Aberdeen businessman highlights importance of oil and gas industry to city

Visiting Professor of Entrepreneurship at Robert Gordon University

Age:

83.

What is your business called?

Skene Group.

Where is it based?

Aberdeen.

What services does it offer?

The group consists of Skene House HotelSuites at three locations in Aberdeen; Inchmarlo Retirement Village on Royal Deeside and Morgan Property Company which offers serviced offices, particularly for start-up companies, in Aberdeen.

To whom does it sell?

The diverse nature of our businesses means that customers range from start-up businesses to holidaymakers and the elderly.

What is its turnover?

It’s 35 per cent lower than it was four years ago due to the downturn in the price of oil. This has affected many businesses, not just our own.

We have also been badly affected by the business rates revaluation – for example our city centre Skene House HotelSuites rates have increased from £280,000 to £704,000! It is clear that current business rates are unsustainable and need to be replaced. However, despite difficulties we are still successfully expanding others parts of the business.

How many employees?

Approximately 200 across our businesses.

When was it formed?

Studio Morgan was founded by my father’s family in 1884 and I joined in 1955 when I returned from national service in the Royal Navy. I was given responsibility for 50% of the staff which sounds very impressive until I add that that was one of two people! Five years later, we employed about 20 people. I set up my first business of my own about 47 years ago.

Why did you take the plunge?

It seems a little ironic now but, looking ahead to what was then the normal age of retirement, I decided it wasn’t going to be possible to sustain the growing photography workload so I decided to diversify into property. I started in the 1960s by buying the former Osborne Hotel on Queens Gardens, Aberdeen and turned it into a combination of family home, business base and offices for rent. I’m delighted to say that these properties are still part of the business today.

In the case of Inchmarlo Retirement Village, during lunch with my bank managers, I learned that they had recently financed a continuing care facility for the elderly in America. Interest duly piqued, I wanted to know more because it was new, different and sounded exciting. My colleague and I looked at overseas examples before taking the plunge and buying the 100-acre Inchmarlo Estate near Banchory on Royal Deeside. The village was born in 1986.

What were you doing before you took the plunge?

I was a photographer running the family business of Studio Morgan. Then a chance conversation at a dinner in Edinburgh led to the acquisition of a large number of tenement properties in Aberdeen. I identified a market opportunity presented by the dawn of the offshore oil industry and refurbished the buildings to offer high end accommodation for short term leases. This provided a cost-effective alternative option for oil company personnel coming to the city. It was pioneering in its day and created what is now Skene House HotelSuites.

What was your biggest break?

The discovery of North Sea oil and gas because this changed the Aberdeen economy dramatically. The city was always a prosperous place and business was good, but the coming of oil revolutionised the way in which businesses, including ours, operated.

What was your worst moment?

The downturn in the oil industry which we have experienced recently is significantly worse than the previous drop in the price of oil in 1986. Combine that with significant increases in business rates, and many businesses are struggling or folding.

What do you most enjoy about running the business?

Harvard Business School Professor Jeffry Timmons described entrepreneurship as: “a behavioural process involving the pursuit of opportunity without regard to the resources currently controlled” and that definition fits exactly how I have operated during 60 years in business. Customer satisfaction is undoubtedly what drives me the most, as well as giving good service and value for money, and achieving repeat business. A bit of profit doesn’t go amiss either of course!

What do you least enjoy?

Paperwork, rules and regulations are things which I employ other people to do because they are not my thing at all.

What are your top priorities?

We must continue to improve our businesses and, hopefully, profitability; improve our products; work hard to achieve satisfaction for customers; continue to promote tourism and personally I will try to promote entrepreneurship through our schools and universities as I have done since 1986, when I became a visiting professor at RGU. My greatest inspiration is Andrew Carnegie whom I studied in detail in my youth. I read his story in a book borrowed from the library in Portsmouth during my national service and it captivated me. He proved that, regardless of your background or education, anything is possible if you are sufficiently determined.

What could the Westminster and/or Scottish governments do that would help?

I passionately believe that nurturing the entrepreneurial spirit of children and young people is central to the future of the Scottish economy.

What was the most valuable lesson that you learned?

I get tremendous excitement from having an idea, taking it forward and seeing if it works. Most have. If it does not work you have to shrug it off and move forward. You have to keep trying.