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Using Data to Build a Business – a conversation with Anwin Mbah
0 Playsin 7 hours
What can how successful businesses deal with data and money teach us about building a business?
Anwin Mbah is a strategic profit advisor for time-strapped CEOs, and the founder of Wealth Fluency which helps small business owners to boost profits by eliminating the hassle of endless spreadsheets and analytics.
In this episode of the Abeceder podcast The Independent Minds Anwin and host Michael Millward explore what makes successful business people different from those who just get by.
They discuss how different attitudes to money and how successful people focus on wealth accumulation whereas the people who just get by are interested in income generation.
Anwin then explains how unlocking the business data is the key to accumulating wealth.
More information about Anwin Mbah and Michael Millward is available at abeceder.
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Transcript
Introduction to 'Independent Minds' Podcast
00:00:05
Speaker
on zencaster Hello and welcome to the Independent Minds, a series of conversations between Abysseedah and people who think outside the box about how work works with the aim of creating better workplace experiences for everyone.
00:00:22
Speaker
I'm your host, Michael Millward, the Managing Director of Abysida.
Income vs. Wealth Discussion Teaser
00:00:27
Speaker
Today, I'm going to be discussing the difference between income and wealth with Anhui Ba from wealthfluency.com.
00:00:37
Speaker
As the jingle at the start of this podcast says, the Independent Minds is made on Zencastr. Zencastr is the all-in-one podcasting platform where you can make your podcast in one place and then distribute it to all the major platforms.
00:00:53
Speaker
Zencastr really does make making content so easy. If you would like to try podcasting using Zencastr, visit zencastr.com forward slash pricing and use my offer code, Abysida.
00:01:07
Speaker
All the details are in the description. Now that I have told you how wonderful Zencastr is for making podcasts, we should make one. One that will be well worth listening to, liking, downloading and subscribing to.
00:01:22
Speaker
As with every episode of The Independent Minds, we won't be telling you what to think, but we are hoping to make you think.
Anhui Ba's Career Transition
00:01:29
Speaker
Today, my guest, Independent Mind, is Anhui Ba from wealthfluency.com.
00:01:36
Speaker
Anhui It's sitting in Jamaica at the moment and I'm not, and it's the middle of January, but I have been to Jamaica. It was the location of my first holiday by myself. There's a whole story associated with that as well. But if I was to return, I would be sure to make all of my travel arrangements with the Ultimate Travel Club, because that is where I can access trade prices on flights, hotels, holidays, and all sorts of other travel related purchases.
00:02:04
Speaker
There's a link and a membership discount code in the description. Now that I've paid the heating bill, it is time to make an episode of The Independent Minds. Hello, Anwi. Hello there, Michael. Hello, hello. Definitely the heating bills is a priority. It's freezing there. The air conditioning bill in Jamaica, though, I suppose.
00:02:22
Speaker
Oh, it's quite it's quite cool. And I'm on the hills. Yeah, I remember. Down by the sea, quite warm. And then bit cooler up in the
Managing Money and Wealth Fluency Genesis
00:02:30
Speaker
hills. But please could we start this episode of The Independent Minds by you just explaining a little bit about your history, how you built your business and able to but live and work in three different countries.
00:02:42
Speaker
So basically, I started off as a cashier, weirdly enough, in Lloyds. And I ended up in finance because I could not get a job as a biomedical scientist, because as we know, in the yeah UK, we have a lot of graduates, but not and but enough training positions. So kind of yes carried out my career, I would say in the banking system started off as a business analyst, then went consulting, started consulting. I've been doing that for over 12 years now.
00:03:14
Speaker
as a business analyst, a business architect and a product manager. And during the tenure when I was consulting, that kind of noted within the private banking space, how ultra high net worth and high net worth clients of those banks, how they went about their money and how they went about their business that the average Joe and Jane businesses did not do. So that's what sparked about fluency to kind of bring some of those financial controls that I saw these billionaires putting in in in place for themselves and their businesses to small business owners because it allows them to accelerate their wealth building.
