Entrepreneurial mentoringA key to business success

The Inner City 100 1

2Entrepreneurial mentoring

Mentoring can be formal, organisedthrough specific organisations ornetworks, or informal, drawing on theexpertise of peers, friends or family.Currently a wide range of formalmentoring schemes are offered acrossthe UK, but, on the whole, take-uprates are poor. Given the potential ofmentoring to enhance businessperformance and therefore contributeto increases in the numbers of jobscreated and the survival of competitivebusinesses, there is a need to reviewthe impact and effectiveness ofcurrent schemes as well as toincrease the number of people beingmentored or becoming mentors.

This paper looks at the experience ofmentoring of The Inner City 100entrepreneurs. These entrepreneurshave fast-growth businesses from arange of sectors and continue toexperience the challenges of growinga business. The views of The InnerCity 100 entrepreneurs are relevantbecause they offer insights into thechallenges of growing businesses,and their continued support needs.

This paper addresses the followingquestions:

l What does entrepreneurialmentoring look like in the UK?

l What insights do The Inner City100 entrepreneurs provide into thecurrent provision and take-up ofentrepreneurial mentoring?

l Drawing on this experience, howcan the benefits of mentoring beenhanced and broadened?

What is entrepreneurial mentoring?Entrepreneurial mentoring involvesone entrepreneur acting as ‘criticalfriend’ or ‘guide’ helping to overseethe career and development of a less-experienced entrepreneur (Harrington1999). The relationship is betweenentrepreneurs from differentbusinesses and can be characterisedas a ‘mentor-protégé’ relationship.However, within entrepreneurialmentoring, the relationship betweenmentor and mentee is often one ofequals. Each party brings differentperspectives and knowledge, and inmany cases mentees will establishthe goals of the relationship.

Entrepreneurial mentoring can beviewed as a business developmentprocess for owner-managers (Gold et al 2003). This is based on thepremise that there is a direct linkbetween entrepreneurs’ actions andcapabilities and the performance oftheir businesses.

Mentoring versus coachingAlthough mentoring and coaching areoften confused — the terms are usedinterchangeably in many cases —there are important distinctions.Mentoring generally involves a longer-term relationship that is less role-specific than coaching. Coaches willoften make more direct interventionsto enhance performance duringspecific tasks. Mentors though, willlisten and advise but not intervene.Table 1 highlights the maindifferences in the two roles.

Entrepreneurial mentoring focuses on:

l The future of the menteeentrepreneur’s personaldevelopment.

l The mentee’s professionaldevelopment.

l Supporting the mentee’s firmthrough providing relevant adviceand sharing experience.

Entrepreneurial mentoring can support business growth,reduce business failure rates and increase the likelihoodof people becoming entrepreneurs.

Mentoring Coaching

Focus on progress Focus on task

Usually longer term, sometimes for life Usually short term

Intuitive feedback Explicit feedback

Develops capabilities Develops skills

Driven by mentee/learner Driven by coach

Helps you to work it out yourself Shows you where you went wrong

Table 1: Distinguishing between mentoring and coaching

Source: Clutterbuck and Sweeney (1997)

3 Entrepreneurial mentoring

Entrepreneurial mentoring in contextOf the approximately 3.8 millionbusiness enterprises in the UK, over99 per cent are small businessesemploying less than 50 employees.These businesses are central todriving competitiveness, increasingemployment, and to creating andretaining wealth throughout the UK,including in the most deprived innercity areas. As The Inner City 100 Indexdemonstrates, successful firms canhave significant positive impacts indeprived areas. In the past five years,The Inner City 100 businesses alonehave created nearly 5,500 jobs andcontributed millions to their localeconomies.

What benefits can entrepreneurialmentoring deliver?Measuring the current economicvalue of entrepreneurial mentoring inthe UK is difficult because there arefew published evaluations ofschemes that provide quantitativeevidence. The majority of benefits arehighlighted through case studies ofparticipating businesses. These offeruseful insights but make it difficult togain an accurate picture ofquantifiable impacts and businessbenefits.

Whether industry sector orgeographically focused,entrepreneurial mentoring schemesshare similar core objectives focusedon enhancing the capabilities ofentrepreneurs and the growthpotential of their firms. However,mentoring schemes have differentapproaches and vary in how theymeasure their success. In somecases, schemes have clear,quantifiable delivery criteria.

