UK: Editorial - Time to cheer private ownership.

UK: Editorial - Time to cheer private ownership. - Management Today's cover story this month on page 32 focuses on Britain's biggest privately owned companies. And about time too, we might say, since this area is one of our economy's best-kept secrets. F

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Last Updated: 31 Aug 2010

Management Today's cover story this month on page 32 focuses on Britain's biggest privately owned companies. And about time too, we might say, since this area is one of our economy's best-kept secrets. For all the media coverage they get, one might think that the companies that make up this sector are at best unfashionable, at worst moribund.

Far from it. Perhaps the most fascinating thing about them is just how big some of them are, and how they've managed to get there without being noticed. Sure, we've all heard of the Swire Group, Tetra Pak, Littlewoods and Virgin. But what about Linpac, a Lincolnshire packaging company with a turnover in excess of £850 million? Or Computacenter, which started in 1981 and is now closing in on its goal of a £1 billion turnover? Many of us may know of the Oxford-based Blackwell's bookshop chain, but did it really report a turnover of £420 million in 1996? Then again, few of us will have come across the sugar, dried fruit and nut trading and processing company Napier Brown - and if we have, would it be a surprise to know it was a £430-million company?

The answer to this, one suspects, is that these companies just get on with their business, freed from the distractions, pressures and impediments that often come with public ownership.

The story also reveals two other pertinent facts. First, unlike their quoted brethren, these privately owned companies have been adding jobs.

With few exceptions, nearly all the top 100 private companies added staff during their latest reporting periods. Indeed, statistics show that non-quoted companies account for 65% of the total UK workforce. Second, many of the companies in this survey have put on turnover at a faster rate than profits - suggesting that their appetite and ability to invest for the long term is enhanced rather than hindered by their ownership structure.

That is not to say private ownership is better than public. Clearly that is not always so, and the '90s concept of 'shareholder value' will keep public company managements on their toes. But it is as well to remember too that many a bad decision has been and will be made in the name of shareholder value.

Factories can be fun

This issue also marks the sixth anniversary of MT's Best Factory Awards which, while signalling individual triumphs, should also be seen as a celebration of Britain's manufacturing culture.

Those who have written off the UK's manufacturing industry - and there are many - would be well advised to read about the winners (page 74).

For there, among the tales of discipline, organisation, inventiveness and flexibility, they will find plenty to inspire. Indeed, there is evidence to suggest that far from looking to Japan and Germany for exemplary practice, we now need look no further than our own shores.

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