Research at the University of Kent reveals ten key traits of successful owner-managers
Simon Raby
Research by the Centre for Employment, Competitiveness and Growth (ECG) at the University of Kent reveals that most owner-managers of Small-to Medium-Sized Enterprises (SMEs) are failing to realise their aspirations for sustained profitable growth.
A comprehensive research study by ECG provides key insights into the challenges faced by the average owner-manager, a character named ‘John’ within the research. John was found to be set in his ways, relying on status quo and informality to run his firm. John’s focus was largely on the day-to-day running of the firm, working ‘in’ the firm and not ‘on’ the firm with little time or regard for strategic planning, the implementation of innovative systems and processes, or managing people more effectively.
The research also found a common set of integrated traits that an owner-manager should embrace if they wish to achieve higher levels of sustained growth and performance (see figure 1).
Dr Mark Gilman, Director of the ECG said: ‘The study employed rigorous research to investigate the drivers of growth and performance in the region's SMEs and evaluate how they changed over time’....‘We found that, although company behaviour differs according to sector, there are some clear common characteristics that distinguish firms achieving patterns of longer-term sustainable growth from those that do not’.
These characteristics of an owner-manager were found to form a gestalt, an integrated whole. This is not to say that all owner-managers will give equal attention to each trait, but that their role must reflect key elements of these traits in response to their firm’s internal and external environment. This research can therefore provide John, the average owner-manager, with practical insight into how he might modify and adapt his behaviour.
Figure 1: The BIG Ten - The leadership traits of successful owner-managers
The Enthusiast refers to the intrinsic passion held by the owner-manager for the product or service that the firm provides to its customers. This passion translates into a philosophy throughout the firm for ‘doing things right’ and adding value.
The Transformer relates to the ability for owner-managers to manage change: not only the day-to-day, but also the future. More often than not, owner-managers are ‘busy fools’ reduced to operational fire-fighting, leaving little time to consider the strategic direction of the firm.
The Strategist refers to an owner-manager’s ability to develop a shared vision and plan and embed this vision across their firm. As alluded to previously, the successful owner-manager must release time from day-to-day activities to spend time on developing a vision (i.e. what is our destination?) and forming a roadmap (i.e. how will we get there?)
The Delegator relates to the owner-manager’s ability to empower others within the firm to deliver tasks that they would otherwise have to carry out themselves. Delegation underpins a style of management which allows staff to use and develop their skills and knowledge to their full potential.
The Innovator recognises the need to develop new products and services and reduces the risk of “placing all of one’s’ eggs in one basket”. Successful owner-managers consider how best to develop and diversify their product and service and are capable of taking such developments to market, leading to new revenue streams.
The Integrator recognises the importance of value-chain relationships and the need to communicate and develop trust with suppliers and customers. Those owner-managers that develop an understanding of the needs of customer and consumer (the needs of which do differ!) and work in a collaborative manner with their suppliers seemingly outperform others.
The Calculator appreciates the need to develop a broad range of performance measures and develop systems that allow the owner-manager to actively manage the firm, moving away from a reliance on standard accounting measures as a means of assessing performance.
The Systemiser recognises the importance of developing appropriate systems, practices and procedures within the firm. These are not systems that result in increased levels of bureaucracy, but systems that support increased levels of productivity and efficiency.
The Engager recognises that the key to competitive advantage is the people within the firm, and that the development of the firm’s human capital is paramount to future competitive success.
The Sponge places great value on the learning process and recognises the benefits of continuously developing knowledge. The Sponge is open to new ideas and new ways of thinking and will seek out learning opportunities within and outside of the immediate firm context.
These findings were uncovered following a comprehensive multi-level and multi-method research programme completed between 2006 and 2010. The research drew on surveys, personal interviews with owner-managers, detailed case studies and a set of workshops with over 500 SMEs across the South East of England. These findings will be released later this year as part of a larger report entitled - The BIG Ten: key traits of successful owner-managers.
This research is part of a wider programme at the University of Kent – Promoting Sustainable Performance (PSP) – which offers business owners and managers a range of research-informed programmes aimed at raising their performance. Simon Raby, Lead researcher at ECG said:
'This research has directly informed our new programme for SMEs, which we believe makes it a unique offer from a UK university,' he said.
'There is no doubt the demise of RDAs and the reduced functionality of other regional business advisory bodies such as Business Link means there is an opportunity for higher education institutions to fill the gap.’
'This is even more the case if universities can make use of research findings to inform their business development programmes. Universities have the potential to help their regional SMEs grow and that has to be good for the UK economy in these difficult times,' he added.
Simon Raby, Programme Manager, The Business, Improvement & Growth (BIG) Journey, University of Kent S.O.Raby@kent.ac.uk