Discretionary Income and Self-Made Wealth
00:03:50
Speaker
What you're saying, I suppose, is that millionaires, billionaires think differently about money to us ordinary people.
00:03:58
Speaker
Absolutely. They definitely do. And also how they go about it. So definitely it's the thought, how they deal with money, their relationship with money, and also how they handle money.
00:04:08
Speaker
They're just in a different paradigm shift when it comes to that compared to the average Jane and Jo, where it's more tactile, where it's more now kind of planning rather than strategic.
00:04:21
Speaker
That's because they're dealing with their discretionary income. All of their bills have been paid. They put their money aside to pay the income tax and there's the money left over and that enables them to have a different attitude towards money. They're financially secure.
00:04:35
Speaker
Yes, that definitely plays a part. The important thing here is that they didn't start up there. They had to get to a point where they had that discretionary disposable income. So how do you get your business to that stage where you're able flex in that way when it comes to how you go about money, when it comes to where you put your money?
00:04:54
Speaker
How do you
Income Generation vs. Wealth Building
00:04:55
Speaker
get there? So that is the critical point here. is that they they were not born in that space. They were not born with just disposable income available to them. Believe it or not, very few of the very rich businesses that we see out there were necessarily inherited. Most of them were self-made to a certain extent, still with family support, but still very much self-made.
00:05:18
Speaker
So take me back to the basics, I suppose. If we're starting a business today, what sort of things should we do? So if I just take us back, as you mentioned, and kind of try to highlight the difference between income generating business and wealth failing business, there's some main differences that would start shining a light in regards to what you do and the decisions that you're making.
00:05:44
Speaker
First of all, is focusing on revenue rather than assets. So we would see, especially in the space that we're in, there's a lot of talk around revenue and making six figures and making seven figures and so forth. There is no talk about, okay, what was the profit margin? When we look at, you know, stock market, when we look at the big businesses, they usually talk about how much profit they've made compared to last year. Small business owners is very much still revenue focused. So there is that of focus on cashflow to cover expenses and to pay bills.
00:06:16
Speaker
So once your business is able to help you cover your expenses and pay your bills, that is where it all stops. That is very much income generating. You're not thinking past into wealth building where it's about creating assets, you know, intellectual property, brand equity. Sometimes if you're brick and mortar real estate as well, we've all heard the story about McDonald's where the real business is actually real estate, not burger flipping, which is weird, but we've all heard that story,
Income Strategies Examples: McDonald's and More
00:06:43
Speaker
right? The other main difference as well is short-term survival versus long-term growth.
00:06:50
Speaker
So when it comes to income generating, it's all about invoice to invoice, month to month. Very little consideration around sustainability, scalability, and also legacy.
00:07:00
Speaker
Whilst if you're wealth business, you're thinking system processes, how do I put things in place so that it enables you to grow exponentially, but more importantly, sustainably as well.
00:07:12
Speaker
You mentioned McDonald's and and straight away I thought about the car dealerships. They don't sell cars. They sell the financing which enables you to take the car home. mean That's their financial services company. just happens to focus on financial services to enable people to drive a car. I suppose that's one of the things that an organization needs to think about is where does the income come from?
00:07:39
Speaker
Exactly. where Where does it come from? What exactly is providing the value to the end client and what is actually shifting the needle when it comes to profitability, not just revenue, because that would be probably the car sales, but profitability, which is, again, the interest that they're getting on the loans that and they've
Turnover vs. Profitability Misconception
00:08:00
Speaker
they've paid out.
00:08:00
Speaker
And it also made me think about every time somebody from the business media contacts me and wants to talk about Abusida, they asked me, oh what's the turnover?
00:08:12
Speaker
And I'm thinking like turnover isn't really important. So I don't disclose it. You know, it's not really important. It's the profitability. It's like, what is your profit margin? How much money have you made rather than how much money has gone through your account?
