediterranean and it keeps the staff happy because they have a nice place to come to work every day.

Over the past three years, we’ve seen that the strongest brands are the ones that have succeeded and the weakest brands are the ones that have gone to the wall. I think that by not panicking and sticking to our guns we’ve probably come out of the recession as well as could be expected. We took a measured approach to cutting costs and we didn’t significantly reduce the head count. It’s a little thing, but we don’t like automated switchboards – we like receptionists to meet and greet customers and to answer the phone. And that costs money.

We have a rigid policy that we own all our own freeholds. That is something we’ve done forever. And by investing back into the business we’ve created a really solid balance sheet. We have £75 million worth of property, so if we do ever want to go to the bank we’ve got plenty of leverage. Someone described our balance sheet as a ‘lazy’ balance sheet. Well, given what’s happened over the past few years, the lazier the better, as far as I’m concerned.

Feature: © Peter Buhlmann. Images: © James Pfaff. This article appeared in the Winter 2010 issue of Elevate magazine. Here’s how you can sign up to receive future editions of Elevate. Our Summer 2011 issue will be out very shortly.

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