Investment in training is vital for manufacturing companies if they are to survive the recession and come out of it as competitive businesses. Manufacturing bosses must recognise training as an investment with valuable returns and not as a cost. One person who knows all about the importance of training and running a profitable and successful business is Ken Scott, CEO of ILX Group. ILX Group plc is an AIM-quoted company delivering business training and educational products and services.
“Organisations are beginning to recognise the importance of training during a recession,” says Scott. “It used to be common practice to cut the training budget in difficult economic climates, but businesses are now more aware of competitive pressures and the importance of staff development and employee relations. They see training as a benefit, not a cost, an investment that will bring them a return.”
HIGH QUALITY TRAINING
“’High quality’ training is also vital of course and it's essential that staff are given the ‘right’ training. The old ‘sheep dip’ approach where employees go on a course and then apply what they’ve learnt for the next few weeks or months, but with no real permanent improvement in knowledge or aptitude is no longer acceptable.”
ILX Group is an accredited training and consulting organisation providing e-learning, mobile learning, instructor-led training and implementation solutions to the world’s top blue chip companies.
The business consists of two trading divisions: the Corporate Training Group and ILX Group Best Practice which delivers training and consultancy services in programme and project management, IT service management, risk management and business finance.
“We’re the biggest global provider of the project management qualification PRINCE2 and have seen a growth in that area of the business over the last 18 months to two years,” says Scott, who is an accomplished businessman with a rich background in business leadership and commerce and many years’ experience in building and running successful business ventures.
His career began in commercial banking after which he extended his expertise into many different areas including running the major estate agency chain, Hamptons, and dot com start-up, Money Guru.
Today ILX Group is a successful company that has grown significantly year-on-year both organically and through a series of successful acquisitions.
But the story was a very different one in 2002 when Scott was brought in.
“ILX was haemorrhaging cash fast,” he says. “It had only six weeks left before the funds ran out. I took immediate action to slow down the cash drain by letting the suppliers, banks and investors know of the company’s perilous situation, asking for patience while I took the action necessary to turn the business around.”
CASH IS KING
“I had already learned that ‘cash is king’ and a business can’t supply without it. What I also recognised was the importance of communication, especially in crisis situations. If you are straight with people and let them know that you are determined to sort things out they are usually prepared to put their trust in you.”
Scott kept his 30 staff informed with regular face-to-face meetings. This was crucial as major savings had to be made through redundancy and pay cuts. The senior team were on salaries ranging from $70,000 - $250,000 per year and some of them had their salaries cut by half.
“They could have left the company at this point and sued us, but the way things were going there would probably be no company left to sue!” adds Scott.
It was important to act fast and as Scott was relatively new to the company it was easier for him to ‘see the big picture’ and focus on the key issues, such as who the company should keep and who it should let go.
At the same time, he cut out all non-core activities and refocused the business on its primary e-learning content.
“It’s essential that business owners know what the core of their business is,” explains Scott. “You need to know what business you are in. An often quoted example to demonstrate this point is that of the North American rail road system. It thought it was simply a railway company. If it had realised it was in the ‘transportation’ industry it could have been one of the forerunners of today’s massive U.S. airline industry.”
By ‘knowing’ his business Scott managed to redirect ILX Group from imminent financial failure. With six acquisitions and strong organic growth, he has led the enterprise to become a healthy and profitable business set for a long-term successful future. “Although we are a big player in classroom training, our core business is ‘off the shelf’ e-learning products, as the best way to make money is to sell the same product again and again.” adds Scott.
ILX is expanding internationally into Australia, the Middle East, South Africa and the U.S. and is currently developing its training products for new media such as the iPhone.
“Over the last nine months our results have been far superior to our competitors who only provide classroom training,” he adds. “This has helped us gain market share. It’s a tough climate, the PRINCEINCEINCEINCE2 pass rates have gone up, but we are helping our customers achieve the higher percentage passes required. “
They are seeing results. Whether it’s profit per employee, cost of projects or number of projects completed on time and on budget, they are witnessing high returns on their investment in training in a very competitive landscape.
Ken Scott’s un-doubtable business acumen saw him win theErnst & Young Entrepreneur Of The Year London & South region 2009 award. This award recognises the passion and drive behind entrepreneurial businesses.
The programme celebrates people who are building and leading successful, dynamic businesses, recognising them through regional, national and global awards programmes in more than 135 cities in 50 countries.
Edited by Ian Armitage
SOURCE: Manufacturing Digital Magazine