David C Baker - Doing What Works

Hi everyone, it's Bill Black, the exit coach from the Exit Coach Radio show. You know, one of the biggest questions I get on the show is what exactly goes into a business exit plan and when should I start creating mine? Well, I always tell people that the best time to start was 5 years ago, but the next best time is now because you never know when you might need it. So we put together a free report that describes what an exit plan is and what you should know. You can get it free by texting exit plan with no spaces to 442-22. That's exit plan to 44222. Again, text exit plan to 44222. Welcome to the Exit Coach Radio show, the show for baby boomer business owners who are looking for cutting edge information as they plan their 3 to 10 year business succession and exit. Every week we interview top professional advisors for their best tips, strategies, and precautions so you can be well planned. And now here's your host, the exit coach Bill Black. Thank you listeners for joining us today. It's really a pleasure to have you with us. My next guest has been called the expert's expert. David C. Baker is the leading authority on positioning, reinventing, and selling firms in the creative and digital space. Really looking forward to talking with him. David, thank you so much for joining me. How are you? I'm good thank you. I've I've been looking forward to um being on your show. Thank you for having me. It's that's totally my pleasure. Really great to have you on. Now we're in some interesting times here. I'm sure people are calling you a lot and wondering, you know, what can we do? I've been looking at your website, some of the things that you talk about areas that you help if one of them's interesting if you'd rather do what works instead of reinventing the flat tire. Man, I have a lot of flat tires in my garage, ideas that I've tried, things that just didn't work out. Tell us a little bit about you and your background and what you do to to help folks. Yeah, I guess if I were a dog I'd be called a mutt because I've come to where I am at the moment through a very strange cir circuitous route. Is that how you say that? I don't remember how to say that word. My parents were medical missionaries and I was born in the US. I'm a US citizen, but I didn't live here until I was 18 when I was just a little baby. We went overseas and lived in Costa Rica for a while while they learned Spanish and then we went and lived with a tribe of Mayan Indians in Guatemala. No roads, no electricity, no plumbing, plumbing, no stores. So my first memories of the US were in when I was 1819, came to live here and entered formal school for the first time at that point. I went through all the typical formal schooling after that went through grad school, a 5 year grad school program, and wanted to head into teaching anthropology and language and decided that I, I was kind of tired of the politics in the, in the higher ed field and uh just sitting on my couch one day looking at the ads in the local newspaper and thought to myself, surely. I could do better than this and very naively obviously decided to start a firm. And did that. That was in northern Indiana. I did it for 6 years, really enjoyed that work in marketing and advertising public relations, but about 5 years into that, I was um just through a strange set of circumstances began to give advice to other principles of firms in the marketing and digital and advertising space. And within about 6 months it took over my life completely spun the firm off, and so that's what I have been doing. Since, uh, well, for the last 2526 years, so what I do now is advise principals. I don't help them with the craft itself. There's plenty of help for that and I'm not better at it than they are. I try to help them make better business decisions, so I've had the opportunity now to work with 900 of those firms in 30 countries around the world and every week I'm inside peering at a new firm that. Believes that the struggles are all new when in fact they typically aren't new even though they've combined their own issues in a unique form of of of dysfunction so to speak, which kind of keeps me in in business so I'm an author, speaker, and adviser, been doing that for about 26 years and and really love what I do. It's very interesting with with your your very unique background. It seems like business owners really appreciate someone who can give them a fresh perspective, and these days a lot of businesses are having to take a whole new look at how they've been doing business up until the first quarter of this year. Of course they were probably doing pretty well with their business. Most businesses were, and all of a sudden, bam, we've got this huge need for change and innovation. How how are business owners reacting? to this COVID-19 virus and what are their biggest, what, what do you think their biggest needs are to plan for this uncertain future? Yeah, it's, it's so odd to have to answer that honestly because the what firms like that are facing doesn't vary too much by geography. In other words, a firm in France or Canada or Australia or the US, they're facing about the same thing, but in each of these countries. The range of experience is very wide, so you have a few firms that are holding their own and maybe even experiencing some slight ramp up in revenue that's very clearly the vast minority of these