Jim McColl – he makes it all look so simple | Glasgow Chamber of Commerce
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Jim McColl – he makes it all look so simple

Our first Glasgow Talks of the year started at the very top of our business world. It’s been four years since we last hosted Jim McColl, chairman and CEO of Clyde Blowers Capital, and true to his usual form he hasn’t been short of investment achievements in the interim.

In 2011 at his last Glasgow Talks, Jim concentrated on his Weir Pumps acquisition as part of Clyde Blowers’ first private equity fund. This time round we had the subsequent sale of Weir Pumps to SPX and the repayment of that first equity fund, the raising of his second equity fund of £420m, the acquisition of Ferguson Shipbuilders, his successful pursuit of David Cameron to reform the UK Government’s provision of export credit guarantees, the beginnings of his third equity fund at £500m and the launch of Newlands Junior College. All in the space of just four years.

But the thing that strikes me most about Jim is how straightforward his approach is.  Set a vision, do your research, don’t let the challenges over concern you, keep your eye on the goal, and if the targets aren’t being met find a different approach.  He was asked at one point what his biggest failure was.  There hasn’t been one, he said.  Every setback was simply tackled with a different approach.  Stick to the vision and don’t be discouraged, there’s always a way.  It may take longer to get to the vision but it doesn’t change.

Now that may be a rather ham-fisted attempt on my part to capture Jim’s deceptively simple philosophy and it should never be forgotten that Jim’s early career is littered with degrees often studied for part-time while he was building his experience.  He has that ability to make complex issues appear tremendously obvious. You come away thinking partly that it should be easy to build a billion pound business, whilst at the same time recognising just how much work Jim has put into the success of Clyde Blowers  and how clever his strategy has been.

Jim chose to talk about the local, and less about the wider global investments that Clyde Blowers has been making.  So with Weir Pumps, where he started his own career straight from school at the age of16, he brought us up to date with the subsequent sale to SPX in line with the demands of private equity funding.  The initial investment secured some 550 jobs at Weir Pumps, and although the job numbers under SPX have fallen back a bit from the peak of 960 Cathcart jobs at the point of sale, the numbers are still above where Jim started. It’s an iconic engineering company still operating successfully in Glasgow.

His second fund of £420m he tells us is 72% invested in a portfolio of seven companies, and with some acquisitions to come will soon be fully taken up. Amongst those companies is, of course, Ferguson’s in Port Glasgow. The news that Jim says the workforce at the renamed Ferguson Marine Engineering will grow to 400 if more ferry orders come through next month suggests that Jim is working that magic turnaround touch.  But there were some other interesting points he made which help to understand the Ferguson’s position better.

Firstly, it helps to have capital to invest.  The company simply hasn’t had the scale of funds available to it that Jim can bring to bear and that reinforced the power of the equity model that Jim has made so successful.

Secondly, Jim described in detail the challenge of providing guarantees in support of contract tenders and confirmed his view that Polish, German and French competitors have all had a more enterprising national government standing behind their companies with guarantee schemes. I remember asking British Chambers of Commerce to reinforce Jim’s point when he was meeting with the Prime Minister to tackle the issue. 

And thirdly, he was as fulsome in praise of the workforce as you could get.  We still have the skills and at Fergusons they are more than capable of competing with the right support.  Can Scotland aim to reshore some of those lost manufacturing jobs? Well, yes we can. Labour costs are rising in China and Eastern Europe for example, and if you take into account transport and logistics costs it’s perfectly feasible to see Scottish manufacturing companies regaining ground in the years ahead.

But Jim reserved the greatest portion of his presentation for the time he has put in to set up Newlands Junior College in the former Weir Pumps apprenticeship centre in Cathcart. Aimed at 14 to 16 year olds who might benefit from a more vocational and practical learning environment and who are not achieving their full potential at school, Jim has brought several Glasgow companies like Weir Group, Scottish Power, SPX and Arnold Clark, together with South Side head teachers, the City of Glasgow College (and Jim picked out the college for the quality of its contribution so far) and Glasgow City Council to deliver the Newlands formula.  It’s now operational, in its first year and he believes it’s already showing its worth with what he estimates to be the 10% of school children who don’t flourish in the current system. He has plans for rolling out the model.  We’ve been invited to see what’s happening there and I’ll let you know more when I’ve seen it at first hand.

Thanks then to Jim for once again raising the bar - not just in business achievement, but in giving back to the city and the West of Scotland from the rewards of his phenomenal success.

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