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Innovation and Growth

SME Tools: eight ways to rein in business costs

Written by Haze Carver on .

NatWest Business Builder: Cost structure

With their eyes on the prize, it’s easy for SME owners to overlook some of the outgoings that can seriously dent the bottom line. Here are eight ways to make smart savings.

1. Don’t be a supplier’s cash cow

“SMEs rarely invest in procurement training, so you have people making quite significant buying decisions without knowing anything about negotiating,” says Chris Aston of cost-management experts Expense Reduction Analysts. These staff are often not motivated or incentivised to make sure they’re getting the best value for the business, he says, which means you may well be a ‘cash cow’ to your suppliers.

“You’d be mortified to hear this,” says Aston. “You’d obviously rather have suppliers feeling that they have to work really hard for your account and that you get the best value of all their clients.”

The answer may be to bring in procurement consultants to negotiate better deals – but educating staff is a good place to start. “You have to get employees spending company money as if it was their own,” says Aston.

2. Claim capital allowance relief

“Tens of thousands of businesses could be sitting on a potentially significant tax windfall in the form of capital allowances relief,” says Mark Tighe, MD at tax specialists Catax. “It concerns the ‘intrinsic fabrication’ of a commercial property, and qualifying items typically include pipework, cabling, air-conditioning, heating, lighting, security and communications systems.”

Tighe says, in his experience, the average net tax benefit to a business is £46,000, but that nine out of 10 SMEs have never made a claim for it. Why wait? An expert firm will often tell you for free whether or not you’re eligible for tax relief.

3. Don’t waste money on pay-per-click

That’s unless you know exactly how it works. “I’ve seen companies that almost seemed addicted to it,” says Andrea Sexton, director of Andrea Sexton PR. “There’s a certain buzz that comes from seeing your brand on the first page of a Google search and above all the organic results, but when every click is going to take cash out of your bank account, it’s imperative you’re confident visitors have a very real chance of buying, and that your margins are sufficient to make the cost of the advertising worthwhile.”

While pay-per-click does work when used correctly, there are probably other basics that need taking care of first – such as making sure your website is truly reflective of what you do, says Sexton.

4. Make sure freebies are being used

Peter Fleming, director and adviser at Business Doctors, used to work for a major car manufacturer and says the company saved £90,000 a year when it got rid of free vending machines that were barely being used.

“A kettle and some tea bags were just as good for the staff,” he says.

Another top tip of his is to outsource debt collection. It can cost as little as £20 an hour, which is a fraction of what you may have to pay running up your overdraft, making late VAT payments and dealing with other cash-flow issues.

“When every click is going to take cash out of your bank account, it’s imperative you’re confident visitors have a very real chance of buying, and that your margins are sufficient to make the cost of the advertising worthwhile”

Andrea Sexton, director, Andrea Sexton PR

5. Do it for a ‘Fiverr’

“The gig economy enables small business owners to find services online at much reduced rates,” says Archna Tharani, director of the newly launched Small Business Finance School, which helps SMEs make sense of their numbers. “You can find freelancers on websites like Fiverr and People Per Hour to get jobs done quickly and cheaply – but it’s always a good idea to get recommendations, as it can sometimes be a false economy when you end up paying again to get the work done if it’s not up to scratch.”

Fiverr in particular can be a boon for those in need of low-cost visuals like logos, but even complex areas into which you might want to make a tentative foray – such as market research and SEO – may be worth a look when just £5 will buy you a short contract with someone whose feedback suggests they know what they are doing.

6. Make pension contributions through your limited company

Tharani’s second tip is that your company can make employer pension contributions for you. “The pension contributions are an allowable deduction in calculating the profit of the business,” she says. “This will lead to a saving in corporation tax.”

As a result, you get extra in your pension and the company pays less tax. “It’s a win-win,” says Tharani.

7. Find partner brands

“As an early-stage challenger telco brand, we needed to generate product awareness with UK SMEs and start-ups,” says Damian Hanson, co-founder of online phone system CircleLoop. “But we found the cost of traditional advertising channels very prohibitive. Instead, we’ve focused on developing key partnerships with businesses that target similar customers with non-competing services.”

Hanson says these mutually beneficial relationships can generate faster volume at a lower cost. CircleLoop tends to seek out two distinct types of partnership. The first is the promotional partner, such as a business that serves the same or a similar customer base and can benefit mutually from joint campaign activity. “The second is the integration partner, a business that offers complementary software-as-a-service-based products into which we can integrate our service,” says Hanson.

8. Bootstrap until you’re 100% ready to expand

The best way to not waste money when starting out is to forego the trappings usually associated with running a business (office, staff, hardware and so on) – something Barnaby Lashbrooke, founder of virtual assistant platform Time Etc, discovered too late when launching an earlier business. “I burnt through cash by hiring staff and renting office space before I needed to – a mistake I’ll never repeat,” he says.

“My advice to other SME owners is to outsource tasks, use freelancers you trust and don’t leave your home office/kitchen table until you’re really ready to expand.”

Further Reading

We have a thriving and diverse community of thousands of entrepreneurs from multiple sectors, backgrounds and skill sets helping you to connect with the right people at the right time. No matter whether you’re looking to upskill, get feedback, engage with new people or simply observe, there’s something for everyone.

‘Want to learn more? Register for NatWest Business Builder to view all of their business development tools. Click HERE‘

SME growth: when to spend

Written by Haze Carver on .

NatWest Business Builder: Cost structure

The average annual expenditure for SMEs is £1m, with the biggest costs being new staff, paying suppliers and investing in technology. Savvy cash flow management is vital to managing these costs.

