Categorie: Articles

The Key Housing Corporation: What do you mean, a ‘depressed’ housing market?

• Achieving impossible goals in an impossible market
• Laying the foundations for a competent internal organisation

Lidy van der Schaft – CEO

After a hard day’s work I was letting off steam in the local pub, on the harbour just outside my office. The place was unusually busy. Unknown to me, a prize was being presented – to someone who had come up with the most innovative idea for benefitting the neighbourhood. The prize was being presented by the director of housing at De Key Housing Corporation. I ended up talking to her and, as usual, business cards were exchanged. Her name was Lidy van der Schaft, an extremely pleasant and disarmingly open person. We met again, not long after that. This time to talk about the Bitsing method. She found it interesting. As a director of a housing corporation she was keen to find out more, particularly as Bitsing has the potential to sell houses. She then decided to apply the method to her business. The housing market was depressed and Bitsing seemed to be just the thing to inject some life into it. Her specific objective was unusually challenging: sell 240 houses in a seriously dormant market. A target twice as high as the number of house sales achieved by the corporation in the previous year. Doubling sales performance in a depressed market represented an extreme challenge. Although not an impossible one if the Bitsing method was applied. Bitsing was applied, with the following results: * The key Housing Corporation sold 126 houses in 2011. * In 2012, with the help of the Bitsing method, they sold 244 houses. * This is a 193.7% year-on-year increase in houses sold. What did De Key do, so differently, to so successfully defeat its competitors and the market conditions?

What De Key certainly did differently was that it did a lot – it did much more than other organisations’ rather cramped efforts to sell houses. Probably the most important thing that it did was not to focus purely on selling the product, houses, but also to profile itself as a brand. This combination of product (house) and brand (De Key) – laid an essential foundation, on which the sales success was then built. While other players in the market seemed to want to look as much like their competitors as possible – saying the same things and marketing themselves in the same way, De Key, driven by Bitsing methodology, communicated its uncopyability. De Key Housing Corporation is one of the oldest housing foundations in the Netherlands. In itself this is nothing spectacular- every organisation has a history, after all. Until one looks deeper into the historical information and discovers that De Key laid the foundations for people being able to have their ‘own’ home – albeit in the context of social housing. De Key was also able to uniquely communicate this primary need: ‘At home – in your own home!’

The housing corporation effectively communicated this uncopyable proposition to its target group, thus successfully completing the phase of creating preference for the brand, De Key. In addition to his typically Bitsing approach, Lidy adopted other aspects of the methodology. The corporation’s marketing communication allocated no more than 15% of its content to selling houses. This 15% sales focus was in sharp contrast to the usual approach in this market, in which communication is 100% devoted to selling the house. Other players in the market were characterised by the assumption that the house and its location were the determinants for sales success. For them, logic dictated that all attention was to be focused on the house and the sale thereof. This assumption has of course being proved to be extremely oversimplified – and wrong. The house and its location – the product – can only be partly instrumental in making a successful sale. Indeed, this factor amounts to just one of the six Bitsing steps. The market contains another five factors which determine whether someone will by a product (a house) or not. Namely: the other five steps of the Bitser ladder.
De Key was outstanding in its application of the other five steps and, yes, this resulted in their getting the most out of every individual in their target group.

The principle that six Bitser steps always have to be “climbed’ apply, of course, to every market and to every target group. If your organisation focuses purely on sales, then the achievement of sales and turnover success will be difficult. There are another five steps – and these also demand attention. This approach requires working on the basis of facts – and always keeping the relevant ones in sharp focus. An interview with Lidy van der Schaft (a retrospective on an initial Bitsing period) It is precisely one year later and I am again visiting De Key, in one of Amsterdam’s most beautiful locations. Standing in Lidy van der Schaft’s office I once again enjoy the classically Amsterdam view across the Amstel River.

My most pressing question receives an immediate answer.” Did you achieve the objective?” I ask.

“The objective was achieved”, answers Lidy. “At least 240 houses were sold.” I feel my eyebrows rising in astonishment. I know, of course, that the Bitsing method always guarantees the achievement of its goals, but I’m nevertheless surprised that this has again proved to be true – in the most difficult market imaginable. The prevailing opinion is that the housing market is depressed. However, once again, assumption seems to have been disproved by fact. And the plan had indeed predicted that this goal would be achieved. I had every reason to believe the outcome, but the news that this had once more been demonstrated in practice…resulted in a euphoric moment! ‘Wow!’, I said. “Again!” I questioned her further on how the Bitsing method had helped. “Well”, said Lidy,” It’s brought us more than we expected”. She described how Bitsing had provided a foundation, a basis for the organisation’s achievements. She added, and I quote her literally, ”Bitsing provided the basis for changing how we looked at things. It showed us that we must focus on facts and avoid assumptions. Bitsing provided handholds that enabled us to get a grip on the correct focus.” Such successes can never be completely attributed to the method, in every detail. There are always a host of other activities which contribute to the results. However, Bitsing did lay the foundation and a foundation can be built on. In this case, to sell nearly twice as many houses as in the previous year and, in so doing, to achieve an ambitious objective. Lidy agrees, ”The support of a solid foundation enables you to be more adventurous in looking for further opportunities. And we did discover them. For example, we developed an intense focus on existing tenant and student target markets. These were options that we otherwise would never have discovered.” De Key also experienced, ”That because Bitsing is based on facts, one is constrained to make the correct choices”. And as Lidy said, “This is why we were able to communicate with the correct target markets”, in effect those which would be responsible for generating the required turnover.

Answering my question as to whether Bitsing had further benefitted the organisation, Lidy came up with something very interesting indeed: “Unknown to ourselves, we lacked competency. Bitsing makes you aware that you’re doing things the wrong way. It made us aware that we lacked certain competencies, that we had been ‘unconscious of our incompetency’. It then provided the handholds for us to get to grips with correcting these shortcomings – we became conscious of competency. Then we came to the phase of rolling out the Bitsing programmes, thereby entering the next phase: that of unconsciously becoming even more competent, in yet more areas. The entire process made a big impact on us. In a period of one year the team at De Key became truly professional.” ”Bitsing enables you to discover your organisation’s talents. Again, this is due to the solid foundation provided by the Bitsing method”, said Lidy. ”Our organisation is large, diverse and consists of a number of islands, each with its own language. As a result of applying Bitsing across the entire organisation, we have all started speaking the same language. As a result, we work better together – and working together is, of course, always the best way of working. It’s another benefit of the Bitsing method.” I asked Lidy whether Bitsing had not only been appreciated by management, but also by the employees. Her answer was straightforward, ”You quickly learn to be selective about who you want in your team. The early adapters stand out and these are the people that you need first. All of our employees experienced the Bitsing method in a very positive way though. Why? Because it facilitates and supports them. It tells them how to do things, how to tackle issues… Bitsing gave them handholds. It means there’s always something to rely on, a system, and that’s very useful for everybody.” Lidy was also lyrical about the effects on their website – and other areas of the organisation. ”Our website was passive, static. As a result of applying this methodology it has been transformed into an active website, which is intensively used in the communication with our target groups. And because we now work so efficiently and have the correct focus, we are now also in a position to deploy this approach to other parts of the organisation, such as student housing and parking sales and rentals.” Lidy continued, ”It’s now a year later and we use Bitsing on a daily basis. It has introduced a structure. This means, for instance, that I now automatically receive the reports I need, every week. These reports provide the necessary facts on our sales and turnover. They put us in a position to react appropriately and to take advantage of any changing trends in the marketplace. And all this comes from Bitsing’s insistence on having the correct focus on the facts, as they stand today.”

Lidy concludes, ”And, of course, things like our ‘house-buying cafes’ and open house routes are also very popular, because we now know who to talk to…because we’ve identified our target group. All of this has grown from the foundation laid by Bitsing.” De Key is a perfect example of how an organisation should use the Bitsing method. My mission is to enable any organisation to apply Bitsing autonomously, following an initial, guided Bitsing period of about 12 months. This development is precisely what took place at De Key, which is why this case study is a source of particular pride!

