Inspire - Issue 17

INSPIRE LOUGHBOROUGH UNIVERSITY SCHOOL OF BUSINESS AND ECONOMICS BI-ANNUAL MAGAZINE ISSUE 17 // SUMMER 2019

GOOD THINGS COME IN SMALL PACKAGES

Editor: Ondine Barry

LOUGHBOROUGH UNIVERSITY

INSPIRE

SCHOOL OF BUSINESS AND ECONOMICS

WELCOME I am pleased to introduce the latest issue of Inspire, the magazine of the School of Business and Economics at Loughborough University. In each issue of Inspire we aim to bring together the work that is going on in the School around a specific theme. On this occasion, we are focusing on our research and a range of activities around small and medium-sized enterprises (SMEs).

It goes without saying how important SMEs are in driving any economy, and with this issue, we have focussed on the broad range of support we provide for enterprising students, the teaching and development activities we engage in with SMEs (nationally and internationally) through to research relevant to SMEs in the global context.

As a School we recognise the importance of engaging our students in enterprise throughout their studies. At the core of this is the enterprise skills we teach students at undergraduate and postgraduate level, described in the “Year in Enterprise� article.

Some of our undergraduate students choose to use their third year working on setting up their own company, whilst many others take their placement year in an SME, which usually affords an intimate understanding of the breadth of activities required in developing a business.

business idea forward. Following a successful inaugural year, we are repeating the IDEA this summer.

In addition to the enterprise skills and experiences we provide for Loughborough students, you may not know that we also offer a truly inspiring array of resources and facilities for entrepreneurs and business startups here on campus, including incubation space for new businesses, access to our outstanding pool of academic and industry expertise across the University and Business Angel mentoring through our partnership with Minerva.

We are proud of the work we do with our students and with the many SMEs with which we work locally, nationally and internationally. In the pages that follow we give you a glimpse of some of the work that is going on in the School.

One exciting venture that we launched last summer is the Innovation Driven Entrepreneurship Academy (IDEA). This brings together four teams of students from the School of Mechanical, Electrical and Manufacturing Engineering and the School of Business and Economics over the summer period. We provide funding (with some external sponsorship) and mentoring support to help the students develop a business idea. In doing so we are able to meld skills in product design and manufacture with business skills.

I hope that you enjoy reading this issue of Inspire. Please contact me if you would like to discuss ways in which we can engage with you or your organisation.

At the end of the summer, the students present their business to a group of investors who provide feedback to help them take their

Stewart Robinson Dean, School of Business and Economics Loughborough University

Sincerely yours,

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NEWS

SBE students win the 2019 Global Master’s Universities Business Challenge Student teams from the School have been entering the Universities Business Challenge (UBC) competition for the past seven years and have a good track record of reaching the semi-finals.

For the first time, 2019 marked the addition of a new, separate postgraduate competition, with three teams from the School taking part.

Two teams progressed to the final of the postgraduate competition – one placed 7th overall, and the other team won the competition, which was held in London in March.

The ‘standard’ UBC competition, for undergraduate students, saw three groups of first years from the School enter, one of which made it to the finals.

UBC Worldwide is the world’s longest-established simulation-based competition designed to develop employability, enterprise and entrepreneurship skills enabling undergraduates and postgraduates to practice and develop key life-changing business start-up and management skills.

Dr Amanda Berry, University Teacher in Enterprise Education, said:

Winter Graduation We held the 2018 winter graduation ceremony in December, with a drinks reception for our postgraduate and post-experience students to celebrate their outstanding achievements - and to welcome them to the #LboroFamily!

Our summer graduation ceremony and drinks reception will be held in July here on campus, with hundreds of our brilliant undergraduate and doctoral research students celebrating their results with family members and School staff.

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“It’s fantastic to see an undergraduate team in the final for the first time, and winning the postgraduate competition is a great demonstration of SBE’s commitment to enterprise and employability for students at all levels.”

Congratulations to Andreas, Louis, Tolulola, Naomi and Aidan!

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Retailing students awarded prizes for consultancy project with Boots SBE staff member helps raise nearly £14k for LOROS Hospice SBE staff member Julie Collett has raised an impressive total of £13,794.28 for LOROS Hospice, a local charity dedicated to providing care for more than 2,500 people each year across Leicestershire and Rutland.

Christine, Julie’s late sister, had originally started fundraising for LOROS but then discovered she had breast cancer. Julie now carries on her sister’s legacy through her continuous efforts of raising funds for the hospice.

Having started fundraising back in May 2011 with her family, the first campaign they supported was the Canal & Boat Festival which raised a total of £703.59 through donations alone. Fundraisers throughout the years have consisted of supermarket collections, occasional raffles, yellow day, penny for the guy and bake sales.

In April this year, Julie and fellow SBE staff members from the SBE Undergraduate Admissions Team (Charlotte Connor, Ann Jones and Sue Upton) participated in the LOROS Twilight Walk fundraiser in Leicester. This involved a 10-kilometre walk around Leicester dressed as octopuses, for the Under the Sea theme, and raised £764.

The School of Business and Economics has been collaborating successfully with Boots for nine years on a ‘live’ retail project for students on the BSc in Retailing, Marketing and Management degree (RMM).

The second-year RMM students worked in groups to investigate aspects of pharmacy operations in the Boots Loughborough Market Place store and were tasked with presenting their research and recommendations for improving the efficiency of the pharmacy within the Boots store.

The project was the students’ first experience of studying pharmacy operations and the Loughborough store manager, Charanjit Singh, provided valuable guidance and support to the groups of students throughout the seven-week project.

Mr Singh was particularly impressed by the quality of the presentations, and subsequently invited four of the groups back to the store to personally congratulate them and provide feedback on their recommendations.

Dr Cathy Hart, Senior Lecturer in Retailing and module leader, said: “This project is a great opportunity to experience first-hand the pressures of operating a busy pharmacy retail business. This workbased learning approach enables students to analyse real operational issues and develop powerful problem-solving skills in a live business environment.”

The student group with the highest score – Charlotte Evans, Olivia Brown, Stuart Graham, Seren Roberts (pictured here with Store Manager Charanjit Singh and Boots colleague Manj Nahal) – won the Best Presentation Award.

We look forward to next year’s project and continuing this fruitful collaboration with Boots.

When asked if there was a specific goal for fundraising, Julie said: “To keep on raising funds each year without a set target, and to continue raising awareness of the hospice”.

The next large fundraising event for LOROS, arranged

by Julie, will take place at the Tesco Supermarket Park Road, Loughborough, on 7th December 2019. Please join us if you can.

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NEWS

MP Nicky Morgan meets with the School’s Executive Education team We were delighted to welcome Nicky Morgan, MP for Loughborough and the UK’s Treasury Committee chair, for a meeting with the Building Society Association (BSA) and the SBE’s Executive Education team.

The meeting was set up to showcase the award-winning Strategic Leadership programme developed by the Executive Education team for the Building Society sector.

Now in its fifth year, the bespoke master’s programme has proved transformational for staff, with some managers being promoted as a result of their outstanding development whilst on the programme.

UG student Keita Orelaja scores with popular new app Skouted

Nicky Morgan was visiting the University to highlight the importance of “homegrown innovation” and was given a tour of campus engineering labs as well as the SBE.