Spending decisions can make or break an SME. As Emma Chesson, head of online services at chartered accountancy and business advisory service Kreston Reeves, puts it: “There’s a balancing act in managing expenditure and business expense that’s a little like running a race car, swapping cash for fuel: if you under-fuel the car and drive recklessly, you’ll quickly run out; if you over-fuel and drive too cautiously, you’ll be overtaken. Businesses that are reckless with their spending will fail, but if you are too risk averse your business is unlikely to succeed.”

Chesson summarises the biggest spending decisions SMEs and fast-growing businesses face as the ‘three Ps’: people, premises and promotion.

“For some businesses there will also be significant capital investment in plant and machine to enable them to carry out their business,” she adds. “Not only are these likely to be significant, they’ll often have to be borne upfront.”

Savvy spending

When Ed Challinor and Dr MJ Rowland-Warmann co-founded private dentist Smileworks Liverpool in 2013, they were turned down for funding, which placed severe limitations on their planned expenditure.

“In hindsight this gave us an opportunity to run a tiny practice with none of the overheads of a large dental practice and learn the art of business finance along the way,” says Challinor.

Eventually, they were able to lease the state-of-the-art dental equipment that enabled them to offer dentistry on a higher margin, while still keeping the costs down to a minimum. Smileworks Liverpool is now growing fast, with a net profit margin of between 30% and 70%.

“All of this profit is reinvested because we’re still growing,” says Challinor. “Our initial investments were all calculated to improve revenue or cut costs.”

For London real estate broker Stonelink International, the wider economic environment prompted a halt on spending in 2017.

“For a long period there it was a matter of patience,” says director Nicholas Tsiougos. “It was a very difficult period, followed by uncertainty in our industry with clients simply pausing from making any investment decision.

“We couldn’t hire new talent, nor could we make the immediate changes required. So we went into a highly resourceful mode with little to no spend at all, with key objectives every quarter, and we stuck to them. Slowly, over the course of 12 months, the clients we wanted started to knock on our door.”

Question your motives

Even if the time is right and the funds are available, you should still take a critical view of your proposed spend.

Simon Paterson, partner at Surrey accountancy firm RJP, recommends considering whether you’ll get value from your proposed spend.

“It’s all very well spending on, say, marketing and advertising, but if all of your work comes from referrals and word-of-mouth, it’s a potentially pointless spend.”

The question of whether to spend on new staff is often the most difficult one for SMEs.

“You’ll be able to see if you’re heading for a cash-flow squeeze further down the road and be able to take preventative action”

Bev Hurley, chief executive, YTKO Group

“Unless you have a healthy and pretty certain sales pipeline, and a bit of working capital in the bank, taking on a new overhead can be daunting,” says Bev Hurley, chief executive of enterprise creation and business growth specialists YTKO Group and chair of the Institute of Economic Development.

With this in mind, it’s worth exploring whether you can simply enhance the efficiency of your existing team, says Paterson.

“As a company grows, you often see them take on more employees when really if you looked at the systems in place within the company, it could be that processes could be improved, which means you don’t have to take on more staff – which ultimately leads to increased profits,” he adds.

Managing cash flow

For Challinor, adequate cash-flow management must underpin any spending decisions. “At the end of the day it’s running out of cash that kills businesses – at an alarming rate,” he says. “There are five ways to improve cash flow: cut costs; make more revenue [by increasing prices if you can]; extend payment terms with suppliers; reduce customer payment terms; and reduce inventory. A sixth could be: lease – don’t buy.”

Business growth expert Royston Guest, CEO of business consultancy Pti Worldwide and author of Built To Grow, adds that you should keep on top of your company’s creditor days (how many days pass before it pays its creditors) and its debtor days (how many days it allows to pass before its debtors pay).

“Understanding average creditor/debtor days is the foundation of a well-run business and cash-flow management,” he says. “But having an understanding is just the start: SMEs need to dedicate time and resource to establishing and maintaining a system for the collection of monies in, for chasing down overdue debtors and for optimising payment terms.”

Hurley recommends creating a cash-flow forecast and updating it at least weekly. “You’ll be able to see at a glance if you’re heading for a cash-flow squeeze further down the road and be able to take preventative action,” she says.

She also suggests running credit checks on potential clients to weed out bad payers, make it easy for customers to pay you (for example, by facilitating online payments) and build good relationships with internal accounts teams for your suppliers and your clients.

“Try to ensure you have a diverse client base rather than putting all your eggs in one basket, and heed your early warning signs and take action – don’t put your head in the sand,” she adds.

Spending wisely: five things to get right

1. Decide whether there is a real benefit to the spend. “Often you see SMEs making needless purchases that don’t add value to a business and are more of a lifestyle spend,” warns Paterson.

2. Consider spreading the cost of any major investment over the lifetime of the asset. “This is particularly useful for expensive plant and machinery,” says Chesson.

3. Have real-time financial information to hand. “Your profit and loss, cash-flow forecast and balance sheet are essential financial tools that will allow you to see the big picture and proactively determine what’s possible,” says Guest.

4. Take a step back and look at the financials of your business and ask yourself: would I invest with my money? “If the answer is yes and you’ve removed all your confirmation biases and downgraded your estimates by a safe 20%, go for it,” says Challinor.

5. Make sure you’re fully aware of all the costs. “For example, recruiting a new team member might include recruitment costs, and then there are the tools for them to be effective – their computer, mobile phone and so on,” says Guest. “There’s not only their base salary to consider but all the additional costs of national insurance, pension and expenses.”

