From the business that outgrew the garage all the way to the London Stock Exchange and the enterprise that’s unrecognisable from its start-up days, we’ve been talking growth with privately owned businesses.
This sector, a major driver of prosperity, employment and productivity was the focus of our recent series of ‘Backing Business Ambition’ regional events, held in partnership with Insider media.
With great thanks to the business founders and directors who shared their experiences, we heard that confidence, structure and disruption are vital for growth while skills and people management are currently front of mind for business leaders.
Those who have been there and done it were clear that founders have to back themselves after starting a business. Confidence, we were told, can result in making smarter decisions, from when to take more warehouse space, to timing technology investments, staffing decisions or committing to office space. For some, taking a risk early on has saved money and time in the long run.
Structuring a business for success and resilience is also key. From doing three or four jobs rolled into one as a start-up, once growing and evolving, it’s important for an entrepreneur to learn to step back and surround themselves with strong senior hires or advisors, to create the space to think about strategy. Bringing governance, transparency and skills into the business will make it more resilient as well as more attractive to others if an exit beckons.
Pivoting was a well-used word. Those at the helm of growing businesses reflected that being able and willing to change had been critical to their success. Some are now making most or all of their revenue in a completely different way to some years ago. One panellist described changing as “constantly disrupting yourself so someone else doesn’t take your place.”
Disruption was definitely a theme, with another panellist acknowledging that “difficult and devastating events such as the pandemic also spark innovation and a real change in the way we all do things” adding, “there is no reason we have to be locked into the old ways of doing things.”
Some focused on purpose as their guide for evolving. One speaker explained they have operations in multiple sectors but which share a clearly defined purpose. Others saw this as critical to achieving growth via M&A. They described a business’ ESG agenda as flowing from its moral purpose and an increasingly important element of assessing the fit of companies exploring M&A together. A panellist from a PE house agreed, saying “as an investor, you are always looking for an alignment, so culture is hugely important.”
With £300 billion of 'dry powder' in the PE world and cash rich corporates, M&A is certainly going to take centre stage as a potential growth route.
One speaker from a business recently acquired in a trade deal described reaping commercial advantages: “We have already seen benefits of buying power and of certifications which allow us to trade with organisations which we couldn't do before and we are now aiming to go for larger contracts which we were maybe stuttering about because we didn't have the badge of honour to do that."
Skills is a hot topic, with business leaders accepting they face “big, big issues” when it comes to reskilling workforces in a post pandemic world.
A view we definitely recognised was that businesses must develop "learning cultures" where employees are encouraged to develop new skills so as to remain relevant in the face of technological change.
One panellist believes we are experiencing a “digital revolution, representing a huge shift in demand in human expertise, with many new roles and indeed entire departments that didn’t exist in previous years.”
Equally, some current jobs will cease to exist because of changes in technology and society. Both sides of the coin mean there is increasingly less value in what you know, and far more in what you can learn, because skills picked up ten years earlier will be out of date.
In fact reskilling was described as a "societal issue" in terms of making sure reskilling opportunities are shared across society. As some roles become obsolete there is an onus on ensuring opportunities to reskill for new jobs are available to the widest possible group.
When considering the workforce, ironically it was felt that to get the benefits of greater flexibility, for example in adopting hybrid working, businesses need to be more structured in their people management. For example, ensuring staff come together in organised ways will be key to creating learning cultures.
It was agreed that some employees will need a reason to visit their workplace – from a discussion, collaboration or simple social interaction. Most technical learning can be done remotely and online, but we will still need to develop those soft social skills that only come from people being around each other. A real desire and need among people to be together is still strongly felt.
Listening to employees and gaining a good understanding of their needs was strongly recommended. One speaker advised that there is no longer a one-size-fits-all approach to working practices, so business leaders must be tuned in to their organisations and use this time wisely to get feedback, trial things and analyse learnings in order to face the future and be fit to grow.
Of course, growing in a time of great change is not easy. One of our panellists described finding their customers want a lot more creativity and imagination at the same time as their employees are asking them to look at how they are working as very challenging. Others referenced supply chain and import and export issues as well as hurdles in accessing funding.
We were left in no doubt that there is a mass of ambitious businesses on a quest for growth as they look to the future.