Current undergraduate student and Loughborough University rugby player Keita Orelaja is the co-founder of Skouted, a free app that puts footballers front and centre to help scouts find their next star players.

Keita Orelaja co-created Skouted, alongside ex-Man United player Fabien Brandy, computer scientist Harjot Singh and entrepreneur Raj Sharma, during his third year spent on a Year in Enterprise after discovering the big gap between players and clubs.

Keita said: “There’s a high number of talented players that can be missed by clubs and scouts due to time or geographical location. So that means a lot of players aren’t able to play at the level that their talent will allow them.”

The Skouted platform provides the opportunity for footballers from various levels to be scouted for a team they had no prior connection to simply by creating a profile, which showcases their talent in action through video snippets.

Interest in Skouted has already been quite high, with articles appearing in the Daily Mail, The Sun and Forbes, and with several clubs already confirming they will be using the app. Skouted will be launching soon – you can stay up to date with news and information about the app via the website Skouted.co.uk The Year in Enterprise scheme at Loughborough University is an option for all students interested in spending a year developing a business or charity, and is run by Dr Amanda Berry at the School of Business and Economics.

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Keita Orelaja

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Clear Knowledge: Protect and enhance your business Clear Knowledge is a suite of applications that together provide a comprehensive insight into the real expertise in an organisation.

Utilising powerful natural language processing of email traffic, early warning can be given of threats and opportunities around knowledge and communications.

A collaboration between Loughborough University and Clear (a commercial software developer), Clear Knowledge represents the commercial application of an innovative piece of postdoctoral research overseen by Professor Tom Jackson in the Centre for Information Management.

Clear Knowledge is a reliable, secure and cost-effective system comprising four key components: • Knowledge Engine: the heart of the system that undertakes the natural language processing • Knowhow Outlook: used to capture details of staff knowledge within the organisation • Knowhow Website: used by all staff to search and locate knowledge within the organisation • Pathways: intuitive desktop software that analyses and identifies threats and opportunities within the organisation Knowhow tools enable teams to seek out the hidden expertise in the organisation and to make others aware of their broader knowledge and experience.

The Pathways tool enables HR and management to conduct in-depth analysis and find answers to far-reaching questions about the organisation, such as:

• “Who in the organisation is critical to our

communications flow?”

• “How actively are people communicating by email within the organisation?”

• “How often are departments/business areas communicating with each other via email?”

• “Which individuals have the highest expertise levels?”

If you would like to learn more about Clear Knowledge, or discuss how it might help in your organisation, please contact Tom Jackson: t.w.jackson@lboro.ac.uk or visit www.clear-software.co.uk/knowledge

EWEPA is 30!

The 16th European Workshop on Efficiency and Productivity Analysis (EWEPA) was hosted by the SBE in London this June, marking the 30th anniversary of the very first EWEPA, held in Belgium in 1989.

The efficiency and productivity community is a vibrant, global group of academics and practitioners working across many sectors and areas, and EWEPA brings them together every two years at a venue in Europe to present and discuss the latest research and developments in the field. EWEPA XVI was a tremendous success with more than 260 participants from six continents in attendance!

A highlight of the event was the presentation of a Lifetime Achievement Award by the EWEPA Scientific and Organising Committees (represented here by Robin Sickles) to Knox Lovell, University of Queensland’s Centre for Efficiency and Productivity Analysis.

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BOOST YOUR INNOVATION THROUGH DYNAMIC DECISION MAKING HOW CHINESE EXPORTERS ‘DO IT’ In today’s volatile and unpredictable international environment, exporters must innovate in their pursuit to remain agile in the face of changing market conditions.

By Professor Anne Souchon, Professor Ian R. Hodgkinson and Dr João S. Oliveira

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— “Exporters are better served when acting spontaneously in the context of flexible planning.”

—

For exporters from emerging markets, the challenges are even greater. A case in point is China, which has already established itself as a major economic giant. Yet, transitioning towards highincome status is no simple feat, with many countries becoming stuck in the ‘middle-income trap’.

Avoiding organisational stagnation and sustaining growth in the international arena requires a shift from imitation strategies to novel and innovative processes. Consequently, managers of Chinese exporting firms are charged with enhancing the innovativeness of their export functions.

So, what is the problem?

A fundamental challenge for managers then is to devise the best way of making decisions for sustainable innovation and greater export success. Current thinking about how better decisions can be made and better strategy created in global markets revolves around two schools of thought: 1.

A rational-design philosophy where management focus is on gathering, interpreting, evaluating and disseminating information systematically to formulate detailed and formal plans.

2.

A focus on more spontaneous decision making predicated on the fact that rationality is often bounded, information is typically imperfect and decision makers may rely on gut feelings, vibes and hunches.

Given the volatility of international market environments, ‘planning’ is considered by some to be a time-consuming and pointless endeavour. This has triggered interest in spontaneous and improvised decisions.

Yet, the common misconception that these are incompatible approaches masks the true dynamics of decision making.

What we have found in our research is that managers can (and should) leverage both simultaneously to boost innovation and maximise performance.

DYNAMIC DECISION MAKING In order for exporters to innovate and not be left behind as competitors adapt and change, a dynamic combination of ‘traditional’ planning and ‘novel’ improvisational approaches is required.

So, what does optimal decision making look like for exporters battling the conditions of volatile international markets? Our study of 213 Chinese exporters reveals the merits of dynamic (hybrid) decision making.

Moderate levels of planning: - Provide strategic direction through goals and objectives - Eliminate the potential for misjudgements - Create an environment for innovation to flourish Having said that, too little or too much planning are both harmful to innovation and, ultimately, to export performance. Too little can lead the firm into chaotic and directionless decisions, while too much may be indicative of a rigid mindset.

Instead, export planning should be used in moderation, up to a point of diminishing returns.

Alongside this finding, higher levels of spontaneous decision making are associated with greater export innovation.

Higher levels of spontaneity:

- - - -

Increase agility Allow a shift from imitation to novel innovative practice Encourage ‘out of the box’ thinking Enable quick identification of solutions

In summation Chinese exporters that combine moderate levels of planning with high levels of spontaneity achieve greater innovation and overall export success.

The lesson here is that when exporters invest heavily in agile practices for new markets, formal planning methods still have a role to play. Much is made of agile decision making as the new route to high performance. But while spontaneous decisions do allow speed to market, exporters are better served when acting spontaneously in the context of flexible planning.

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— “In order for exporters to innovate and not be left behind, a dynamic combination of ‘traditional’ planning and ‘novel’ improvisational approaches is required.”

—

This article is based on a research paper (forthcoming, Industrial Marketing Management) by Paul Hughes, Anne Souchon, E Nemkova, Ian Hodgkinson, João Oliveira, Nathaniel Boso, N Hultman, A. A. Yeboah-Banin and J Sy-Changco entitled: “Quadratic effects of dynamic decision-making capability on innovation orientation and performance: Evidence from Chinese exporters”.

Anne Souchon is Professor of International Marketing and Associate Dean [Enterprise]. She is a member of the Marketing and Retailing discipline group and can be reached on a.l.souchon@lboro.ac.uk Ian R. Hodgkinson (right) is Professor of Strategy, Deputy Director of the Centre for Service Management and Head of the International Business, Strategy and Innovation discipline group. He can be reached on i.r.hodgkinson@lboro.ac.uk João S. Oliveira (left) is Lecturer in Marketing and Retailing and a member of the Marketing and Retailing discipline group. He can be reached on j.oliveira@lboro.ac.uk

If you are in the export business and would like to discuss how we could help develop your innovation strategies, please get in touch with one of the authors.