Further Reading

We have a thriving and diverse community of thousands of entrepreneurs from multiple sectors, backgrounds and skill sets helping you to connect with the right people at the right time. No matter whether you’re looking to upskill, get feedback, engage with new people or simply observe, there’s something for everyone.

‘Want to learn more? Register for NatWest Business Builder to view all of their business development tools. Click HERE‘

European Union Settlement Scheme

Written by Haze Carver on .

Norfolk Community Law Service Providing Access to Justice & Equality “Providing Access to Justice & Equality”

What is NCLS?

We are a small registered charity. Our services are available to everyone living or working in Norfolk.

Our aims and objectives

The objectives of NCLS are to identify unmet legal need within Norfolk and to attempt to provide free services to meet those needs.

Equal opportunities

We are committed to applying equal opportunity practices in the management of our organisation, in the way we employ staff and work with volunteers and in the delivery of our services to all our clients.

We offer interpreters and translation where we can, but our limited funding means that this is not always possible.

 Covid-19 – Additional Information

Due to the current Coronavirus situation solicitors and advisers will continue to advise on behalf of NCLS according to the legislation and information that is available at the time the advice is given.

As we are unable to hold face-to-face meetings, we may not be able to obtain as much information from clients as we normally do because we will not have your documentation in front of us. 

In terms of issues arising specifically out of the Coronavirus situation, such as employment and benefits questions, our solicitors and advisers will give as much help and advice as they can. However, they are reliant on government guidance and proposals which may not always be complete or unambiguous and which may change after the advice has been given.

To keep updated on our services

Website: www.ncls.co.uk 

Facebook: www.facebook.com/NorfolkCLS/

Twitter: www.twitter.com/nclawservice

Is it worth being an Entrepreneur or Angel in the UK?

Written by Haze Carver on .

Magic Sauce

Ok, so that headline was a little hyperbolic.

Beauhurst published results of a survey on the feelings of the Startup ecosystem in the UK with regards to possible government plans to overhaul CGT (Capital Gains Tax) on share disposal.

Currently, when a founder exits a business the first £1m of the proceeds is only subject to 10% tax, with the rest subject to 20% in most cases.

The government is proposing a 45% tax on disposal of those assets. 

This would make it the highest in Europe, with all of the consequences that entail.

1. 85% of those surveyed said that they’d set up in another, more favourable location (in tax terms).

2. 88% said that jobs would move abroad.

3. 90% said that it would be harder to attract top talent.

4. 72% of Angels said they would be less likely to continue to invest in UK companies.

All of these scenarios would be catastrophic for the UK at at time when financial stimulus and innovation is needed most.

The high growth sector of the UK economy employs 3.5m people, all paying income tax, national insurance and VAT on whatever they buy.

Those companies would definitely have brought a proportion of inward investment to their businesses throughout their growth (which is then spent on staff, services provided by UK companies, etc.). 

Let’s use back of a napkin maths. Let’s say that each person working for a high growth company (mostly well paid jobs) pays £16666 through the year in income tax, NIC and stuff like VAT.

That’s worth £58bn to the economy annually. 

That doesn’t account for those fast-growing companies that have been acquired and now form part of a larger corporate machine.

This doesn’t account for the increase in spending a tech platform may encourage, or business efficiencies and productivity gains it may provide.

What none of these things mention is the risk that founders take to gain the potential high rewards that a tech platform scaling and then being acquired or going to IPO can bring.

Quite apart from the toll on mental health, it causes relationship break ups, debt, sleepless nights. It’s not a 9-5 job. People are putting their reputation, savings and everything else on the line (and the burden of responsibility that any good founder feels when they are invested in by outsiders).

To try and bracket that risk and the tax on the reward on the same level as an employee in a well paid 9-5 job is an insult, a deterrent and could stifle an entire generation of innovators (or force them to another country to try their luck).

Look across the pond to the US. 

A tech founder could realistically exit their business and not pay a dime in tax on the first $10m of the sale of their shares in their own company. They’d pay 20% on the rest. That incentivises both investors and founders to innovate and scale a business. 

Having the highest CGT in Europe does not.

It will harm more than just this current generation too.

Every founder I’ve ever met on my journey that’s made it to a pre-seed investment has a purpose of some kind. Ultimately, every single one of them wants to be an Angel investor themselves one day and ‘pay it forward’. That paying it forward is critical to the circular economy within the tech landscape. People get invested in, they grow a company, and if they have enough money they become an investor themselves to seed the next generation of tech companies.

Living in Norfolk, one of the things that caused a lag in the growth of the tech Startup scene here initially was the lack of exits. An ecosystem cannot exist without successful ex-founders who choose to reinvest in that cycle.

80% of the people surveyed by Beauhurst said that they would be unlikely to reinvest. Liquidity on disposal of a Startup is critical to the growth of further innovation and Startups in the UK. 

We’ve already lost jobs from large companies due to Brexit, we’ve lost entire companies due to Brexit. If the government thinks it can rely on those corporates to maintain the country in a post-Brexit, post-Pandemic world, it’s deluded and smacks of the same overconfidence of many high street retailers who failed to change the way they do things and adapt to the new behaviours of its’ consumers.

We get that we have to reduce the borrowing that has spiralled thanks to the pandemic to offset the measures put in place to keep people in jobs. That money shouldn’t have been spent propping up ailing, dying giants in the form of large high street retailers that were going to die anyway. It should have been spent upskilling or helping people transition into better paid jobs in the digital sphere, for employers that would truly value them.

If anything, we need to seed the environment to create more high growth companies and the jobs that go with them. Imagine if we could double the amount of high growth companies in the UK over the next 5 years?