‘Change management’ is one of today’s most annoying clichés. It’s as if change, in itself, will bring success. Which is far from the reality of change. The Dutch word for change is ‘veranderen’ – which illustrates my point rather neatly. The word can be split into ‘ver’ (far) and ‘anderen’ (others). Which expresses my advice on change: stay far away from it – and leave it to others. If you’re driving in your car and get lost, do you change the car? No. At most you drive in a drive in a different direction. Which is exactly how you’re going to use this second law of the Bitsing method. Not to change – but to take a different route. You’re going to do things differently – but using existing resources and capabilities. Success really has nothing to do with change, but with doing things differently. A small difference in how you do things can have a large, positive impact.

Change management has a negative impact on your organisation. Attempts to change people have never meet with success, but you can get people to think differently and do things differently. Which is why I prefer to speak of ‘difference management’. Organisations that attribute their success to change have actually just done things differently. They haven’t really changed at all. Has Coca Cola changed? Or Apple? Or Microsoft and Shell? Yet organisations that pursue change do take big risks – and often don’t succeed. Brilliant businesses with world-changing products have failed because they tried to change. Compac, one of the largest global suppliers of PCs, failed – when it changed into being part of a software giant (HP). MCI Worldcome, a billion-dollar American discount telecom company, went bankrupt as a result of change in the form of a series of massive mergers. Eastern Airlines changed from a postal service into one of the four largest airlines in America, but could not survive this change and disappeared off the map. General Foods Corp. bought brands that lay outside the area of its core business, was itself purchased by cigarette company Philip Morris and, yes, went up in smoke. Tire manufacturer Firestone tried to grow by producing a completely new kind of tire – and rolled to a halt. Consumer Electronics Manufacturer RCA was prized for its history of innovations – it was the first company to globally market electronic television sets – but began to diversify its operations beyond the area of its traditional business. The ensuing expansion was so quick and so remote from its core business that the company became impossible to manage. AltaVista, a search engine that was once bigger than Google, destroyed itself by adding unnecessary complexity to its interface. More examples? Well, just Google them.
Change can lead to dismissal of employees, unnecessary cutbacks and more misery than solutions. Is this what you want in your organisation? Just doing things differently will lead to continuity and growth, to more turnover, more profit and, above all, to pleasure, positiveness and a good (working) life. The best way to deal with change is therefore not to change. Which is in any event our automatic reaction. This is called involuntary adaptation, or evolution. Who among us still thinks and acts as they did ten years ago? We’ve automatically We involuntarily adapt to the developments changes in our environment. Which, for most people, is absolutely no problem. The coming of the car, television, the mobile phone and now the internet and social media caused us to involuntarily adapt our behaviour. We travelled more easily, communicated more, became better informed and more easily accessible. Most adaptation is easily absorbed by individuals and society. Although surrounded by new developments, we embrace these new opportunities and situations – and naturally adapt to them. Sometimes this takes a little time, while for some it can’t happen quickly enough.

If someone tells you to change, they are actually asking you to become something other than yourself. A different person. Such imposed change is never successful. You are who you are – and change takes time. If you’re currently involved in change processes within your organisation – stop! My point is that you should do what it takes to achieve your continuity goal. And this is something other than change. It’s just doing things slightly differently. In order to deal seamlessly with new developments. To do things differently, for example to take a new route instead of changing the car, is something you can ask of everyone – and something that everyone can do. Imagine: you’re walking outside in the sunshine, when suddenly there’s a rainstorm. You put up your umbrella, so as not to get wet. The change is that your surroundings have changed – from dry to wet. Your reaction is to put up your umbrella, in order to stay dry. Have ‘you’ changed? Or did you just do something differently?
It’s the same for your organisation. You’re not currently doing things wrong – as always suggested by proponents of change management. You’re just not yet doing what is necessary to achieve your continuity goal. The strength of Bitsing is that you do not have to change. You just have to do things differently. And this chapter will help you achieve that. I call it ‘difference management’.

Start by looking at how you can do things differently. For example, are you currently spending a lot of time and money on things which you’re not sure will turn out to be successful – while areas that produce a lot of your sales and profit are being neglected? To what extent are relatively small developments in your business, your market or the economy seen as very significant in your organisation? Online purchases of retail products and services, for example, will only account for 8.8% of the total worldwide retail market in 2018. This is less than a tenth of the market. To what extent will you focus heavily on this development?
Take my advice to heart: see ‘change management’ as managing to keep far away from change. Leave it to others.
Succeed gloriously, by doing things differently – and by not changing.

You have to keep moving, always. Standing still means you’re going backwards”

Bas Huysmans

Saint-Gobain employs 190,000 people
in 64 countries. The business has four divisions, each with its own area of expertise. These complement each other in such a way as to make this a global top 100 industrial company, in terms of both innovation and size. The business has seven general and twelve specialised, research institutes –

and around a hundred development departments. These resources are used by each of the company’s four divisions – innovative materials, building distribution, packaging materials and building products.

My interview is with Bas Huysmans, Managing Director of Saint-Gobain Weber Beamix, pioneers in the DIY market. It focuses on the building product division.

How did you use the Bitsing method and what can you tell us about growing at a multiple of the market growth rate?

Bas Huysmans: “You have to keep moving, always. Standing still means you’re going backwards. Or, to coin a saying, for us still waters don’t run deep – they’re just stagnant. To keep moving forward you sometimes have to let go of the security of the old way of doing things. Not easy for some people. In fact, for many in our business, using the Bitsing method was a journey into unknown territory. So, people are of course a bit hesitant in the beginning, wondering what’s going to happen. You always have to take this into account – so it pays to be patient and take things step by step. You don’t
have to get it 100% right the first time. People will take you seriously in due course.

What one discovers in this process is that many still use the ‘I think that …’ approach. And indeed, people are used to working on the basis of assumptions. What we’ve now done is make things far more fact based – how things are, rather than how we think they are.

There was previously a mentality of, ‘OK,
I have a task, so it’s up to me to do it -
the way I think best’. People understood the Bitsing method well enough; the chal- lenge was to get them to work according to it. So we integrated it into our daily operations, step by step. We started by creating awareness of the turnover goal and that everything we did should result in turnover. This was quite ambitious.

Five years of recession had resulted in
a damaged, unstable construction market. A closer look revealed that people were
a bit numbed by the negative experiences of recent years. So we immediately started shifting the focus of the organisation – using the pencils philosophy of the Bitsing method. It emerged that we had invest- ed a lot of time and money in markets, target groups, and products with less than significant shares in our turnover. It was inconceivable, but the vast majority of our turnover derived from 1.3% of our product range.

Shifting to a realistic focus resulted directly in 20% growth. The ‘pencils’ are a fantastic tool for convincing everyone in the organisation of the need to change focus.

This corrected focus led directly to active engagement with the market. We did this using an uncopyable proposition – our leading position as the pioneer of the
DIY market: ‘Lead by Origin’. Each of the involved departments took control of their own segment of the BITSER programme. B and I fell to marketing, T and S to sales and E and R to account management. They all developed their own programmes, with the common departure point being the essence of our Golden Egg: ‘Lead by Origin’. Everyone in the organisation knew what this proposition meant. So, the departments could independently, yet consistently, develop their own BI, TS and ER programmes. In conclusion, we assembled these elements into a consistent, BITSER programme, compiled by all of our departments. It was extraordinary to see how the awareness thus created integrated these previously independently operating departments. Now Marketing is aware that Sales can’t sell without B and I, and Sales knows it must achieve the T and S in order that Account Management can retain the clients recruited by Sales, failing which all the efforts of Marketing and Sales are wasted. A feeling of togetherness and collegiality emerged as a key element
in our organisation.

First impressions were often negative – and old habits die hard. Initial reactions to new things were often, ‘I’m already so busy’, or ‘Yes, but my approach is very different’. However, as the system (‘What pencil are you using for that?’) and the role of the departments within the BITSER model were better understood, acceptance became easier and is now almost automatic.”

