James Caan is the newest dragon on the BBC television show Dragons’ Den. He is
the chief executive of private-equity firm Hamilton Bradshaw and has been
building and selling businesses since 1985 in various sectors, including
publishing, HR, recruitment, software and franchising. A graduate of Harvard
Business School’s Advanced Management Programme, he has since won several
awards for his entrepreneurship.
My business success has been built on recognising the importance of people.
Since launching the executive recruitment firm Alexander Mann in 1985 I have
invested in people businesses and inherently placed a high value on my
staff. This is the cornerstone of how I now operate Hamilton Bradshaw, my
private-equity investment company, and in developing the businesses in which
I invest through the BBC television show Dragons’ Den.
In the highly competitive business world it makes good sense to maximise the
probability of success by enabling employees to be ambassadors of the brand.
However, with the ongoing advent of technology, too many companies
increasingly focus on procedures and processes rather than the human factor.
On a trip to Nasa, former US president Bill Clinton met a man with a broom.
During their conversation he asked the man what he did at Nasa. He replied:
“I take people to the moon.” He knew that he worked in a team where every
function was valued as being important to the overall performance of the
organisation and Clinton had certainly never walked on cleaner floors.
Stuart Rose, chief executive of Marks & Spencer, is a striking example of
a leader who exudes the inclusive journey; the shop floor is an important
ingredient in the overall strategy of the business, and the company has
thrived because of it. When management brings all components of the business
into harmony they will tend to be successful by default.
How do you get people to engage with the whole ethos of the business? Most
organisations emphasise the values of their leaders, but what are the values
of the component parts? The key is to listen to the voices from the various
departments and understand the values of the people working in them.
An interesting example is one acquisition I made last year where revenues
exceeded £180m. I increased profitability by 107% over 12 months despite
difficult market conditions by implementing a strategy developed using
feedback from customer-facing employees. This proved to me that the whole of
a business is worth more than the sum of the parts. I invariably invite an
employee from the acquired company to each board meeting. First, in this way
this person feels significantly involved at the highest level and is likely
to tell everyone. Second, and most important, these presentations usually
offer up some gems of useful information. I continue to use this technique
across all my business interests.
Regrettably, if people have a great idea, in most firms today their first
impulse is to leave and join a rival or set up in competition themselves. In
90% of these cases the idea will relate to the everyday operation of the
organisation, and the first port of call should ideally be the company
itself. It is so important for business leaders to establish a level of
communication that ensures retention of creative staff and not let this
intellectual property go out of the door. To lose them in today’s
competitive market risks launching a dangerous competitor.
When I owned Alexander Mann I was approached by a very smart employee. She had
come up with an idea, way ahead of its time, that would change the direction
of the recruitment industry. The market was transaction-led, which resulted
in a potential employer using the services of a variety of recruitment
companies to fill vacancies within the different departments of their
organisation.
This woman thought that employers would prefer to use one main supplier to
manage the supply chain. For example, a leading technology company was using
the services of 50 different suppliers with 50 different processes that
required a large in-house HR department to manage. The idea was that this
company, and all companies, should focus on their core business and let a
recruitment firm centralise the entire supply process.
The passion of this individual was overwhelming, so I listened, supported her
idea and encouraged her to set up a new division. By using expertise and
technology to apply the necessary efficiencies to develop an attractive
proposition, we got the technology firm using Alexander Mann for all its
recruitment needs — a move that also had a huge impact on our competition.
This division is generating revenues in excess of £380m today. It is a great
example of the effectiveness of encouraging intrapreneurship rather than
entrepreneurship in your organisation. If I hadn’t, the very idea would
certainly have precipitated an important competitor, instead of an asset.
As well as getting good value from employees it is equally important to value
them and create an environment that nurtures camaraderie. This is best
achieved by having fun together. At Alexander Mann I started the AM Sound
Band and justified my belief that in any organisation with hundreds of
people, finding four with karaoke fever, drum or guitar yearnings, is not
too far a stretch. The AM Sound Band subsequently played at our conferences
and fostered a sense of belonging, company-wide.
It was a huge success, in no small part thanks to one band member who was
adept at changing the words to well- known songs. Imagine the impact at a
sales meeting when the lyrics to Queen’s Bohemian Rhapsody, “Mama, I’ve just
killed a man” is replaced by “Jimmy, I’ve just placed a man.” It was highly
appropriate and had the audience in fits of laughter. No amount of money can
buy that sense of team spirit. With a little research, similar opportunities
will present themselves in most organisations and the team will grow from
the experience.
