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Tim's viewpoint

Listening to the people who work on the front line is the key to business success ..and democracy is the key to successful nations

I’m often asked by investors, students or would-be entrepreneurs to define the key ingredients of business success.

I always say that there’s no magic formula and that Wetherspoon is only as good as the next pint we serve, but the main ingredient can be summed up in one word: listen.

Successful businesses – and, indeed, entire countries – depend, above all, on the quality of decision-making.

Good decisions, in turn, depend on a system which encourages ideas and criticism.

Business commentators tend to overemphasise the influence of big, groundbreaking ideas, dreamt up by shoot-from-the-hip CEOs.

Indeed, big ideas have their place, but, in reality, long-term success almost always stems from the cumulative effect of thousands of suggestions for small improvements, emanating from the shop floor and implemented weekly or even daily.

Knowledge

It follows that a key personality trait in business is understanding that the cumulative knowledge of employees and customers is far greater than that of the top brass.

In my experience, ideas which emanate from experts in ivory towers are often wrong and need to be tested in the fiery crucible of common sense and public knowledge – just as the jury system tempers the views of judges and lawyers, thanks to the combined knowledge of jurors.

A way must be found to tap into the pool of public knowledge and to sift through and implement the best ideas.

This enables businesses to move forward, rather than sinking slowly into the mud of obsolescence and changing tastes and fashions.

Ideas

Wetherspoon’s method of adopting the best ideas includes the top brass spending a couple of days a week visiting our pubs to speak to staff and customers – preferably alone and unannounced, for maximum exposure.

A huge number of the improvements we’ve made over the years stems from these visits.

Criticism

We also encourage staff to make suggestions and we try to be as receptive as possible to criticism from every corner: the press, friends, relatives, Uncle Tom Cobley and all.

As an example, have a look at the letters pages of the Wetherspoon news magazine (pages 6–7) – these contain six or seven suggestions about how we could improve the business. Turning criticism into a positive force can be hard on the emotions, because no one likes to be criticised, yet is a vital process.

At Wetherspoon, suggestions and criticisms are reviewed at a weekly meeting which I attend with senior colleagues, along with a changing rota of pub managers and staff – and we try to select the best ideas to run with.

It’s not rocket science, but somehow it works.

Success

Nor is it an exaggeration to say that the long-term success of any pub, restaurant or retail business is directly proportionate to the number of ideas from the shop floor which are received, distilled and implemented on a weekly basis. However, that is not how most companies are run.

Boardrooms tend to be dominated by highly qualified people, often with big egos, resulting in almost all ideas being imposed from the top.

These ideas have a high failure rate and also disincentivise employees, who can feel that they are just cogs in the corporate machine.

There is also a tendency, in some companies, for top brass to hide in the corporate HQ, rather than to visit pubs, shops or factories themselves and, when visits take place, for them to be announced in advance.

Visitors tend to be surrounded by an impregnable entourage, making the exchange of information with the real world all but impossible.

Like the queen, many CEOs think that the world smells of fresh paint.

Analysis

John Gapper, associate editor and chief business commentator of the Financial Times, spent a long time analysing Wetherspoon’s business and produced the best analysis I’ve seen of our approach (you can read the article on pages 60–62 of the Wetherspoon News, or download from the bottom of this page).

To be fair, the approach isn’t unique to Wetherspoon.

Some ideas are our own, yet we’ve also learned from visionaries like Sam Walton of Walmart, John Timpson of Timpson and Julian Richer of Richer Sounds, who all emphasise the importance of listening to staff and customers – and of trying, however imperfectly, to improve working conditions and rewards.

What applies to well-run companies also applies to entire nations.

History clearly shows that a proper democratic system which emphasises ideas and the voice of the people, through the ballot box, brings far more prosperity, equality and freedom than do autocratic régimes.

Any list of the world’s wealthiest countries demonstrates that the most democratic countries are the most prosperous – and also have the greatest levels of free speech and human rights.

A few autocratic oil states might have a high income, but the liquid gold doesn’t trickle down far.

It’s also clear that democracies, which respect universal suffrage, offer the best protection against war.

Australia won’t invade New Zealand and the US won’t invade Canada, just because they’re bigger and more powerful – it would obviously be unacceptable to their electorates.

In contrast, however benign or attractive non-democratic systems may appear to start with, they invariably end up with a psychopath in charge.

Only a nutter could have decided to attack Russia in 1941, and only a nutter could have decided to attack the US at Pearl Harbour in the same year.

Astonishing

Yet, once those formerly warlike régimes became democratic, astonishing progress was made – because the leaders were forced to listen to the people.

