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Well I think there are many challenges that are facing business over the next 3-5 years,
primarily in Western Europe and possibly the USA, it's the issue of growth, growth from
where we are now. We've got a very mature economy and we're always looking for ways
of stimulating growth. So part of what I do for instance with the British Library is trying
to inspire and help new entrepreneurs to push forward growth in certain aspects, innovation
is a big thing.
Yeah, I think one of the big growth areas for the UK, in my opinion for the UK specifically
is export. I think the UK manufacturing has been allowed to fall away over the last 30,
40 years, I think it's a great shame and I think with the increasing robotic, increase
in robotics, that there is a possibility of bringing back a lot of that manufacturing
to the UK from places like China and Asia, you know where you reduce, OK you're reducing
the number of people that are used in manufacture and people may be of a more technical background
because they're using laptop and computer technology to control the production lines.
I was at a factory only the other day in the UK, which produces I think it's about 25,000
bottles and glass an hour and it's quite an amazing thing to watch how few people are
working there, but none the less the business employs 100 people. So I think that's a very,
very big thing for the UK to push toward and in fact I've written a letter to David
Cameron about this because I want to try to help British manufacturing.
We try to make our mistakes on paper at the planning stage rather than in real time. That
enables us not to have so many terminal casualties. We do you know whenever you're starting a
new enterprise or whatever it is, particularly something that requires a lot of technical
know how, there will be mistakes made. But if you can make those mistakes on paper, on
the drawing board rather than mid term, two or three years into the business, you have
a better chance of ironing those little idiosyncrasies that go with any business and particularly
innovation.
We are always following all the news, I have an office in Cardiff and what we do there is,
for us it's a bit like a war room, and what this does is I have staff there that are looking
worldwide at possibilities, it's all about finding something in the market place that
needs filling, a gap that needs filling. For instance at the moment we're developing a
baby bottle which reduces, some would say eliminates but I wouldn't go as far as to say that because
I don't think its possible, but reduces colic and obesity because the actual bottle that
you have, the baby has to suckle on it rather than pouring milk down its throat. So, that product
was developed by quite an outstanding inventor over a period of time. They came to me wanting
to get it into the market place properly and that's really our function - it's taking something
that an inventor or an engineer has found something or discovered or produced something
and we take it to market. So that's the thing, we then analyse the market on a worldwide
basis to see where we might push that product.
By creating the right work place for them, the right, the way you deal with people. We, see my business
operates what I call, someone asked me just recently and this is very important I think
because it does go along with the retention of staff, who my role model was growing up
and through my life, who have I looked up to and I have to say there isn't an individual.
What there is, is a business and that business is actually John Lewis and we operate a John
Lewis style of business in as much as everyone that we have, someone also asked me the other
day how many people we employ, in fact we consider that we don't employ anyone. What
we do is work with people, so everyone in our business is a part owner, so if we had
a business that had 11 people in it, all 11 people would share the ownership of that business.
No question, I would get paid more than anyone else, but they would all get paid better than
they would doing the same job elsewhere and get treated better; so my formula over 40
odd years has been to develop an ethos, a DNA for the business, that's interwoven
into the fabric of the way we do business, which is working with people, collaborating
with people and so the 11 people in the business I've just described would have ownership of
that business with us to a percentage and then, you know, if the business does well they
share in that, if the business isn't doing so well, they share in that also. So, that's
how we retain people and to such an extent that over 43 years, bearing in mind I started
in business when I was a kid, we, I think, I've only ever sacked I think two people in all
that time and we may have lost four or five over that period of time. A lot of people
that I worked with 40 years ago, I still work with today within our businesses.
I think you have to be prepared to say no, I equally think you have be prepared to say
yes sometimes and you have to recognise when to do both of those things. So I'm a great
believer in leading from the fron; I never ask anyone in our business to do anything
I can't do or I haven't done. If I walk into a business where we're, they're unloading
pallets and I'm not doing anything for 20 minutes, I'll give them a hand, if I am you
know I don't like unloading pallets but I will do it because we've got to get
the business going and we work in a lot of SME's I mean you see a lot of our businesses
are start ups and SME's and we take them through to maturity and so you're working in a small
business with people and you know when you do that, you're part of a team.
Cash flow, key, absolute key - cash flow, a good CEO will know what's coming in, what's
going out and when, that's the first thing. Cash flow number one, profitability right up
behind cash flow, so those are the two key things and then it gets down to making sure
the business works properly. The way I see a CEO is as the oil on a business wheel. A
good CEO knows what's going on within his business (or her business) they make sure that
if there's something that needs doing, that it's done, that the right person is available.
