Creating a ‘big business’ mindset

Small businesses are not small versions of their big cousins. They are different.

This was all too apparent as I listened to the speakers at this year’s CBI national conference.

Their culture, lines of communication and decision making are often faster andmore responsive to customers, the market and staff. At the same time, they may use less evidence for a decision, driven by the need, or desire, to act quickly rather than properly.

Smaller businesses are less bureaucratic and structured but similarly they may rely too much on one person; the benign dictator who makes all decisions, is the bottleneck and brake on change and innovation. Roles and personalities merge in

a small business, whilst their larger cousins can appear characterless and full of automatons.

Neither model is right; both have a place and role to play in the development of a business.

What is clear is that a larger organisation, with more complex communication lines, more resources deployed and assets at risk, is more likely to segregate tasks and functions than a smaller organisation. The distinctions between shareholder, director, manager, group leader or staff member are much clearer.

In a small business, particularly at start up, the founder is shareholder, director, employee, chief salesman and head of production simultaneously. As the business grows the founder quickly brings other people into the operation, but the blurring

of roles may continue well into the multi-million pound turnover territory.

One thing larger businesses often do well is to distinguish between the important and the urgent, dedicating whole teams to thinking about the long term trajectory of the business and positioning, its people and resources to maximize on those

opportunities. These businesses have people working on them and not in them.

Some larger family businesses do this extremely well, surviving and thriving over many generations, such as Gibson & Co and Fenwick in the north east and The Alchemist clients, British Engines and Dicksons the Butchers.

Similarly some of the sophisticated early stage businesses, ‘young big businesses’, are structured for growth and size from the beginning.

They have a team of founders with varied skill sets, they structure their balance sheet for growth with a proper slug of equity from day one and, most importantly, they develop a plan for growth. The plan is a guide, a reference, for the journey

ahead and a mechanism for measuring success. At The Alchemists for example, we worked closely with Connect phc to plan their growth and introduced a non-executive director who contributed additional experience and specific skills. This

crucial idea of measuring performance is one feature that distinguishes ‘grown up’ businesses from their small minded cousins. Being a controls freak rather than a control freak.

Finally big businesses seek and use external advice and expertise. They value it.  They build relationships with their bankers, accountants, lawyers and surveyors.  They seek and listen to external advice and spend time networking in their industry and further afield. The leadership team may spend more time outside the business than inside. Only they have the freedom to gaze towards the horizon, to learn from outsiders and seek new ways of achieving things.

This final shift from costing to valuing advice is, in my experience, the most difficult for founding entrepreneurs to achieve. It is always more comfortable to do what you’ve always done than embrace the idea of learning something new.


Yet this third hallmark of a big gown up business is the real key to long term

Review 2017

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Dicksons is a family butchers based in South Tyneside that was founded by the current MD’s father in 1953. The founder died suddenly, leaving his widow to run the business with the help of her two teenage children. Since then the business has grown steadily and now has 20 shops across the north east, employing over 200 people.

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