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WHAT SHOULD I DO? MAKING EFFECTIVE DECISIONS UNDER UNCERTAINTY The idea that entrepreneurs, owners and managers face change is not new. Time flows like a river, bringing with it changes to the world around us.

Changes in socio-cultural values and preferences, customer tastes and desires, technology, political regimes, sentiments are a natural part of the development of economies and markets.

But, “change” is not what it used to be. It is no longer gradual, slow or predictable. Change is now fast, disruptive and unpredictable - more like a flash flood than a meandering river.

By Professor Mat Hughes and Dr Boyka Simeonova

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LOUGHBOROUGH UNIVERSITY

— “Increasingly, entrepreneurs, owners and managers have to make effective decisions when faced with change that is difficult to fully grasp or understand.”

—

Looking at the world around us, to what extent can we predict the disruption of a no-deal or even pro-deal Brexit on supply chains? To what extent can we predict the effects of Trump economics and policies on China trade and its knockon effects on markets? To what extent can we anticipate the effects of digital technologies on what businesses and business models will make money in the next 5 to 10 years? To what extent can we reason what Generation Z customers will want and demand from businesses (not just as products and services but as business practices)?

These situations are difficult to answer because they all possess one common characteristic: the factors at play and their associated outcomes are uncertain.

Increasingly then, entrepreneurs, owners and managers have to make effective decisions when faced with change that is difficult to fully grasp or understand and make reasonable guesses as to what the scope of its outcomes might be.

Making good decisions requires judgments about change – about its risks and uncertainties.

On the basis that part of the risk can be understood and insured against (with plans, contingency plans, use of experience and knowledge), uncertainty cannot be predicted or insured against.

Unpredictable, dramatic and wildcard events abound, which complicates effective decision making when faced with change.

Change has always been about the proportion of risk to uncertainty.

Uncertainty causes problems for effective decision making because it affects the ability to predict complex cause-effect and means-ends relationships.

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Over the years, scholars, entrepreneurs and managers have realised that under these conditions, entrepreneurs tend to rely on “heuristics”, decision-making short cuts and rules-of-thumb (partly emerging from experience and partly from the ways in which entrepreneurs think) to “simplify” complex decisions or situations; managers also rely on experience, often augmented by their power in the role they occupy; and both entrepreneurs and managers use “sense-making”.

— “Change has always been about the proportion of risk to uncertainty.”

— Historically, this was an after-the-fact exercise to interpret events and actions, but is now becoming an activity that happens in the moment to combat the complexity of the world around us.

Something in common among all these approaches is their vulnerability to bias, erroneous sense-making which might bring companies to a halt: where entrepreneurs and managers stick with what they know (and their past experiences) because it is comforting in times of high uncertainty.

This issue is particularly pertinent to SMEs that might not be equipped to break their routine of decision making.

Because most decision making is under duress, relying on experience and heuristics is understandable.

But to what extent is past experience of either a stable or changing world a reliable way to make decisions in a world that is changing rapidly, dramatically and unpredictably?

Fundamentally, we find that it is not a reliable way to make decisions under uncertainty because that experience may be outdated, tied to ideas and ways

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of working that no longer fit the world entrepreneurs, owners and managers operate in – and may lead entrepreneurs, owners and managers to adhere to past strategies instead of changing to the current circumstances.

The consequence to SMEs is not just poor financial performance: it is business failure itself.

Modern and contemporary conditions in a business’s external environment can add duress to decision making, leaving

— “Uncertainty causes problems for effective decision making because it affects the ability to predict complex cause-effect and means-ends relationships.”

— entrepreneurs, owners and managers with a fundamental problem: How can SMEs make superior and more effective strategic decisions under conditions of uncertainty?

In recognition of the importance and urgency of this fundamental problem, we have launched a project to transform insights from more than 10 years of our research into a decision-making toolkit with the aim of helping entrepreneurs, owners and managers of SMEs to make better decisions under uncertainty.

Called “Enhancing Decision-making in SMEs: Making Effective Decisions under Uncertainty,” the aim of the project is to develop, evaluate and disseminate a decision-making toolkit aiming to equip SMEs with the tools, skills and knowledge to make superior and more effective strategic decisions under conditions that puts stress on decision making.

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The toolkit is intended to take the form of a playable board game that entrepreneurs, owners and managers can use to visualise their decisionmaking scenario.

At the centre of this is the intended decision and its affiliation to strategy and its intended outcomes.

If you would like to participate in a future workshop and learn how to make effective decisions, we would welcome the opportunity to talk with you.

From there, participants will need to think through: (i) the information context (ii) the organisational context (iii) areas of risk and uncertainty (iv) decision enablers and barriers (v) the actors involved in the decision (vi) the outcomes of the decision All of these decision-factor pieces are informed by our research.

The additional advantage of the game is that it is customisable to each SME and is intended as an add-on to such well-known tools as the “Business Model Canvas” and the “Where To Play” game.

As part of this project, we have developed a prototype which was launched at a workshop in June aimed at entrepreneurs, owners and managers.

The event was a great hit and focused on using the game to work through a stylised strategic decision with the participants.

Mathew Hughes is Professor of Entrepreneurship and Innovation, CoDirector of the newly formed Centre for Corporate Entrepreneurship and Innovation and a member of the International Business, Strategy and Innovation discipline group. He can be reached on m.hughes2@lboro.ac.uk

The toolkit is intended to enhance current and future decision making by SMEs by enabling entrepreneurs, owners and managers to think through the components of a decision and build a holistic view of making effective decisions under uncertainty.

Boyka Simeonova is Lecturer in Information Management, Deputy Director of the Centre for Information Management and Leader of the Knowledge Management research interest group. Boyka is a member of the Information Management discipline group as well as the International Business, Strategy and Innovation discipline group, and can be reached on b.simeonova@lboro.ac.uk

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IS A GOOD WORKER A HAPPY WORKER? Solving the productivity puzzle There is much confusion among analysts about the true causes of productivity and growth within economies – post credit crunch that debate has only intensified. However, there is little doubt that a well-informed, innovative, flexible and unhampered small business sector is vital to this process.

By Dr Jonathan Seaton and Professor Louise Cooke

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— “Our work reveals the pivotal role of employee wellbeing in terms of knowledge sharing.”

—

Meanwhile, the recent fear of a ‘hard’ Brexit has raised awareness that we are poorly equipped to sustain our present food consumption levels through domestic agricultural output alone.

Jonathan Seaton and Louise Cooke, Reader in Business Economics and Professor of Information and Knowledge Management, respectively, reflect on an international research collaboration with Hao-Fan Chumg (former PhD student) and WenYu-Ding (National Training Institution for Farmers’ Organization, Taiwan) regarding Taiwanese farming non-governmental organisations (NGOs) and what they tell us about how we may be able to resolve the productivity puzzle here in the UK. High continuous and sustainable economic growth is the pipedream of businesses, politicians and economists. Given that in the UK small businesses account for 99.3% of all private sector organisations, SMEs represent 60% of private sector employment (that’s 16.3 million workers), with a total annual turnover of £2 trillion, we need to take this sector seriously.

