Interview with Digby Jones (Lord Jones of Birmingham)
Digby Jones (Lord Jones of Birmingham) is a former Director General of the Confederatio of British Industry and served in the UK Government as Minister of State for Trade & Investment. We recently interviewed him on his views on the outlook for businesses during the current financial crisis.
TLSB: In the current downturn, what should companies, particularly small companies do to stay competitive? Should they batten down the hatches or go after new markets?
Digby Jones: First and foremost the banks must maintain a supply of working capital to enable small businesses simply to survive. After the way the country has bailed out the banks it is important they respond by helping UK companies survive. Companies must continue to skill and train their people as when the upturn comes (and the sun will come up in the morning!) they must be ready to exploit the knowledge-based end of the global market. In any downturn “Cash is King” and business must be even more diligent in financial management. But it is also a time to be positive and go after new markets in new areas, working on commercial relationships and not putting heads in the sand.
TLSB: How might it affect Britain’s place in the global economy?
Digby Jones: The UK is ideally placed in global terms because of its number one spot in Europe (and number two in the world) as the location for inward investment and, per capita, the greatest trading nation on earth. As each country comes out of recession at the end of 2009 or early 2010, Britain’s engagement will put her in pole position to take advantage. There are not many upsides in the reducing value of sterling but one is that exports (of goods and services) are appreciably cheaper which will help keep those who work for exporters in jobs.
TLSB: Does the downturn emphasize the need to attract and retain skilled workers and motivate them properly? And should companies be more creative in adding value and service?
Digby Jones: There is never an excuse for cutting back on enhancing the value of the most important part of the business… the people. Those who cut training now will lose competitiveness, fail to grow in the good times and will show that they have fallen behind in the value added, knowledge-based arena that is the UK’s 21st century market. If you define innovation as “taking an idea to market” then companies should always encourage the ideas machine in their business.
I sincerely hope that a global free trade agreement can be concluded since it is through business and its power to train the people, build an infrastructure and add wealth to nations that we can give hope to those (especially the young) who currently feel 21st century globalization has passed them by. People with clean water, better healthcare, better education and a road (all pre requisites for sustainable business engagement) feel they have some part to play in the future and are less likely to pick up a rifle to solve their problems.
Digby Jones Business Speaker