Can you describe what Bitsing has done for you – in one word?


“‘Streamlined! That’s the key word. You came here telling us that everyone within
an organisation is busy doing their own thing, while not one of them is involved, from beginning to end, in the entire process. And yes, at Saint-Gobain Weber Beamix we had a Strategic department, Marketing department, a Sales department, an R&D department and a Production department – all doing their own thing. Of course, they engaged each other and had points of contact, but nothing about the interplay was streamlined. So, they weren’t really working with and for each other. Indeed,

it was this word, ‘streamlined’, that actually

triggered my reaction, which was, ‘This is music to my ears!’ We can do something with this, I thought. The structured approach inherent in Bitsing forces an organisation
to also adopt a harmonised, structured approach in order to achieve its common aim. Which is why I then adopted the Bitsing system – a decision that has validated itself in practice.

The language of Sales is totally different to that of Marketing. Both departments endure a lot of pressure, do a lot of activities and suffer a lot of stress. However, they experience different types of pressure, action and stress, and express this in two, different languages. So, it is di cult to have enough empathy with each other, given this barrier. It’s difficult to engage with each other’s opportunities and problems.

As a result of the Bitsing process, the organisation now shares a common language to a much greater extent. Everyone now knows how to identify an important product; that you can only get a client to buy once he likes you, and so on. It actually doesn’t matter anymore whether you’re on the marketing or sales side, or in production and innovation, you all speak the same language, you understand what is meant and you also see the effects of the work of others on

your own part of the business. The inter- actions between the various disciplines are suddenly far more linked to each other and have become almost visual for the people in the various departments, particularly in Sales, Marketing and After Sales.”

Does this give them more respect for each other’s work?

Bas affirms, “Yes. Because you have better, shared understanding of what the other person is doing, and why you are doing these things. There is also more readiness on all sides to work with each other and help each other. So what we deliver is now seen as the product of everyone’s e orts, which also has a motivating effect. This, in turn, creates more commitment and better performance – and so you have almost a virtuous cycle.”

And what you’re now doing is raising
this to the next level?

“Yes, It’s like learning a new language.
In the first phase you really do your best to learn the words, the conjugations. So, you get to know the language, but you don’t yet speak it. As a company we are in that phase. We can get by with the language – perhaps on holiday, but when it comes to conducting business we are not yet fluent enough. Which is why I took the decision to become more fluent in the language.”

What other effects have you noticed?

“Internally, I can see we’re beginning to
get more insight into the short term – our plans are better. Where we once operated on gut feel in terms of product development and promotions, we are now more planning orientated and therefore can also prepare our internal operations better. So, as regards development – we are more focused on developing. And in Marketing and Sales we are more targeted in our approach. We’ve experienced distinct advantages in both these areas. Now that Marketing and Sales give more consideration to what we have
to do, it’s become noticeably easier to communicate their expectations to Production and Logistics.

What’s really di cult is not doing the things that we’ve always done. People have a tendency, in the first instance, to do Bitsing in addition to what they used to do. They see it as increased workload – ‘Now they’ve thought up another one’. But as they take the first steps and start to make progress, they become more enthusiastic and more aware of the fact that Bitsing actually reduces workload.”

Are you growing at the moment?

Bas: “Yes. Our growth rate is at least twice that of the market. Which means that we are grabbing market share. And, of course, there’s a reason for that. It’s partly due to the organisation itself, with its well-structured management. And that, in turn, is a function of the fact that we are more highly focused. And that the decisions we have taken are far more based on facts than feelings. We do still follow our gut feelings, but the decision process has been speeded up enormously by the fact that we’ve looked at the Bitsing plan. And this, in turn, has given us a far better understanding of the numbers. When you first arrived, Frans, we had just survived a five-year crisis. Things were just lightening up again. We were able to breathe again. You came with a positive message, a very simple message. One that I, as a technical guy, could easily understand. That was very important. It’s as simple as it can be. And you presented it in such a simple way that everyone that heard it said, ‘Yes, of course, we knew that all along – so yes, let’s do it!’ It’s so logical, it must work. Yes, you arrived at the right moment, with the right message. One that appealed to my need to shake up the internal organisation, organise it better and tighten up the processes. Your logic appealed to me – as did the simplicity of the system. It’s what persuaded me to adopt Bitsing!

Every entrepreneur wants results. There is no shortage of people who invest millions
in projects while having no idea of what the investment will produce – as strange as this seems. The success of Bitsing stands or falls in relation to how strictly one executes the Bitsing plan. If we were to partially apply it, it wouldn’t work. Of course you can do other things alongside it – one has to retain a bit of individuality – but I really am convinced that half doing it makes absolutely no sense.

With Bitsing it’s not a question of a promotion here and a campaign there. You have
to do the whole thing. That’s what resulted in our growth. If we hadn’t Bitsed, we may have done these activities in any event, but would then perhaps only have had 25% of the total, required package in place. And what would that have delivered, if anything? By thinking it through completely, from a
to z, one develops the complete process.
As a result, your prospects and clients swim further into the net, making it more di cult for them to escape. Yes, we did previously conduct similar activities. We put the nets into the water, but we hung the bait near the entrance. Clever fish entered, then quickly turned around and swam in the opposite direction. Now we have six pieces of Bitser bait and the fish swim so far into the net that they can’t escape.

And because they are always addressed in a way that’s appropriate to the Bitser step they are on, the fish are always happy!

The system is complete. The ‘Lead by Origin’ message is everywhere. On our fleet, our videos, in our promotions and TV commercials, our online presence and so on.

We have delivered so many solutions in
so many areas that we have built up really extensive experience over the last 50 years. In principle, we’ve already executed a solution for virtually every problem that arises -
and it’s in our records. We can do anything that’s required. Which is why the whole Saint-Gobain Weber Beamix enterprise is designed around flexibility – it’s an important pillar of the organisation. So everything that we do and everything that we invest in must increase our flexibility – and certainly never limit it.

What I would like to pass on to the reader
is that you shouldn’t limit yourself to a few products or single target group. This exposes your business to risk. If the market collapses, you’re done for. In Bitsing ‘pencil’ terminology, deriving your turnover from only one pencil product or target group makes you very vulnerable, especially if you can’t sharpen the pencil. Broaden your range and use the pencils philosophy to achieve this.

There will always be ups and downs, but
a good mix ensures that you can operate comfortably in your market. Bitsing helped us to focus and concentrate – and sometimes to drop a few things. Things which didn’t generate turnover, or weren’t profitable. We did that, and we didn’t go unrewarded. We are currently growing at a rate of 22%.”

Interview MIEP Design – from dream to reality
• Starting a business is a decision – not a risk
• How the BiTSing method guarantees success

Githa Minis – Interior architect

Every entrepreneur has, at some stage, gone through the process of starting their own business. I am no exception. It’s a challenging experience – at the very least, as I wrote in the introduction. Income is always necessary, but how will you ensure it? And when will it come in? As a result of such concerns a very large number of aspirant entrepreneurs never dare to take the step towards independence. Which is why I wanted to include a motivating and inspiring story in this book – for everyone who has dreamt of their own business, but never turned that dream into reality. The following case study is about Githa Minis, a young woman who took the challenging decision to start her own business – in a situation that had seemed hopeless. Nothing forced her to take this step. She took it thanks to a dream and, as she says, ”Thanks to the Bitsing method”.

This is Githa’s story. My first acquaintance with Bitsing ”The economic crisis had made it difficult for me to find a job after graduating as an interior architect. I submitted at least fifty applications for jobs in large design agencies. The response was uniform: ‘insufficient experience’. Indeed, in a market with very many applicants and very few vacancies, it’s impossible to get a position without experience. So I was forced to take a job in catering. At the same time, I still wanted to pursue my dream and follow through on the years of study I had put behind it.