But in the UK, agricultural, forestry and fishing combined is small in comparison to many other service and manufacturing sectors – representing only 5.6% of 2.67 million businesses in 2018.

To feed the UK alone, this sector would need enormous structural, technical and environmental changes beyond anything seriously considered before – such as removing meat entirely from our food chain and considering other sources of protein such as insects or high-yield pulses. Increasing our use of robotic, IT and alternative food production methods such as indoor hydroponic systems would be a must.

Output as a percentage of GDP in Taiwan (services 69.2%, manufacturing 29.2%, agriculture 1.6%) is similar in structure to the UK (services 80.2%, manufacturing 18

19.2%, agriculture 0.6%) with manufacturing and agriculture decreasing relative to services.

Indeed, much of the economic miracle Taiwan experienced in the 1950s was the rapid change of a labour-intensive agricultural sector to one today where much of its rice and sugar cane production is entirely mechanised.

Again, the need for a vibrant small business sector in agriculture is key for them to succeed. And succeed they do!

Despite being smaller in GDP terms, they possess higher GDP per capita than the UK. So, they must be doing something right!

The question is: Are there lessons we can learn from the successes in their approach to productivity and growth in the agricultural sector?

Modern supply side economics stresses the roles of investment in machinery and people (human capital) as well as technological innovation – but has to some extent, particularly in economics, failed to address the more human issues of knowledge sharing activity and management.

— “Brexit has raised awareness that we are poorly equipped to sustain our present food consumption levels through domestic agricultural output alone.”

— Indeed, knowledge sharing is key to enabling successful technological transformation and the shift towards more capital-intensive activities, such as learning, education and skills development.

An aspect missing from the economic productivity puzzle is the element of

wellbeing and how it impacts on the transmission processes between knowledge capital, information sharing and the workplace.

Our work reveals the interplay between an employee’s sense of wellbeing, social capital tendency, organisational culture and knowledge sharing behaviour. In particular, the pivotal role of employee wellbeing in terms of knowledge sharing is evident in our findings.

Given that much of this is determined in a Chinese cultural context, there may be nuances of behaviour that we can learn from in our search for better and more efficient managerial and worker relations.

Our work, which was completed in 2016, centred on the virtual networks of NGOs and their role in supporting each other and, in particular, the issue of knowledge sharing – rather than focusing on technology itself. Technology is no good without the knowledge or ability or the right situation to use it; therefore, knowledge sharing may be the key to technology transformation.

Indeed, the classic prisoner’s dilemma suggests that sharing of precious knowledge or expertise may mean loss of perceived hierarchy/position for the individual in the organisation – yet sharing yields a better organisation and technological advances and higher wellbeing or happiness all round.

Interestingly, we find in the Chinese cultural context social capital (the strength of network ties and trust between individuals that enable them to work together towards common objectives) plays a particularly important role – that is, relationships matter.

In this sense, and this is probably true in many international contexts, it is important for managers to prioritise knowledge sharing in organisations – virtual or

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otherwise – as this is pivotal in improving a firm’s comparative advantage and, in general, their organisational performance.

— “A good organisation encourages the development of interpersonal networks and a benevolent organisational culture, increasing employees’ sense of wellbeing – and thus activates knowledge sharing.”

— It is probably obvious to the layman, but still instructive that this work re-enforces the finding that to increase worker wellbeing, workers should be treated with greater trust, cooperation, encouragement and – dare we say – friendliness by the organisation, which in turn triggers knowledge sharing motivations.

In other words, a good worker is a happy worker! A good organisation encourages the development of interpersonal networks and a benevolent organisational culture, increasing employees’ sense of wellbeing – and thus activates knowledge-sharing.

If you are interested in discussing ways in which the productivity of your small or medium-sized business can be improved, please contact one of the authors.

Louise Cooke is Professor of Information and Knowledge Management and a member of both the Information Management discipline group and the Centre for Information Management. She can be reached on l.cooke@lboro.ac.uk Jonathan Seaton is Reader in Business Economics and a member of the Economics discipline group. He can be reached on j.s.seaton@lboro.ac.uk

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DEVELOPING FUTURE ENTREPRENEURS The School of Business and Economics has been working with Minerva Business Angels since 2014 to help develop early stage angel investment in the East Midlands. Minerva’s aim is to help address the staggering imbalance in investment opportunities for businesses outside the UK’s South East region.

By Dr Julie Holland

We have supported Minerva’s growth over the last five years and have advised other local university business schools which were contemplating forming their own Minerva networks. There are now 10 separate groups, with Loughborough’s being one of the most successful in terms of companies funded.

HMRC has identified that of the £1.8 billion invested through the Government’s Enterprise Investment Scheme and the Seed Enterprise Investment Scheme, £1 billion goes to South East companies, most of which are London based. Only 2% of this funding makes its way to East Midlands companies.

Alex Toft, who heads Minerva, seeks to redress this imbalance, and has many reasons for targeting university campuses and business schools as partners and hosts for the Minerva clusters: “Being associated with university business schools like Loughborough’s School of Business and Economics gives us gravitas.

There are many options that start-ups can pursue for business finance, but universities are seen as honest and fair with opportunities for all. They are also seen as open minded and supportive of the small business community – and supporting small business for the right reasons such as social benefit. Universities such as 20

Loughborough have good governance and give the Angel network credibility.

business mentors for their own start-up ideas.

“The network around a university is often an un-tapped resource: alumni join the networks, creating a bigger pool of mentors and investors for the companies that are seeking finance. Minerva has a lower entry level in terms of wealth for their members – the minimum investment threshold of £5,000 plus low subscription fees encourages those new to investing to engage – and this subset of the population can be identified in the surrounding community.”

So, not only is Minerva supporting our local SMEs, but also playing an active role in helping develop the entrepreneurs of the future.

Anyone interested in becoming an Angel investor should contact the author below.

The Angels themselves are business owners, self-made entrepreneurs and former company executives. The age profile has lowered, with the youngest Angel being 26. The Angels come from diverse backgrounds and emphasis is put on helping female entrepreneurs and entrepreneurs from minority groups.

The partnership also benefits the School and the University. Many Angels participate in University activities, both curricular and extracurricular, which they enjoy and which fuels further involvement.

In addition, our students get to witness the Angel community in action, observing pitches, using the Angel’s own companies for student projects and having access to

Julie Holland is Director of Executive Education, University Teacher in Enterprise and Deputy Head of the International Business, Strategy and Innovation discipline group. She can be reached on j.holland@lboro.ac.uk

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— “Minerva’s aim is to help address the staggering imbalance in investment opportunities for businesses outside the UK’s South East region.”

—

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By Dr Louise Scholes and Professor Mathew Hughes

INNOVATION STRATEGY IN FAMILY FIRMS IS GOVERNANCE THE KEY? Corporate governance is a major determinant of the strategic decisions of firms, from deciding how it manages staff to deciding whether and how it adapts to changes in the environment in which it operates.

A firm’s governance defines the structure of authority, incentive and accountability that cause a firm to behave in particular ways. Because of this, it has the potential to re(shape) innovation strategy.

