‘Company profits have more than doubled in the four years since EO’
DICK PHILBRICK not only successfully steered his own company Clansman Dynamics into employee ownership (EO), he now has a role as an Ambassador of CDS, sharing the benefits of the business model with others.
He says: “I can offer to talk to any company or individual who is at all interested in the idea of EO. They can come to Clansman to see EO in action and discuss how we did it. This is assisted by sharing our excellent financial results and exploring the dramatic change in attitudes since we made the change.”
As managing director of Clansman Dynamics, Philbrick has seen his East Kilbride-based company, which manufactures robotic foundry handling equipment, build an enviable international client list. He decided to pursue employee ownership in 2009.
He recalls: “I believed that Clansman was a healthy business with a good future and that it could provide a pension for me and a good investment for all the employees over the coming years – it’s always good when there is self-interest on both sides!
“I also believed that employee ownership was a much better alternative than a trade sale to a competitor who might make warm noises and then move the business away, as happens so often.”
Philbrick and Clansman were helped by CDS in the transition. Philbrick says: “CDS introduced me to other companies who have made the change and gave a presentation on EO attended by some of our employees – this generated great enthusiasm.”
Philbrick has since seen major benefits for himself, the business and the employees.
“I’ve now been fully paid out and the employees have all recovered their investment in Clansman and a lot more,” he says. “All are now beginning to get a real understanding of our business and of just how many issues are not simple black and white but grey. There is now a tremendous level of participation in our company meetings – from young and old, senior and not so senior.
“For me it is simple – if I prefer to know what is happening, how much money is in the bank, who is not paying and why etc, then there is a very good chance that all will feel more confident and secure if they know what is happening – and that is how it’s turned out.”
For Philbrick, the equation is simple: if you have a meaningful stake in something, you will want to become more involved.
He says: “Our profits have more than doubled in the four years. Employees are now making decisions for the long-term future of Clansman and not for shortterm Porsches tomorrow. More technical development is going on now.”
In a wider context, Philbrick believes the EO model brings benefits to Scotland. He says: “The EO structure responds to that quirky Scottish I-don’t-likebeing-told-what-to-do temperament. It glues the business to Scotland because that is where the employee shareholders work and want to live.”
With his Ambassador head firmly on, Philbrick is keen to argue the benefits of the EO model to anyone considering the change for their own business.
He advises: “If your business is healthy and if your employees understand this, work out what you need to get as a total payment for the business and work out a deal that allows your employees to buy without taking on large debts.
“If the business is not healthy, employees will not want to buy. If it is healthy, you can afford to make the deal possible by granting ‘soft’ payment terms and still not be taking a large risk.
“And, if you can do that, you’ll be doing a great thing for the quality of lives of your employees. It’s a model of ownership for solid, long-term business development.”