The Welsh national mentoringscheme, Mentor Wales, measures itsperformance against several metricsthat, although not widelycommunicated, govern its working.These include:

l The number of jobs created.

l The number of jobs safeguarded.

l Referrals to other business supportproviders (public or private sector).

l The number of hours of mentoringreceived.

l The number of businesses andsenior managers mentored.

Establishing performance againsttargets like these can be difficult asdemonstrated by the lack ofquantitative information available from

many existing programmes. However,an independent evaluation of NorthernIreland’s Business to Business Bridgementoring programme, by SQWEconomic Consultants, specified anumber of key benefits directlyattributable to the scheme. It should benoted that the scheme involvesmanagers from within large businesseshelping entrepreneurs. Nonetheless,the results for Small and MediumEnterprises (SMEs) are interesting:

l Increased sales turnover of 3.3 percent.

l Increase in after-tax profits of 17.9per cent.

l Increased employment of 6.1 percent.

This impressive list of benefitsindicates significant positive impactson the businesses involved. Anotherscheme in the North East of England,the ‘Alchemists’ builds on thisapproach and has clear and ambitioustargets for adding value to the region.

The full impact of the Alchemistsscheme remains to be seen, but itsclear target and pool of talent fromacross the UK make this an innovativescheme whose success should beclosely monitored.

4Entrepreneurial mentoring

While there is evidence thatentrepreneurial mentoring can deliverreal added value for businesses, therequirements for clear output criteria —for example, number of jobs created —may undervalue the more informaltacit benefits that mentoring provides.These include:

l The increased confidence ofentrepreneurs.

l Better staff management andinternal business processes.

l Broader networking.

These factors may take time to feedinto quantified benefits. Therefore,focusing solely on quantifiable short-term outputs may lead to schemesbeing assessed against criteria thatdo not capture their long-termsuccess. Whilst it is important toevaluate schemes robustly, care mustbe taken to measure ‘soft’ outcomesas well as the ‘hard’ outputs.

What does entrepreneurialmentoring look like in the UK?Entrepreneurial mentoring alreadyplays a role in efforts to assistentrepreneurs and SMEs across theUK; its contribution to improvingentrepreneurs’ success is increasinglyacknowledged. In the majority ofinterviews for this work,

representatives from the public sectorand entrepreneurs underlined the roleof mentoring. Lee Williams, ManagingDirector of Universal ServicesSolutions, expressed a commonlyheld belief that mentoring was criticalto many of his most importantbusiness decisions. In addition tobeing mentored, Lee Williamsmentors less-experiencedentrepreneurs to help them developtheir businesses, and feedback fromthem suggests this is one of thecritical factors in their success. Clearly,there are many factors that contributeto the success of a businessincluding market demand,product/service marketing, andproduct/service quality; however, theentrepreneur plays a central andimportant role in the fortune of thebusiness. Supporting thedevelopment of owner-managers (theentrepreneurs), and their businessesshould considerably increase theirchances of success.

The number of entrepreneurs involvedin informal mentoring in the UK,whether as mentors or mentees, isunknown. However, evidence fromThe Inner City 100 suggests thatsome entrepreneurs may be receivingimportant support from entrepreneursthey know through personalrelationships, family and business

contacts. However, the focus of thispaper is largely upon formalmentoring. As the number and size of programmes available is growing,their likely impact and role inentrepreneurs’ success and personal development requires closer examination.

At present, formal mentoring schemesin the UK tend to be locally orregionally organised and supportedand delivered by public organisationsand agencies. The RegionalDevelopment Agencies (RDAs),National Federation of EnterpriseAgencies (NFEA) and Business Linksare key players in deliveringmentoring schemes. There appear tobe clear benefits of organisingmentoring schemes at local andregional levels:

l Interviews with entrepreneurssuggest that businesses may bemore willing to participate if thementor or mentee is local andaccessible.

l The economic conditions ofparticular areas may mean thatnew/growing businessesexperience common problems.More established entrepreneursmay have particular insights intothese challenges.

The Alchemists

The Alchemists, a scheme in the North East of England provides, perhaps, the best example of a scheme driving to a clear target — to create £100 million of additional value in the companies it engages with by the end of 2005.The scheme is funded by One North East, but businesses pay for their mentors/consultants once engaged. TheAlchemists scheme links entrepreneurs with experienced professionals from a number of fields to provide advice onthe next steps of business growth. Interventions are often quite focused, for example, on realising a specific growthopportunity.

