Everybody’s business

At the height of the controversy over executive pay and fat-cat directors three years ago, a report was published which gave a fresh perspective to the issue. It argued that the successful company of tomorrow would behave inclusively, taking into account long-term relationships with all who had an interest in the company’s success, rather than […]

At the height of the controversy over executive pay and fat-cat directors three years ago, a report was published which gave a fresh perspective to the issue.

It argued that the successful company of tomorrow would behave inclusively, taking into account long-term relationships with all who had an interest in the company’s success, rather than focusing exclusively on short-term profits and purely financial measures of success.

This wasn’t the work of a fringe left-wing think-tank. The Tomorrow’s Company inquiry was set up by the Royal Society for Arts, Manufactures and Commerce (RSA), and brought together representatives of 25 prominent UK companies, led by Sir Anthony Cleaver, chairman of AEA Technology.

The Centre for Tomorrow’s Company was formed in 1996 by businesses aiming for an inclusive approach. It has now published research supporting the idea that this improves business performance.

Last May, a pathfinder project was set up in the West of England to put the concept to the test.

It has been so successful that moves are now afoot to set up similar projects around the country. And a conference to report on the results of the pilot will be held in London next Wednesday.

In 1995, the Tomorrow’s Company report said key relationships with employees, suppliers, customers and the community needed to be developed by a company that aspired to be world class.

Centre for Tomorrow’s Company director Mark Goyder has just published a book, Living Tomorrow’s Company. In it he describes the battle between two views of business: one that reduces operations to contracts and transactions, and the other ‘which is about inspiring people to produce extraordinary results by concentrating on the human beings whose needs lie behind every business relationship’.

The pilot project, sponsored by the centre and Westec, brought together 10 companies ranging from Rolls-Royce Military Aero Engines to Natwest Insurance Services in a series of workshops.

The project has been overseen by Nick Obolensky, development director of the centre, and Mike Jackson, chief executive of Birmingham Midshires Building Society.

The workshops enable the companies to learn from each other and then filter the information through to their own organisations.

Companies have found that despite their different sizes and diverse businesses, they have much in common.

In one workshop, Wheale Thomas Hodgkins chairman Adrian Wheale told Sue Lyons, deputy managing director of Rolls-Royce Military Aerospace: ‘One of your project teams is three times the size of my company and yet we are grappling with the same issues.’

A series of meetings aimed at setting up similar projects began in Staffordshire in April and will be followed by others in Sunderland, Leeds and Bradford in June.

Meanwhile, Obolensky will be telling next week’s London conference that ‘the philosophy underlying the approach in action is that lots of companies are grappling to become more inclusive. If they get together and exchange information, it reduces the need for outside bodies to help facilitate change’.

Independent consultant and chartered engineer David Newitt, with Obolensky’s collaboration, is working to set up a pilot in the engineering sector, and is encouraging the Engineering Employers Federation (EEF) to keep an eye on the project.

Newitt says: ‘Implementing fads has very little impact on a company’s leadership, but making real changes at the top is met with resistance.’ The difference with the Tomorrow’s Company approach is that ‘it actually focuses on all stakeholders’, Newitt says. ‘It says bluntly that if you are driven by profit and the bottom line, you are missing a trick. You are not getting maximum value for shareholders.’

Newitt is speaking on the inclusive approach in the manufacturing and engineering sectors at an IMechE seminar entitled BPR or Kaizen in London next Tuesday. He contrasts the revolutionary approach for regaining business competitiveness through business process re-engineering (BPR) with the evolutionary, continuous improvement approach of Kaizen, and considers why ‘both have, on occasions, failed to generate the results anticipated’. What is needed, he says, is to fit both continuous and discontinuous change into a holistic view of the business.

‘The inclusive approach developed by the Centre for Tomorrow’s Company integrates the good principles of both business process re-engineering and Kaizen with other world-class thinking and practices. It provides a platform for a truly transformational and non-threatening shift in management thinking and organisational development. It includes and balances the interests of all stakeholders involved.’