Kids Company – Over Reliance Dangers

After the recent closure of the charity Kids Company, I listened intently to Camila Batmanhelidjh’s interview on Radio 4 yesterday. I can understand that this is a terrible situation for all parties involved, but I was ever so surprised to hear her say that there were NO problems with management.

How can any business truly say that they couldn’t be more efficient or make improvements? Every business (no matter the size) can face difficult times, but careful planning, monitoring and financial management can help organisations to avoid insolvency coming out of the blue – letting employees, suppliers and customers down so badly.

Kids Company relied heavily of government funding, and a recent £3million grant given for restructuring and downsizing was going to be recovered by the government as the charity had failed to meet the conditions of the grant.  Coupled with the loss of a Further £3million donation because of an ongoing police investigation into child abuse, the charity’s future was bleak.

It seems that Camila and her team were relying heavily on successfully lobbying the Government for more financial support to survive. However, Government Officials  have been questioning the success of the charity for a long time, and reading further into it the success of Camilla as a figure head.

Working with small businesses, I have seen companies that are wholly reliant on the reputation of the man at the top, some of them visionary and proud, but with the ability to alienate clients to the dismay of their work teams!  I have also worked with businesses that are heavily reliant upon one key supplier or customer.  With so many eggs in one basket, their company can collapse along with the supply chain.

It is critical to identify in your current business context – the internal and external factors that can threaten your business – so that you can put plans in place to mitigate the risks, and keep your employees, suppliers and customers happy.  And might I also suggest keeping firm control of your cash and profits too.  Cash is the oxygen and profit the food of a business.  Make sure you don’t suffocate and starve it.

Let’s hope that someone picks up the slack for their vulnerable children.

By | 2016-12-06T18:07:48+00:00 August 7th, 2015|The Organised Business|0 Comments

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