Family Business Scale-ups: Breaking Barriers to Growth
Insight piece
Key insights
People, culture and talent Martin Byrne, MD at Strathberry, says: “We don’t generally struggle to recruit, because we’re growing and profitable and can increasingly attract good people. But it can be difficult to find people that fit in with our dynamic culture. We were advertising for a fairly senior role last year for 12 months – and ended up not recruiting anyone because we would rather not hire than recruit someone who doesn’t fit in. We’re choosy’, but the skills we want are out there, and finding talent won’t be an impediment to growth.” Family roots morph into family culture As the family businesses become bigger with many more employees, retaining the underlying fundamental family culture is vital and family businesses deploy different tools to achieve this. When the Hundlebys launched Strathberry in 2013, they relied on family for IT help. “Today, with 120 staff, we retain the family-business ethos: staff have a voice and share their views, with our values as a ‘moral compass’ for the team,” Leeanne says. “It’s doing ‘the right thing even when no one is looking’.” Macphie commits 1% of profits to good causes, totalling more than £1 million so far. Former chairman Alastair Macphie says family firms are naturally philanthropic because they aren’t beholden to short-term shareholder returns. Family roots pervade the recruitment policy too: Macphie competes with the North Sea oil industry and can’t always match energy-sector pay, “but treating staff as human beings, not a salary, helps”. This approach has resulted in just 2% staff turnover. Similarly at JW Lees, “Promotions involving relocations are timed to fit the beginning of the school year, to help parents who need to change their kids’ schools,” William Lees-Jones says. “As you promote people internally, they become an extended part of your family.”
Retention challenge at the top Unlike smaller, more agile family firms experiencing rapid early growth, at W&R Barnett, Barnett, whose father remains chair, admits it can be a struggle to retain high-flyers. On the one hand, family businesses’ stable structures appeal to workers: “We are less faddish than PLCs,” he says. “That offers a permanence that is attractive to long-term career builders – employees stay because the objectives don’t shift every quarter based on shareholder whims.” But equally, with senior roles being long-tenured, family businesses can find it difficult to satisfy high-end career expectations. “Many driven people are drawn to our consistency, but we struggle with retention of high-flyers with technical skills in our structure, where we can’t easily rotate them and they struggle to manage their own career growth.”
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