That would look like over £100bn in tax revenue for the UK, jobs created, inward investment pouring into the company paying for the growth of those companies, more confidence from the investment community to invest in those companies, more people paying it forward, more Angels, more people able to invest in VC funds and lending…

We also have to remember that a lot of the Angels that have helped grow the sector until now have been ex-corporates and landowners who’ve levied their assets to invest. That can’t go on forever, especially as we’re seeing more people turn to spread betting lower amounts via crowdfunding rather than getting involved.

The alternative is dwindling confidence that the UK is a hotbed of innovation that attracts more inward investment into Startups than any other country in Europe. People start to switch off, people lose the aspiration to do things that could improve processes, governance, the climate, stimulate consumer spending.

Don’t raise CGT.

Offer high growth companies (up to) the first £5m of their disposal free of ANY tax (on a disposal of £50m). Tax them at 20% for the rest. Sure, put a caveat in that the £5m is only tax free because it’s ringfenced for reinvestment. 

If we tiered (the government likes loads of tiers, I’ve noticed that) that tax so that it represents 10% of the value of that disposal to an individual it means they’re likely to either start a new company with money behind them or invest in others.

At the bottom end, even if someone benefited from the sale of a company to the tune of £5m, they’d be tax free on the first £500k, with 20% being levied on the rest. The total tax to pay would be £900,000 (instead of £2,250,000). Would that encourage an entrepreneur to start again or invest in others at £25k a pop? Don’t sit there scratching your arse and thinking because the answer is yes.

The other thing that needs regulation is the amount of founder equity that some universities are taking in the UK. They should be capped at a maximum amount of 25% of dilutable equity. There is so much IP floating around the Universities that’s been left to rot due to ignorance/greed of Universities. No-one will invest in a startup that has 50% of the IP and founder equity belonging to a non-active partner. Stop it.

You can get in touch with Magic Sauce here

We think you may also find this interesting: RESTART Festival | Angels Den pitches

White paper: Delivering Virtual Work Experience and enriching work experience through digital media

Written by Haze Carver on .

Morgan Sindall

In our latest white paper speak to those involved in our online work experience. A programme devised by the team in our East region, when their latest group of work experience placements were unable to begin their placements due to the Covid-19 pandemic.

By moving the programme online, the students were still able to gain valuable experience and learn new skills.

Find out more about the programme as we hear from the students, their parents, their teachers and the Morgan Sindall Construction team, download the report here.

To view the original article click here

Why Startups Fail & How to Avoid it

Written by Haze Carver on .

Magic Sauce

The research tells us that pre-Covid, 90% of startups fail (that includes all startups). 

There’s a nice, confidence raising figure for you eh.

20% in Year 1, 30% in Year 2 and the rest in years 3-5 (if you can’t do the maths on the last bit then you should definitely get a CFO as your first co-founder).

What those stats don’t tell us is ‘why’?

WHY?

There’s a myriad of reasons, but the most common are:-

Poor management

Cash Flow

Lack of Funding

Poor market/product fit

Founding team implosion

Covid (and an inability to pivot to the ‘new normal’)

Some of that stuff is surmountable, some of it not. 

Fintech for instance has had a huge focus in the post-Covid world, so I could just tell you to go build a fintech platform because investors are desperate for deal flow in that area. You may get money but still fall foul of all of the other reasons above, so let’s tackle those in brief.

Poor Management

The stats tell us that a startup with more than one founder is more likely to gain funding and it’s more likely to succeed. Accept your limitations and try and find a team to fit around you that make up for the skills you don’t have or could improve upon your ‘gifted amateur’ skills. I know this because I’ve been a lone founder and it’s (as the name would suggest), lonely. It also means that you don’t have a ton of cash for experts to do the stuff you’re rubbish at (at least at the start). It’s taken me time but diarising stuff and to-do lists really help to motivate you do the stuff you hate doing. I still push stuff down the list, but I’m getting better at it. You also need to remember that as you build a team, you need those people to buy into your vision. If you’re talking to prospective co-founders or employees, really dig into what they want now and in 3 years (don’t necessarily give them your vision in any detail beforehand, you want to hear who they are).

Cash Flow

Getting a good cashflow template is a real boon. Sticking to it is another, but you have to own it, particularly with a high growth tech startup. Once you get that first £100k+ of funding, people are going to want to know what you’re spending money on and that you’re sticking to the plan for it. Test your assumptions by dropping your revenue by 1/3rd and 2/3rds to see what effect it has on your burn rate (your investors certainly will). Don’t use hiring costs for people way before you’ll need them, think lean.

Lack of Funding

Well, that’s most startups in honesty. To give yourself the best chance possible, you either need to research the hell out of how to raise money and spend time building relationships with the kind of investors you want involved in your business. Otherwise, try and get onto an acceleration programme, into an accelerator, or onto programmes that can deliver the help you need. Only around 3% of startups end up actually attending an accelerator and not many more get invested in (something Magic Sauce is trying to change by making acceleration and investor visibility accessible to a larger audience).

Poor Market/Product Fit

It’s something we try and address with our free canvas available on the Magic Sauce site. Some investors say they aren’t swayed by market size (and it’s right, that’s not important on its’ own). Your product has to be compelling and able to solve problems for its’ audience. History is littered with startups that built something without first checking the size of the potential audience, whether a problem actually needed solving (that had a price ticket attached), or whether their product was usable by the target audience. Identify your audience, talk to your audience and keep them involved. Test and iterate. I have a motto that goes, “you can kick seven shades of shit out of an idea, but it’s illegal to do it to a founder”. Founders that can adapt their vision and product to meet the need of an audience succeed (with a ladle of resilience and ability to listen).

