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internet. It does not. Currently only 20 per cent of British business pro-
cures online. But, and it is a potentially important but, it is estimated that
80 per cent will be procuring online by 2006.

C

Capital The money invested in an enterprise so that more money can be
made. Working capital should make money and enhance cash flow. Fixed
capital may attract asset strippers if the application working capital is
questionable.

Captive demand Creating a market advantage such that the customer
has no choice but to come to you. If Amazon had exclusive rights to a Tom
Lambert book all my many fans would have no choice but to go to them.
(Sadly no-one offers me millions to write exclusively for them. Perhaps I
should be asking: “why not?” You, on the other hand, should be asking how
you might establish captive demand when it comes to your products or
services. Captive demand by definition is market domination.)

Cash cow A mature product that offers high revenues with little invest-
ment usually in a low growth market. Cash cows should have unstinting
protection when they still have potential, but when they grow too old they
should be recognized as “dogs” and dumped.

Cash flow The inflows and outflows of cash. It enables the day-to-day
management of funds. It is essential that funds are never idle they are
there to make more money. Negative cash flow is potentially more danger-
ous to a business than lack of profit, so always be prepared to ask “when
will cash flow be positive?” This is a slightly different way of looking at the
first of Lambert’s Laws that any investment should pay for itself in a rea-
sonable time.

Change agent A process consultant who “acts as a catalyst” to bring
about change in a company. What worries me about such worthies is that
like the catalyst to which they compare themselves they may induce
change in others without experiencing any change themselves. (Another
way of saying that some of us never learn.)

Change management The process (usually expensive and protracted) of
changing the culture of a business. Research in the USA and the UK sug-
gests that between 1970 and 1995, 75 per cent of such attempts failed to
achieve their objectives. Before incurring expense, managers should ask
“what precisely are any shortcomings in the present culture costing?” and
“is there a cheaper, more reliable way?”

Client A “posh” word for a customer intended to denote that the user is
in a “profession” rather than a trade. The purpose of any business, trade
or profession is to create and keep a customer.

Glossary (and soapbox) 233