00:08:26
Speaker
Yes, that's absolutely it. But when it comes to that, it's an easy figure. It's a quick thing to ask and get the information on. And To be fair, that is the first sign of viability for your business is your revenue, is your turnover. So there is some credibility there when you ask for a turnover.
00:08:49
Speaker
When you start looking under the bonnet, that's when everybody starts getting a little bit uncomfortable because you might have 3 million turnover, but it's not profitable. We've had Twitter that was not profitable profitable for over 12 years before it started making profits.
00:09:03
Speaker
So it's very much in regards to what information you need and why do you need it. Media, it's all about marketing. It's all about sensationalization.
00:09:14
Speaker
had to slow that down. So revenue and turnover is a big thing. I suppose though you can have a large turnover and like you say, not be profitable for a number of years. Absolutely. And, or maybe never ever profitable, but you appear to be because you've got a large turnover. Yes. Appearance successful.
00:09:32
Speaker
It's a big, issue in the entrepreneurial small business space because you look successful so you feel like you should be able to do everything else which is not necessarily the case being able to you know decorate a cake doesn't necessarily mean you can bake one yes fear of judgment that comes in place when it comes to certain elements because you believe that as a ceo i should know this stuff already and that's not the case because it's a different skill set altogether off so The challenges that people face is like not understanding when they're setting up a business or when they're running a business.
Building Business Resilience
00:10:06
Speaker
It's not understanding where the value stroke wealth of the business is because they're too focused on the day to day. Am I going to be able to pay the bills? A hundred percent.
00:10:17
Speaker
We have to give it to them, though. We have to pay the bills. First step that we cannot ignore is then, OK, now that I can pay my bills, what next? We do not stop at just paying our bills.
00:10:28
Speaker
How do I build systems? How do I delegate? How do I focus on profitability and not just revenue? How do I create and invest in scalable assets?
00:10:39
Speaker
How do I, as a business owner, step away so that everything doesn't rely on me? When I'm on holiday, that doesn't mean my business is on holiday as well. so Those kind of things we start having to think about.
00:10:50
Speaker
One thing I've noticed as well with business owners is We have this preconception that we'll live forever and that our health and our family circumstances will be the way they are now. So we do not think about retirement. We do not think, oh, there might be a day where I do not feel like doing this anymore. There might be a day where, you know, I need to slow down because I need to take care of my aging parents. What does the business look like then?
00:11:15
Speaker
so starting putting things in place from now for when you can step away, whether it's life, whether it's choice, whatever it is, It's very vital. Yes, I can see the um logic of it. Until you've actually struck put the structure into your organization, you're never going to be able leave your organization alone.
The Role of Data in Business Management
00:11:35
Speaker
And part of that structure is like, what is your exit strategy? Both your planned exit strategy and your forced exit strategy. So you become ill, you can't work anymore, or you have family commitments which take over. i mean, you can't work in the way that you used to work. You've got to build all of those various different things in. And most of us don't, do we Most people who are running a business or managing a business don't think about how they're going to leave that job or that business. it's We just don't do it. We just get into the habit of doing the same thing every day. 100%. So focused in the now, in the technical, that you do not think on the strategic, on the long term. Bearing in mind as well that you need to be able to think about it, not necessarily have all the answers. And that's usually what gets you stuck.
00:12:31
Speaker
Is that, ooh, I do not know if I'm going to sell. I do not know if I'm going to pass it on to the kids. I do not know if I'm going to close shop. You don't need to have those answers right here and now. It's just thinking about, okay, if I want to sell, hand it off to the kids or close down shop, what would the business look like?
00:12:49
Speaker
Because that makes a difference between what kind of systems you invest in. That makes a difference in how you document your process. If I'm speaking to somebody that's reading the business, I might use certain terminology that somebody that is new into the business and into the industry, they might not necessarily understand.
