The Interview – Joe McLean

JOE McLean is a partner at Grant Thornton’s Leeds office. But had it not been for a sports injury his career path might have been altogether different as we find out in this week’s The Interview.

What aspects of your job/profession do you enjoy the most?

As a Grant Thornton partner specialising in recovery you could say that I deal with distress, both in terms of the financially distressed businesses that require professional skills and the emotional distress of the worried directors and employees having to operate in those businesses. Consequently, nothing rivals the satisfaction obtained from selling a business out of insolvency and ensuring that a large workforce has remained in employment, or helping to make a real difference to an under-performing business that safeguards its future. People generally assume that working in recovery must, by its very nature, be depressing but in fact it is very positive. Finding solutions to problems for businesses can be compared to a doctor prescribing treatment to his patients. The role is challenging, with plenty of variety, often frustrating but when everything comes right, very satisfying.

What key challenges do you anticipate will affect your sector/profession over the next 6 months?

One of the key issues affecting business at the moment, which will inevitably continue to cause problems over the next six months and beyond, is the shortage of liquidity. We have enjoyed great liquidity over the last 10 years, some would say too much, and the recent market correction has swung the pendulum the other way, so that we do not now have enough liquidity. One of the consequences is that potential purchasers of businesses are unable to raise the funding to complete a purchase, which is making it very difficult to sell businesses.
The banks have been urged by the Government and the media to start lending again, but this is against the background of the criticism that has been fired at those same banks for lending too freely in the past, resulting in the current shortage of liquidity that the Bank of England’s quantitative easing measures are seeking to correct.
Clearly there is a need for a return to traditional bank lending decisions, which means we cannot envisage a return to the way we operated before the credit crisis. More challenging and disciplined lending decisions will be required, and more compliance can be expected regarding capital ratios of banks. All this will mean that when the situation has stabilised we will not see a return to the plentiful liquidity position enjoyed before the credit crisis. We have to become used to less liquidity in the short-term, and that will present an additional challenge in the turnaround sector, where the banking risk is clearly greater. Demand for cash will exceed supply and risk will clearly be a major factor in allocating supply.

What key skills do you think every entrepreneur should have?

The most fundamental skill for a true entrepreneur is the ability to realise that if you are not making a profit then you are not a successful entrepreneur. All too often I encounter businesses where the directors think they are making a profit but the reality proves to be different. In 30 years working within UK PLC I have found that the issue of inherent viability has always been utterly critical. All other business decisions flow from this issue. My experience shows that nearly all the businesses that end up in a formal insolvency process, such as administration or liquidation, do so because of problems that are rooted in a lack of inherent viability.

Why do you think Yorkshire is a good place to start up/operate a business?

Economic history tells us that Yorkshire has always been a hotbed of entrepreneurship and innovation, and that culture still prevails today. Operating costs are below the UK average, there is a diverse and hard working labour market and there are some sound financial packages available and, of course, excellent and plentiful professional advice and support.

If you could improve anything in the region what would it be?

Leeds Bradford International Airport. I see it as more of a handicap than a benefit to the business community in the region.

Do you think that red tape is hindering business growth in the UK?

I think the red tape issue is overplayed. People with the skills and drive to build a business will always overcome the bureaucracy.

What is the best piece of advice you’ve ever been given?

My school motto, Nil Sine Labore, which translates as ‘Nothing without Labour’. It is a mantra I firmly believe in and it has served me well over the years.

And the worst?

None

What barriers have you had to overcome in growing your business/developing your career, and if any, can you explain how you overcame them.

I have found that if you the have the right motivation and drive then anything is possible.

What was your first job and what did you spend your first wage packet on?

My very first job, (aged 15 years), was a milkround in Glasgow. I was paid £5 which I saved to put towards a pair of running shoes.

If you could choose to start your career over again would you do anything different and if so what?

My career with Grant Thornton started in Glasgow in 1979. My real passion in life at that time was a major commitment to an athletics career, which was blighted by a serious Achilles tendon injury. If I could wind the clock back I would re-commit to athletics and delay my entry into the business world.