Case Study: CITB Growth Fund – Structural Timber Association mentoring programme
MENTORING DRIVES 300% INCREASE IN PROFITS
A CITB Growth fund Structural Timber Association mentoring programme to improve business skills amongst its members saw sales turnover increase by 33% and gross profit rise by 300% in less than two years.
- Sales turnover up by £4.4M
- Employment up by 22%
- Net profit increased by 300%
In 2013 as UK economy began to improve and demand across the construction industry picked up the Structural Timber Association (STA) put in place a mentoring programme to help timber frame erectors prepare for the expected growth. The subsequent Management & Supervisory Development Programme for Erectors was rooted in Constructing Excellence values and delivered in activity in partnership with Egan Consulting and Reeves Consulting Limited, with the aim of improving business skills within the sector.
It took shape following a skills gap analysis exercise, conducted by the STA early in 2012, that had already identified the critical areas to focus on – business strategy and planning, marketing, people management. The STA identified 15 individual businesses to join the programme and the consultants, Kevin Reeves and Peter Egan, then had to match the respective requirements of each organisation to provide them with a tailor-made mentoring programme that included objectives and scheduled one-to-one visits.
Each business progressed through the programme at its own pace, working to its own objectives, some achieving more than others. The achievements were above expectations and pointed to a shift in mind set and an improvement in business skills –
Most companies have increased their administration function – the research highlighted this as a key issue
- Companies increased their senior management team by over 50%
- Companies are spending more time planning and “working on“ their business
- As the upturn in construction unfolded the companies were able to identify and target good quality growth contracts
- Leadership and business skills improved across the 15 companies
- Leaders have put more rigour into managing performance
- Recruited 29 additional apprentices –nearly two per organisation
- Ten additional managers, administrators and quantity surveyors employed
The results for the participating companies during the two year programme have been fantastic –
- Gross value added per full time equivalent employee (GVA/FTE) was 34%
- 300% total net profit increase from £270,000 to £1.1m
- Net profit per company increased from 2% to 7%
- Collective sales turnover grew by £4.4m (33%), the market grew 12% in 2103
- Total numbers employed increased by 73 (22%)