By Sandy Kennedy
Freezer Space. Would you believe it? Freezer space is the constraining factor for one of Scotland’s fastest-growing firms, Bella and Duke. Mark Scott and Tony Ottley founded the raw dog food manufacturer after they each lost their dogs to cancer. After extensive research into natural dog diets, they developed their own recipes. Their business has grown dramatically during lockdown. There have been 17,543,002 dogs’ dinners to date and counting, all from their headquarters in Blairgowrie. Entrepreneurial spirit alive and well in Perthshire.
Identifying and understanding constraining factors is a fundamental to business growth and satisfying customers. Nadeem Sarwar spotted an opportunity whilst in Boston on the Saltire Fellowship. With oodles of grit and many low points, Nadeem and his team have created Phlo, a digital pharmacy focused on repeat prescription delivered to your door. Pre-lockdown the constraining factor was getting customers to try their service. An embedded inertia in the system. A reluctance to change especially amongst the older generation for whom the service was most suited. That all flipped on its head over the past six months and Phlo’s business exploded. It could now be one of the fastest growing businesses in Scotland. Entrepreneurial spirit lighting up Glasgow.
The high-quality jobs of the future will be created by firms like Bella and Duke, and Phlo, and others like Celtic Renewables (low-carbon technology), Actiph (alkaline water), Broker Insights (insurance), Ooni (pizza ovens), Integrated Graphene (materials) to name a few. Or The Vegan Kind, the provider of the UK’s most popular vegan subscription boxes, which was founded by Karris and Scott McCulloch from their living room in 2013. Last month, they moved to a new 35,000 square foot warehouse in Glasgow described as “the world’s biggest vegan fridge”. Their recent growth has created 21 new jobs.
If entrepreneurial people like Mark, Tony, Nadeem, Karris and Scott are the job creators, how do we support them, and nurture others like them? Their firms are all so different: different sectors, different locations, different stages of growth. The good news is that they are already connected to each other sharing knowledge, experience, encouragement through organisations like Scottish EDGE, ScaleUp Scotland, The Entrepreneurial Scotland Foundation and others in the CAN DO Collective.
The answer, I believe, has been heralded by Mark Logan in his recent Scotland Technology Ecosystem Review. Mark takes a system thinking perspective recognising that start-ups and scale-ups and the people in them are influenced by the ecosystem around them. He identifies education, infrastructure and funding as the “fundamental dependencies” upon which the performance of the ecosystem depends. Notably, he ranks the dependencies in that order, with education the most important and funding the least. It is about people not just money. Similarly, the ScaleUp Institute, which publishes its annual report next week, identifies the top three constraining factors on scale-up growth as talent, market access and leadership capability.
Scale-ups are really important, but not at the exclusion of others: social entrepreneurs, micro entrepreneurs, intrapreneurs have their own support ecosystem. Those systems connect to each other.
The Theory of Constraints does not just apply to dog food and freezers it is relevant to how we nurture our entrepreneurial ecosystem and in turn achieve our ambitions of mass job creation. By better understanding the system and its layers, the feedback loops, the constraining factors, we can focus our resources in the right places to the benefit of all. We will need a new approach to economic development founded on systems thinking: flexible, collective, grassroots up, holistic, self-organising, responsive. That would be entrepreneurial.
Sandy Kennedy is CEO of The Entrepreneurial Scotland Foundation
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