Founding Team Implosion

Horrible to witness and some good startups have fallen by the wayside, usually because of dollar signs in someone’s eyes. Protect the company, look to have solid “bad leaver” clauses in your Shareholders Agreement and robust Articles. Make sure that you’re all clear on vision and who should get what from the outset. Foundrs.com has a great (and simple tool) to give you a ballpark of who should get what to get the conversation rolling.

Covid

Covid has shot many a tech startup down in the last year, while others have thrived (see health/med/pharma/fintech). It doesn’t mean your idea isn’t investible, but it means you may be a bit less “sexy” right now if it’s not ready for market or already building traction/sales. Look at how you can pivot into different markets or adapt your platform. Investors like more than one revenue stream and potential audience (as do lenders) as it can provide an additional revenue stream and may bring forward the potential to step into a market you planned to hit in a few years. An example is one startup I helped last year. Their proptech business was focused on residential house checks. We had a chat and they pivoted into commercial property checks (properties were empty, they needed checking over).

That lot sounds simple, and it’s deliberately broad and high level. Each startup is unique and has its own advantages and disadvantages. Experience and good advice for your own situation is the best remedy and proactive path.

Feel free to add opinions, evidence or questions of your own.

Kris Jones

CEO, Techvelocity/Magic Sauce, Advisor, Mentor and Speaker

If you want a chat in confidence then get in touch here

Management strategies: the six questions you need to ask your staff

Written by Haze Carver on .

NatWest Business Builder: Self Awareness

If you really want to know what your team think of you and your business, these questions will help create a clear image.

1. What frustrates you about your role at the moment?

This question is a great one for SME owners to ask, says Peter English, a management development consultant and author of Tackling Difficult Conversations, because about 40% of people focus primarily on resolving problems in their lives. “These are people who are more aware of problems and get more annoyed by them,” he says. For the other 60%, it’s still a good question because it can unearth all kinds of issues.

English says many owners have a natural aversion to this line of questioning because they’ve been tutored in the ‘think positive’ school of thought. “They also fear that they won’t be able to address the issue that’s frustrating employees, or that the answer might be about their management style,” he says.

Why it’s worth asking: It should give owners a true snapshot of what their staff are thinking about their daily grind. “Owners won’t always be able to solve the problem, but they can often do something about it – maybe meeting staff halfway,” says English, who adds that bosses should try not to act defensively to employees’ suggestions.

2. What can I do better as the owner of the business?

This question – unthinkable to some bosses – turns the spotlight 180 degrees. Nelson Phillips, professor at Imperial College Business School in London says that feedback could be transformational if the owner is brave enough to listen.

“Owners often think that employees will feel free to speak up and tell them their ideas, observations, and suggestions, but this is very often not true,” he says. “Hierarchy always looks much more distant looking up than looking down.”

Why it’s worth asking: The team may well be holding back – especially true, says Phillips, if the founder is charismatic and full of self-belief. “Asking this question is, ironically, most useful for owners who are least likely to ask it,” says Phillips. “This is a version of the feedback paradox: the people who desperately need to receive feedback will do everything they can to avoid it.”

3. What do you think of the service we currently provide to our customers?

If the customer is king and your team’s on the frontline when it comes to dealing with them, getting staff to open up about their thoughts on the customer experience can be a valuable exercise. Caroline Dunk, owner of business consultancy the CDA Organisation, says this question often helps identify opportunities to improve customer service by making changes to key processes.

“I’m the only person in this business who can make blanket changes quite easily, so I tell the team that if something can be better, they should let me know”

Adam Greenwood, CEO, Greenwood Campbell

“We carried out some work for a mobile phone retailer to improve the service in their high-street stores; many of the changes that we made were based on ideas that came from their store staff when we asked them this question,” she says.

Why it’s worth asking: As well as unearthing new suggestions to improve the customer experience, Dunk says this question will help you to identify which members of the team really care. “Even if you don’t agree with every detail, a considered, passionate response will tell you that the individual is engaged with the goals of your organisation and wants to deliver an outstanding customer experience,” she says.

4. What can we as a company do better?

It seems such a blindingly obvious thing to ask the team, but Laura Jackman, assistant professor in entrepreneurship at Edinburgh Business School, says many owners simply never get round to it.

“The ‘we’ aspect of this is important because staff need to feel that it’s safe to be honest and not just say what they feel the boss wants to hear,” says Jackman, who cautions against asking this purely as a box-ticking exercise with nothing happening as a result. “When that happens it’s hugely de-motivating and staff quickly realise that their opinion isn’t valued,” she says.

Why it’s worth asking: “It’s open-ended, and in my experience frequently brings out both problems and opportunities,” says Jackman, who reiterates the importance of acting on at least some of the feedback. “I think you can ask staff as many questions as you like but if they really don’t feel ‘safe’ to answer honestly, it’s utterly pointless,” she says.

5. How can we improve working here?

Happy staff and a work culture in which they thrive are much-sought prizes for many owners, and Adam Greenwood, CEO and co-founder of digital agency Greenwood Campbell, says the best way to get there is to ask the team what they want.

“I’m the only person in this business who can make blanket changes quite easily,” he says, “so I tell the team that if something can be better, they should let me know.”

Why it’s worth asking: Staff are the lifeblood of any enterprise, and the happier they are, the more likely they are to propel a business forward. Don’t ask, and resentment and grievances may simmer. “Last year we took two members of the team away to a big digital conference in the US,” says Greenwood, “and some of those who didn’t get to go questioned why I only took those two. So this year I said: ‘OK, we’re going to take everyone.’”

