Am I alone in finding something a bit weird about the rise of equity markets since Brexit/ the election of Trump? Its true there are financial dynamics at work. Increased spending on infrastructure and the fall in the pound have some immediate benefits for some large companies.
But this window dressing obscures a fundamental underlying message. A big part of the populism that is driving today’s political agenda is rage against multi nationals. In the US the talk is of trade barriers that will disrupt low cost global supply chains. In the UK and Europe Governments and citizens demand “fairer” tax contributions. Extracted from the profits generated by global companies. Used to prop up public spending.
In every country and all sides of the political debate, inequality is seen as the defining economic and social challenge. And nothing represents that inequality more vividly than the pay of Fortune 500 CEOs and their ilk.
2017 will be the year when some of this anger translates into real challenges. Corporate giants are right in the cross hairs. The US President’s remarks about the pharmaceutical industry are a straw in the wind. The actions of the new US administration and the fallout from the UK leaving the EU will have consequences for big companies.
Hitting the enterprise where it hurts
In a sense these are symptoms of a wider trend. Anger and frustration at the profits of global corporations is widespread. Business practices and networks are also in the spotlight. This is an issue which appeals to all politicians. One of the few areas of common ground between left and right, populist and technocrat, democrat and dictator.
Expect meaningful action in areas like:
The SaaS opportunity
Your view on the politics and economics of this is not important. Enterprises large and small are entering a period of unprecedented disruption. At a time when there is also severe pressure on profits. For a B2B SaaS company this is a once in a generation opportunity. Global corporations need to change. Improved adoption of digital technology must be part of that change. This broad theme was reinforced by McKinsey this month in Measuring B2B’s Digital Gap.
The enterprise software landscape is also shifting on the ground. I was fascinated by Tom Tunguz’s $100m ARR Deal. The headline number is eye catching. His analysis of the implications for Workday is interesting in its own right. But for me the big message is that this was a straight fight between the SaaS alternative ERP company and SAP. No better sign that SaaS will be a big part of the solution for enterprise companies.
The Chairman's view
These trends are important for setting the scene. Yet the big picture offers no direct link to revenue growth. Generalisation can help you identify targets. Winning deals depends on specifics. Enterprise sales depend on three things:
Success with enterprise customers is not about a high volume of leads and conversion rates. Nor is a brilliant sales team the key factor. Focus on qualifying which opportunities to go for. Analysis and insight followed by patient pursuit is the winning formula for enterprise SaaS.
I am not a big fan of setting goals or targets at the best of times. They create two fundamental problems:
The New Year disease
So what to do at this time of resolutions and annual budgets? You could join the crowd and make a full blown plan. If you must, this short article from Fred Wilson on Planning for Next Year is a good guide to the principles.
And as Fred points out, if you want to develop a proper annual plan you would start in September. In other words planning is a complex process not just a way of capturing your post holiday guilt trip. The great military leaders have always understood this:
"No plan survives contact with the enemy."
Helmuth von Moltke the Elder
"In preparing for battle, I have always found that plans are useless but planning is indispensable.”
In other words, if you want to make plan establish a process. Set aside proper time for thinking, analysis and discussion. Develop a set of goals that are support by data and argument as well as passion.
This is not something that can be accomplished over a couple of days New Year holiday. So don't start 2017 with a blast of goal setting. I would like to offer a different approach. Think about this one question:
What would you like to change?
Its not an original question. I first started thinking about back in 2007. That year the firm I worked for used it as the centrepiece of a marketing campaign. The beautiful challenge lay in the infinite variety of responses. Take two simple examples from that campaign:
At the time, we commissioned a series of essays in the FT on the topic. Then Deputy Editor Martin Dickson wrote a piece. In it he expressed a wish for the press to behave better and to be better regarded. He headed it with this quote:
“You cannot hope to bribe or twist, Thanks God! The British journalist. But seeing what the man will do unbribed, there’s ’s no occasion to.”
By contrast, each of us had to stick a poster on our office door stating our own answer to the simple question. Mine read:
“I would like the people of Scotland to go out into the world with confidence and ambition once again.”
Either of these responses would stand up well as an aspiration today. Yet both are also personal and just a little bit odd. Answering this question is a good time for your inner geek to show.
So these answers may not fit your circumstances or way of thinking about the world. No matter. The question is designed just to make you think. How could your business or life be different? And also how could you make a difference to others?
Your answer may already be the guiding light for your life. Or a small change that requires only a bit of active willpower to deliver. Or a way of capturing the vision for your business and the difference it can make in the world.
The Chairman's view
The purpose of this post is simple. Instead of setting goals or making resolutions, start the year with a little reflection. Think about hope, ambition and direction. That could lead to changes and plans. Or just help you draw you new energy and focus for the challenge ahead.
We all have it in our hands to make a difference in 2017. How will you use that power?
Kenny Fraser is the Director of Sunstone Communication and a personal investor in startups.