Roger Trapp: True entrepreneurs develop an ability to grow

Click to follow
The Independent Online

Over the years, politicians and policymakers have made a lot of noise about encouraging business start-ups. Back in the 1980s, such programmes were little more than ill-disguised attempts at reducing unemployment figures. And, because the amount of business taught in schools and colleges was even less than it is now, the resulting ventures were often short-lived.

Now, with unemployment not such an issue, the reasoning behind the interest in new businesses is a more nebulous fixation with "enterprise". Rather like the management gurus who preach innovation to all and sundry, modern politicians - even those whose natural constituency is the unionised workforce of traditional big industry - promote entrepreneurs out of a belief that business these days is all about funky products, flexibility and "knowledge workers".

To a certain extent, this is true. Traditional labour-intensive businesses cannot generally hope to compete with the lower wage economies of China, the rest of the Far East and even parts of Europe. But, time and again, some manufacturers demonstrate that if you get your product and - perhaps more importantly - your service right you can not only compete, but prosper.

The businesses that do this, though, tend not to be instant start-ups. Succeeding in the longer term requires an ability to grow and develop that in Britain seems more elusive than a desire to go it alone. This is not so surprising. Look at the surveys and you will see that many respondents' keenness to start their own business is motivated less by the desire to start and develop a business but to work for themselves. In many cases, this translates into working by themselves. In other words, they set up what have come to be known as "lifestyle businesses", where the business founder sets out to do as much work as is required to keep the mortgage payments up, the school fees paid and the rest, hopefully leaving enough time for leisure pursuits.

Given that in most walks of life, it is generally accepted that you need to aim higher than you want to achieve, it is then not unexpected that many of these businesses fail. Indeed, this could help explain why - even when economic conditions are benign - the number of business start-ups each year is pretty much matched by the number of failures. This means that - for all the announcements made in Budget speeches and elsewhere - the number of small businesses is largely static.

Not all small business founders are content to stay small, of course. Many - the true entrepreneurs rather than the lifestylers - have grand ambitions from the start. They may even combine such aims with a willingness to work hard and a readiness to accept short-term, or even long-term, poverty in return for the chance of building something worthwhile. But they can still come unstuck because they lack the skills needed to develop and expand a business from an initial idea to a successful and well-established concern.

As Richard Ellis, chairman of the East of England Development Agency (EEDA) points out, entrepreneurs often have a particular skill - such as being a technical person with an idea or a sales person who has spotted a potential market - but they tend not to have all the skills required to develop a business. "Often there are things that put them off, such as strategies for growing a business through or issues around marketing," he says.

This is why he and colleagues at EEDA have come up with Destination Growth, a one-day "growth academy" aimed at bringing together about 500 small and medium-sized enterprises that have fewer than 250 employees but want to grow. The keynote speech at the event, to be held at Newmarket Racecourse on 17 November, is due to be given by Gordon Ramsay, the colourful restaurateur who has various observations to make about what makes businesses successful. Other elements will provide insights into lateral thinking courtesy of Edward de Bono, opportunities to learn from the experience of other successful businesses and, above all, the chance to meet other people facing the same challenges and decisions.

Ellis, who has previously run the Kettle Crisps company and now heads Norfolk Country Cottages, says the event, timed to take place in national Enterprise Week, is part of an effort to demonstrate to business owners that there is a realisation that businesses need to be helped to grow and that help is available to them.

With Cambridge and its various university spin-off businesses at its heart, the East of England is seen as a centre of innovation to the extent that it is sometimes described as "the ideas region". But Ellis and his colleagues recognise that, for the moment, there is a lot more potential than actual development. And if that is true of this region, it is hardly likely to be less so elsewhere.

If the East can help shift attention from start-ups to growth, then Britain might start to have something tangible to show for all the talk about enterprise.

Comments