Management ability in SMEs found wanting

Start-ups in the UK must improve management skills to increase their chances of survival, according to the recommendations of an industry report.


Start-ups in the UK must improve management skills to increase their chances of survival, according to the recommendations of an industry report.

New analysis of UK-wide data on small and medium-sized enterprises (SMEs) reveals that nearly half (44 per cent) of businesses founded in the UK in 2011 had failed by 2014, with incompetence and bad management to blame for 56 per cent of these business failures.

The lack of professional management skills is also holding back UK productivity and employment growth, with only 16 per cent of all new SMEs found to be fast-growing.

Just two fifths (42 per cent) of small businesses were found to have provided management training in the previous 12 months, compared to 89 per cent of businesses with 250+ staff.

The position is even worse for businesses with fewer than 24 staff where only one in three (36 per cent) receive any management training.

The Growing Your Small Business report reveals a complex picture of business support practices across the UK with more than 600 initiatives available to small businesses.

The launch of the report at the House of Commons marks the start of a campaign to help SMEs access the management support provided by business schools and provide much better sign-posting to management best practice and professional support. 

The report reflects the outcomes of a nationwide roadshow hosted by business schools, CMI and partners involving 1,200 managers sharing their growth stories and how business schools can play a key role in developing the management and leadership capability of owner managers, recruiting and development new managers, and supporting both their survival and growth.

A new ‘heatmap’ developed for the campaign provides employers with key information on the qualifications, networks, placements, business support and professional management qualifications being provided by local business schools.

Anne Kiem, chief executive of the Chartered Association of Business Schools says, ‘The UK’s business schools are full of world-class business expertise and knowledge, and with a business school conveniently located in every region they are perfectly placed to support the growth of small businesses.

‘As this report has evidenced, those small businesses that have received support from a business school have received high quality advice and professional development to start, grow or reshape their business.’

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