Kakapo Chat 004: Alex Peterson of Oxygen8
James Ashwin checks in with Alex Peterson (a Director of Oxygen8), a business and finance guru who cut his teeth in the funds management industry and corporate world that co-created an NZ-based hedge fund before selling out. Alex (pictured on the right with some of their team) also happens to be an industry leading business consultant who works alongside small and medium business owners to take their businesses to the next level.
What exactly is a Business Consultant and how do you help business owners?
A “Business Consultant” can be anyone who says they are a business consultant (our industry is totally unregulated much the same as the oldest profession in the world) and covers a wide range of definitions and disciplines – it’s a very generic term.
However, for us at Oxygen8 Consulting Ltd, a “Business Consultant” is a professional advisor that partners with a business owner to: assess and analyze the facts; listen & learn; challenge assumptions; bring a different view to the table; and ultimately provide sound actionable business advice. We help business owners to gain business clarity and then through accountability (gentle but firm) drive results through implementation. At Oxygen8 we actually refer to ourselves as “Business Success Partners” not “Business Consultants” – we believe that this is a more fitting description. A Business Success Partner’s calling is to breathe life into business (sorry the pun is too good not to use) by providing a fresh professional view and a whatever it takes attitude!
Are you typically dealing with profitable small businesses that are looking to grow or do you have a range of different clients?
To begin with, in general, there seems to be a strong misconception that as “Business Consultants” we only fix broken businesses (which we can do and occasionally do – FYI it’s really hard work rescuing a company from failure). However, “typically” what we really do (and are extremely good at doing) is working with “good companies” and partnering with the business owners to make them “great companies”. So yes we deal with a range of clients and Oxygen8 even has some general groupings we use to classify businesses that go from: Ideal, Living, Working, though to Failing. Our sweet spot is moving companies from “Working” and “Living” to “Ideal”. However, we also know that wherever a company is at, the Business Success Programme will add value – even at the top level “Ideal” we have had some great results through adding better governance structures and helping business owners and management to more effectively work on the business.
Partnering with a Business Consultant is often the start of a long working relationship which makes it crucial to select the right one. What should a business owner be looking for when meeting potential consultants?
It’s very similar to hiring a new employee – you should be asking them heaps of questions (full interrogation style) especially about details of their proposed engagement and/or program/services (the more difficult the questions the better). If they can’t sell their services, how are they going to advise you in your business? In my opinion a good consultant shouldn’t have any issues with answering lots of questions - more to the point they should thrive on it. Ultimately you should also (at the risk of stating the obvious) really like and trust them as a person, so also ask some personal questions.
Other things I believe are important to look for are:
- Are they a one-man band?
- Do they have a robust, proven system/structure that they use? Or is it just a “shoot from the hip and hope” consulting strategy?
- Do they have a good support network and/or colleagues to help them out if they get stuck?
- Can they provide you with some quality testimonials?
- Have they had any sort of training?
- How flexible are they in relation to your session and their time.
- Will you be able to talk or have access to them in between sessions and will there be extra costs/charges?
- Are they an Oxygen8 consultant?
My social media feeds are becoming flooded with young 'consultants' selling online programs on how to grow revenue or scale your business, have you seen these ads and what are your thoughts?
I haven’t seen too many of these ads but maybe I’m not part of their target audience as I don’t frequent the same trendy websites and social media platforms that you do James? I know that there are a number of big sell online business improvement programs out there (I’ve seen a few) that are very active, and are very in-your-face, promising great results. My thoughts are that anything (online or not) that helps a business to grow and improve is fantastic. I can’t verify the results of these online programmes as I honestly haven’t heard any good news stories (that’s not to say they don’t exist). For us we use a number of online tools to deliver our Business Success Programme but we strongly believe that real life face-to-face people meetings are still an essential part of achieving great results and business success. You just can’t beat sitting in the same room as a business owner and working together to figure out the right way forward. We do work with some clients remotely (that are geographically challenged) if required but will mix online meetings with travel to meet in person. However, if someone is really keen from out of town we are more likely to refer them onto one of our local consultants that are part of our nationwide network “The Consulting Group” which is made up of 3 consulting firms (including Oxygen8) and has over 40 consultants nationwide (who are all trained on and use the Business Success Programme).
What advice would you give to a small business owner who would like to scale but struggles with not having total control over every aspect of their business?
Seek help, go to our website and book a Free Business Diagnostic with an Oxygen8 Business Success Partner. This is a really hard question to answer as it really depends on the business and the details of what the business owner is struggling with – for example, is it the bookkeeping? Well I would suggest finding a good bookkeeper etc… Ultimately, any business owner who wants to scale needs to get to a point where they can spend quality time working “on” their business rather than “in” their business (usually on the tools or running around putting out fires). The paths to get there are fraught with many a hazard and you really need to have all parts of your business working well, not just a few. Again, seek help with the parts you are struggling with - the cost of doing so will far outweigh the cost of not doing so and not scaling your business up.
As a Business Consultant how long do you need to successfully prepare a business for sale in order to maximise the sale price for the owner?
It depends on the business and how much value the owner wants to create before they sell business. This could range from 6 months to 3 years… or longer if they want to develop a market or realise all untapped growth potential. However, if the owner has limited time it comes down to trying to upsell the unrealised growth potential and opportunities (selling the dream). In general, in a perfect world (again depending on the business) I would advise at least 12 months and no less than 6 months. The other key part of maximizing value is partnering with a high-quality business broker such as Kakapo that is willing to really put the time and effort into understanding your business and marketing it properly. One of the other key issues I see when it comes to business sales is owners letting emotions (understandably because it’s their baby) destroy business value through making emotionally driven business decisions and imploding the sale negotiation process. This is where a Business Consultant and a Business Broker will add a massive amount of value (the cost of both are really pennies on the dollar in the big picture). A good business consultant knows exactly how to pull the right business levers to maximise value and a good business broker knows exactly how to market the business, qualify buyers, control the due diligence process, and negotiate the best deal. If done properly you won’t leave anything on the table and very little to chance. You can DIY it and sell your own business… just the same as you can fix your own car, build your own house, build yourself a boat, do your own accounts, do your own legal work, and be your own Doctor Google … right?
The single biggest killer in small businesses is...
Not having the right people – I strongly believe that for most small businesses attracting, managing, and retaining the right people is a critical success factor (without this you are dead in the water). If you dig a little deeper this really becomes a leadership issue – most of the time the key leader in the business is the owner (for better or worse) and if they aren’t a good leader (or learn how to become one very quickly) they will not be able to attract, manage, or retain the right people. Not having the right people or even worse having the wrong people is definitely the biggest killer in a small business. People are the biggest assets and potential liability of any business but it’s especially true in small businesses - as the effect of one bad person or the lack of a good one has a greater impact (sometimes even terminal!).
Cheers for your time Alex, how can our readers get in touch with you?
Check out our client testimonial videos on our website (they will make you smile and maybe even laugh) and while you are there, book a Free Business Diagnostic! You can also check out my profile on LinkedIn