Within a few decades, Japan became the second biggest economy in the world… and West Germany became the third.

Not only that, but, from the rubble of war, press freedom and the rule of law were constructed with lightning speed, creating the foundations of success for future generations.

Democracy

If you need more examples of the magic dust of democracy, just compare the amazing economic performance of democratic North America (let’s face it, once it had dislodged the Brits) and the freedoms which its peoples have enjoyed in the last 200 years with that of unfortunate South America, which has been dogged by a lack of democracy.

Or, compare the astonishing performance of democratic South Korea with that of undemocratic North Korea.

Democratic India, too, with its massive population and huge diversity of religions and ethnicity, has made giant strides.

You may not like Donald Trump or Justin Trudeau, and many North Americans agree, but they were democratically elected, at least, and will be but on their ear, if they don’t cut the mustard.

Undemocratic

So, how can it be that Europe, which has, itself, until recent decades, been the victim of undemocratic régimes, is surrendering its hard-won democracy to the unelected bureaucrats of the EU?

What started off as a benign sounding ‘common market’ has transmogrified, without any proper democratic mandate, into an ‘ever-closer union’, with five unelected presidents, MEPs who can’t initiate legislation and a court which is subject to no real democratic control.

Why is it that so many of the most highly educated in the UK and Europe are determined to subvert democracy? The UK’s impartial Electoral Reform Society, among others, has been highlighting the EU’s democratic deficit for many years, yet its suggestions for reform have fallen on deaf ears.

Referendum

Indeed, the UK’s then prime minister, David Cameron, said, before the 2016 referendum, that the EU needed ‘fundamental reform’, but even the threat of the UK leaving was insufficient to create democratic momentum – no surprise really, since the EU, like undemocratic regimes down the ages, is seeking to accrue more power to itself and wasn’t going to give it away to Cameron… or to anyone else.

In the UK’s 2017 general election, the two main political parties promised to honour the referendum result, but the prime minister and her pro-Remain kitchen cabinet have reneged on their manifesto commitments.

They are trying to push through a ‘deal’ which keeps the UK tied indefinitely to the customs union, pays £39 billion to the EU and fails to assert control over UK fishing waters.

Sorry, but that’s not Brexit.

Staying in the customs union keeps prices high in shops and pubs, by continuing to impose import taxes (known as tariffs) on over 12,000 products from outside the EU, the proceeds of which are sent to Brussels.

It also prevents the UK from reaching beneficial trade deals with countries like the US, India, China and Japan.

And crucially, it keeps us tied to EU rules, regulations and laws – with no say.

The Labour Party’s policies are worse, advocating a permanent customs union and, according to many of its MPs, a second referendum.

The danger for the UK and for Europe is that the EU holds a religious mystique for most of the political classes – and for their counterparts in the media, business organisations and Whi tehall, almost all of whom attended those bastions of privilege and groupthink: Oxford and Cambridge universities.

Surreptitious

Paradoxically, the greatest danger to democracy in the UK comes not from foreign powers, but from what Bob Marley called ‘the brainwash education’ of the graduates of these universities, who, apart from a rebel minority, have led the campaign for the surreptitious transfer of power to the unelected oligarchs of Brussels for over 40 years.

This tight-knit diaspora tried to get us to join the disastrous euro, directed the pro-Remain campaign in the referendum, was the main promoter of Project Fear and now controls almost all of the main levers in parliament, the media and business.

Cynical

Cynical Theresa May created a ‘kitchen cabinet’ to oversee Brexit, composed entirely of her rabidly pro-Remain Oxbridge peers – ‘deputy PM’ David Lidington, chief of staff Gavin Barwell, chief negotiator Olly Robbins and Attorney General Geoffrey Cox, among others.

The wider cabinet is also stuffed with Oxbridge Remainers, such as Philip Hammond, Amber Rudd, David Gauke and Greg Clark.

So, what can a poor boy do?

The first thing is to follow Bob Marley’s advice ‘to chase those crazy baldheads out of town’, by voting the indoctrinated Oxbridge elite out of power (but let’s make an exception for the rebel minority…).

Support

Your vote in forthcoming elections should support pro-democracy candidates representing genuinely pro-democracy parties.

The second is to make your personal economic power count by buying British and non-EU products, wherever reasonably possible.

Free trade increases prosperity, but a stand must now be made against the protectionist and undemocratic EU system.

It’s unfair, in a sense, to our European friends and allies, with whom we have no quarrel, but, like us, they must shake off the yoke of EU imperialism – before trade, freedom and democracy suffer even more.

Tim Martin

Chairman


Extract from Wetherspoon News Summer 2019