Business ownership has seen a gradual revolution over recent decades, with founders increasingly seeing the advantages that employee-ownership can bring for business growth, resilience and success. Employee-ownership is now the fastest growing form of business ownership in the UK, delivering 4 per cent of UK GDP annually.
Giving greater power to a larger number of people, or even the whole company, might sound like madness for some organisations, but to Saxton Bampfylde it made complete sense. We have been in business for 32 years and are proud of our reputation as trusted advisors to our clients, the quality of our research, and the strong sense of community in the firm. Becoming employee-owned therefore seemed like a logical step for us, and in July this year we celebrate our fourth year as an employee benefit trust.
Throughout our journey, we have met with a number of inspiring employee-owned businesses from the large to the small, some established and others who have just recently transitioned. Each of them have a fascinating story to tell.
Friday 29th June marks the Employee Ownership Association’s (EOA) national day of celebration, #EODay. To mark the occasion, we spoke to two employee-owned businesses to find out what this business model has brought to their company and to their clients.
Alastair Sawday, Founder, Sawday’s
What does being employee owned mean to you and your organisation?
It means a reinforcement of the notion of fairness throughout what we do as a company, and ensuring the full engagement of all staff. It means holding my head up high when asked what I have done with the business. I am alarmed by the way so many entrepreneurs sell out to bigger companies, with little regard for the future of what they have so lovingly created – and for local jobs and community.
How has employee ownership changed your approach to leadership and decision making?
I am no longer the MD, but the new MD has clearly set out to work closely with the new Employee Council and to listen to employees in general. He has launched a new Employee Well-being programme and cemented in place our commitment to having fun as well as working hard. I was perhaps a maverick and patriarchal leader – just what was needed of course (!), in the early days. But Mike is consultative, something positive that is encouraged once the employees own the business.
Why do you think employee ownership is important for today’s commercial and public sector organisations?
Business in general is discredited among the general public, with very good reason if one looks at the behaviour at Boardroom level. A deeper analysis of the state of capitalism may well conclude that it has set our global society on the path to self-destruction; we cannot consume more than one planet’s worth of resources, yet we behave as if we had three planets. Things have to change, quickly and radically, and EO is one solution. It is however, not quite enough: creating wealth and sharing it is fine as far as it goes, but what if it is at the expense of others or of the planet? And what if it merely creates a new elite? I look forward to the EOA developing ideas on a more visionary approach, not least on the subject of salaries. The bloated and unfair salaries of today’s business model should not be tolerated. The public sector is a different case, of course, but one point to make is that it tends to inefficiency. The full engagement of its workers should counter that tendency and enable it to compete more effectively with the private sector.
What does a good employee/partner look like in an employee owned organisation?
One who is keen to learn about company performance and to understand the figures. One who puts the company ahead of individual ‘rights’, understanding that the ability to reinforce rights flows from good performance- and fairness. One who cares about the welfare and happiness of his or her colleagues and is proactive on that front. One who cares more about working within a successful and happy team than making lots of money. (Success, of course, has to be re-defined – too.)
What other employee owned businesses do you admire and why?
I admire them all, just for having taken that pioneering step. It would be unfair for me to pick one or two out when I know so few with any intimacy. In future I hope our company manages to work with more EO businesses as suppliers.
Simon Fowler, Director Of Communications, John Lewis Partnership
What does being employee owned mean to you and your organisation?
The John Lewis Partnership exists today because of the extraordinary vision and ideals of our Founder John Spedan Lewis. He believed that industrial democracy – where Partners shared profit, knowledge and power – was a better way of doing business.
As somebody who has been with the Partnership for 32 years in various different roles, those same ideals which inspired Spedan, principally, sharing the responsibility of ownership as well as its rewards, is something that drives and inspires me professionally.
Spedan Lewis also believed in, and encouraged, experimentation. This ethos still thrives today in the John Lewis Partnership. Indeed, within a sector as competitive as retail, it is this environment of experimentation and ingenuity that has ensured the Partnership remains at the forefront of British retail. As co-owners, this is what sets us apart from other organisations and allows us to do business differently.
How has employee ownership changed your approach to leadership and decision making?
For me, it is principally about how it affects Partners at a personal level. We spend the majority of our waking hours at work. And the question of how to create a fulfilling and fair workplace – where people feel valued for their talents and where they have a real stake in their work – is something I personally strive for, and I believe will become increasingly important as automation, AI and the world of work changes. Employee Ownership is not in itself the silver bullet to these challenges but rather the catalyst for overcoming challenges more sustainably. The way ‘co-owners’ are led is different to the way ‘staff’ are led and in giving Partners a say in how we run our business, in ensuring democratic vitality, and by listening to and acting upon Partner opinion to create a better business, I believe it has much to contribute to this debate.