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Family firms are increasingly required to innovate to nurture their competitive advantage and to overcome economic and financial downturns. But despite evidence of an ability to innovate in new ways, many family firms demonstrate a consistent and general unwillingness to act. Also, while the governance of family firms varies greatly, it is their governance, we have discovered, that seems to define whether, and how, they innovate.

In our research, conducted with colleagues at Imperial College London (Mike Wright), Free University of Bozen-Bolzano (Alfredo De Massis) and Politecnico di Milano (Josip Kotlar), we look at the governance of family firms in the UK and how the composition and structure of their boards affect innovation strategy and activity.

Innovation activity versus innovation strategy Because the governance of family firms is so varied, differences in categories of governance dimensions have the potential to create meaningful differences among family firms in respect of innovation.

Innovation activity refers to innovations in products, services or processes, and a firm’s innovation strategies can be classed as ‘explorative’ (emphasising really new products, services and processes) or ‘exploitative’ (emphasising incremental and piecemeal refinements to products and services).

Trustees and family councils introduce a perspective external to those involved in the management of the family firm that may destabilise the personalisation of authority and the pursuit of particularistic family goals, thereby causing innovation strategy to vary among family firms. This may encourage family owners and managers to adopt new innovation strategies.

Under family management, the decision-making power granted to family owners, managers and next-generation members provides scope for entrepreneurial behavior but also more cautious behavior because decisions involve the family’s personal wealth. This reduces problems of opportunism but also reduces risk tolerance.

What we found These findings tell us that, under typical circumstances, family members act as cautious stewards of the business, which may inadvertently lessen the importance attached to explorative innovation due to its high potential for failure and consumption of family financial and non-financial resources. But, a lens external to that of those managing the business added by trustees and family councils (the family guardianship governance category) may refocus family owners and managers in ways in which longer-term goals are reintroduced.

Essentially, governance shapes the decision preferences of family owners and managers to choose one innovation strategy over another.

Insights for family owners and managers

— “For family owners and managers, a key priority for medium-term health and long-term wealth must be the family firm’s readiness for innovation.”

— Both are important to firm performance and longevity, but because they are essentially opposite in nature, achieving both exploration and exploitation can pose significant challenges to the firm. Such issues are likely to be more prominent in family firms, especially due to the existence of multiple short-term and longterm family goals.

Family governance: management and guardianship We collected data from more than 300 private UK-based family firms, examining the influence of two categories of governance dimensions on innovation strategy among family firms: family management (family CEO, family managerial involvement and next-generation involvement in the business) and family guardianship (trustees and family council), aiming to shed light on which dimensions of governance most affect the explorative and exploitative innovation strategies of family firms.

Our findings show that explorative innovation strategy relies on family management (in terms of involvement in innovation by the next generation) and family guardianship (in terms of the existence of a family council), while exploitative innovation strategy is positively associated with more involvement in innovation by the next generation only.

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For family owners and managers, a key priority for medium-term health and long-term wealth must be the family firm’s readiness for innovation.

The involvement of next-generation members under family management, and the use of family councils under family guardianship governance, introduce elements that concentrate the attention of family owners and managers on longer-term viability and health, leading to greater importance on explorative innovation strategy. Without these new perspectives, family managers default to a conservative innovation strategy, if one exists at all.

Increasing the number of family decision makers appears to create conflict that nullifies any importance from being attached to either form of innovation strategy, though. Trustees do not alter this apparent stalemate (which may mean that their role is more focused on ensuring accountability rather than entrepreneurial activities through innovation), but next generation involvement and family councils do.

Although family management may give rise to reticence towards explorative innovation strategies, by involving next-generation members, the pool of interests, knowledge and resources available are diversified and may prompt a new emphasis on innovation strategy. Family councils can support efforts to bolster explorative innovation strategies by requiring family owners and managers to focus on the future longevity of the family business.

Family owners and managers are urged to adopt family councils and involve next-generation members in innovation activities.

Active awareness of the behavior-directing properties of family

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governance, and especially the composition of family management, matters in moving away from entrenchment and towards attaching importance to innovation strategies.

Despite not being sufficiently explored in our, or prior, research, our results also show that women on the board have a positive effect on firm survival as well as a positive association with explorative innovation strategy.

Female presence on the board can bring additional perspectives that might otherwise be missing. The effect of women on the board in reducing conflict, for example, may create the space needed for explorative innovation activity.

— “Despite evidence of an ability to innovate in new ways, many family firms demonstrate a consistent and general unwillingness to act.”

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Although we find a positive link with innovation, the role of the family council is not well understood. Family councils are heterogeneous, so future research could focus on understanding how they are constructed and how they affect innovation performance.

Given that innovation is a vital ingredient of short- and long-term performance, we believe that the underlying governance dimensions may explain why some family firms do better than others by prioritising different innovation strategies in their business activity.

Based on this research, we were commissioned by the Institute for Family Business (IFB) to write a report, which summarised our findings and highlighted good practices to help family firms to innovate and be agile: “Family Business Entrepreneurship”.

Louise Scholes is Reader in Entrepreneurship, Acting Director of the Institute for Innovation and Entrepreneurship at Loughborough University London and Co-Director of the newly formed Centre for Corporate Entrepreneurship and Innovation She can be reached on l.scholes@lboro.ac.uk

Mathew Hughes is Professor of Entrepreneurship and Innovation, a member of the International Business, Strategy and Innovation discipline group and Co-Director of the newly formed Centre for Corporate Entrepreneurship and Innovation. He can be reached on m.hughes2@lboro.ac.uk

If you run a family business and would like to participate in any future research or talk to us about innovation, please contact us.

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LOUGHBOROUGH UNIVERSITY

MANAGING INNOVATION:

WHAT SETS OUR MBA PROGRAMME APART

By Dr Julie Holland and Dr Amanda Berry

In their 2017 Financial Times article entitled, “What employers want from MBA graduates – and what they don’t”, Jonathan Moules and Patricia Nilsson identified a set of skills that employers want but often don’t get from MBA graduates. Their FT survey also identified that one in three recruiters couldn’t find candidates with the right skills.

The School of Business and Economics has always placed emphasis on developing skills that augment traditional knowledge, and for over 10 years we have concluded our MBA programmes with a module that not only requires students to draw on their academic knowledge from previous modules, but also develops these important employability skills.

Perhaps unsurprisingly, the five mostimportant skills identified by Moules and Nilsson were:

Our Managing Innovation module, delivered to both executive and full-time MBA cohorts, gives students the opportunity to work on business problems brought to the School by a variety of organisations.

1. the ability to work with a wide variety of people 2. the ability to prioritise 3. understanding digital impact on business 4. the ability to build, sustain and expand networks 5. the ability to solve complex problems 26

These organisations, termed innovation partners, are generally small businesses with technology-based ideas. Innovation partners also tend to be early stage companies involved in scientific or technical research and often lack the skills, resources or time to develop their ideas, conduct market research or write business

plans that would interest commercial partners and investors.

On this popular module, students use a business analysis tool called the TECnet algorithm, developed by the University of North Carolina. The TECnet algorithm is a framework for crossing the ‘Valley of Death’ – the decision space between discovery and product/commercial development of an idea.

The algorithm allows the students to start from a technology-driven, rather than market-driven, perspective, and on completing the analysis, the student teams advise their innovation partner on the best approach to commercialisation.