6. Are you clear on the wider business objectives and your role in achieving them?

“A lot of business leaders make the assumption that employees know the business goals and the part they play – and that everyone is pulling in the same direction,” says business coach Rebecca Morley. Unfortunately, this isn’t always the case – as Morley discovered when she recently put this question to a senior leadership team. “In a number of cases there was some ambiguity around the goals and their role, and it can lead to inefficiency,” she says.

Why it is worth asking: “Sometimes the simplest questions can make the biggest difference,” says Morley. “Business is a machine, and everyone needs to be playing their individual role in making it move forward effectively. If someone is misaligned, it creates an issue not just for them but for the business and the people around them.”

We have a thriving and diverse community of thousands of entrepreneurs from multiple sectors, backgrounds and skill sets helping you to connect with the right people at the right time. No matter whether you’re looking to upskill, get feedback, engage with new people or simply observe, there’s something for everyone.

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Get involved with the Norfolk Knowledge Hub!

Written by Haze Carver on .

If you have content you want to share, get in touch!

The Norfolk Knowledge Hub is available to every business, the content is provided by every business that would like to share their knowledge, skills and expertise. It is curated by your Norfolk Chambers of Commerce.

If you would like to get involved, then we would love to hear from you!

Why not drop us a line and we’ll get straight back to you to arrange a chat.

You can find out more about membership with the Norfolk Chambers of Commerce here

Or if you would like to speak to a member of our team directly call us on 01603 625977

(we’d love to know more about you and your business!)

Uber case should be ‘wake-up call’ for businesses using independent contractors, says leading HR expert

Written by Haze Carver on .

Lovewell Blake

Businesses which use independent contractors as part of their workforce need to conduct an urgent review of whether those contractors should be regarded as employed workers, following a landmark Supreme Court judgement last week, according to a leading East Anglian HR expert.

An important unanimous ruling by six Supreme Court judges determined that drivers for taxi firm Uber should be classed as employed workers – entitling them to a range of benefits such as National Minimum Wage and holiday pay.

Although there are no Uber taxis in Norfolk, the judgement has major implications for many firms in the region, says Vicky Webber, HR specialist at Lovewell Blake.

“The court decided that because Uber set contract terms, determined fares, set rules about accepting rides and the criteria for customer ratings, that their drivers are in a ‘position of subordination and dependency’ in relation to the cab firm, and so should be regarded as employed workers,” said Ms Webber.

“The ruling will have a major impact not just in the taxi industry, but in many businesses which rely on an independent contractor workforce, including food delivery firms, couriers and delivery companies.

“The case makes it clear that no matter what might be written in a contract, if the relationship between a business and a worker is not genuinely a self-employed one, then tribunals are going to rule based on the reality of the situation, not what is written down in a contract.

“The case came down to the element of control that the employer has over the worker: if they are determining working hours, don’t allow the worker to send a substitute, are supplying equipment or a vehicle, or in some other way controlling when and how the worker works, then it is likely a tribunal will regard the worker as having employed status.”

Ms Webber said that the judgement should be a reminder to businesses to review the relationships they have with contracted workers on a regular basis.

“It’s likely that the publicity around this ruling will embolden individuals to go to tribunal to seek employed status, either while they are working for a business, or when they no longer work for the business. Such cases could lead to substantial claims for backdated holiday pay and underpayment of the National Minimum Wage, and even in some cases claims for unfair dismissal if employee status is established.

“This case should be a wake-up call for businesses to conduct an urgent review of the relationship they have with independent contractors, and to take expert advice on whether they should be regarded as workers, or even employees.”

You can view this original Lovewell Blake article and others here

If you have any specific questions or would like to speak to a member of the Lovewell Blake team, get in touch via email [email protected]

Work engagement, job quality, wellbeing and innovation post-COVID – what can employers do

Written by Haze Carver on .

UEA – PrOPEL Hub

Businesses across the UK share an aspiration to bounce back after the COVID-19 crisis and get back to delivering value for customers and good jobs for employees. Promoting employee engagement (or ‘work engagement’) is important to delivering wellbeing for employees and improved innovation and performance for businesses.

As part of the ‘PrOPEL Hub’ and ‘Management Practices for Employee Engagement’ initiatives, supported by the Economic and Social Research Council, our team at the University of Strathclyde is working with UK companies to explore the linkages between jobs, work engagement and a crucial innovation outcome sought by employers – what we call ‘innovative work behaviours’ among employees. You can find lots of useful resources from us and colleagues on steps organisations can take to encourage these behaviours at www.propelhub.org.

Some critics have argued that engagement has become a buzzword – cover for employers reluctant to do the hard work of improving jobs, pay and conditions. So what is work engagement and how solid is the evidence base that action on engagement can deliver positive outcomes for employees and businesses?

It is true that the ‘engagement agenda’ has become somewhat ubiquitous, and the term has been used with reference to a range of meanings. But there is a decent evidence base that levels of ‘work engagement’ are important predictors of performance and wellbeing. Work engagement has been defined as ‘a positive, fulfilling, work-related state of mind that is characterised by vigour, dedication, and absorption’. This way of capturing engagement – developed by Wilmar Schaufeli and colleagues in the early 2000s – asks fundamental questions about feelings of resilience and energy (the vigour bit), whether employees find jobs meaningful (dedication) and if they are happy and immersed in interesting work (absorption).

