Welcome to The Entrepreneurs Network's third monthly Policy Update. You can read our last two updates on Immigration and the Budget over here. Let me know if there’s a topic you’d like us to cover in future months.

This month in honour of our latest report Management Matters, we’re covering the issue of management. We launched it in Parliament as part of our Business Stay-Up Campaign along with Small Business Minister Kelly Tolhurst MP and Rob May of the Association of Business Executives.

The report analysed the latest research on the impact of management on productivity, employment, and firm survival. It had three key findings:
 

1. There is a strong link between the adoption of structured management practices and higher productivity, higher profitability, and a higher chance of firm survival. In fact, one study found that differences in management ability explained almost a third of the differences in productivity between and within countries. 
   
   While another study based on interviews with 34,000 managers found good management predicts a firm’s success better than R&D spending, IT spending or how skilled their workforce is. 
    
2. Britain isn’t as well managed as other leading economies. A survey of over 11,000 businesses across 34 countries found that British firms are less likely to have adopted productivity-boosting management practices than their American, Japanese or German counterparts. On the bright side, British firms are marginally better than French ones. While our larger firms are typically well-managed, the UK’s SMEs, the so-called long tail, underperform internationally.
    
3. Management can be improved. Well-designed management courses such as the Goldman Sachs 10,000 Small Businesses course can have large positive impacts upon productivity. Peer-to-peer learning helps too. A study from China found that firms in different industries who attended monthly peer-to-peer support sessions were better managed (and more profitable) one year on.

This is a topic that the government is increasingly interested in, seeing improving the management of British SMEs as a potential solution to Britain's sluggish productivity levels.

At the last budget and in subsequent announcements the Government has pledged support for a range of schemes aimed at helping SMEs upgrade their management capabilities. These vary from business-led initiatives such as Be The Business to expanding successful schemes such as Knowledge Transfer Partnerships and testing out new approaches with the Business Basics fund.