Comments by Mr Micheál Martin TD at the Ernst and Young Entrepreneur of the Year Awards

Citywest Hotel Thursday 29 ^th September, 2005

I am very pleased to be invited to speak at the Ernst and Young Entrepreneur of the Year Awards. This event recognises and celebrates the island’s entrepreneurial talent. I would like to extend a warm welcome to all of you here today, and in particular to those of you who have travelled from Northern Ireland.

Over the last number of years the Global Entrepreneurship Monitor (GEM) Report has found that Ireland is one of the most entrepreneurially active countries in Europe. Key informants interviewed for the purpose of the study consistently highlight a positive culture as the most significant factor in creating an environment conducive to entrepreneurial activity in Ireland. The Entrepreneur of the Year Award is one facet of this positive culture which celebrates and recognises the achievement of our emerging and established entrepreneurs.

The transformation in Ireland’s economic fortunes over the past decade has been little short of remarkable. More than 700,000 new jobs have been created, Ireland’s finances went from chronic indebtedness to surpluses, and standard of living has improved significantly. Many reasons and factors have been advanced to explain this turnaround but one factor, which is seldom given due credit, is the emergence of a genuine culture of entrepreneurship in Ireland – one which had never really existed before. Ireland has moved from a culture that viewed entrepreneurs with scepticism to recognising their contribution to the country’s economic growth. They are seen as local champions who have demonstrated the courage and the capacity to create successful enterprises that created employment for themselves and others. At this event we acknowledge the ambition, determination and inventiveness of entrepreneurs who have taken on the challenge of starting and building internationally competitive businesses.

The success of Irish entrepreneurs has not just been in the Irish market. Increasingly Irish entrepreneurs have sought to conquer foreign markets. Such has been their achievement that Ireland now has a whole range of Irish-owned or Irish-led companies quoted on the NASDAQ and other international exchanges. What these companies, and others like them, have in common is the fact that they were all founded by Irish entrepreneurs whose ambitions and sights were set far beyond the horizons of the domestic market.

There does not appear to be any shortage of entrepreneurs out there. This is clearly illustrated by the findings of the InterTradeIreland study ‘Entrepreneurship on the Island of Ireland’, due to be published next month. The study reveals that the total number of entrepreneurs on the island of Ireland in 2004 was approximately 245,000. This means that for the island as a whole, about one person in every eleven is active as an entrepreneur.

The Government’s policy in relation to enterprise and entrepreneurship is constantly evolving to meet changing sets of circumstances. In many ways, it can be said that Ireland has now moved on from what might be called the “climate creation” phase and has arrived at a point where access to finance is no longer the critical problem it was for many start-up enterprises in the past. The current policy is to work continually to identify and remove constraints and barriers to growth. For our enterprise development agencies, this means taking a holistic approach to developing solutions for their clients. This approach takes into account all areas of business activity from design, through production to marketing and including the key areas of finance and human resource development.

There is no room for complacency, and that is why I recently established a Small Business Forum to examine the current environment in which small business operates in Ireland. Among the matters I have asked the Forum to consider is whether the strategies being followed to support and develop the spirit of entrepreneurship in Ireland are effective and appropriate.

The Government, and the industrial development agencies north and south of the border, are all committed to achieving a globally competitive all-island economy characterised by the optimal utilisation of the island’s resources, particularly knowledge resources, to drive competitiveness, growth and wealth creation. The realisation of this vision entails working with companies to enhance their competitive performance, and also helping to improve the business environment within which companies do business.

The move up the value chain, the internationalisation of businesses, and the move to the knowledge economy all increase the complexity of the management task and also the nature of the skills required. In the rapidly changing global business environment management capability is the most important long-term determinant of success for any company, whether that is at CEO, senior management or Board level. However, for many companies increasing management capability is often relegated as a priority because of more pressing short-term business survival and growth issues. This is particularly the case with smaller companies compared to larger international competitors.

For a company to survive, prosper, and grow to its full potential it must be committed to building the management capability within the firm. The management of the company must be ready to change behaviour, respond to changing business circumstances and ultimately be capable of pro-actively impacting on business performance in the short and long term. This is a difficult and complex process, as highlighted in one of the ‘Entrepreneur of the Year’ programmes leading up to to-night’s event.