The Alchemists scheme works to identify fast-growing companies that have reached a critical stage in theirdevelopment. To be eligible, businesses have to have doubled their value in the past three years and have atleast £5 million of value in the business. Given these criteria, the scheme is clearly not for the majority ofbusinesses.

The scheme has assisted 22 enterprises in the North East and drawn on mentors from across the UK. One of TheInner City 100 entrepreneurs who participated provides an example of how the Alchemists scheme has benefitedbusinesses. Since joining, this entrepreneur has seen considerable improvements in his business and rapidexpansion, much of which would not have been possible without the insights provided by his mentor. Interestingly,one aspect of the advice received was that he should seek to create additional businesses because his talents lay ingenerating ideas and making them realities. The entrepreneur followed this advice and has established a number ofnew businesses; it is too soon to tell how successful these businesses will be in the long-term, but given his trackrecord and the new lease of life the scheme has provided, there are significant benefits in prospect.

5 Entrepreneurial mentoring

There are national business mentoringschemes operating in England,Scotland, Wales and Northern Ireland.Additionally, Business in theCommunity (BitC) supports severaldifferent mentoring schemesthroughout the UK and NorthernIreland including CompanyConnections in Wales, BusinessBridge in England and Business toBusiness Bridge in Northern Ireland.The Prince’s Trust and the Prince’sScottish Youth Business Trust alsooffer mentoring support focused onyoung entrepreneurs in the UK.

Mentoring schemes differ in format,but most in the UK consist of face-to-face interactions between mentorsand mentees. Telephoneconversations often provide the back-up to these meetings. As informationtechnology has improved andbecome more accessible, onlinementoring has increased insignificance. Shell LiveWIRE, part ofthe Business Volunteer Mentor (BVM)network, is a scheme targeting youngentrepreneurs solely delivered online.

LiveWIRE provides an informal forumfor discussions where members seekadvice from each other rather thanthrough formal channels. Benefits ofbeing online include ease of accessand the comfort young people feelwith the medium. Initially mentoringcan seem intimidating for both partiesand less formal systems may be anideal first step.

Mentoring and The Inner City 100An examination of The Inner City 100businesses’ involvement inentrepreneurial mentoring offers someinsights into its benefits and use. Thefindings are derived from informationgiven by all of The Inner City 100winners in 2003. Subsequentdiscussions with several of The InnerCity 100 winners from years 2001–03provided further insights into theirexperiences of mentoring.

The Inner City 100 firms havesuccessfully navigated the turbulentearly years of business formation andgrowth. However, the majority are not‘established’ in the sense of having

extensive professional systems andteams of skilled managers. This doesnot mean that they are not managedexpertly, but that owner-managersremain essential to firms’ dailyoperation and success. Theseentrepreneurs:

l Combine multiple roles thatdemand wide-ranging skills.

l Are often under considerablepressure.

l Have little business experience insome cases.

Entrepreneurial mentoring proposes toassist these entrepreneurs in helpingthem to step outside of their dailyroles and take a more strategicapproach to their business.

Within The Inner City 100, 26 per centof entrepreneurs are involved inentrepreneurial mentoring either asmentors or mentees. Initial findingssuggest that of these, approximatelyhalf are mentors and half arementees. These firms come from a

National mentoring programmes

EnglandThe Business Volunteer Mentor (BVM) network is a national programme with 35 sub-contracts in place for delivery ofthe scheme. These range from a pan-regional scheme (in the East of England region), to one that offers purely on-line mentoring with no geographical boundaries (Shell LiveWIRE).

Wales Mentor Wales has been developed as a partnership involving the major supporters of business across the whole ofWales including the Welsh Development Agency. The aim of the Mentor Wales scheme is to provide long-termsupport to financially viable, established SMEs that show growth potential. The mentees must have a managementteam in place or in the process of development and be seeking up to two years’ professional advice and guidancefrom a mentor.

Northern Ireland Invest Northern Ireland is the main economic development organisation in Northern Ireland and funds two keymentoring programmes:

l Business to Business Bridge enables large, well-established firms to invest a variety of non-financial resourcesincluding mentoring to help SMEs through periods of growth.

l Northstar Mentors are willing to offer expertise to help other businesses overcome problems and improve theircompetitiveness. The role of the mentor is to discuss issues and advise on ways to overcome obstacles togrowth.