“My catering job brought me into contact with Frans. His advice was that if I had a dream I should follow it; that if I wanted to start my own interior design business, I should just do it. This had, indeed, always been my long-term dream, but had intended to first build my experience by working for other companies in the industry. Frans, however, convinced me that if I followed the Bitsing rules, my success would be guaranteed. ”I rose to the challenge. Not because I dared to take the risk, but because insight into Bitsing methodology showed me that I would succeed, without a doubt. I resigned from my catering job and started MIEP design – my own interior design business. Filled with enthusiasm, I worked day and (sometimes) night to ensure the success of my new business. It’s a great feeling. Thanks to Frans and Bitsing I was able to busy myself with my greatest passion, while seeing the dream of my own business taking shape around me.

MIEP design ”The business name didn’t just occur to me out of the blue. The Bitsing method showed me that you have to be uncopyable – and that your uncopyability should find expression in everything you do. My immediate thought was that this also applied to naming the business. Bitsing also delivered a real eye-opener: Large, professional design agencies were absolutely not my competitors! And I should avoid this becoming the case. (And to think that I had originally wanted to work for one of them!) ”I had learned, of course, about the Bitsing concept of the ‘money competitor’ – the answer to the question: where does my target group spend its money when it doesn’t engage an interior design agency? The answer was simple – and surprising. They spent it on DIY. My competitors appeared not to be the professional design agencies, but the clients themselves. They were the money competitors. So I had to convince my target group that their money was better spent on me than on doing it themselves.

This, in turn, would succeed once they knew what made me uncopyable. So I went in search of what made me uncopyable in contrast to clients’ DIY tendencies. The Bitsing method led me to the following conclusion: Dutch common sense. I was born in the northern province of West Friesland and grew up in a traditional, Dutch family. One in which the well-worn Dutch maxim was applied and practised: ‘Just use common sense – it’s uncommon enough’. Moreover, I was simply drawn towards everything that’s authentically and typically Dutch. I can’t explain it further, but what’s really Dutch really works for me. It’s just ‘how I roll’!

“So what happens when you combine the principles of interior architecture with … common sense? Well, you get an Interior that looks fantastic, that you can be really proud of and that also respects the practical requirements and enjoyment of the people that will live in it. It will lack false pretence and needless ‘decoration’ – and excel in functionality. In a contrast, an interior that’s just beautiful but can’t, for instance, deal with the impact of children and dirt is less desirable than it first seems. In fact, the emphasis is far too often on design, form – and not on function. My approach would be different, a blend of design (the experience) and Dutch common sense (the practical function). Effective interior design – in fact what clients ideally want when they do it themselves. Straightforward design, with both feet firmly on the ground. In fact, a real MIEP (a typically Dutch name for a simple, straightforward female character, also often humourously used).

“As it happened, I didn’t have much time to think up the name. However, I let myself be guided by the Bitsing model’s requirements for creating awareness in a target group – the requirements of step B of the Bitser ladder. The name conformed. It’s simple, surprising, attracts attention, is short and impactful, memorable and one which such basic familiarity that everybody thinks they ‘recognise’ it.

Three reasons for not starting your own business: ”Whenever I talked to friends about starting my own business I was immediately overwhelmed with an abundance of arguments as to why I definitely shouldn’t. I had no experience all, it was an insecure income – and anyway, I wouldn’t even know where to start. After all, I’d only just graduated! There are always enough reasons for not doing something, but Bitsing gave me a new perspective. It simply confronted me with the reasons why I indeed should start my own business! The single reason to start today ”When Frans started telling me about Bitsing he brought many factual arguments to bear. These demonstrated why one should start a business and how every obstacle would be surmountable. They were facts. They offered me handhold and forced me to accept that there was no alternative to believing that I would succeed. ”

I made my own Bitsing plan and started to reduce the number of hours I worked for the catering business. As I steadily implemented more elements of my plan, the process became ever more magical. It was strange, but it was as if a voice kept on whispering to me, ‘This is really something. It can’t fail. You must give it everything you’ve got.’ These were, of course, nothing more than my own feelings. But they came to the surface because of the enormous positive energy and conviction developing around me. All sorts of things were taking shape, and after six months I had resigned from my job and started working full-time for my own interior design business, MIEP design.

”My Bitsing plan told me that I should focus on houses advertised for sale. Applying my Dutch common sense, I brought concept to the market that would satisfy four parties simultaneously: the house buyer, the seller, the estate agent – and myself. Many houses reach the market in a bad state of repair and are dated in appearance and style. This is an obstacle to potential purchasers. My concept provided a virtual makeover of any house offered for sale. This was based on a completely new interior design for the entire home, presented by means of an artist’s impression. The house would then be sold – on the basis of its new, virtual interior and together with a quote for its renovation. Purchasers would immediately be confronted by the home’s full potential plus the appeal of its new and practical functionality. They could also see exactly what it would cost to turn this dream home into reality. ”This approach immediately lowered the threshold to buying a house. Houses that previously had attracted no interest were now getting many enquiries and some were indeed being sold on this basis, together with design and renovation package contained in my virtual makeover. I am now introducing more estate agents to my concept.

“In everything I did, I was guided by the requirements of Bitsing. I knew that it would enable me to succeed. And I was completely right. The positive effects are unavoidable. Whenever I have presented my ideas, people bought into them. For Bitsing always stimulates belief and conveys trust. Even more so because it contains the tests that determine whether your plans will actually succeed. It’s a handhold, a foundation on which to build.

It does require investment of your time and money, both of which are in short supply when starting out. I didn’t do this lightly, but as a result MIEP design has been established, is successful and is here to stay. ”My plan is to continue to evolve MIEP as a successful business which, in itself, will create more jobs as it expands! ”Frans asked me to summarise how I had benefited from Bitsing. This is my list. And, in fact, my credo:

1. Never spend money before you’ve earned it.
2. Only invest time and money in ‘sharp pencils’.
3. Ensure that there is demand for the product you’re selling.
4. Focus on your product’s purchasers – i.e. know your target group and appeal to them.
5. Your competition is where people spend their money if they’re not spending it with you.
6. Don’t make sales offers if they don’t address why people aren’t buying.
7. Don’t construct your campaign out of your own problems.
8. First make your brand and name known, then sell.
9. Discover your own uncopyable characteristics; ensure that you remain uncopyable.
10. Use your own uncopyable characteristics in your marketing messages.
11. Enable people to draw their own conclusions. Don’t tell them what to do, just hint at it.
12. Stick to the facts.
13. People must want you before they buy you.
14. Traffic is very important. You need it to make a sale.
15. Ensure that traffic and contact is risk free for the customer.
16. Consider media and messages you use to achieve your goal. Will they reach the right people?
17. The medium doesn’t determine success. The message does!
18. Keep your goal in focus and don’t diverge from it!

“In the beginning I had no idea of what to do, while I am now absolutely certain that I’m doing everything right! Everything is so fact-based that it’s irrefutable. Everything I’ve learned now guarantees the success of everything I take on. The volume of enquiries coming in makes me feel that it’s unnecessary to convince people to take my product. What I do – works! Bitsing inspires me, convinces others and at the same time creates its own discipline: stick to it – and you’ll achieve your goal. There are always, of course, moments in which you ‘lose the plot’. In these moments I go back to my notes, absorb the wisdom and once more know what I have to do. Bitsing is a manual for entrepreneurship. I love it. It’s allowed me to do what I studied for 9 years.

And the best thing is that at the close of every day I have, once again, seen my business grow. A fantastic experience. ”My dream has become reality. My hope is that everyone who wants to start their own business will, through my story, also see their dreams fulfilled.”

Engie (former Cofely) – innovation, powered by Bitsing
• Creating focus – also in start-up situations
• Getting departments to take ownership of the methodology

An interview with Bas Ambachtsheer, managing director of Cofely West Nederland BV and Cofely Energy Solutions. Bas and I have known each other for quite a while. We met when he worked for Fokker services, the business I used to provide an example, in step three of this book, of uncopyability. A few years ago Bas was asked to become managing director of Cofely and he took the Bitsing method with him to his new company. Cofely is a technological service provider and forms part of GDF Suez Energy Services, one of the biggest energy suppliers in the world, with 220,000 employees and more than €90 billion turnover. Cofely Energy Solutions supplies integrated technological solutions for sustainable and energy-efficient, fixed property applications, as well as related advice, design, financing, implementation, maintenance, management and agency services. You’re likely to come across people from Cofely in nearly any business you visit. Their characteristic, branded clothing identifies them. And it is, indeed, a company that stands out!