firms. Then at the other end of the spectrum you have some firms who have lost 80% of their revenue. And the typical firm is right somewhere in the middle. They've lost 20 to 30% in any given year, at a private independently owned firm like the ones I serve, we would lose about 15% of those firms in a year. Some would be very innocuous reasons like somebody retired or they merged with another firm, but most because, you know, it was forced on them. They went out of business in some way. I, I'm predicting now based on the data that I'm seeing that about 30%, so double that will happen. What's unique about our industry though is that that by our industry I mean the marketing and digital and and advertising space is that we have always been a lagging indicator. So when you look out and you see what's happening in businesses in general it's much worse than what's hit this field that I serve but the other shoe is going to drop and so not only are these business owners facing the challenge of trying to do all this work from home rather than in a central location they also. I don't know how they're going to keep staff now in some countries there's been some government help, but all that's done is really just defer the really tough decisions and so this now that's all bad news, right? The good news is that this is forcing fantastic thinking around business model innovation and that's really where I'm focusing with clients and it is really exciting to see how some of these firms are actually going to thrive. Even more than they were before, partly because they've done a great job thinking, but partly because there's going to be a leveling of the competition and only, you know, some of the weakest kids are going to get thrown off the playground. Yes, there, there are certainly opportunities available for growth by acquisition, as many, especially baby boomer types of owners, are saying, you know, I just don't want to pull the sled up the hill one more time if this is a long recession. I think a lot of them were done probably in the 2008, 2009 time frame, and they pulled a sled up the hill, that's what I call it, and they, you know, they get up again in the last few years, looked like things were great. Maybe I can sell my business now and here we go again. So are, are you saying, are you counseling your clients that, you know, don't look at it as a problem, look at it as a huge opportunity because this is very different. Than a normal, uh, recessionary time frame, right? This was created quickly and may have a, uh, hopefully a quick recovery. Yes, I am encouraging them to, well, I'm asking all of them to rethink how much they enjoy this field and whether they want to do the hard work to get through this and be even stronger on the other side and. The firms that have always been taking the long view rather than the short view, they're not doing anything different than they would normally do except that they're conserving cash and they're making very quick decisions about. Um, lowering their staff costs by dismissals or furloughs, but otherwise they're still doing all the normal things. The the folks who haven't been doing the right things all along, they're panicking because it's not really a great time to go out and put a new positioning in place or a new new lead generation plan in place. I, it's hard to know I'm not an economist. I'm certainly not a medical professional, but if you think back to 2008 and 2009. When we lost all of those jobs, I'm speaking just to the US market at the moment, we didn't replace those jobs until 2014. It took 6 years to rebuild that marketplace before we even went beyond it to grow. This will probably be significantly worse than that. It's hard to know. I I I have no doubt that we'll rebound and be an even stronger economy than we ever have been, but how long that takes is really anybody's guess. and It, it's going to be very, it's gonna be very, very painful. Only the strongest business owners will thrive through this. Yeah, that's, that's what we're reading because I guess when you think about it you have to have enough cash to get through what might be a difficult time, and then you have to have cash to restart, assuming we get a tremendous amount of volume coming in. Now in the creative space, it would seem like, I don't know, this is, this is an area that I don't have a lot of expertise in, so I want to ask you, it seems like everybody needed new advertising, but it It may or may not have been real creative, you know, there's kind of like a stock, hey, we're all in this together, kind of commercial going on in the creative space there or advertising, but, but when it comes back, when it starts to come back at that point. Will new and innovative campaigns come into play and will this new familiarization with with video um change the game at all, you know, a lot of people that weren't on Zoom before have been on a lot of zooms now. Yeah, there'll be some changes for sure, like working from home. Part of that will be permanent and so on, but I don't think human behavior changes this quickly or this shallowly. So I would say that a lot of what we're doing right now will absolutely be temporary. People will still be going to movies again. They'll be eating out again. They'll be watching regular sports again, so all of that will come back at some point. I, you know, you, you made a note in passing about how