ScotlandBusiness Mentoring Scotland was introduced by the Scottish Executive in 2000. The Scottish Executive formalisedexisting networking groups and its Business Gateway provides the first point of access to public support available tofirms in Scotland. Several mentoring programmes have been developed within the Business Gateway including aprogramme aimed specifically at women.

6Entrepreneurial mentoring

range of industry sectors thatbroadly reflect the composition of thewhole of The Inner City 100 (seeFigure 1). This broad mix of businesssectors appears quite typical ofmentoring programmes in the UK(France 2003).

The Inner City 100 firms that areengaged and involved in mentoringare not recent start-ups; they havebeen established an average of 10years with an average turnover of £5.1million. Many of these companieshave strong market niches and arebuilding on successful periods ofgrowth. Clearly, being involved inmentoring is not restricted to the

youngest firms or the mostinexperienced entrepreneurs,indicating that entrepreneurialmentoring may be appropriate atall stages of business developmentand growth.

Examining The Inner City 100entrepreneurs’ involvement inmentoring by region indicates no clearpattern (see Figure 2). However, it isinteresting to note that despite 25 percent overall of the The Inner City 100being based in London, none of themare involved in mentoring. This mayreflect:

l A lack of provision in London.

l Greater independence of Londonbased entrepreneurs.

l Dominance of informal mentoring.

l Poor coordination and/or marketingof mentoring activities.

l Lack of public sector support formentoring schemes.

Clearly, this finding deserves furtherresearch to understand its causesand significance.

Analysis of the entire of The Inner City100 indicates that advising otherentrepreneurs is just one of thementoring activities in which they

Figure 2: Inner City 100 firms mentoring by region

Figure 1: Inner City 100 firms mentoring by sector

7 Entrepreneurial mentoring

participate. As Figure 3 shows, overhalf of The Inner City 100entrepreneurs take part in visits andplacements and are linked to schools and colleges; this is twice the number participating inentrepreneurial mentoring. Clearly, the entrepreneurs are finding time foractivities outside the daily running oftheir businesses.

Looking specifically at the 26 of TheInner City 100 entrepreneurs involvedin entrepreneurial mentoring (see Figure 4) the majority are alsoinvolved in visits, placements or linkswith schools and colleges (81 percent); a number are also involved inmentoring at-risk young people.

The findings suggest thatentrepreneurs who are involved inentrepreneurial mentoring are alsomore likely to be involved inmentoring young people. While furtherresearch is required, this finding mayhave important implications forchanging the culture ofentrepreneurship in the UK.Entrepreneurs involved inentrepreneurial mentoring could alsobe encouraged to speak to youngpeople about the benefits ofentrepreneurship and offer guidanceon how to start a business.

Inner City 100 entrepreneursreceiving mentoringOf The Inner City 100 entrepreneursinterviewed, the majority expressedpositive views of their experiences as

mentees. As one of The Inner City 100entrepreneurs put it,

“Mentoring can help with anybusiness, providing the menteeis open minded enough to listento external advice. Naturally, yourmentor won’t get it right everytime and it’s up to you todecipher what is relevant to yourindividual situation.”

But others have more mixed views(see case study on page 8).

Entrepreneurial mentoring provides anoutside perspective on a business,and may be particularly useful indifficult times such as periods oftransition and for family ownedbusinesses seeking external input.

“Coupled with the fact that thebusiness leadership was in atransitional phase from myfather and mother to my brotherand I – we had problems.Having the external influence ofa mentor was very important inthat he could see straightthrough any personal issuesthat may have been preventingus from seeing the real pictureand acting accordingly.”Inner City 100 entrepreneur

The Inner City 100 businesses haveachieved huge growth and, as oneentrepreneur noted, there isconsiderable value in having “someearly warnings on what was likely tohappen to the business” from those

that had already experienced thedifferent stages of businessdevelopment. In addition, many of TheInner City 100 entrepreneurs do nothave business backgrounds andmentoring may be particularlybeneficial in offering support andadvice in these cases.

Although feedback from The Inner City100 entrepreneurs regardingmentoring was generally positive,there were some criticisms that offeruseful insights into possibleimprovements.