It was Cofely, for instance, that built the energy distribution network for the London 2012 Olympic Park. This was one of the biggest energy projects ever implemented in the United Kingdom, with two, ultramodern, sustainable power stations feeding a network of 16 km, while achieving a 50% reduction in emissions. Cofely is also active in the Netherlands. Together with the Amsterdam City Council it developed ‘Amsterdam’s greenest Island’, on the Oosterdok island and the Ijdok. There a Cofely heat/cold storage system supplies connected buildings with energy, reducing fossil fuel requirements by 65%. Kofi employs about 6,000 people in the Netherlands and has a turnover of at least €1 billion.

As I’ve said, Bas first came into contact with Bitsing while previously employed by Fokker Services. There he was involved in the development of a new business line, which was structured from the outset to employ a go-to-market strategy developed with the help of the BiTSing method. Since then he has been vocal in his praise of the clear differentiation Bitsing can deliver to a business via the Golden Egg concept, as well as its effect in given direction to commercial strategy. Bitsing had played a crucial role during the entire process of (a) determining products and markets, (b) defining the operational process and (c) enabling development and growth of the business line, all of which fell under his responsibility.

Bas has also ensured that Bitsing played a prominent role at Cofely, from the time he took up his new position there. ”Our overall strategy made it clear to us that it was important to add new services to our portfolio, coupled with ambitious turnover goals. We therefore started a new business unit in 2010, focused on integrated technological solutions for sustainable and energy efficient real estate applications. Such initiatives, of course, require investment. Which is why CFOs really appreciate Bitsing. They relate to its sharp focus, clear structure and concrete ROI predictions. The autonomous growth curve used in our multi-year business plan was therefore also completely based on Bitsing methodology. Bitsing also enabled us to construct a ‘paper blueprint’ of the intended unit and to thoroughly test the viability of its underlying strategic focus. This gave rise to an enjoyable yet intensive process, which took a few weeks and was stacked with revelations. This process is particularly enjoyable when it involves the whole team. If you already have the capability of developing something within one or two days, then the value of Bitsing is already apparent as it takes you from a zero base to achieving something that’s really very significant, in a very short period of time. The experience of using it is always one of moving from knowing very little to becoming extremely aware of the relevant issues. In addition, Bitsing gives you so much insight into where you should and should not direct your focus. It ensures that you build on the positive aspects. For example, the Bitsing process provided us with a totally different focus on the issue of identifying our prospective client. And we immediately used this insight to implement changes in how we were structuring the planned business unit.

“Following introduction in January 2010, Cofely Energy Solutions was profitable, for the first time, by 2011. Consistent and close adherence to the Bitsing strategy ensured that turnover grew from € 8 million in 2011 to € 15 million in 2012. Turnover nearly doubled. This year our profit will grow exponentially and, again, this has to do with a number of focal points revealed by the Bitsing process. We’re now really in a phase in which the business is beginning to fly.

”I use Bitsing constantly. It really helps me manage the business. And it makes sense to use it in every phase of business development. From start-up, throughout the business development phase and, once it’s achieved a steady state, in phases in which a boost is required. I can rely on Bitsing to always provide the right direction, relevant feedback and a mechanism for steering progress. In a start-up situation it certainly provides so much more direction than the usual process of analysing market reports and so on. The methodology is pragmatic, it’s to the point, and it provides a model with a clear beginning and end point. For these reasons it has become an integral part of our DNA. Take uncopyability, for instance. It’s a brilliant concept – very clearly perceived by customers and it lifts your game to a new level!

”I always use Bitsing methodology when explaining our sales processes. As a result, our entire sales team lives and breathes Bitsing. The methodology is so clear and its basis so easy to explain that everyone can master it, in the shortest time. Having said that, there is also a learning curve. Over time the relationship between the Bitsing elements becomes increasingly clear – as a result of which, your own effectiveness also increases. From this point of view, Bitsing is a continuous improvement process, which directly addresses the question of why one does or does not sell. And when things do go wrong, it delivers a sort of ‘final judgement’ as to the reasons why. This also helps to inspire and infuse my sales team. Through Bitsing they understand what they’re doing and this increases their job satisfaction. Bitsing injects structure and craftsmanship into their side of the business – in a way normally only associated with operational roles – and it provides rewards in the form of success. Their reaction is, ‘At last! Here you really get taught how to sell – and to generate turnover.’ One notices, of course, that the people who are successful in selling are those who understand Bitsing.

”So now they all know what to do concerning hit rates, customer visits and so on. They understand that the T (for Traffic) only really has value when the B and I also have value. The Bitsing method is central to my approach to sales and has directed me to teach my people to initially only focus on the B and I. They may not sell until these phases have been filled in! And it works! In the beginning they all said, ‘An appointment? No problem. I’m able to get them.’ But the sales calls they had in mind didn’t really count. They do occur in the T phase, but they aren’t the kind of traffic or contact that produces sales. These appointments should rather have been used to give the B and I substance. People have to get used to this. These prior steps are necessary, before you can talk start talking about making a sale. But the process works incredibly well. What happens is that the prospect makes his own conclusions and, before the meeting is over, is saying things like, ‘Well, that means that I should be interested in this…and need more information on that…’ and so on.

”This also highlights one of the biggest failings in sales – that the B and I are seen to be less important and are often ranked lower than they should be. This comes because people think, ‘They already know us’. But how well do they really know you? In my experience, one tends to conclude that people know you before they really do. The answer to the question, ‘Do you know what we do?’ is often, ‘No’. In practice, this meant getting the entire salesforce to hold back: ‘Guys, for the first 10 minutes I want you to relax and just talk about Cofely’.

”Another good thing about Bitsing is that, when you approach it as a team, it gives rise to a better plan. We have also benefited very much from our involvement in the process itself. Bitsing means that everyone speaks the same language, uses the same terms and begins to think in the same way. In this way it also really helps in directing the business towards greater effectiveness. If people are spending increasingly more hours on a customer without results, one can conclude that something is wrong with the B and the I. Bitsing helps us to check where we are in the process and to manage our progress. This also helps me arrange teams consisting of people with complementary skills. People who are good in the B and I areas, but also people that are good in closing the deal. I encourage them to use each other’s strengths.

”Bas’s tip for you: ”Bitsing is an investment which, of course, must pay itself back. This presents a challenge to justify the investment – but don’t hold back. It’s never too early to introduce Bitsing. In fact, it’s better to start Bitsing a second time over, than not to have applied it sufficiently!”

Nayak Aircraft Services – the BiTSing method at work in the labour market
• Optimal staff recruitment
• Improving employee performance

Bitsers are sometimes surprised by the power of their own ideas. This happened to Patrick Morcus of Nayak Aircraft Services. The Bitsing method, which Nayak use to recruit new clients, became a powerful personnel recruitment tool which also improved the organisation’s performance. It delivered results which seemed impossible to achieve using traditional staff recruitment tools. Nayak recruited 124 new employees, in a labour market in which such staff were difficult, if not seemingly impossible, to find. ’Without Nayak – things don’t take off’.

This was the (literally translated) slogan on the presentation boards shown to me by Patrick Morcus, managing director of Nayak Aircraft Services. To which he added, ”Look, I’m not really keen on this. To be quite honest, I don’t know if this is what we are going to run with. Can you also recruit staff – using the same method?” My answer was, ”If you can recruit clients using Bitsing, why not employees? personnel recruitment is surely just selling your company to potential employees?” A smile dawned on Patrick’s face, “Well then, we’d better start doing that straight away!”