you didn't use these words but sort of uncreative the current marketing is I just have to agree with that completely. I, I think it's based in the fact that brands advertisers are so terrified of saying the right thing that they're just being lemming like and they're just saying we're all in this together our first concern is for you. And it's all a little bit nonsense. I think there's room for brands to stand out from the crowd right now more than ever before by being a little bit different, by weaving some humor in maybe some self-deprecation. There's very little of that happening and and brands are missing the boat by playing it way too safe in a in an environment like this. Yeah, that's my impression too. If you string 3 or 4 of those commercials together, it's, it's kind of, it's good for the alcohol industry. It's time to go get a drink. It's like you know. I've noticed, for instance, you know, one of whoever does Progressive insurances, commercials, fantastic job at weaving back things together and creating humor. They always do such a great job. So tell us a little bit about your book The Business of Expertise, how entrepreneurial experts convert insight to impact and wealth. How, how, how long did it take you to write the book? What's it all about? Why should our listeners go grab a copy? Sure, well, it took a lot longer than it should have. I'll say that. That's because when I started to write it, I envisioned it as somewhat of a textbook about how to build and then position and then sell and then deliver expertise, and I was boring myself writing it, so I cut it way down to a much shorter book. I illustrated it, did it in color. And at the end of it I was very, very proud of it. It's my 5th book. It's really a passionate manifesto arguing for the value of expertise and arguing very passionately that you should not be giving it away for free, that it's possible to be very effective in your work for clients and also make good money for yourself. Those are not antithetical. And it's an easy book to read. It's been the most popular of all the books I've written so far, so I'm very proud of it. My 6th book comes out shortly, but I've had to wait until all of this simmers down before I promote it, but they can find out more about that book at expertise. is expertise. I. Excellent, excellent. And what tips or precautions would you tell your your clients? We always like to share, you know, two or three brief tips or ideas or precautions for our listeners. What would you tell people now about dealing with the issue of the days of these days? Sure, I would say be really careful about debt uh it's, it's something that if you decide to undertake it will lessen the pain and the pain is what prompts you to make good decisions, so I'd be very careful about taking on debt. I would also. Make sure that you remain disciplined and working on your business and not in your business every day as Michael Gerber says and the final thing and this relates a lot to expertise and positioning is don't grab. In some panic mode all the opportunity that comes your way, keep being choosy about working with clients who are indeed a good fit for you and that you won't regret working with later. Continue to be choosy even if it means you have to be even more ruthless in lowering your capacity so that it's always less than your opportunity. That's what I would say to your listeners. And leave some toilet paper on the on the rack, right? Right, unless, unless somebody stolen the roll before you got in, right. The metaphor of the day. Well, this is very fascinating talking to you. When you're, when you're looking for a new client to take on, of course they probably find you before you look for them. What's an ideal situation? What, what really is a situation where you would say, Boy, I'm really glad this person called cause I can really help this type of situation? Yeah, frequently they've tried several things that have not worked, so there's some level of pain. There's something that's keeping them up at night. They are not afraid to spend money. They're not afraid of the truth, and they're, they're courageous. That's one of the biggest things is courageous because I'm, I don't really enjoy just giving advice that isn't taken. I'd like to be a part of real change with clients, so. I, and I'm a big believer in letting prospects self-select themselves out of the running. I don't bug them. Like 39,000 people have signed up to get the weekly emails. I never contact them in a selling way. I just let them decide if it's a good fit to work together, and then we have one conversation and either it's not a fit or it is. So it's just being confident in what you can do and not being afraid of of running out of opportunity. I think that's the advice I give my clients as well. Well, it's very nice to talk with you, and I've been looking at your website as we've been talking and a founding found several very interesting articles, blogs, webinars, and of course the book The Business of Expertise. The website is davidcbaker.com. And it's a tremendous, a tremendous amount of information there. I would really urge our listeners to take a look and get to understand the mind of David C. Baker. David, thank you so much for joining me today. It's been a real pleasure to have you on. Thank you, Bill. I really appreciate you having me on. Thank you for listening to Exit Coach Radio.