They make sure the person has the skill set to do it, recognising sometimes that if you
under employ someone its as bad as over employing someone, so if you have someone that isn't
really good enough for a job, it isn't fair on him or her anymore than it is the other
way around because you're putting stress on an individual, you're putting them out of
their comfort zone. Being stretched is a good thing, I think the CEO needs to recognise
that, but I think they also need to recognise that you can go too far with that and put
people into an over stressed situation. So a good CEO would recognise that and when he's
sometimes, she's sometimes, made a mistake and allowed that to happen, they recognise
it and they sort it out, so a good CEO needs to watch the business and understand every
part.
The first thing, the most important thing of all, is keep your overhead low. Most new
entrepreneurs want to immediately take on overhead, they want, they sell the idea that
they need this office, an expensive office. They sell themselves the idea that they can't possibly
see customers with the old *** they're driving, they need a new car. Most of these
things aren't true, its not necessary if you explain to most customers that you're building
your business, most customers will respect that and they will look at the budding entrepreneur
and say this person is the person will probably survive because he isn't going out and doing
all these things. So my advice would be take on as little debt as you can, really decide
whether you need that bank loan. If you do, make sure you read the small print and if
you're going to ask for a loan, make sure that it is enough, there is nothing worse
than if a budding entrepreneur needs to borrow 20,000 asking for 12 because you're going
to go back to that bank and ask for another three or four and if you go back two or three times,
they're going to be thinking you don't, the business, it gives the impression the business
is going the wrong way. Whereas if you, what I did initially, if I ever had a loan, going
back many years ago, what I would do is take the loan and immediately take half of it and
put it in a building society account. So if I borrowed 20,000, I would take 10 and put
it in a building society account and pretend I never had it and try to make it work on
10 and that meant that when I suddenly needed to, ah I can go to my reserve account. But
I didn't have it in the account every day, so it didn't you know that's the thing, so
I would always say ask for enough if you're going to borrow, try to borrow nothing but
recognise that if you do - borrow enough, make sure that you're covered for the period of
time. So, but overheads are a big thing I mean people go out and take on car leases,
don't, invest it in your business. Take on the right person if it's a member of staff,
if you need a new machine invest in that machine. You know if you've got a old car and you're
driving a battered old car as an entrepreneur, there's nothing, there's no shame in that
and the thing to remember is, that if that old car breaks down it might cost you 400
quid to sort it out, but if you've leased one it will cost you 400 quid every month
and at some point if you suddenly don't have that 400 quid with your old *** you can
leave it and get public transport for a month or two whilst you sort your cash flow out.
Unfortunately if you borrowed for this flash van or whatever it is you've got, you got
to keep on making those payments and it can affect your cash flow. So in the very early
stages, fledging stages of a business of any description, avoid debt, keep your overhead
low and watch your cash flow, that's the most important thing and spend the money on finding
customers because without customers, without sales you have no business.
Absolutely I think universities are key; as someone that suffered with my own education
because of the way of my upbringing, I'm a great believer in education and I think people
need to remember that entrepreneurs, you can be an entrepreneur in someone else's business,
always looking at ways, innovative ways to improve the business and I think that there's,
you know I get a lot of students, a lot of people come to me from universities. Universities
are fantastic for stimulating ideas, students are always thinking about new ideas. Lots
of students want to go into business, they may not want to run multi million pound corporations,
but they maybe got a great innovative idea from you know engineering or whatever, from
many disciplines, medical, alsorts, they want to develop that, so I think that developing
entrepreneurial talent is vital for the economy and I think it's, universities have got a big
place to play. I'd like them to be integrated into the entrepreneurial way of thinking,
universities; I'm absolutely all for that.
Passion, as I would with anyone, are they, do they want to do the job they're applying
for or are they just doing it for money. You see, I have a great belief that, I mean everyone
needs money, we all, we need money, we go to work because you can't eat and do the
things you want to do. But actually strangely enough, in my own case money was never my
motivator, for me freedom was my motivator. So, I think with university graduates, the
passion, so if someone is coming to us for a job then I would be looking to whether they
really want to do that job, second is the money and ambition, passion, ambition and
reliability there is no point being a genius if you don't turn up. So, you know it's great
being a genius I expect but they have to turn up, you can't apply your genius trade if you
don't come into work, so I'm looking for that also.