There is good evidence that higher levels of engagement are associated with positive wellbeing outcomes for employees and some signs that they are also bottom-line benefits for companies. One area of performance that there is increasing interest is innovation – Are more engaged workers more likely to innovate and solve problems in the workplace? Here the evidence is a bit more limited, but there are signs that higher levels of engagement can support employees’ innovative work behaviours – ‘the intentional proposal and application of novel and improved ideas, processes, practices, and policies aimed at organizational effectiveness, business success, and long-term sustainability’. A new study by Kibum Kwon and Taesung Kim in Human Resource Management Review journal concludes that ‘engaged employees are more likely to behave innovatively by activating coping strategies to deal with challenges’. But we need to strengthen the evidence base on what works in supporting employees to innovate and also enhancing their wellbeing.

What sort of things should employers be thinking about to promote engagement and innovation? Our research focuses on the importance of job quality. Two members of our research team – professors Evangelia Demerouti and Arnold Bakker – have lead the development of the Job Demands-Resources Model. This is a way of thinking about job quality that centres on the need to balance, on the one hand, ‘job demands’ such as workload, emotional demands, interpersonal conflict, and on the other hand, ‘job resources’ – the elements of good job quality that help people to cope with the demands of the workplace, like job control, task variety, development opportunities and effective feedback. Evangelia Demerouti and Arnold Bakker and their colleagues have developed an impressive evidence base that suggests that these elements of job quality can feed into engagement and wellbeing. As I have already said, there is also some evidence that higher engagement equals more innovation, but we need more information on how these processes work.

Which brings us back to the major research programme that the University of Strathclyde is leading to arrive at new insights on these issues. We will be working with thirty companies to explore linkages between job quality, work engagement and wellbeing, and crucially, adding to the evidence on how we can support employees to innovate.

Of course, these are uniquely challenging times for HR practitioners and business leaders, and in the immediate term the emphasis is likely to be on business survival and retaining or exiting people from the organisation as necessary. But it might also be a good time for businesses to reflect on their workplace practices – as we move towards a ‘new normal’ post-COVID-19, employers have an opportunity to think about improving job quality to benefit people and performance.

For more from the PrOPEL Hub on Work Engagement, Job Quality and Innovation, head over to https://www.propelhub.org/job-quality-matters-building-workplace-wellbeing-and-engagement-into-the-new-normal-for-business/

If your business would like to work with our at team at the Scottish Centre for Employment Research at the University of Strathclyde Business School we would be keen to hear from you.

To find out more about the research, contact Professor Colin Lindsay at the University of Strathclyde – [email protected]

We think you may also find this interesting: The Value of Personality Tests

The PrOPEL Hub

Written by Haze Carver on .

Management Practice, Employee Engagement and the Productivity Puzzle

The UK ‘productivity puzzle’ – that is the long-term lag in our economic growth compared to competitors – is no secret. The causes for this are still not fully understood, but one thing is certain…if the UK economy is to survive the challenges thrown up by our EU exit and the Covid-19 pandemic, a solution is required.

Here at the PrOPEL Hub we believe that the workplace is the key to driving higher levels of engagement and productivity.

So who are we?

The PrOPEL Hub (Productivity Outcomes of workplace Practice, Engagement & Learning) is a major initiative designed to support improvements in productivity through enhanced workplace practice and employee engagement. The Hub brings together leading researchers from 8 UK universities alongside the CIPD, to develop practical tips and tools to help businesses take advantage of the latest insights and expertise. Funded by the Economic & Social Research Council, we focus on supporting the development of high quality, inclusive and engaging workplaces that help tackle the UK’s productivity puzzle. 

What do we do?

Events. We run a series of events exploring links between management practice, employee engagement and productivity. These range from our larger Masterclass events targeted at a senior business audience, our International Research Seminars aimed at an academic audience, to our smaller more engaged workshops and hacks which allow organisations to problem solve within their own specific business context

Research. All of our activity is underpinned by a robust evidence-base. We have 5 major on-going research projects funded by the ESRC which explore links between workplace practice and productivity through a range of different perspectives. You can learn more about these here.

Webcontent. Our website shares findings from our own and other key stakeholder’s research in a format that can be usefully and practically applied by businesses. We offer blogs, podcasts, videos and ‘How To’ toolkits.

Work with Us

We work with all different types of workplace stakeholders. For opportunities and to get involved, please sign up for our mailing list at www.propelhub.org or email us at [email protected]

We think you may also find this interesting: Matching People to Jobs

Environmental, social and governance – the bigger picture for life sciences

Written by Haze Carver on .

Mills & Reeve

Business leaders know that environmental, social and governance issues are increasingly important – to their customers, their people and their investors. This is no longer a “nice to have”, but a key part of doing business in the modern world. At Mills & Reeve, we are bringing an ever-increasing focus to our own business practices, and, more importantly, to how we can support our clients in achieving their own ESG goals. Here we consider what this means for the life sciences sector and what steps we are seeing organisations take to make a real difference.

A responsible approach to doing business has long been a priority for the life sciences sector. In this highly regulated industry, the risk of harm is intrinsically high. This means that compliance with not just the letter of the law, but also the underlying principles, is at the forefront of minds from the top to the bottom of a well-run organisation. Dealing with products and services that affect the health of many individuals, and with ethically complex issues like genetic modification, means that organisations regularly encounter the need to make difficult choices, and to be accountable for the decisions they make.

What are the E, S and G?

ESG brings in a wide range of topics and concerns, and while there are some universal touchpoints, the main issues will vary from sector to sector. The ESG metric helps organisations to think through all of the issues – including those that they might not previously have identified for attention. Delving more deeply into the acronym:

  • Environmental is all about reducing our impact on the planet and addressing the climate crisis. 
  • Social looks at the impact that an organisation has on the people that work within it, and within its business partners, and the communities that it serves.
  • Finally, Governance focuses on ensuring that an organisation has a strong decision-making structure that is fit for purpose and ensures that the likely end-points are taken into account in any decision taken.