By working closely with their innovation partners on a ‘real-life’ project, students can develop those skills and competencies identified by Moules and Nilsson.

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Students must work in teams to analyse the idea and carry out market and risk analysis. But this is not purely a classroom exercise; student teams work closely alongside their innovation partners to source knowledge and insight and are often required to handle difficult situations, such as conveying findings that may not be expected by the company.

It is not only the students who benefit from this module. A number of innovation partners have seen significant impact on their business growth or direction through working with our MBA students. The mini case study below illustrates the value of the student input to the company.

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Over the years, we have also been approached by non-technical SMEs, social enterprises and charities looking for help with developing their ideas. We now have an adapted version of the algorithm that enables MBA students to evaluate non-technical ideas for their commercial potential, once again focusing on the ideadriven perspective rather than the marketdriven perspective.

Several charities and social enterprises have benefitted from business analysis, with one inviting the module leader, Dr Amanda Berry, to join their board of trustees.

Mini case study: Convert Technologies Ltd Convert Technologies Ltd provided SBE with an MBA student project in 2016. At the time the company’s lead product was a high-end music streaming product called Plato.

Although the technology was well developed with many innovative features, the company was keen to explore commercialisation and markets for their product.

Amanda Berry (left) is University Teacher in Enterprise Education, Academic Lead for Student and Graduate Enterprise at Loughborough University and a member of the International Business, Strategy and Innovation discipline group. She can be reached on a.j.berry@lboro.ac.uk Julie Holland (right) is Director of Executive Education, University Teacher in Enterprise and Deputy Director of the International Business, Strategy and Innovation discipline group. She can be reached on j.holland@lboro.ac.uk

We encourage you to contact Dr Julie Holland or Dr Amanda Berry if your organisation is interested in becoming an innovation partner.

Convert was focussing on a high-end offering with a niche customer base which was limiting sales. Using the TECnet algorithm to explore the risks associated with such a niche product gave the students the insight to realise that the company had the expertise to make a variety of alternative models, and they advised the company to develop a lower-end product that targeted a wider sector of the population but still capitalised on the innovative technology capabilities of the company.

The company was impressed with the business knowledge of the students and took on board their findings to inform their future strategy. Indeed, Convert CEO Martin Boddy has remained in touch with members of the MBA team who worked on his company project.

Since 2016, SBE has worked closely with Convert Technologies Ltd on other initiatives, including providing a case study for an undergraduate module in Entrepreneurship and Innovation Management. Martin also features in our e-learning material developed for innovation and entrepreneurship modules.

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LOUGHBOROUGH UNIVERSITY

OWNERSHIP AND CORPORATE GOVERNANCE IN INDIAN SMEs Micro, small and medium enterprises (MSMEs) are often hailed as the core or backbone of socio-economic activities in India and predominantly figure in the growth and development indicators of the country.

Despite the growing academic interest in these enterprises, aspects of corporate governance of these firms – especially in the context of emerging markets such as India – remain underexplored.

By Dr Vidya Sukumara Panicker

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Since, in the Indian context, limitations of funding and investor support in SMEs have led to their increased listing with stock exchanges to raise their capital, these firms now offer their corporate governance standards to disclosure and scrutiny.

enterprises was a major motive behind its implementation, the more pertinent role of this act was to provide the first-ever legal framework for recognition and definition of an enterprise, notably within the manufacturing and service sectors.

It is therefore a fortuitous time for researchers to look into the specific corporate governance practices of SMEs in India, following the fact that SMEs are no longer single proprietor-owned firms without any public accountability and are answerable to their investors.

— “Indian MSMEs hold nearly 30% of the country’s overall GDP and offer employment opportunities to more than 80 million people.”

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MSMEs in India According to the 2017-18 annual report of the Indian ministry of micro, medium and small enterprises, SMEs hold 28.77% of the overall GDP of the country, 45% of its manufacturing output and 40% of the total exports. Additionally, they offer employment opportunities to a large part of the population (around 80-100 million) and (with an estimated 20% or more operating outside of urbanised areas) provide regional balance by ensuring industrialisation in rural and underdeveloped areas of the country.

Further, MSMEs fulfil a complementary role to large industries as ancillary units, and a large percentage of them are entrepreneurial in behaviour and outlook.

The ever-increasing importance of MSMEs in India was acknowledged by the Indian government when, in 2006, the Micro, Small and Medium Enterprises Development (MSMED) Act was introduced. While seeking to facilitate the development and improved competitiveness of these 30

In the manufacturing sector, a ‘small enterprise’ is defined as one with investments in plant and machinery between INR 25 lakhs and up to INR 5 crores (note that at time of writing this article, 1 Indian rupee (INR) = £0.011 in British pounds).

On the other hand, in the service sector, investment in equipment is the benchmark for this classification, with a ‘small enterprise’ having an investment between INR 10 lakhs and INR 2 crores and a ‘medium enterprise’ between INR 2 and 5 crores.

Corporate governance in Indian SMEs A 2015 report on the financial architecture of the MSME sector in India revealed that the lack of a timely supply of finance and inadequate working capital are among the major challenges that these firms face.

Since 2015, Indian SMEs have been listed more frequently on stock exchanges. That the Bombay Stock Exchange (BSE) offers a separate listing platform for SMEs is indicative of the increased opportunity of

SMEs to raise capital from the public, as well as harbouring an investor-friendly environment for SMEs by ensuring some regulation and organisation in an otherwise unorganised sector. Starting its operation in 2012, over the last six years BSE-SME has listed 280 companies, some of which have since moved out of the SME listing to the main board.

Though arguments exist that all corporate governance norms that apply to any other firm should also apply to SMEs, my research attempts to understand if corporate governance characteristics play out differently in these firms.

Ownership structure and board characteristics are the most commonly studied aspects of corporate governance across the world. I attempt to understand the association between these characteristics and performance in listed Indian SMEs. Interestingly, the results demonstrate a non-linear relation between ownership, board characteristics and performance in these firms, rather than a linear relation which is often assumed in many studies.

Promoters (founders) play a prominent role in SMEs since most SMEs generally have their origin from a solo proprietor who continues to be a part of the organisation in later stages as well. In evaluating the relationship between promoter shareholding in the firm and the performance of the firm, I find that at an ownership of over 45% shares within the firm, promoter ownership impacts SME performance positively – while at lower levels, the impact is negative.

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— “MSMEs fulfil a complementary role to large industries as ancillary units, and a large percentage of them are entrepreneurial in behaviour and outlook.”

—

This signifies that a promoter who is locked-in (or committed) more to a firm contributes positively to firm performance.

Another notable outcome of the analysis is the insignificance of board independence on firm performance. In this aspect, SMEs appear to be no different from larger firms, where insiders often have more intimate knowledge about the firm, and the role of independent directors is limited to one of compliance to the listing norms.

Board size, however, is an important determinant of firm performance, and in support of an optimum board size (rather than a large one), I find that there is a non-linear relation between board size and firm performance. Indeed, a board size of around six seems to be optimum for an SME. A board smaller than this may not be effective in contributing knowledge and resources to the firm, and too large a board could result in group thinking and restrict individual participation.

inputs in terms of this shift. In addition, the role of proprietor, their involvement in firm management and the emotional value they attach to the firm and its strategic decisions can throw light onto this relatively unexplored segment from a governance perspective.

