RIP Thomas Cook’s Business
Thomas Cook, the business, (1841 to 2019) is yet another example of a consistent number of bad business skills (forget greed) – bad leadership skills, bad management skills, bad decision making skills, bad communication skills, bad problem solving skills, bad listening skills, bad time management skills, bad negotiation skills, bad meeting skills, bad critical thinking skills – and sadly not just from one person.
As a small business owner, I know the importance of good business skills, why, simply because if I do not make good business decisions I will be out of business and loose everything; this is common sense from a junior CEO to the business market. I fully realise that for my business to survive the last person to leave the building with everything correctly in place has to be me as its CEO, leader, manager. The business and all its intangible employees (by which I mean marketing, sales, stationary, leased equipment, phones, internet, office premises) have to be taken care of first, followed by leaving a financial buffer (for Brexit measures) and only then can I go home in the evening.
Until 2007 Thomas Cook was doing relatively but after one business decision after another 2019 was the year of its demise. In 2007 it stepped away from its core (stay in your lane) business and merged itself out of existence and whilst merging is not bad for business merging and using loans and debt to become bigger is not the best business decision. Executive decisions for the betterment of a business is not easy but the writing is generally on the wall months or years in advance, giving you enough time to do something to fix your business!
To try and save a complex business in its last few months is complete and utter madness. The problem was occurring years before “figures do not lie”. The C-Suite – CFO, COO, CEO, CIO – top shelf accountants, internal accountants, retail banks, managers, leaders, would have seen the drop in the numbers. It must now become a question of he said she said – who was too stubborn to take advice, who was too stubborn to listen, who was the know-it-all, who was too afraid to speak up, or who could not read the balance sheet and/or profit and loss statement or who did not ask the significant questions or simply chose to turn a blind eye and just took fat cat salaries and bonuses.
Whilst debt can be a good thing, having to service such a tsunami of a debt will strip away at cash and put pressure on profits and future earnings. There is no shame in a U turn if you make a business mistake but from one merger after another, £1.1bn goodwill, £1.7bn debt, together with £140m per year to service the debt (WTF!). As banks refused to give me a credit card, a small bank loan or tiny business loan (thank God they did not), how did certain Banks so easily lend millions upon millions in the name (or hope) of restructuring which now they will write off (no enforcement agents banging down their doors!) – with so many educated and professional eyes on the business it should never have gotten this disastrous.
Now what is legacy: another British business trophy gone, nearly 21,000 already poorly paid staff with no jobs, salaries, bonus (still with mortgages/rent to pay, children to fee), 150,000 overseas clients abandoned and fearful (the government’s Civil Aviation Authority left to bring them back home) and globally hoteliers and resorts overseas with unpaid invoices and no income.
As a small, non-complex business, I have 24hour access to my business bank via my App on my phone, my tablet, laptop and desktop. I know how many clients I need to see coming into my business daily weekly or monthly. I know how many sales I need to make a day. My accountant is there only to reinforce what I am seeing. He is not there to run my accounts in isolation. At every minute of the day I am aware of what is happening with my business, the numbers are either increasing or decreasing and subject to which way they are going is subject to what business decisions I need to make – as a business owner it really is that simple!
Sadly there is no excuse for what happened to Thomas Cook’s business.
About the Author
Jannette Brimm is a business skills trainer, speaker, expert. She is a TAP certified trainer, runs business skills workshops for NQs, Junior Lawyers, Associates and Partners and supports law firms’ wellbeing, induction and career development programmes.
Approved by the SRA in 2013 to deliver training to solicitors, Jannette set up SKILLSSANCTUARY Ltd, the Chancery Lane based business skills training company.
Working in the legal sector for 27 years, Jannette Brimm has provided business support to all level of solicitors at law firms Dentons, Maples and Calder (Cayman Islands), Watson Farley and Williams, Wedlake Bell, Eversheds and Mayer Brown.
Jannette also speaks at business events, BAME events and women in leadership events.