Nayak Aircraft Services is an aircraft maintenance company. Located at Amsterdam’s Schiphol airport, its clients number more than 60 airlines and it has maintenance stations at 27 airports,
across Europe. Nayak is like an emergency help automobile association – of the air. If an aircraft has a problem, Nayak solves it immediately, so that it can proceed safely to its destination. The company has been a fervent Bitsing user since the time of the method’s introduction. It has used Bitsing to achieve its commercial goals for years. It is also the first business to have created a specialised, dedicated department for this purpose. It has no marketing department, it has a Bitsing department, which supervises correct application of all aspects of the method.

Nayak is also extremely successful, which is a function of the extraordinary drive and passion that its people bring to their jobs. As a result, it holds an increasingly important position in the international aviation services market. At Schiphol it is responsible for providing technical services to one third of all aircraft taking off and landing at this huge airport. And this achievement has not remained unnoticed. One evening an SMS message arrived from Patrick, ‘Standing on stage at FD (the leading, Dutch financial newspaper) Gala event. Have won FD Gazelle Award for 500% growth over recent years and consistent personnel quality. Also due to your efforts. Thanks v. much!’

Nayak’s growth remained unstoppable. By the end of 2007 Nayak had closed major contracts with KLM Cityhopper, to maintain all its aircraft. The contract would commence on 1 April 2008, for a limited number of aircraft, and from 31 October 2008 for the entire fleet. To meet these contractual requirements the company had to recruit a total of 104 aviation technicians, and have 48 already operational by 1 April 2008!

Not an easy task – to put it mildly – as these people were as rare as hen’s teeth. They belonged to the category of personnel in shortest supply – worldwide.

Meantime 1 April was four months away and Nayak was contractually bound to ‘deliver’ on this date. Everything possible was done to recruit the required staff. Recruitment and temporary staff agencies were briefed, as well as a well-known labour market communication agency. Despite these measures, nothing worked. Patrick had run out of options. In any event until he had his breakthrough idea and asked me, “Can you also recruit staff using the Bitsing method?” It was an opportunity for the Bitsing method to demonstrate, for the first time in its existence, that it was also effective in therecruitment of high level, specialised personnel.

All seven steps of the Bitsing method were implemented, in precisely the same way as when applied to commercial objectives:

Step 1. Employee recruitment was expressed as a continuity turnover goal.
Step 2. Goal achievement was guaranteed by means of a focus on the hard (financial) facts.
Step 3. Nayak was rendered unbeatable – now backed with the additional benefits of uncopyability. Step 4. A plan was developed to take each potential employee through six steps of the Bitser ladder.
Step 5. This plan was implemented using programs formulated according to Bitser techniques.
Step 6. The programmes were rolled out against predicted results.
Step 7. Profit was guaranteed, with an investment plan in which less money was spent on the programs than they were expected to produce.

Results: The required 48 staff members were recruited well before the deadline of 1 April. On 15 July I received an email from Patrick: ‘Stop the presses! Number of employees exceeded!’ Within a period of eight months Nayak had filled all the required vacancies and had also accumulated a ‘reserve’ of another 20 employees. In total 124 employees had been found, instead of the targeted 104. Nayak had its ‘ducks in a row’ more than three months before the start of its massive KLM assignment. Recruitment interviews were carried out with a total of 517 candidates, from which 124 were employed: a conversion rate of 24%. The final recruitment costs were extraordinarily low: as little as one third of the previously set budget turned out to be enough to achieve the goal. And this budget had been based on the average, expected costs of traditional personnel recruitment. The recruitment campaign had mainly focused on Nayak’s uncopyable proposition as an employer in the personnel market.

By focusing on the hard financial facts, Nayak discovered that its target group consisted of a mix of different job positions, which were jointly responsible for the generation of turnover. Nayak did not only earn its money from deploying technicians, but also by having professionals in operational, supports and administrative functions. These people also had to be recruited, in order to secure the increased turnover. The number required to support the technical service requirements could be calculated per target group and Nayak knew exactly how many people where necessary per group. The campaign objective found commercial expression in a 45% focus on the creation of brand preference, 30% on stimulating purchasing behaviour ( i.e. the decision to enter employment) and 25% on ensuring that the new employees remained at Nayak (i.e. loyalty). As stated, only 30% of the program activities were focused on purchasing behaviour, in other words on the job itself – which therefore did not play a dominant role in the recruitment activities. Nayak used emotional propositions to profile the brand, rational propositions to get people to decide to take the job and relationship propositions to optimise employee performance.

Nayak had to claim an uncopyable proposition for its positioning, one which other brands could not claim because they simply lacked the credentials to do so. Nayak sought its uncopyability within the organisation – where the work took place. It emerged that Nayak had an internal culture which revolved around solid, collegial support between its people. This was translated into the proposition, ‘We never let you down’. Who would not want to work for a company whose people were always there for each other? The campaign execution communicated this ethos by using actual employees instead of professional models. The results prediction quantified how many people would have to be recruited per Bitser programme and per target group. Communication with the target groups was based on the well-known six types of Bitser programmes, each tailored to one of the six Bitser steps.

The program to increase brand awareness consisted of billboards in the Schiphol area, buses for broader regional reach, Nayak’s own fleet vehicles within the airport area and free publicity in aviation industry magazines. The image building program consisted of interviews in industry magazines, a ‘making of’ film (about the Nayak employees who were models in the campaigns) which was posted on YouTube, a specialised personnel market website (which communicated the Nayak philosophy) and an award event (the Dutch Aircraft Maintenance & Repair award, which spotlighted not only Nayak but the entire aviation technology industry). Recruitment interviews were stimulated via a promotional website (called ‘workingatNayak’) which also carried vacancy ads and a personality test to determine applicants’ psychological ‘fit’, a promotion on the Schiphol platform as well as in various airport car parks (this was the Nayak ‘Snack Car’, which offered technicians sodas, snacks and vacancy brochures), a photographic competition (prize: an Airbus 380 scale model) and online banners (on websites frequently visited by the target group, such as a Dutch aviation news site and various blogs).

Entry into employment- the employment contract phase – was supported by small group events, in personal interviews, with a presentation (about Nayak), and via case studies (by and about employees who had just started working at Nayak and who also shared their experiences on the ‘workingatNayak’ website). A satisfaction program served, as implied by its name, to ensure employee satisfaction. This was supported by, among other things, the Nayakclub.nl website (a community where employees could read all about Nayak and about their colleagues – new arrivals, new babies, staff birthdays and other life events and news).

There was an on-site suggestions box and initiatives like ‘A feather in your cap’ (‘award one to a colleague and explain why’), formula 1 and football pools, savings points (for interesting gadgets) and so on. Finally, current employees were encouraged to also identify potential new recruits. For this they were rewarded with Nayakclub.nl savings points – for a skid course, a flip in a helicopter, a casino evening with friends, etc.

Patrick Morcus: “We’ve used the Bitsing method for many years. I found it exceptional that it’s also helped us recruit extremely hard-to-get personnel and that it delivered such quality – nearly everyone is still working for us. A quick success is not so difficult to achieve, but when it involves new employees with such a high degree of loyalty, that’s a real achievement. Bitsing provided an extremely solid foundation. It ensured that our messages were correct, our tasks were very clear and the people we recruited are still with us. Indeed, the picture we presented of the company fitted the reality – Bitsing doesn’t make things look better than they actually are. Which is one of the reasons for our new employees’ continued loyalty.

I first saw the investment in the programs as short term and evaluated it accordingly. However, I have now concluded that the loyalty created by applying the Bitsing is still benefiting us 5 five years down the line. The benefits have turned out to be long-term. I hadn’t previously seen it this way and it’s given me a new perspective. So this isn’t only about achieving short term objectives, I also now look at my investment in Bitsing programs as, indeed, longer term investments. You do keep benefiting from the investment, as long as you use the method correctly. Our uncopyable theme, ‘We never let you down’ has turned out, for instance, to be timeless. We can’t drop it. It remains relevant. And this is the result of Bitsing, of going in search of our own identity, our DNA. And that, also, is something that doesn’t change.