Why do you think employee ownership is important for today’s commercial and public sector organisations?
The changes we are currently seeing – politically, in society and economically – underline the continued relevance of Employee Ownership and the valuable role that it can – and is – playing as a progressive, positive force. From social mobility, fair work and fair pay, to tackling regional disparities and delivering growth across the whole of the UK, the EO sector is a force for good. For example, EO businesses are more likely to create and help retain jobs that are rooted locally, thus contributing to the resilience of regional economies.
Few, if any, other sector consistently has the mechanisms across such a diverse mix of large and small businesses to create social benefit, while also driving economic growth. Employee ownership is also a mark of trust and quality in business for both consumers and prospective employees. In this world of ever increasing change, these are the factors on which businesses not only compete, but depend on to survive and prosper.
What does a good employee/Partner look like in an employee owned organisation?
Partners are at the heart of everything we do within the John Lewis Partnership. Partners’ happiness, through worthwhile and satisfying employment in a successful business, is the very first sentence of the first principle in our written Constitution, which has endured for nearly a century. Why? Because EO is fundamentally about people – no-one can understand or care about your business more deeply than those who work in it and who own it. Being a Partnership, where all employees are owners in the business, is about much more than sharing in the rewards of its success. With ownership comes responsibility, and the knowledge that our success depends entirely on providing the best quality products and services to our customers so that they come back to us again and again. The best Partners are those who epitomise this sense of collective responsibility.
What other employee owned businesses do you admire and why?
One of dthe exciting and intriguing things about the EO sector is the diversity of its membership, from small to large businesses and across a multitude of sectors. There are two I would highlight:
Gripple – not only because I personally use its products in my garden, but because it embodies the ethos of experimentation that was at the core of John Spedan Lewis thinking, by inventing new, practical products in direct response to everyday problems.
Grant Thornton – because it has shown that there is a fairer, more responsible way of doing business within a competitive sector not normally renowned for that. The amount of awards it has won is testimony to that.
www.johnlewispartnership.co.uk
Kate Ludlow, Partner and Director, Saxton Bampfylde
What does being employee owned mean to you and your organisation?
For me being employee owned means longevity and guardianship. One of the primary things that attracted me to the firm when I joined 9 years ago was its unique culture and values. We have worked deliberately to develop our values, culture and purpose for over thirty years: becoming employee owned was a way of preserving this beyond the lifetime of the current leadership, for the talented partners that we see joining the business now and in the future.
For partners I suspect it means a whole range of different things: for some a sense of ownership and responsibility, for others it’s the collective power of everyone pulling together to deliver great work for our clients and ultimately the commercial success of the business, and for others it’s a set of clear standards that we hold one another to account over.
How has employee ownership changed your approach to leadership and decision making?
Employee ownership has been an extension and development of the leadership principles that Stephen Bampfylde and Anthony Saxton established when they founded the firm in 1986. Today, as a member of the board, I see the potential that our collegiate, non-hierarchical culture represents, and the emphasis placed on this for those playing a role in the leadership of the firm. We work to actively engage with all partners around decision making and strategic development: we deliberately seek the views of our newest and youngest members of the team, to ensure that we are constantly working to challenge and improve ourselves. We have a relatively hands off leadership approach, and instead work to give as much autonomy to others in the business as possible: we hire bright, passionate individuals who work best in a trusting, supportive environment. With regard to decision making, we are able to take a much more long-term view, supporting colleagues in the development of new practices or trialling new approaches.
Why do you think employee ownership is important for today’s commercial and public sector organisations?
Employee ownership allows organisations and leaders to operate beyond the constraints of quarterly reporting and shareholder requirements. We have been proud to work with some leading employee owned businesses over the years, and consistently see the value that this model affords in relation to innovation, staff engagement and decision making that is grounded in a long term view. We are delighted to see more organisations looking to explore the potential of this model.
What does a good employee/partner look like in an employee owned organisation?
At Saxton Bampfylde a good partner is curious about the business and why we do things the way that we do them, passionate about our mission and the role that they play personally in enabling us to fulfill it, and responsible, working hard to complete their respective role whilst supporting colleagues to be able to do the same.
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SAXTON BAMPFYLDE, LEADERSHIP ADVISORY
Over the past thirty years Saxton Bampfylde has developed a particular interest and niche in recruiting to organisations that have a distinct and unique structure and culture – from family-owned businesses going back centuries to cooperatives and businesses changing their ownership structure. As an employee-owned organisation, Saxton Bampfylde is uniquely placed to advise these businesses. To find out more about how our leadership advisory can benefit your organisation, please get in touch.
Contact: Kate Ludlow, kate.ludlow@saxbam.com