“The first mentor I had was setup through a professionalnetwork. At our first meeting, allhe wanted to talk about washimself. I think he liked the ideaof helping someone, but hadn’tmanaged to grasp the conceptof how it all worked. I think it’svery important that mentors arematched to people. It is quite apersonal process and thechemistry has to be right. Weinterviewed several peoplebefore settling on our mentor.”Inner City 100 entrepreneur

Several entrepreneurs highlighted theimportance of mentors havingappropriate skills and approaches totheir role.

“You need to be aware of thepotential impacts of what youare saying or doing. Forexample, if you see someone

Figure 3: Number of Inner City 100 firms involved inmentoring activities

Figure 4: Inner City 100 firms involved inentrepreneurial mentoring and other mentoringactivities

8Entrepreneurial mentoring

not doing well and youreiterate how successful youare, it can be quite daunting forthem. As a mentor, you needto be aware of the power youhave over other people. Someinduction – at least in terms ofraising mentors awareness ofthis kind of power – would bea good idea.”Inner City 100 entrepreneur

In one case, an entrepreneur spoke ofhow he preferred to rely on his ownopinions following poor advice from amentor. He also commented on thedangers of having risk-averse mentors,

“If you already haveuncertainties running throughyour mind then a negative ordefeatist contribution from amentor may make somepeople give up.”Inner City 100 entrepreneur

Entrepreneurs as mentorsMentors amongst The Inner City 100entrepreneurs reported gaininginsights into their own businesses,skills and personal development.Before becoming mentors, many wereunaware that they had something tooffer other entrepreneurs. However,

many have found their involvement tobe hugely rewarding.

“Mentoring gives you a chanceto reflect on what you havedone. It gives you theopportunity to stand back andrecognise your achievements.”Inner City 100 entrepreneur

It is clear those volunteering asmentors do find it beneficial. However,many entrepreneurs still only seethemselves in the role of mentee,believing that their knowledge andexperience would be of little value toothers. When asked about becominga mentor, responses included “I amnot too sure who would benefit frommy experience” and “I am not reallysure of what is around or what isrequired.”

The example of the BusinessChampions Network in South EastEssex provides insights into how toinvolve more of these businesses.Approximately one third of thebusiness champions were initiallyinvolved as mentees. After receivingmentoring, many entrepreneursrealised they had something to offer new businesses and volunteered to be mentors

themselves. Attracting experiencedentrepreneurs to be mentors is criticalto ensuring that schemes offer theright mix of skills and experience topotential mentees.

Mentoring should not be a ‘one-waystreet’ for mentors or mentees. Actingas the mentee in one relationshipdoes not preclude acting as thementor in another. In the BusinessChampions Scheme, run by the EastMidlands Development Agency(emda), a ‘bank’ of BusinessChampions, consisting of bothmentors and mentees, is maintained.Entrepreneurs are able to switch rolesdepending on their needs or whatthey can offer.

It is important to provide high-qualitymentors to mentees in order to getthe best out of mentoring schemes.The usefulness of the relationship formentees will be determined to a largeextent by the attitudes andexperiences of mentors. Someschemes require mentors to haveinductions and meetings with relevantthird parties — for example, localaccountants. This process ensuresthat mentors can suggest appropriatereferrals for further business adviceand support. Entrepreneurial

Case study

Temploy Recruitment Services, a three-times Inner City 100 winner from St Helens, has had mixed experiences withmentoring. Although Karl Hart, managing director of Temploy, has found mentoring helpful regarding timemanagement and general advice on productivity, he has had varied experiences with mentors.

Hart believes personal experiences are key to being a good mentor. One mentor he was engaged with had onlyworked for a multinational company and not run a business. The mentor was largely unaware of issues affectingsmall business as Hart stated, “There is a big difference between running a multinational and running a corner shop.The bigger you get, the ways of doing things are obviously different. If you’re small you need to be a jack of alltrades whereas a big company has a lot more staff to cover the different positions and issues.”

Though not supportive of classroom teaching to create mentors, Karl Hart believes that some instruction would beuseful, “A classroom could not teach you how to be a mentor if you haven’t actually got any small businessexperience, but your mentoring skills could be enhanced.”