If you are doing business in, or with, India, and are interested in finding out more to help your own organisation, please contact the author.

This research is ongoing with several unexplored or under-explored aspects that need further analysis to offer new insights with respect to both theory and methods, as well as enriching the existing knowledge on Indian SMEs. For instance, understanding the determinants and consequences of corporate governance standards in SMEs can be of interest to theory and practice.

Also, BSE shows that listed SMEs often move to the main board, indicating positive growth trends.

Understanding this transition in terms of changes/improvements in corporate governance structure can provide SMEs

Vidya Sukumara Panicker is Lecturer in International Business and a member of the International Business, Strategy and Innovation discipline group. She can be reached on v.s.panicker@lboro.ac.uk

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LOUGHBOROUGH UNIVERSITY

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Here at Loughborough University, enterprise is a key pillar of our activity which we consider in three distinct but interlinked areas: Student and Graduate Enterprise, Academic Enterprise and the Loughborough University Science and Enterprise Park (LUSEP).

Integrated into all of these activities is support for small and medium-sized companies, whether it is one of our students launching their own business, an SME wanting to work with us on research or supporting small businesses at LUSEP.

By Professor Tracy Bhamra

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LOUGHBOROUGH UNIVERSITY

Student and Graduate Enterprise In 2017, we launched the Loughborough Enterprise Network (LEN) to bring together all of the support at the University for our students and graduates that had been developed over 15 years. We now have

In 2018, we opened the InnovationDriven Enterprise Academy (IDEA) – an extracurricular summer camp to encourage students to develop innovative business ideas. By helping students to develop entrepreneurial skills through trialand-error iterations, IDEA aims to foster

KTPs are a great way for an SME to engage with Loughborough University and tap into the outstanding expertise and resources available on campus, including access to grant funding and specialist facilities, collaborative partnering and external R&D support services.

In addition, Loughborough University runs the iNet, a community of businesssupport programmes helping SMEs to raise levels of competitiveness and productivity, support their innovation and increase the number and quality of industry-academia interactions.

To date, the iNet has helped more than 830 SMEs receive support, created 279 new jobs and established more than 30 collaborative R&D projects between SMEs and six universities (including 13 projects with Loughborough University specifically).

Pictured front, left to right, are Robert Simmonds, Deputy Relationship Director at Santander Universities, Professor Tracy Bhamra, Pro Vice-Chancellor for Enterprise, Andrew Fisher, Loughborough alumnus and Executive Chairman of Shazam, and Professor Bob Allison, Loughborough University's Vice-Chancellor.

a pipeline of activities to take students from being inspired to be enterprising, developing enterprise skills and starting up and launching their own businesses.

We provide valuable opportunities for them to develop a highly desirable entrepreneurial mindset. Through the sharing of ideas and collaboration, and by accessing the support, training and start-up funding available, students and graduates are invited to become a key part of our network and unique creative community.

Through business-specific training, workshops and mentoring in our exciting, new co-working space, The Start-Up Lab (supported by Santander Universities and opened in 2018 – see photo above), plus our popular Start-Up Fund, we help students to develop the skills and knowledge they need to get their businesses up and running.

We also give graduates the best possible environment to launch their business and watch it fly in The Studio. Any Loughborough University graduate within five years of graduating can apply, and we select between 10 and 20 each year to be part of the two-year programme. Through a tailored mentoring and support package, plus an office space in a vibrant incubator with plenty of peer support, we aim to help them maximise their business success.

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experiential learning as the students go about developing tangible innovations that may become commercially successful. The ultimate aim is to nurture a talent pipeline for fast-scaling, sustainable start-ups.

Academic Enterprise We encourage all academic staff to collaborate with external organisations to help ensure they maximise the impact from their research and help facilitate knowledge exchange.

A team of partnership development staff works closely with interested companies to help identify the most suitable School within the University for them to work with.

There are many mechanisms for collaboration, but a popular one is the Knowledge Transfer Partnership (KTP).

This is a three-way collaboration between the University, an external organisation and a graduate (enabled by funding from Innovate UK). KTPs are set up when the organisation identifies a strategic need that the University has the expertise to address, with help from our partnership development team. A graduate, supported by the academic team from the University, then joins the organisation to work on the project for anything from one to three years.

Loughborough University Science and Enterprise Park In 2015 we opened the Advanced Technology Innovation Centre on LUSEP to house start-ups and growing businesses in fully serviced flexible space designed for collaboration and innovation. All businesses at LUSEP, no matter their size, can engage widely with the University’s research expertise and recruitment pool. They are integrated into the thriving community of more than 75 organisations and 2,500 employees which we call campus partners.

The latest addition to our range of SME support is the Business Incubator at LUSEP. The Incubator provides accelerator programmes, space for individuals and organisations to develop their enterprise knowledge and activity, space for discussion and debate between industry and academia and a community of supportive peers and high-value connections through the network it provides.

The Studio is also based in the same space, adding further to the dynamic innovation community, and provides Loughborough graduates access to the resources, expertise and knowledge available on campus to develop sustainable businesses.

Since 2011, the Studio has supported 70 early-stage businesses, more than 20 of which are now registered and trading.

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Alcuris Alcuris is a start-up based at LUSEP, which Loughborough alumnus Alex Nash (pictured here) launched on the back of an Innovate UK Innovation Award after graduating in 2016.

The company’s first product is a digital telecare platform, called Memo, that monitors the dayto-day activities of vulnerable people and builds a database of behaviour patterns, alerting family members if there is any unusual activity.

To date Alex has raised over £1.5 million of investment to deliver a Minimum Viable Product (MVP) which is in paid product trials with local authorities, with industry-standard accreditation in process. Fifteen technical jobs have been created, with further expansion planned before the end of 2019.

Memo is an assistive living platform that aims to prolong independence for vulnerable and elderly individuals, provide reassurence for the carers and family members as well as actionable data for local authorities and care providers.

There are 1.7 million telecare users in the UK, 85% of whom use an analogue-based system – however, by 2025 analogue systems will no longer work due to the digital switch-over.

Tracy Bhamra is Pro Vice-Chancellor (Enterprise) and Professor of Sustainable Design at the University. She can be reached on t.bhamra@lboro.ac.uk

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LOUGHBOROUGH UNIVERSITY

A YEAR IN ENTERPRISE:

SUPPORTING STUDENT START-UPS

By Dr Amanda Berry

In 2011, the School of Business and Economics opened the Centre for Enterprise Development.

One of the Centre’s goals was to establish a Year in Enterprise (YiE), a scheme to give students the opportunity to run their own business in their third year.

Eight years on, we have grown the scheme across the University, and in 2019-20 the SBE will support 20 students on a self-employed placement.

The self-employed option to a traditional placement is becoming a selling point when prospective students visit the University, with other universities now offering a similar option for students with their own businesses.

The current scheme provides students with a defined level of business support from experts within the University as well as from industry. Students who enrol on the Year in Enterprise are generally running their own business or are starting a new business from scratch.

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Students take part in a training programme that lasts throughout the year, with a three-day intensive bootcamp kick-starting things. The bootcamp gives the students the chance to get to know each other and covers topics such as risk analysis, business environment analysis, legal/tax issues, finance, business governance, marketing, selling and negotiation.

