Do you lack effective leadership & management skills?
According to the recent Growing Your Small Business report by the Chartered Management Institute (CMI), shortfalls in effective leadership and business management skills are holding back the growth and productivity of Britain’s SMEs.
The report, which was launched last month at the House of Commons, focused on the importance of SME owners not just hiring good managers in every area of their business in the first place, but also on the need to improve their current employees management and effective leadership prospects across the board by providing regular management training sessions and developing new talent.
In the report, Chief Executive of the Chartered Management Institute, Ann Francke, notes that “Small businesses are a vital part of our economy, employing over 15 million people, with a combined turnover of £1.6 trillion… Their growth is being held back by poor management and leadership. It’s the leading reason for business failures.”
Areas of Improvement
Some of the main points, and areas of improvement, covered in the report are as follows:
Poor SME management is now the leading cause of failure in small businesses, accounting for 56% of all insolvencies,
Conversely, improved management personnel has been identified as the key factor in the growth of medium-sized businesses.
Despite this, many SME owners perceive time and cost as barriers to entry in providing management training sessions for their employees, yet the CMI argue that improving management and leadership within an SME is a key factor in strengthening its growth and reducing the chance of the business failing.
SME Productivity and Employment Growth Held Back
According to data collected by the CMI from a wide subsection of British businesses, nearly half (44 percent) of small and medium-sized businesses that were founded in 2011 had failed by 2014, with just 16 percent of new businesses across the country currently considered to be fast-growing.
Chief Executive of the Chartered Management Institute, Anne Kiem, was clear in her assessment of the importance of management training sessions, noting that: “The evidence shows that small business productivity and survival are greatly improved through the application of business and management education.”
The report found that just 41 percent of small businesses across Britain provided management training sessions for their staff over the last year, compared to 89 percent of businesses with more than 250 employees. Micro-businesses with less than 24 employees faired even worse, with just 36 percent having provided management training sessions for their staff over the last twelve months.
Experienced SME Accountants
You can never underestimate the importance of working alongside good managers in every area of your business. When you hire an accountant, such as our experienced professionals here at Tax Agility, we can work to manage the financial side of your business for you.
To speak with a professional accountant to discuss how we can help manage the financial side of your business, or for anything else, contact us today on 020 8780 2349 or get in touch with us via our contact page to arrange a complimentary, no obligation meeting.