Start-ups in the UK must improve management skills to increase their chances of survival, according to Growing Your Small Business Report produced by CMI.
New analysis of UK wide data on SMEs reveals that nearly half (44%) of businesses founded in the UK in 2011 had failed by 2014, with incompetence and bad management to blame for 56% of these business failures. The lack of professional management skills is also holding back UK productivity and employment growth, with only 16% of all new SMEs found to be fast growing.
According to the CMI, the issue of poor management is no surprise given that just two in five (42%) of small businesses were found to have provided management training in the previous twelve months, compared to 89% of businesses with 250+ staff. The position is even worse for businesses with fewer than 24 staff where only one in three (36%) receive management training.
The Growing your Small Business report produced by the CMI provides new analysis of the Office of National Statistics Business Structure database and the UKCES Employer skills Survey, which has been jointly produced by the Chartered Management Institute, Chartered Association of Business Schools, The Supper Club and the Quality Assurance Agency for Higher Education. Alongside the data the report reveals a complex picture of business support practises across the UK with more than 600 initiatives available to small businesses.
The launch of this 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 practise and professional support. A new “Heat Map” 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.
Ann Francke, chief executive of CMI commented:
“Small businesses are a vital part of our economy, yet as our report shows their growth is being held back by poor management and leadership. CMI has an important part to play in changing that and improving the productivity of small business. Our online “heatmap” gives managers a simple tool to find the business schools and publicly-funded support programmes available to help them.
The heatmap also shows the business schools involved in the Chartered Manager Degree Apprenticeship, which will give small businesses the chance to train graduates on a scale that hasn’t been possible before. Small employers will benefit from specific support measures, including financial subsidy, making it easier for them to develop the managers and leaders they need.”
Source: CMI, 2015.