00:13:07
Speaker
So you already thinking about, okay, there'll be a day where i need to step away already makes you think differently, even though you do not have the answers as to how you would exit or if you would exit at all.
00:13:18
Speaker
Again, The world is your oyster when you have the right systems and processes in place. Yes. That reminds me of the 20 odd years ago now when I set up Abbasida and meeting other people who were setting up their own businesses and thinking back to the conversations that I was having with those people, it was very clear that like only fools and horses, Del Boy, we were all going to be millionaires next year.
00:13:43
Speaker
Yes. We'd all be driving so like fancy cars. When I look back at it now and and listening to you, I'm realizing we were all focused on the emotions and the feelings of what it's going to be like when we've built this business.
00:13:57
Speaker
But what you're saying is that you're la more likely to build a successful business if you've got the systems in place, which means that the business will be able to survive without you.
00:14:08
Speaker
Yes, 100%. ah hundred percent This business should be able to run without you.
Systems for Data Collection and Performance Measurement
00:14:14
Speaker
if Your business cannot run without you. You literally have yourself a job. You've created a job for yourself. Yes. In running a small business, you can get very much tied up in the emotion of running a small business. You will give up something that you really want for yourself because there is a business bill to be paid. There's ah an investment that is required. You have an emotional connection with your business. yeah But people who have jobs in big businesses and big businesses themselves don't think in that emotional way. They're very much more nuts and bolts. They deal with the figures, the data.
00:14:50
Speaker
Yes. And that, I think, is what you're saying as a small business owner, as a department manager in an organization, is you need to get to know your figures. Absolutely. If you're thinking of long term, if you're thinking of scaling, if you're thinking of sustainability, it has to be data driven. So you might get away short term with passion driven, instinct driven decisions.
00:15:12
Speaker
But if you're looking further than short term, it has to be data driven because you can be pouring your heart and soul down the wrong path of your business. Tell me more about how to use data. You know, what data are we talking about? Where do we find it? How do we manage it? Give me the the big picture on on data. Well, when it comes to data, data is all around us. The intimidating thing about it is that is, again, a lot of data. Every system that you use in your business is gathering data.
00:15:41
Speaker
It's a matter of how do I use it? When you say every system in your business, ah define a system. How many sort of systems am I likely to need, want, have? And it may be generating data, but how do I know the data? How do ah how do I collect the data? When I mean systems, I'm talking about any tools that you use in your business. For example, social media is a system where you have some of your marketing on.
00:16:10
Speaker
wherever you're sending emails, whether it's Outlook, that as well is a system where you're communicating with your clients. You have probably an appointment book of some sort. That is, again, another system where you're contacting your clients. So all these different systems, usually small business owners have between 10 and 13 systems within your business to run on a day-to-day for them to be able to deliver, whether it's the service or the products that they are using. So every part of our business, our department, however we operate, in order to make sure that we are doing it well and not wasting time or other resources, we should be measuring what goes into it, the time that it takes to make it work and the output that we
Data-Driven Insights as Business Managers
00:16:57
Speaker
achieve. Yes. And if the output is actually what it is that you want. So you always go back to, okay, what are you trying to achieve in your business?
00:17:05
Speaker
Because your metrics and what you're tracking will change depending on what it is that you're trying to achieve. If you as a business owner currently, you're focusing on awareness, business awareness to bring more eyes to your business.
00:17:19
Speaker
The metrics that you are looking at is again, football is, you know, impressions is how many people are actually seeing, whether it's your ad, or whether it's your appearances on whether it's a podcast or even at conferences, compared to somebody that is, let's say, in the lead generation space, you want to see, okay, how many people, how many conversations am I having to create more leads? And also, are the leads qualified or unqualified? What is the quality of the leads that i'm bringing in? So depending on what your goal is for your business at that particular point in time will determine what it is you're tracking,
00:17:57
Speaker
And also will determine what success looks like for you because we might be tracking the same things. But for me, success might mean speaking to five people and booking two calls. What success for the next business down the road would be getting 100 people through the door. You've made me think is that when so when you've been an employee, you've had a manager, somebody who's going to tell you what to do, when to do it, how to do it, and when you've got to finish it by. When you set up a business or you become the manager, you don't have that. You're on your own. But what you seem to be suggesting is that an entrepreneur is their own manager, but they should be thinking about this type of data as their manager.
