My Biggest Mistake: Peter Scawen
Sunday 18 July 1993
MY BIGGEST mistake was not focusing enough energy on the people element of the business in the late 1980s.
We had enjoyed a period of phenomenal growth after I started the European operation in January 1981 - doubling revenue every year.
One of the reasons was that we were small in number and worked very closely. Management was hands-on. If I wanted to call a meeting, I just raised my voice and everybody heard.
By the end of the 1980s, the staff had grown to 250. I had been spending more and more time travelling in Europe, and in effect was away for two years.
By the time I came back, the UK company was in a mess. Leadership was poor, morale was low and staff turnover high. As a result, the company had ceased to grow, despite being in a rapidly expanding industry.
On further investigation, I found we had created a bureaucracy that prevented people from being effective in sales and marketing.
For example, just to get a manual to give to a customer required the signatures of five people. It was de-motivating the staff - an in-built sales prevention system.
In 1990, we brought in an outside consultancy, Stone Cockman, and started a total quality management programme. We agreed a common set of rules whereby the leader (that's me) sets out his vision for the organisation, then the employees agree the mission and values.
We had to empower the staff, to allow them to make their own decisions, so that they became re-motivated.
Next, we trained every member of staff in basic selling techniques. We had to get them to realise that everyone in the organisation is selling. It's no good the salesman doing a brilliant job if the ledger clerk abuses the customer because of an overdue invoice.
During these courses I identified many members of the management team who were not strong enough to move us forward. Even worse, these were the people doing the recruiting, and, since they were inevitably appointing people who were less valuable than themselves, the quality of staff was declining.
We put everyone through psychometric profiling, allowing us to identify the strengths and weaknesses of each. This enabled us to develop them, re-deploy them or, frankly, get rid of them. One man used to come to a management meeting and agree a course of action, then walk out the door and refuse to do it. He was what I call a blocker. You can't change them; they have to go.
We found one manager who set himself lower and lower targets because he wanted an easy life. That sort of person is not suitable for a sales organisation.
It is a truism to say that if you get the people right, the chief executive's job is easy - and that is what I had failed to do.
What I have found is that the amount of energy you have to devote to getting the right people is almost a full-time job in itself.
But that is what my job has now become. The process is exhaustive, but we now have good people who become productive very quickly. They work well inside the organisation, and the customers like them. And - thankfully - we are now growing once more.
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