Particular challenges exist in developing the management capability to sell. The key to the success of a new innovation and technology-based business is the ability to sell and secure the all important first international reference sale. That is why it is very important that the management teams promoting projects focus not just on technology itself, but more crucially on what the technology can deliver in terms of a customer solution with clear benefits that can be sold. The Enterprise Strategy Group Report “Ahead of the Curve”, on the strategic importance to the Irish economy of exporting, found that Irish companies were at a serious disadvantage because of difficulties in sourcing suitably qualified and experienced sales professionals. I tasked Enterprise Ireland and FÁS to deliver a co-ordinated answer to the problem. A month ago, I announced that Enterprise Ireland and FÁS have brought forward a joint proposal to source and develop increased levels of sales and marketing talent and place them in Irish companies. Enterprise Ireland and FÁS already collaborate across a number of areas relating to company capability. A more integrated approach for graduate placement, with a specific focus on closing the international sales capability gap, will be made available by the agencies to companies within months. This will be of real value to Irish companies especially many of those here tonight who realise that in the current global economic climate the ability to close the sale is paramount for all Irish companies trading internationally.

A key part of the initiative, that Enterprise Ireland will deliver, is the development of a programme that is totally sales focused and company-led. It is designed to give results targeting both existing and long-term strategies of participating companies and also the personal selling skills of participating executives. The programme will be part-time and modular, and will include overseas-based elements in relevant markets. It is centred on three main themes:

• developing the international sales strategy
• managing the international sales organisation, processes and operations; and
• winning international sales

The programme will be delivered by a leading third-level institution which will concentrate on the practical rather than the theoretical in that the context will focus on a real life sales situation of each of the participating companies. It will be workshop rather than lecture based, and will utilise the very best of international expertise and practice. Over 30 companies are expected to participate in the pilot phase of this programme which will be constantly reviewed from the outset in terms of its ability to deliver results.

The challenge of selling does not just exist for relatively new companies. Building the management team to internationalise their business successfully will remain a consistent challenge for all businesses at all stages. Companies can address this challenge in three key ways; by building the management team within the company through recruiting and successfully integrating new managers; by developing the capabilities of the CEO, senior team, and the skills within the company, and finally by accessing external expertise. Enterprise Ireland is currently developing a wide-ranging management development programme which will address these three themes.

The State’s role in promoting and fostering entrepreneurship has changed greatly over the past decade. From a position of having to intervene in financial and capital markets and provide relatively high levels of financial support, we have now moved to a situation where the culture of entrepreneurship has taken firm root in Ireland. While the State can take some credit for putting in place the range of supports and other measures that helped the current crop of entrepreneurial companies to grow and flourish, we must now facilitate those individuals who will be responsible for the development and creation of the next wave of internationally successful Irish-owned and Irish-led companies – a wave that we are already seeing emerge as evidenced by the successful companies participating in this awards programme.

It is essential that success be celebrated. It confers benefits not only on the entrepreneur but also on the wider community. I believe that tonight’s event will provide exposure and afford the opportunity to many people on the island to learn from our exceptional entrepreneurial role models. The experiences and outstanding success stories of the 24 finalists will play an essential part in encouraging others to follow their example. The success so far of the finalists should not be understated. The 24 finalists have a combined turnover of more that €1.5 billion with over 5,000 employees. The finalists are representative of the makeup of Irish business. They are involved in sectors such as internationally traded services, pharmaceutical, hospitality, food and drink, construction, manufacturing, oil and agribusiness industries. Previous winners of the Award include Denis O'Brien, Moya Doherty, Eddie Jordan, Martin McVicker, Padraig O'Ceidigh, Liam Shanahan and Peter Fitzgerald. Tonight’s winner will join this impressive assembly and will go on to represent Ireland at the world Entrepreneur of the Year in Monte Carlo in

June 2006 – a tough assignment!

I congratulate Ernst and Young for their initiative and ongoing commitment to highlighting the success of entrepreneurship in Ireland. While only one finalist can achieve the Irish Entrepreneur of the Year Award, tonight we recognise all 24 finalists – all winners. I congratulate the entrepreneurs here this evening in leading their companies from strength to strength. You are fully deserving of the recognition now being afforded. I wish you and all entrepreneurs every success into the future.

ENDS

ETE 1423