”Everything we did was built according to the Bitser model: the programmes, the ‘workingatNayak’ website – absolutely everything! This includes the employee loyalty program which, after all these years, is still running and is still a success. It’s fantastic. I think it’s the most complete programme ever, from top to tail. Employees even involve themselves in it at home and over weekends. It’s really great. The programme offers employees a sort of savings point, which they can use to buy Nayak goodies. And there’s always a run on these items. Imagine! That’s really brand preference in its purest form. It’s really a unique achievement for a technical business that’s not really ‘sexy’!

“Bitsing also makes salespeople increasingly less important. They no longer have to sell, as the sale is already made. This is what that the programmes do for you. My salespeople are becoming order takers. Sales appointments no longer revolve around whether the order is placed or not. Customers simply order. This makes Bitsing more of a goal achievement model than a selling model. The method itself is a ‘manager’ – it brings oversight to the otherwise intangible process of managing, guiding and evaluating employees. It also makes internal operational processes transparent and controllable. ”What have I learnt from Bitsing, in practice? It comes down to translating your dreams into objectives and realising that you can use the model to achieve these goals, provided you stick to the method. You have to trust the model and not diverge from it too quickly. Businesses will always throw up issues that could make you want to change strategy. Experience has taught me that the viability of the model far outlasts the whims of the market.”

SHELL INTERNATIONAL
Always forecast

I write many blogs. I do this, on the one hand, to share the benefits of my Bitsing method and on the other hand to inspire people who are on the way to achieving their goals. The blogs are widely read. And one of them drew an unusual response: “Bitsing remains impressive in its simplicity and accuracy”.

It came from Sven Kramer, Senior Strategy, Planning & Performance Management Lead at one of the world’s biggest companies, Shell.

The positions Sven has occupied during his long career at Shell could fill their own chapter in this book. Rarely have I seen such an impressive career. So I am not surprised that Sven is responsible, at general management level, for ‘global business performance management in support of capital investment decisions worth billions’.
And I expect this makes him a source of inspiration when it comes to the business of making difficult decisions.
So I am pleased and surprised when the subject of this impressive resume responds to my request for an interview with an immediate ‘yes’. More so when he continues, “I have great confidence in your method. In fact, a smart colleague recently applied the theory to show that a large-scale, international initiative was not all that profitable”. I was, of course, flattered – and keen to know more.
Join me, as I learn a few things from a conversation with Sven Kramer.

We’re in the room in which Sven once attended one of my Bitsing Master Classes. “I still remember attending that inspirational master class here”, said Sven. “Your method has had some great successes. You will continue to grow, of course, if you just continue to apply your own model”, he smiles.

Sven has been inspired by Bitsing, in a number of ways. But what has intrigued him most is the method’s ability to detect answers to complex problems using fact-based models. “It’s this factual aspect that I find so special. It’s what occupies Shell each day; making things … factual. We don’t just take action. Everything is tested, made fact-based, as it were. Because what we are doing represents investments of billions.”

“In my role as international Strategic Advisor”, says Sven, “I received a question requiring the full attention of my colleagues and myself – as unprecedentedly large investments are involved, with equally large risks if it all goes wrong. The question concerned a new energy source – one that is hidden deep in the earth. (I’ll just use the general term ‘new energy source’ here, to avoid a long technical explanation.)”

“This new energy source had seen a lot of growth in some parts of the world, and the question was where else we could grow this new energy source? So they engaged my department to find out.”

“At the outset you think of the big financial potential; the resource is everywhere. But this quickly narrows to: ‘But where, precisely?’ So yes, we search, worldwide, at the locations where we think we’ll find it. And we went for it. We invested. We searched. But it gradually became apparent that it wasn’t going all that well. A kind of awareness dawned: We think we’ll find it somewhere … but how factually correct is that thought, in itself?

“Then you arrived, with the Master class on your Bitsing method. Your approach to making choices, in the form of the pencil philosophy, was particularly relevant to this problem, and we applied the model to our situation with the new energy source.”

“The issue is that we work in many different countries, all over the world. And the size of the investments involved and, indeed, of the world as exploration area, are a cause of concern. The investing starts with the first geological analysis, which of course costs money. Then there are the next steps, each of which cost even more money. I’ll keep it simple for the reader, but think of drilling a well, or a number of them; the amount of money you invest without knowing what it’s going to yield, grows with each step. And if there are, ultimately, cautious, positive signals, you’re not there yet. You must then build a whole lot of facilities and pipelines, and invest an even larger amount.
In short, all the stages you pass through and all the investments must at least be repaid. However, you don’t know in advance whether those cost will be recovered.”

Sven remains quiet for a moment. “Do you know that only a minority of the pilot projects are ultimately successful? Yet the investments in the majority of the unsuccessful attempts, or where we should have stopped projects earlier, must also be recovered?
This corresponds to those experienced in product innovation in general. Only about one innovation in ten is successful – and that one success must cover the investment in the other nine innovation attempts.

“That means”, continues Sven, “That this, single, successful project, that will undergo full development, must pay for all the projects, worldwide, that are not successful. And that is a lot of expense.

If you do the sums you quickly conclude that you need to raise your strike rate. Partly on the basis of your pencils model and the philosophy behind it.

We started costing out all aspects of the new energy source; using numbers which, as your model says, must be based on hard financial facts. This showed that our focus model actually wasn’t so great,” said Sven, his tone reflecting the negative impact of this discovery.
“The focus on this new energy source was out of proportion – far too big in relation to its expected turnover, to its capacity to produce a positive yield. That yield appeared more marginal than what we can make on traditional oil and gas – in other words from our ‘sharp pencils’, to use your terminology”, said Sven.

“So the new energy source was a ‘blunt pencil’, but one that got an amount of attention comparable to that given to our sharpest pencils, namely oil and gas. And we had to use its much smaller margin to cover a very large investment, with a much lower chance of success.
So, yes, as often happens with the Bitsing model, we had to conclude that our initial approach didn’t look too good from a commercial point of view. The degree of focus, of course, had to change.
So we did that.
We first looked at making a more intensive version equivalent to your model; at how we could refine the model and adapt it to our complex processes. By applying a more factual focus, based on financial facts, we aimed to increase the success rate of our selections.

We started identifying criteria, which raise the chance of financial success. We called them the Big Rules. If a project didn’t sufficiently match the criteria, we immediately stopped it. We stopped earlier than before, in this way keeping the costs as low as possible.

We applied this. And it then appeared that the new energy source had more chance of succeeding if you prospect in areas in which you already produce, areas that represent sharp pencils – where we have a firm handle on the models.
In contrast, if you explore in a totally new area, you have to set up everything without knowing whether the project is going to be profitable. To keep within the pencil metaphor, you have to sharpen that pencil from the start, but without knowing if you’ll ever manage to get a sharp point on it.

The selected areas, on the other hand, the pencil is already sharp [there is no perfection in underground oil & gas]. And so, working together, we arrived at the Big Rules: What do we have to take into account to increase our chances of success? In so doing, we had actually created a predictive model for future projects, with all the positive implications of such a tool, such as significant savings in terms of efficiency and an increase in effectiveness and success rate”, says Sven.

He follows this fascinating account with how they are now applying the approach in practice.

“We are therefore making increasingly critical evaluations of whether a project matches the Big Rules. If the answer is ‘yes’, we have a big chance of continuing the process. If not, then we must be disciplined enough to stop applying it, before it goes wrong.

I do operate at mega high level. One shows a number of slides and makes a proposal and then the people in the country take that and get to work. And once I see that happening I step out of it. But in the case of the strategy for the new energy source I hung around, because I found what happened there very special”, says Sven.

“It’s so great when you see a result. They were using the sharpened approach, which was something in itself, and there was a positive result for our business, for our employees and for the surrounding area.

What I could recommend to everyone is focus on your current source of business. Look at the facts: Do not just go out and start the adventure anywhere and then go for it, full on. Things could go very wrong. The chance of things going wrong is much larger if you’re in areas that are new to you, than in those where you already know all the ins and outs.
The risk of something going wrong in unfamiliar territory is many, many times bigger – and that is the risk we have now reduced, with this new approach.”