Temploy’s mentoring experience did bring direct business benefits. One of their mentors was also advising a numberof companies who were fellow Chamber of Commerce members. One of these firms had staffing issues and thementor made the connection with Temploy’s provision of temporary staff. Although this was outside the remit of thementor’s role, it was a positive development for Temploy and demonstrated the flexibility of mentoring as a businessdevelopment process. In this case, mentoring created a direct business opportunity that, although not a classicexample of the benefits of mentoring, is still an interesting and positive development. This example builds the casefor a more careful look at the complicated nature of mentoring and the positive repercussions it can have forparticipating businesses.

9 Entrepreneurial mentoring

mentoring is not a one-stop shop forexpert advice, but can help provide aroute to access support alongside itsfunction as a sounding board forentrepreneurs.

The UK’s largest mentoringprogramme, the Business VolunteerMentor network, uses an internalinduction in which the mentor’straining needs are assessed and apersonal training plan is derived.Depending on an individual’s needs, this may involve sitting in with an existing mentor in clientsessions or being shadowed by anexisting mentor or adviser. Thementors are assessed based on the standards developed by theSmall Firms Enterprise DevelopmentInitiative (SFEDI). The assessmenttakes place in front of a real clientand is carried out by a qualifiedassessor who must be independentof the end result.

How to encourage greaterparticipation in mentoring From discussions with The Inner City100 entrepreneurs, there appears tobe a general lack of information aboutwhich mentoring schemes inoperation could be of benefit andhow. Several entrepreneurscommented that they would like to beinvolved, but were unsure about whatschemes exist and which would bemost suitable for them.

MarketingAt present, much of the mentoringliterature is targeted at start-ups andnew businesses and tends to focuson specific benefits, for example,advice on financing. However, thebroader advantages of mentoring for‘would be’ mentees at any stage ofbusiness growth need to beexpressed, as well as the benefits ofbecoming a mentor. Presenting theseroles and benefits in more detail mayencourage more businesses, likethose in The Inner City 100, tobecome involved.

Time constraintsThe other main reason entrepreneursdo not participate in mentoring isbecause of a lack of time. Asdiscussed earlier, many entrepreneurshave some connections with localschools and colleges and this mayreduce their capacity to act asentrepreneurial mentors.

“We do mentoring with localschools and various othercommunity activities. Since thatalready takes up a significantamount of our time, additionaltime is not available”. Inner City 100 entrepreneur

Despite their involvement in a rangeof contexts, many of The Inner City100 entrepreneurs find it difficult tomake time for commitments outsideof running their businesses. Giventhese time pressures, someentrepreneurs argued that mentoringschemes need to reduce their currentlevels of bureaucracy.

StructureHowever, it is important that somestructure and efficiency is retained asother entrepreneurs complained thatschemes they have participated inwere poorly designed with insufficientstructure or support.

It would appear that operating on anad hoc basis is just as likely as ‘toomuch bureaucracy’ to reduceentrepreneurs’ involvement inmentoring. However, the pressures onentrepreneurs can be eased byensuring:

l The relationship has clearly statedexpectations.

l The adoption of different mediaincluding email and the Internet.

l Meetings are planned in advance.

Following the initial meeting, mentorsand mentees should largely be left topursue their relationships withinterventions only when required.

Perhaps schemes should also follow the example of BusinessChampions emda in which championsare able to take time out from theprogramme if other commitmentsdemand. Organisers’ experience in thisscheme shows that most entrepreneursrejoin when time permits, suggestingthat this flexibility is effective.

Summary of findings l Entrepreneurial mentoring has the

potential to deliver value-added forentrepreneurs and their firms,whether they are start-ups orestablished owner-managedbusinesses. This appearsparticularly true for family firms orthose going through transitions.

l Some of The Inner City 100entrepreneurs do not believe they have sufficient experienceand skills to become mentors,even when they are well placed to mentor otherentrepreneurs given theirbusinesses’ success.

l The Inner City 100 entrepreneursinvolved in one form of mentoring(i.e. youth) are likely to be involvedin other types of mentoring (i.e.entrepreneurial).

l The number of business-to-business mentoring schemes inthe UK contributes to thedifficulties entrepreneurs have inknowing which ones to access,how they work and the details ofthe schemes.

