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Similar to David Ball Group Final Europe Practicum
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David Ball Group Final Europe Practicum
- 1. David Ball Group plc. WE MAKE CONCRETE MATTER Leading the world in concrete solutions By: Brad Wyllie JoAnn Swank Mehul Patel The Dubai Fountain Owen Fayer Yamini Bammi
- 2. Agenda Company Overview 1 Opportunity Statement 2 Succession Planning/Wealth Creation 3 Brand Awareness 4 Conclusions 5
- 3. Company Overview Target market 2011 1970 Products Founder PUDLO •Contractors •£3M~ revenue •Architects •£500K profit David Ball •Engineering and •InstaRange •26 employees Construction firms •New facility •SpecialistSand •UK-based •Customers: •New products •Concrete Morrisrow,Galldris, industry Expanded Ltd. www.davidballgroup.co.uk
- 4. Financials
- 5. SWOT Analysis Strengths Weaknesses • Innovation • Lack of PUDLO product • David Ball’s vision awareness • Family-run work culture • Lack of succession plan Opportunities Threats • Company tech knowledge • Limited product range base • Concrete viewed as a • Concrete community “commodity” • Carbon footprint reduction • Competitive landscape • Markets expansion (UK, (Everdure Caltite vs. Europe, Asia, North PUDLO) America)
- 6. Organizational Structure David Ball Chairman Jackie Ball Strategic Planning Chris Howard Oliver Minett Prof. Peter Hewlett Hugh Purser MD Production Director R&D Director Non Exec Director Alan Sleigh Commercial Mgr. Rowan Swanser Martin Liska Overseas office On-site QA Manager R&D Manager and distributors Deirdra McNeil Mktg. Mgr. Gillian Wells Financial Mgr. Total employees: 26 Martyn Smith PUDLO Mgr- Groundworks
- 7. Opportunity Statement Future Business Strategies Succession Brand Planning Awareness Wealth * Creation
- 8. Road to Succession = ESOP • Employee Stock Ownership Plan (ESOP) • Practice of companies giving employees shares in the company • Allows employees to become owners of stock in the company
- 9. Why ESOP? Employee Management Financial Business ownership accountability benefits continuity •Commitment •Responsible •Profit-sharing •Continuity •Productivity to “internal” •Tax benefits •Sustainability •Employee shareholders (Share •Long-term control •Effective Incentive Plan) customer •Work culture decision- relationships •Career making •Low staff development turnover Why not ESOP? •Trust and management structure issues - conflict of interest •Family conflicts
- 10. ESOP Successes •Largest ESOP retailer in UK •Special •Trust manages ownership partnernship structure •Governance – •Charitable council and board John Bosch foundation •Share Incentive •Industrial trust plan Lewis •7% family owned •Satisfying long-term •Entrepreneurial careers freedom •Share Incentive •Employee Plan benefit trust •Council - safety holds 100% valve for shares employees’ Tullis •Dividend Russell Savant •Employees main “capital”
- 11. Journey to ESOP Stage 1 Options appraisal Stage 2 Building a viable business Stage 3 Planning leadership and engagement ESOP Stage 4 Legal and technical considerations Stage 5 Ownership and governance • Time 6 ~ months • Legal fees Stage 6 Securing a strong mutual future
- 12. Employee Benefit Trust • Goal: Maximize shareholder value • Stock distribution 51% Ball family, 49% employees – “Golden shares” repurchased by trust • Structure: Chairman + 4 directors that represent family, employees, legal, and finance areas • Charter: – Veto power on company sale, relocation, acquisitions, mergers – Profit sharing schemes with board approval – Support employee loans for stock purchase
- 13. Legacy Ethics- based R&D Culture Concrete Technology Education Pioneer Concrete David Ball’s Legacy Customer Society Relationship
- 14. Legacy Preservation • Scholarships • Grants • Internships • Social service • Fellowships • Environmental • Partnership with Institute Foundation responsibility Engineering schools • Mitigation of Institute for family disputes • Establish Family corporate governance Business • Develop family talent
- 15. Brand Awareness • Increase domestic market footprint • New Markets: Singapore, Indonesia, Central / Eastern Europe, Germany and N. America • Maintain and expand footprint in current markets • Innovation in Green technology • Social media: Facebook, Twitter • Updated website (customer focus, testimonials) • Industry related-conferences/trade shows
- 16. Opportunity Statement Future Business Strategies Succession Brand Planning Awareness Wealth Creation
- 17. Conclusions • Create and share wealth via ESOP • Suggested path to business succession • Create structure for innovation, continuity, and sustainability • Maintain legacy • Expand brand awareness
- 19. References Internet Links http://www.bosch.com http://www.cipfa.uk/pt/download/governance_standard.pdf http://www.employeeownership.co/uk http://www.kohler.com http://www.institututeforfamiybusiness.com http://www.sesadvisors.com/ESOP_casestudies/ Interview Sessions Chris Howard, Interview at the company, September 26, 2011 Chris Howard, Telephone Interview, September 27, 2011
Editor's Notes
- Government discourages installation of devices that are none critical
- Other options considered Sell the company Merge company or get acquired Continue current business model
- There are several compelling reasons to opt for an employee owned business. Research repeatedly shows that firms with employee ownership and active staff involvement can outperform more conventional forms of business with outside shareholders, and be better places to work. Giving employees a serious ownership stake in the business tends to make people feel more committed, more likely to ‘go the extra mile’. Staff are more likely to contribute ideas, take responsibility, solve problems and cope with change when they part own the company. Because all or most of the shareholders are in the company and know it inside out, employee owned firms tend to be much more open and honest about the business, which in turn breeds mutual trust. Because it’s their business, employee coowners tend to treat customers with greater care and effort than the average elsewhere. And for the same reason employee owned firms can also expect lower absenteeism and staff turnover. But employees having a genuine ownership stake does not, usually, mean that the business is co-run. In most employee owned companies managers have the power to make decisions as quickly and effectively as the business requires. The difference from more traditional companies is that management is accountable to the internal shareholders: the employees. That accountability can take all kinds of forms, from trustee boards, to employee directors, to a consultative body. The John Lewis Partnership, a member of the Employee Ownership Association, is frequently cited as an example of employee ownership. The John Lewis Partnership is far from an isolated example. The ‘coowned’ sector of which it is part is worth at least £30 billion annually, larger than the agricultural sector. So becoming an employee or co-owned company means joining a thriving and growing part of the UK economy. Successive Governments have created a range of tax advantaged schemes, notably the Share Incentive Plan, which make structuring an employee buy-out feasible and rewarding for owner and employees alike. Selling to the workforce is a way for owners to recognise employees' role in helping build the business. Employee buy-outs have an excellent record of sustainability compared with management buy-outs, so the enterprise the owner created is more likely to survive. Employee buy-outs are less likely than a trade sale to result in closure of premises in local economies who may have come to rely on them for jobs and trade. Allowing existing management and staff to buy the company puts control in the hands of people who know it best, and who will be most committed to making it succeed. An employee buy-out means continuity for customers and suppliers.