My biggest mistake: Angus McDonald, CEO of Barbeques Galore

Angus McDonald began his career in retail as a schoolboy working on the shop floor of Safeway supermarkets (now owned by Woolworths). More than 20 years later, he’s the chief executive of Barbeques Galore and has worked in management positions for some of Australia and New Zealand’s biggest brands.

Despite his career success, McDonald hasn’t been immune to mistakes. And his biggest mistake is one that provided a lesson he still carries today.

The mistake

In his days before Barbeques Galore, while working for another company he doesn’t want to name, McDonald was tasked with establishing a new distribution channel for a new section of the retail business. It was a matter of selling the same products to different customers in another market segment, so McDonald began where most corporate organisations start: research.

“To start this new journey, we did a heap of research and wrote an enormous business case with a big waterfall plan detailing all the things we wanted to deliver,” McDonald said.

“And, we ran a pilot — but it wasn’t really a pilot. We were trying to build the whole thing first go.”

Despite being armed with extensive spreadsheets and detailed business growth projections, things didn’t go to plan.

“We’d spent millions of dollars building this thing, and when we actually started delivering it, it was very apparent that a lot of the assumptions we had made weren’t quite right despite all the planning and research we did up front,” he explained.

“We tried to build the Taj Mahal from day one but forgot to check something fundamental — will customers actually buy the stuff from us?”

The answer to this vital question was no. At least in the short term.

The context

Like the mistakes made by many business professionals before him, McDonald’s errors came down to assumptions.

“We did a lot of research around who we thought the customer was and what we thought was important to them,” McDonald said.

“And we invested in systems, processes and extensions to support that part of the market. But it was all theoretical. It wasn’t until we had sales reps out on the road knocking on doors that we started learning what they wanted. In some cases, we got it right. But there were other areas we didn’t — particularly the product assortment and service model.

“The other significantly different thing from other parts of our business was the timeline around customer acquisition. It takes a lot longer in that section of the market, and we didn’t understand that because we had never operated in that part of the industry before.”

The impact

All up, McDonald believes they spent millions of dollars building “stuff” that simply wasn’t needed, making the venture more expensive than it should have been, and a much longer road to success.

“A few months in, when I knew it wasn’t working, I could begin going back and remediating, recalibrating and changing things. But the whole mess could have been avoided,” McDonald said.

One of the hardest parts about the mistake wasn’t just the impact on time, money and colleagues. It was also admitting a mistake had been made in the first place.

“When you’ve invested so much effort, written this huge business case, given a great presentation to all these people who back it — one of the hardest things to do is then admit it’s not doing what you thought it was going to do,” McDonald says.

“There was a moment about three months in where I had to say: I got it wrong. And it’s a tough thing to do which is why some people are reluctant to do it. They often get confirmation bias that causes them to continue despite the growing signs that it’s not working.”

The fix

The first step to correcting the mistake was doing just that: admitting a mistake had been made.

“It’s really important to own up to being human,” McDonald said.

“You have to engage with the teams that work for you and explain you got it wrong, but you’re listening. You have to tell them: these are the changes we’re going to make, and we need your support and help to reshape that area of the business. The magic happens when you involve the team in solving the challenge rather than disengaging them because you’re not listening.”

The second part of the solution required a significant shift in mindset, and it came as a book.

About 12 months into the new venture, McDonald was given a copy of The Lean Startup by Eric Ries — a book he says wishes he’d read years earlier, because it completely changed his way of thinking about how organisations innovate, particularly when developing new areas.

“The book is written in the language of the startup world,” explained McDonald.

“But, the reality is that it’s absolutely applicable to corporate environments as well. The concepts around building minimum viable products and then testing and iterating them to achieve a better product-market fit.”

The lesson

McDonald says that in hindsight, it’s easy to look back and say the venture was successful because it eventually worked.

But the assumptions he made when launching could have been validated in small ways that fitted The Lean Startup concepts.

This validation process would have been slower in the beginning; however, he says it would have saved “an awful lot of money and got us to the endpoint quicker overall.”

“Lean Startup thinking is an approach that I’ve continued to use to unlock new markets since,” McDonald explained.

“I would suggest that it’s often challenging in large corporate organisations to drive change when pursuing new opportunities. But Lean Startup thinking gives you the ability to build some credible data that supports your market hypothesis. Then, you’ll have the momentum to mobilise people behind the new opportunity.

“It also means you won’t lose time chasing things that might not eventuate.”