l Some of the main complaints fromThe Inner City 100 entrepreneursregarding current provision ofmentoring are that:

ll Schemes lack structure. Thiscould be addressed byimplementing guidelines, forexample, regarding frequencyof meetings and timecommitment required. Schemes should avoidunnecessary bureaucracy.

ll The role of mentors andmentees are ill-defined.Guidelines on what is expected should be set so that both mentors and mentees are clear about whata mentoring relationshipinvolves to ensure that theirexpectations are met.

ll Some mentors haveinappropriate experience andskills. Mentors should beselected carefully andexpectations of training andquality assurance should beemphasised. For example,mentors need practicalexperience in running asuccessful small businesswhich may then be enhanced by training orguidance on how to be aneffective mentor.

ll Some schemes lack flexibility.Entrepreneurs can often act asboth mentors and mentees,

10Entrepreneurial mentoring

potentially in the samescheme, and programmesshould encourage this flexibilityto maximise the valueindividuals can provide.

l Local and regional schemesprovide benefits in terms of easeof access, minimising timecommitments and leveraging localknowledge.

l Schemes are not marketedeffectively, particularly to firms thatthat have moved beyond the start-up stage.

Recommendations l Establish a UK-wide web-based

access point specifically forentrepreneurial mentoring, perhapsaligned with the ‘DTI For Business’website. At a minimum, this shouldprovide details including whereexisting programmes operate, asummary of features and benefits,contacts, funding details and linksto programme websites.

l Entrepreneurial mentoring canplay an important part in theentrepreneurs’ ‘lifecycle’ from theseed of an idea to the peak ofbusiness success. The

Government and other providersor funders of mentor schemesshould consider developing alifetime mentoring approach thatbegins by focusing on youngbudding entrepreneurs. Onstarting a business, entrepreneursshould be encouraged to seekmentors and have the option ofcontinual mentoring throughouttheir careers. Mentors may changebut the entrepreneurial mentoringrelationship can continue.

l Establish a learning networkbetween providers that wouldenable the exchange of bestpractice. This forum would enablethe insights and experiencesabove to be shared constructivelyto guide provision.

l There are insufficient evaluationsof existing mentoring schemes.More are required to determine thebenefits of entrepreneurialmentoring and provide the basisfor marketing of schemes toentrepreneurs.

l A five-year business health checkshould be offered to businessescoordinated by the main providersof business support, for example,

RDAs, Invest Northern Ireland andScottish Enterprise, in which thebenefits of joining a mentoringscheme can again be encouraged— at this time the idea of becominga mentor for other businessesshould also be introduced.

l On registration of a business withCompanies House, a WelcomePack should be sent tobusinesses, containing informationrelevant to start-ups such aswhere to access business advice.The benefits that mentoring offersin terms of the survival andsuccess of businesses should alsobe highlighted.

l Where firms have becomedisengaged from business supportagencies that offer schemes,participation may be boosted byprofiling firms that have benefitedfrom mentoring. Businesscompetitions and high-profiletargeted initiatives, for example,mentoring roadshows andbusiness media campaigns, helpto create all-important role modelsand demonstrate the benefits ofmentoring schemes.

References

Business in the Community Northern Ireland (no date) Business to Business Bridge [online], Invest Northern Ireland.

Clutterbuck, D. & Sweeney, J. (1997) ‘Coaching and Mentoring’ in Gower Handbook of Management, Gower PublishingCompany, Aldershot, UK.

France, M. (2003) Business Volunteer Mentor Project Review, National Federation of Enterprise Agencies, December,Bedford, UK.

Gold, K., Devins, D. & Johnson, A. (2003) ‘What is the value of mentoring in a small business? Using narrative evaluationto find out’, British Journal of Guidance & Counselling, vol. 31, no. 1, pp. 51-62.

Harrington, A. (1999) E-mentoring: The advantages and disadvantages of using email to support distance mentoring[online], Hertfordshire TEC.

11 Entrepreneurial mentoring

l An average five-year turnover growth rate of 575 per centl Nearly 5,500 jobs created in the last five years

l Average 2002 sales turnover of £7.4 million l Average profitability in 2002 was 6.9 per cent

Patrons of The Inner City 100 include:l The Rt. Hon Gordon Brown MPl John Bird, International Chairman, Big Issue

l Sir Ronald Cohen, Chairman of Apax Partnersl Professor Michael Porter, Harvard Business Schooll Derek Mapp, Chairman, East Midlands Development

Agencyl Lord Richard Rogersl Sir Alan Sugarl Fred Goodwin, Group Chief Executive, The Royal

Bank of Scotland Groupl Laura Tyson, Dean, London Business School.