00:18:39
Speaker
If you you need to collect the data in the first place from each of the systems that your organization has, look at that data, understand it, and work out how you can improve it. And that then becomes the the driving force, the manager, the the motivation, the carrot and the stick to so and will help you by focusing on the data and improving the data, help you to grow your business.
Goal Setting and Data Alignment
00:19:08
Speaker
Absolutely. I'll even take it a step further and say the actionable insights from your data is actually the manager. The actionable insights would actually tell you where you should be focusing your time, where you should be focusing your resources and where you be focusing your money. About focusing the money. That's a good idea. Because without the money, you're you're not going to be able to do anything.
00:19:31
Speaker
You can have as much time as you like, but you've still got to get the money coming in and control how it goes out in order to be able to make this happen. I can imagine that lots of people saying, okay, we'll collect all this information, but give us some hints and tips on how to, how to use it. How to, well, I suppose display, how do you compare the information or what do you need to do with that? Once you've got the information, what you need to be able to do so that you can manage your business by using the information. First of all, it's know exactly what your goal is. When you know your goals, then as in what your business goal is or what you're targeting.
00:20:08
Speaker
When you know that, then you we can decipher what metrics would meet those goals. So start aligning those. A goal could be something like, I want to have a million pound turnover by in two years time. Okay. Yes. And then you, you need to collect the information, which will tell you how far away you are from achieving that. And then what might you do in order to get you closer to that?
00:20:35
Speaker
Yes. so That is a, it's a large goal. So that not, that would have to be broken down into the different departments in your business. So what what does it take for sales to be able to hit that goal?
00:20:47
Speaker
What would it take for marketing to be able to hit that goal? Operations and finance. So it's then bringing all those different departments back to that goal. So it's breaking it down so that we're able to go to the end point where like ever for sales every month, I need to have at least 100 sales calls. 100 sales calls, i will know that, okay, I'm converting 40% of those.
00:21:13
Speaker
into actual conversations about the product or services that I have. And out of those, I get two clients or four clients. So it's getting to that nitty gritty. So they're able to then funnel everything back to that main goal in regards to what does this look like? So that on the day to day, so what I do with clients is centralize all of the data so that we have our marketing, we have our finance, we have our operations and we have our sales, to be able to tell in one central place, one source of truth as to how the business is doing against that goal.
Balancing Instinct with Data
00:21:49
Speaker
So that you're able to make quick decisions that are data driven and not just a gut feeling. And even though you have a gut feeling, because you would know your business better than anybody else, you're able to then use your data to either prove the gut feeling or disprove the gut feeling. The important thing here is being aware that sometimes your data might not necessarily be in alignment with what your gut feeling is saying because there's certain elements like you might know certain things in the industry that your data might not necessarily see at the moment so you're able to then make decisions that doesn't necessarily match your data but you're aware of it you're aware so if anything goes pear-shaped you're able to then quickly readjust most times it happens blind
00:22:35
Speaker
So we always end up faffing around trying to figure out, oh, what happened? Because we're making decisions and not being able to track, why did I make that decision? What did my data tell me? Was I pro data or not data? And if I wasn't using my data, why did I make the decision? What drove it to be able to then pivot back or pivot forward? With this central source of truth, are you talking about something like a dashboard? 100%, it is a dashboard.
00:23:02
Speaker
And it kind of does away with spreadsheets. So I'm not a spreadsheet person. And unfortunately, business owners have had to deal with a lot of spreadsheets and having to put it the data together to try to figure things out themselves. And more times than none, either they don't have the time to be able to do this on a regular basis, or they don't have the skillset to be able to do this.