Three subsequent training days focus on more specific topics, such as submitting your tax returns!

Each YiE student gets a business mentor to provide support throughout the year. Students can also seek financial support either through bursaries or by entering competitions. Funding is available from the new Loughborough Start-Up Fund, and students can submit multiple bids up to a cumulative value of £5,000 per business. Year in Enterprise students can also apply to other competitions that are run by the University’s Loughborough Enterprise Network (LEN).

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The current group of Year in Enterprise students

The impact of the Year in Enterprise The Year in Enterprise scheme has clearly had an impact on SBE students who have set up and run their own businesses during their placements.

and our mission statement, as well where to look for sources of finance and how to actually budget and progress financially.

In Oliver’s own words:

“The YiE has also benefitted my studies.

I scored highest in my module Small Business Issues, and this was partly due to the fact that I could relate to a lot of the content and so understood it. I also found the marketing modules easier to understand due to the fact my business operations are very marketing intensive and we had covered marketing quite a lot in the quarterly meetings.

“The Year in Enterprise gave me an opportunity to get my business up and running and set its foundations. This has been crucial to my career path, as it’s given me an opportunity to push the business into a position where we can see the long-term potential as well as start to earn some income from it along the way.

“In terms of skills gained from the YiE, I believe I have improved as a leader. I have become more disciplined and better at time management and conflict management, and I’ve realised taking calculated risks is crucial if you want to do something different to the norm and have a good quality of life.

“The quarterly meetings which involved receiving advice from experts were very useful. We discussed topics ranging from social media usage, setting up the building as a legal entity, what the brand is about

“After University, I intend to get a part-time job to keep me ticking over whilst I put my energy into Lost in Music. I hope that two years from now the business will be in a place where it can support me full time.”

SBE student Oliver Watson (BSc Retailing, Marketing and Management, pictured above) ran his company, Lost in Music Events LLP, during his third year spent on a YiE. Lost in Music delivers house and techofocused music events, hiring nightclubs and booking world-class DJs.

If you are interested in becoming a Year in Enterprise mentor, please get in touch with the author below.

Amanda Berry is University Teacher in Enterprise Education, Academic Lead for Student and Graduate Enterprise at Loughborough University and a member of the International Business, Strategy and Innovation discipline group. She can be reached on a.j.berry@lboro.ac.uk

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LOUGHBOROUGH UNIVERSITY

STUDENT CONSULTANCY WORKS

By Dr Duncan Robertson

Our current cohort of MSc Business Analytics students are in the final stages of working on their MSc Analytics projects with organisations – solving real-world analytics challenges under the supervision of SBE academics.

Analytics projects are an integral, capstone part of the course, taking place in the final semester of the students’ time at Loughborough between June and September.

We have been partnering with large organisations such as the United Nations, the Netherlands Red Cross, Ford, Dixons Carphone, Virgin Media and Government departments, but are on the look-out for opportunities with small and mediumsized organisations.

The first semester of the MSc exposes students to the craft and skills involved with analytics problems, as well as specific techniques to discover the secrets of data sets using statistical techniques, making decisions through optimisation, simulation, decision and risk analysis and the increasingly important use of managing big data.

The second semester applies these tools to specific functions of organisations, such as customer analytics, to expose the behaviour and attitudes of customers; operations analytics, to understand how operational processes can be changed and improved to identify efficiencies;

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and policy and strategy analytics where more fundamental questions are asked as to how to respond to the complexity of organisational systems. We also introduce students to the process and programming aspects of analytics and data science.

Student projects this year have focused on understanding health risks, developing and analysing pricing schemes, predicting market demand, optimising efficiency, working with games as a recruitment tool, using analytics techniques to listen to customers and ensuring participation in sport.

Based on the road width of the course and the start times, could we model the runner flow? A challenge that one of our students is working on at the moment.

If you would like to work with us on a business analytics project, please contact the author below.

A great example of one of the projects this year has been with the company The Music Run, an organisation run by Loughborough alumni and based in Kuala Lumpur, Malaysia. The Music Run was launched in KL in 2014 and is now one of the world’s biggest running series, with a timed 5K race, a 5K Fun Run and a timed 10K race, complete with music throughout the course and “with the industry’s best finish-line party”.

TMR contacted us with a challenge: How could they model the flow of runners so that the course could cope at any point in time. Having grown quickly over the last 5 years – with 35 events in 13 countries and their largest event having 20,000 participants – they realised there was an issue facing them with regards to keeping their races flowing smoothly.

Duncan Robertson is Lecturer in Management Sciences, MSc Business Analytics projects coordinator and a member of the Management Science and Operations discipline group.

He can be reached at d.a.robertson@lboro.ac.uk

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BUSINESS INSIGHT

By Jeff Prestridge

Growing the SME Sector SMEs are the lifeblood of this country, irrespective of where we end up with Brexit.

While multinational companies will come and go – and retail chains will continue to fold in response to the appalling state of the nation’s High Street – it is our army of entrepreneurs that will keep the economy ticking over very nicely thank you. Business people who are prepared to put their livelihoods on the line in order to keep the home fires burning and generate wealth for themselves – and for society as a whole, adding to the country’s GDP. Although endeavour and ingenuity are in our DNA, SMEs cannot thrive unless the conditions are conducive to rewarding success. So it’s important that both government and the financial services industry do their bit... and then some.

A thriving SME sector needs a government that understands business and gives risk-takers the opportunity to grow, with a taxation system that is sensitive to their needs rather than a pernicious, overwhelming burden.

Most of the signals coming my way suggest that the Government’s current approach towards SMEs needs refining.

To say the least, it’s a little heavy handed.

A recent survey by the august British Chambers of Commerce suggested as much, indicating that more than half of UK small businesses believe the current

tax regime is ‘unfair’ to them – with many complaining about high up-front taxes eating into their cash flows.

For example, the recent introduction of the new HM Revenue & Customs’ ‘Making Tax Digital’ regime has not particularly gone down a storm with many businesses. The new requirement for businesses with a taxable turnover in excess of £85,000 to file their VAT returns digitally is just the beginning.

— “Although endeavour and ingenuity are in our DNA, SMEs cannot thrive unless the conditions are conducive to rewarding success.”

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banking space - with the likes of new entrants such as Starling Bank and the imminent arrival of Nationwide Building Society (a force for good) with its business banking proposition. Such competition will only help.

And of course, it would be remiss of me not to mention the great work still being done by the Princes Trust in helping young individuals start their own businesses through a mix of grants and access to mentors.

SMEs? Yes, please.

Of course, we all live in an increasingly digital world and must embrace it in our personal and business lives. But SMEs, struggling against a difficult economic backdrop, must be more nudged than pushed.

As for SMEs and financial services, it is imperative that the banks encourage entrepreneurship. I am still haunted by the grotesque behaviour of some banks towards struggling small businesses in the wake of the 2008 financial crisis – behaviour that must never be allowed to be repeated.

But there are some encouraging signs.

There is more competition in the SME

Jeff Prestridge is a Distinguished Alumnus and Personal Finance Editor of The Mail on Sunday.

He can be contacted via Twitter @jeffprestridge

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@lborosbe /lborosbe /lborounisbe

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Loughborough University School of Business and Economics