Renowned business strategist Michael Porter foundedThe Inner City 100 and maintains close ties with us.

Partners include: Financial Times, London BusinessSchool, HM Treasury, and Business in the Community.

Sponsors include: The Royal Bank of Scotland Group(lead sponsor), all nine Regional DevelopmentAgencies in England, and the Department for Trade and Industry.

For further information visit

www.theinnercity100.org

The Inner City 100The Inner City 100 is a unique business index andresearch initiative that champions fast-growthbusinesses in the UK’s inner cities.

Led by independent think tank nef (the neweconomics foundation), sponsored by The RoyalBank of Scotland Group and partnered by HM Treasury and the Financial Times, The Inner City 100’s mission is tochampion enterprise-led regeneration and to promote the untapped market potential of the inner city.

The Inner City 100 supports the future growth of fast-growth inner city businesses via a structured series of events,awards and media exposure. Acting as a research and publishing mechanism, The Inner City 100 Index enables firms’success stories, as well as the opportunities for the UK’s inner cities, to be captured, analysed and shared to influencepublic policy on the UK’s enterprise culture.

Inner City 100 research is fundamental to the mission of The Inner City 100 initiative, since it actively helps to promotethe market potential and support for enterprise-led regeneration in the UK’s inner cities. Our research activity centres onthe unique information pool offered by The Inner City 100 winners, and leverages research excellence within nef. From2001, we have published reports analyzing the opportunities and constraints of doing business in the inner city.

In 2004, we are diversifying our research in order to produce a series of short briefing/position papers. Areas of interestinclude the mapping of business impacts and their economic linkages within the local community, business retentionand the role of entrepreneurial mentoring.

BackgroundThe Inner City 100 was conceived in 1997 by Michael Porter, the renowned Harvard Business School academic. The ideafor The Inner City 100 was based on his work The Competitive Advantage of Nations, widely seen as one of the mostinfluential management books ever written. This work, in essence, outlines how the competitive advantage of nationscontributed to their economic prosperity. Porter realised that this theory could also be applied to inner cities.

In 1997, he launched the Initiative for a Competitive Inner City (ICIC) in the US. By uncovering and highlighting fastgrowth inner city businesses, The Inner City 100 US – an index of the top 100 fastest growing businesses in US innercities – aims to show that inner cities can be competitive areas for doing business.

In June 2000, with policy backing from the Treasury, financial support from The Royal Bank of Scotland and NatWest andin partnership with ICIC in the US, nef took the lead to establish The Inner City 100 in the UK.

The first Inner City 100 UK index was published in the Financial Times in November 2001. Within one year of its launch,The Inner City 100 UK brought to light the entrepreneurial spirit and business success stories that exist in the UK’s innercities. The second and third years of the project have established The Inner City 100 as a leader in the field of inner cityenterprise and renewal. Now in its fourth year The Inner City 100 continues to change perceptions about the economicimportance of the inner cities, both as investment locations and a breeding ground for new business ideas.

Key facts and figures about The Inner City 100 2003 winners:

Registered charity number 1055254© 2004 nef (the new economics foundation)

ISBN 1 899407 88 X

new economics foundation3 Jonathan StreetLondon SE11 5NHUnited Kingdom

Telephone: +44 (0)20 7820 6300Facsimile: +44 (0)20 7820 6301E-mail: info@neweconomics.orgWebsite: www.neweconomics.org

nef is an independent think-and-do tank that inspiresand demonstrates real economic well-being.

We aim to improve quality of life by promotinginnovative solutions that challenge mainstreamthinking on economic, environmental and socialissues. We work in partnership and put people andthe planet first.

nef (the new economics foundation) is a registered charity founded in 1986 by the leaders of The Other Economic Summit (TOES),which forced issues such as international debt onto the agenda of the G7/G8 summit meetings. It has taken a lead in helpingestablish new coalitions and organisations, such as the Jubilee 2000 debt campaign; the Ethical Trading Initiative; the UK SocialInvestment Forum; and new ways to measure social and environmental well-being.

Researched and written by Anne-Marie Davies and John Taylor