Thursday, 5 June 2008

Licence to print money

This evening I had dinner at the famous Ballroom at The Dorchester, Park Lane with some guys who have a licence to print money. I mean these guys are making bundles of cash. Literally. It was the annual dinner of the Diplomatic Corps hosted by De La Rue, a company that prints money, passports, identity cards and other secure documents for about 150 countries worldwide.

I didn't really know who the Diplomatic Corps were until I got there. It turns out that is the collective phrase for the London based Ambassadors of every country in the world. They very rarely all gather together in one place at one time but they did this evening for the 76th annual De La Rue dinner and for some reason that I still don't fully understand I got invited too.

I sat between the Ambassador of El Salvador and the High Commissioner for Mauritius and opposite the Ambassador of Angola. The Ambassador of Myanmar (Burma) was supposed to be opposite too which would have been interesting but the chair was empty. General Sir Mike Jackson GCB CBE DSO DL, former head of the British Army gave the after dinner speech. It was all very "grown up" but once I got in to it, it was a fascinating evening, hanging out with over 100 Ambassadors and High Commissioners. I even tried "small talk".

Tom (trying "small talk" with a very experienced Ambassador) "So, have you been following the US primaries"

Ambassador (looks blankly at Tom, pauses, then hoots with laughter) "What do you think?"

I didn't bother much with small talk after that! I just told them jokes instead. That seemed to work better and two of them exchanged cards with me (but what does one do with an Ambassadors card? Do I email them tomorrow and say "Hi there, we hung out last night, remember? Fancy a beer sometime?").

From a business point of view, the evening was an object lesson in managing your franchise in a very British way. De La Rue sell their banknote printing and other services to countries and have done very successfully for nearly 200 years. Their customers are countries and they have established a rock solid franchise. Since 1932 they have hosted this dinner for the assembled masses of the Diplomatic Corps, and it has become established to the extent that it is now a firm fixture on the Diplomatic calendar.

No business is discussed at the dinner. That's not how it's done. The Chairman of De La Rue says a few words but then fades gently in to the background. This is not a hard sell set up. It is just the annual dinner hosted by De La Rue. Gentlemen chatting to gentleman over a very nice dinner (if you like that sort of think. Raw tuna! Yuck. What's that about? Thank goodness I had a big plate of mash potato at home before I went) and a few very nice glasses of wine and port (if you like that sort of thing; I drank orange juice). But De La Rue know what they are doing. It's all about the strengthening the franchise.

You've got to nurture your franchise if you want to build a business for the long term and De La Rue's 200 years illustrates the success of this approach. They don't rush around like headless chickens, chasing the next deal, the new client and forgetting about the old. They invest in, build and nurture the core franchise, year in and year out and sure enough year in and year out business flows.

I remember exactly the same language being used at Goldman Sachs, the worlds most successful investment bank with 125 years of history behind it when I worked there in the mid 90's. The markets were tough. The Partner in charge of our area called us all together and told us to focus on the franchise. It's all about the core franchise. Build it, nurture it and it will look after you through good times and bad. Good advice for Garlik I think.

It's also good advice, sometimes, to ask dumb questions of people who you know just love to talk. After His Excellency had stopped laughing at my silly "USA primaries" question, he and the other two proceeded to give me an Ambassadors view of Obama, Clinton and the sweep of American politics. Fascinating!

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