Attracting investors

Investors are increasingly focusing on the ESG perspective when making decisions as to where to allocate capital. Likewise retail investment funds are under pressure from the market to provide ethical options. Public market regulators set standards to be met by larger companies. Falling short in these areas is increasingly seen as a risk factor for investors, exposing a business to the possibility of problems like regulatory sanctions and product recalls. Such is the pressure to move towards sustainability, that some investors find it difficult to identify sufficient opportunities that match their criteria.

Analysis by index-provider MSCI relies on a break-down weighting factors by sector. The MSCI ESG Industry Materiality Map identifies the following areas as particularly important for its assessment of life sciences businesses:

  • E: carbon emissions, and toxic emissions and waste
  • S: human capital development, product safety and quality, and access to health care
  • G: ownership and control, board, pay, accounting, business ethics, and tax transparency

New ways to do business

Major pharmaceutical companies have been active for many years in building responsible supply chains. As part of a global industry, they have faced the need to address problems around ethical and responsible business earlier than most. Collaborative projects like the Pharmaceutical Supply Chain Initiative help businesses to collaborate in promoting responsible supply chain management and better business conditions across the industry.

For smaller and younger organisations developing and embedding best practice can be a challenge. 

There are relatively straightforward changes that can be introduced into day-to-day practices. Tightening up auditing and reporting provisions in contracts with commercial partners can, where appropriate, drive better behaviours in your supply chain. It can also help to demonstrate that you are taking action in your regular business activities.

Some activities can be updated more extensively, but without necessarily having a detrimental effect on workflow. During the past 18 months, for example, we have seen a much greater use of remote working in clinical trials, with patients able to attend appointments digitally rather than visiting a hospital. Introducing this kind of practice on a long-term basis would see a major reduction in travel requirements for trial subjects. Likewise, the use of digital technologies in everyday clinical practice during the COVID-19 pandemic has demonstrated that remote appointments and use of health technology can enable greater efficiency and reduced need for travel.

Premises and property

While life sciences organisations may not be among the top contributors to the environmental impact of construction, they often have complex and sophisticated premises requirements. Purpose-built R&D and manufacturing facilities may have intensive energy needs. As an organisation grows and evolves, it is likely to need a different size and combination of facilities, moving from research towards manufacturing scale-up, for example. This will often mean a change of location.

Organisations can make a positive impact in their selection of new premises. While there are many factors for an organisation to consider when finding a location for expansion or relocation, adding the environmental impact of a building to the list can be a straightforward way to make a substantial, long-term change. Science park specialists We are Pioneer Group, for example, have specific environmental objectives for their sites – such as the Nottingham BioCity Garden. Read more about the environmental agenda for real estate here, and access our report on Building towards net zero. 

A diverse talent pool

We find that businesses that take a lead on ESG are more likely to be seen by prospective job candidates as good places to work and so these efforts support both recruitment and retention.

Hiring and developing people from across the community can be a challenge for life sciences. The level of education and specialist skills required may limit the pool of talent available. But considered and well-developed policies for staff can make it possible for organisations to attract and retain diverse individuals who might not otherwise have been able to fulfil their potential. Beyond that, many business leaders are looking far into the future, with mentoring programmes enabling those still in education to build towards a career in life sciences.

Biotechnology as a driver of sustainability

Life science innovation is an important driver of change. Take one example. Agriculture and food production are widely recognised as a major contributor to carbon emissions and environmental degradation, with agriculture and land use change thought to be responsible of 23% of manmade greenhouse gas emissions. Pressures to increase production while reducing environmental impact mean that progress is slow. OECD data on the period 2005-07 to 2015-17 showed an increase of 3% in greenhouse gas emissions to 1.47 Gt of CO2eq. About half of this total was in the form of methane, mainly from livestock sources and rice production, with a similar amount in the form of nitrous oxides originating mainly from the application of organic and inorganic fertilisers. Alternative approaches to agriculture – new crop cultivars developed through breeding or biotechnology, novel microbial animal feeds derived from waste, and methane reduction strategies are identified by the IPCC as potential contributors to both mitigation and adaptation. Likewise, replacement foods such as laboratory-produced meat are gaining in recognition and commercial viability.

Where next?

So we can see that ESG is hugely important to the life sciences sector. Embedding ESG within your business can make the business both financially and environmentally sustainable in the longer term, making the business more attractive to funders, employees and customers alike. And the industry also has a huge part to play in helping solve some of the biggest problems faced by the planet.

These are just some of the themes that we are seeing as the sector embraces the ESG agenda. We will be exploring these, and others, through a process of engagement with our clients, and will share these perspectives in the months ahead. We would welcome your contributions.

There are immense challenges before us but now, as never before, business is reaching out to meet them, and to find solutions.

At Mills & Reeve, we have recently appointed Neil Pearson as head of ESG and social value. Neil, previously a partner in our corporate tax team specialising in impact and social investment, will be heading up our own ESG initiatives and strategies, to put ESG and social value at the centre of how we run our own business. Neil explains:

“ESG is no longer a “nice to have”. All organisations, large or small, and whether public or private sector, need to look at how they could embed ESG into every aspect of their operations. However, whilst this is a real challenge for all of us, the benefits of getting this right are huge, both for us as organisations and businesses, and for society as a whole.”

Learn more about our life sciences team here.

Further reading

You can view the original Mills & Reeve article here