UK needs an enterprise culture to help build a better future: Martin Towers

The response by business to the new economic paradigm of inflation and higher interest rates matters. If the private sector does not shape up and be a wealth creator, then the funding of public services becomes even more of an issue given the high level of government debt.

The conditions have to be favourable to enable that to happen.

Few would argue this is the case in the UK at present. Whoever wins the next General Election will be heavily constrained in its toolkit by already high taxes and government debt.

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Business has to understand how the economic cycle has come back into play as a major factor in determining company performance both now and in the foreseeable future.

Martin Towers shares his business knowledge.Martin Towers shares his business knowledge.
Martin Towers shares his business knowledge.

This has rather been forgotten before Covid struck through a long period of stability and zero interest rates.

Those days are gone. Managing your business through the cycle and forming a view as to where we are in the cycle have to be at the forefront of strategic thinking.

Recently some companies have been surprised in an unpleasant way to discover how the cycle does affect its business, when previously this was ignored. Challenges arise.

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For example is the de-stocking currently being experienced further evidence of a continuing cyclical downturn, or is this just a temporary phase of adjustment following the supply chain mayhem of the pandemic? And what will the new normal afterwards actually look like?

Business will realise it has to focus upon those events that it can control. An understanding of market conditions and the framework within which you are operating is essential but beyond a point, there are events way outside of control.

So devise a strategy and concentrate on what you can influence, not become a hostage to what you cannot.

The successful business is becoming more complex because the world is. Much is written about and advocated around purpose and sustainability.

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Whilst great emphasis is placed upon such wording in corporate material to the point of becoming marketing speak, much of this is common sense and what a well run business should and will be doing anyway.

To recruit, motivate and retain staff. To reduce environmental impact and costs. To instil a proper sense of values and ethics in procurement and building supply chain resilience. In acknowledging climate change because your market has shrunk.

A high priority for any business is not just an ability to do financial administration, bean counting.

A more complex and changed world means the challenges for senior management have only got greater. The CEO needs to be an all-rounder and not just a functional expert. Softer skills have come right up the leadership skills requirement, yet are not possessed by everyone. It is not an easy role however well paid and powerful. The churn rate is high. Yet without the leaders of today and being mentored for tomorrow, the UK will not win talent wars.

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Economic performance will be very average and insufficient to fund the public purse. It is crucial therefore that the right environment is created for budding entrepreneurs and business leaders to come forward and aspire to succeed, often despite considerable odds.

This involves creating an enterprise culture up and down the country and a can-do mentality. Only then will we emerge from the recent dark times and face the future with confidence.​​​​​​​​​​​​​​

Martin Towers is the former finance director of Kelda Group, which was the parent company of Yorkshire Water, and former CEO of Spice PLC. He is now an early-stage business investor.

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