00:23:24
Speaker
So being able to provide the service where everything is centralized and quick and live, so that it's not lagging data so one of the reasons i kind of do this outside of just finance is because finance is the lagging data finance uses historic information whilst you know your sales and your marketing it's live data is what is happening now that you can still change when i come and tell you what your profit is you cannot change your profit anymore you can just do something going forward but if i tell you oh
00:23:54
Speaker
this particular campaign is not really working, is not giving you the return on investment you expect, you can then go and tweak things in that campaign or totally pull down the campaign.
Real-Time Data and Decision-Making
00:24:04
Speaker
So it's being able to have that quick decision to to totally change what your portal would look like. So a dashboard. And there's this thing with the gut reaction, the gut feeling.
00:24:14
Speaker
That's almost the gut feeling is when you you talk to yourself. Very difficult to explain a gut feeling to people that you want to work with you to support you to achieve your goal. It tends to come across as an instruction rather than teamwork. And yet when you can display data to support your gut feeling, you're more likely to have a much more of a collaborative response from the people that you need to do the work, to make sure that you can work on your business rather than in your business.
Team Alignment through Data Sharing
00:24:45
Speaker
Yes. When um one of the thing is sharing data is making sure that your team is all on board. You're all singing from the same hinge sheet. And sometimes there's this apprehension in regards to sharing data.
00:24:57
Speaker
But when a team member can see how they are contributing and what they are doing on a day-to-day basis, shift the needle, they're more invested in it because it's a bit like where each person is a partner in the business. So when the business does well, yes you know that everybody else, us as a team will do well as well.
00:25:17
Speaker
That is the great thing about small businesses because it's more, the impact is immediately visible compared to big corporations. where it's a massive ripple effect that you might not necessarily see at all how your day-to-day impacts the overall you know strategy of the business, which is way high over there when the CEO declares it at the beginning of the year. I get that. It's about being practical. It's about having objectives. It's about putting in place the structures, the systems and the information, the data to enable you to achieve those objectives.
Episode Wrap-Up
00:25:51
Speaker
It's sort of like thinking about all the things that I don't do, which I now realize after talking to you, Anway, that I should be doing. if That made me feel quite guilty.
00:26:03
Speaker
well The great thing is, again, everything doesn't need to be done at once. But once you're aware, you would see yourself, you know, picking things up on your day to day. Like, oh, I could do this differently based on this, you know, podcast or conversation I heard the other day.
00:26:18
Speaker
That is the greatest thing about it, I believe. Yes. It's been very, very interesting. I do appreciate your time and your help in making such an interesting episode of the Independent Minds. Thank you very much. Thank you for having me. been a pleasure. Thank you. I am Michael Millward, the Managing Director of Abbasida, and I have been having a conversation with the independent mind Anhui Bach from wealthfluency.com.
Closing Call to Action
00:26:42
Speaker
You can find out more about both of us at abbasida.co.uk. There is a link in the description. you're listening to the independent minds on your smartphone, you may like to know that 3.0 has the UK's fastest 5G network with unlimited data. So listening on 3.0 means you can wave goodbye to Buffering.
00:27:02
Speaker
There is a link in the description that will take you to more information about business and personal telecom solutions from 3.0 and the special offers available when you quote my referral code.
00:27:14
Speaker
That description is well worth reading. i am sure you will have enjoyed this episode of The Independent Minds, our first from Jamaica. So please give it a like and download it so that you can listen anytime, anywhere.
00:27:28
Speaker
To make sure you don't miss out on future episodes, please subscribe. Remember, the aim of all the podcasts produced by Abbasida is not to tell you what to think, but we do hope to make you think.
00:27:40
Speaker
All there remains for me to say is until the next episode of The Independent Minds, thank you for listening and goodbye.