“You’ve been with Shell for a long time?” I ask.

“Yes”, says Sven – in the manner of one contemplating this for the first time. “In fact, for my whole working life. The funny thing is that when I had interviews at Shell there were people who’d worked for the company for ten, twelve, fifteen years – and I was amazed that they could have been with the same company for so long. I didn’t understand it. Now I can identify with them completely – the international opportunities, job rotation, leadership development and travel are all things I’ve now also experienced and, indeed, have enjoyed very much. So I would now give the same answers if young people asked me why I’ve worked for this company for so long. I have had many different jobs. I have worked in different countries. I work for one of the largest and oldest companies in the world. In fact a company like this is a world in itself. It has everything. Yes, it has everything and, as a result, evolves and continues to re-invent itself as time passes. Which fascinates me no end.

Somewhere in our company smart men and women are busy right now, just like you, discovering their own Bitsing method and, in the process, applying it. Using it to develop smart things and trigger better and different ways of doing things. They also help drive the entire company, by continuously improving themselves. It’s what we at Shell do, we’re always improving ourselves.
These people are spread throughout Shell, they are to be found in every department and country. And that is very inspiring.”

“Looking at the Bitsing method as a strategist, at Shell, I think it has wide applications”, says Sven. “I was also recently thinking about its application in searching for a job or career, and in the achievement of many other kinds of goals. This methodology automatically makes you think about the choices you are offered. You ask, ‘Does this job offer fit the overall picture?’ Instead of just taking any job. The whole career process could be approached more thoroughly and systematically. I haven’t developed this any further yet. But there, too, lie many opportunities. There are so many applications. I think it’s a great opportunity to investigate all these other applications and apply them.”

Nothing would please me more than to tackle these tasks, together with Sven. Instead, I ask my last question: “You responded to my blog with, ‘Bitsing remains impressive in its simplicity and accuracy’. It’s great to hear this from someone who works for a company the size of Shell, in a complex area, and who has so much influence in the world.”

Sven: “What we’re after isn’t something that’s available off the shelf. Gigantic sums of money are involved and a lot of uncertainty. And one has a lot of responsibility then, to the world. Because no one knows exactly what is under the ground. There are huge uncertainties, with many different aspects, in which a lot of money is involved. And a lot of responsibility – for instance to your employees and to the environment, to take just two aspects.

I would like to pass on the following advice: Keep making forecasts – and use that information to populate a financial model and a planning model.
Try to keep this as fact-based as possible. For us at Shell, this is not an easy process. We don’t know what is under the ground, or in a reservoir. And, to re-visit my example of the new energy source: whereas we originally invested in areas just because we thought we could be successful there (with investments that quickly rise to tens of billions), our forecasts are now significantly more fact-based, also using a Bitsing-like method.
So what I am basically saying is, don’t just start up a project. At least make sure that you estimate the risks you’re going to take, based on the facts to hand and taking all possible risk factors into account.”

Toys XL interview: “retail magic – with Bitsing!”

Eddy Assies is the General Manager of Toys XL. Assies moved into the ‘real’ toy business in 2012, working for Toys XL. We asked Eddy a few questions about his experience, as general manager of the business, with the application of Bitsing, and what the business consequences were for Toys XL.

Question: You’ve now been implementing a Bitsing master plan for a few months. What are the differences between this and your previous approach?

Eddy: ”Bitsing introduces structure, efficiency and direction. Thanks to the Bitsing plan, we know what we have to do. All our choices are now governed by the Bitsing pencils strategy. The pencil strategy ensures that you always make the right choices for your organisation.”

Question: What else has the Bitsing pencils strategy done for Toys XL?

Eddy: ”Lego was identified as one of the Bitsing ‘focus products’ at Toys XL. In other words Lego played a dominant role in our turnover. According to Bitsing thinking, the product should therefore receive a corresponding degree of attention. The reaction at Toys XL was therefore to establish a 100% Lego store. We also laid out all of our stores according to the proportionate turnovers indicated by the Bitsing methodology. We no longer apply the traditional retail formulae which prescribe that your ‘money maker’ product should be placed in the back of the shop, in order to lure the customer to walk through the entire shop. Bitsing prescribes that you must use the actual ranking of product turnover. If Lego dominates, then that must be the first product you see when you enter the store. Playmobil is the second most important brand at Toys XL, so after being impacted by the Lego sensation the customer must enter the world of Playmobil, followed by the other products, pro rata to their turnover ranking.”

Question: What else appealed to you about the Bitsing approach?

Eddy: ”The idea of the ‘risk-free offer’. Bitsing told us that if you want to attract store visits you should make a risk-free and, in particular, a non-commercial offer. The offer should be free of any threshold to acceptance and attractive enough to motivate people to visit one of our stores. This requires more than a simple discount. Bitsing calls this a risk-free offer.
“So we claimed the ”wish list” during the St Nicholas (a Dutch tradition, early in December) and Christmas periods. Children could fill in their wish lists for presents and throw them into a wishing well, which we constructed especially for this purpose. These cardboard wishing well displays were supplied to every store so that children could throw their wish lists into them. These wishing wells were then placed just inside the store entrances and a winner was then drawn from these entries. The winners won every product on their wish list.

“Children brought their wish lists to the stores in the company of one of their parents, which then increased our store traffic enormously. The wishes could, of course, also be delivered digitally, which also ensured more online traffic to our web shop.”

Question: Were there other surprises that emerged from Bitsing and were applied by Toys XL?

Eddy: “Yes, certainly. We always thought that mothers and grandparents spent the money in our shops. This was an assumption. The Bitsing analysis shows that it was actually fathers. And that was in fact so. The father pays for the products at the checkout and the mother and children influence the father and stimulate the purchase. As a result, we started to focus more on fathers in our communication.”

Question: Which Bitsing element, applied by Toys XL, turned out to be the most significant and was responsible for the most change? Eddy: “Bitsing provides an analysis which reveals exactly what makes your organisation uncopyable. It’s not a strengths and weaknesses analysis, such as we are familiar with, but a tool that ensures that Toys XL will be unbeatable in the marketplace. In Bitsing language, ‘unbeatable’ means that Toys XL’s messages to the market are unique – it’s communication which our can never equal or imitate. It’s quite an experience to implement this. After all, if you say or do something in the market which others can copy, that doesn’t make you any more attractive than them – but according to Bitsing we had something really unusual. So what was it that made us uncopyable? The Bitsing analysis revealed that we were a “Dutch child with American parents”. We are, after all, derived from Toys ‘R’ Us, the world’s biggest toy store, which originated in America. And the largest Toys ‘R’ Us store in the world is situated – where else- on Times Square in New York. While our competition in the Netherlands is Intertoys and Bart Smit – and they come from Volendam, a small fishing village! The difference is obvious.

“Bitsing revealed our uncopyable factor and this what Toys XL have applied. We do business, for instance, with a mixture of the traditional Dutch emphasis on common sense and business sense, combined with thinking big and being service orientated in a typically American way. Which is why we chose for a marketing communication approach that uses typically American traditions, such as Black Friday and Cyber Monday. On these days American shoppers go completely crazy, because the shops are open for 24 hours and stacked with special offers.” Question: Do you have more success stories in which Bitsing methodology has played a role?

Eddy: “Yes. Something that I personally found interesting happened at the Meet and Greet at the Spiellmesse, the big toy fair in Nuremberg, in Germany. Lego was so impressed by our approach that they rewarded us with some special benefits. So Toys XL now receives its Lego shipments before all the other toy stores in the Netherlands. We won’t be surprised if we get Apple Store scenarios unfolding, with kids camping outside shops in sleeping bags in order to be the first to get the latest Lego Chima or Lego Ninjago items!
“As a result of this success story we are busy opening our second Lego store and, by the end of the year , we plan to have four Lego stores.”

Question: How would you describe what Bitsing has done for Toys XL, in one sentence?

Eddy: “retail magic !”