By Daniel Hunter

New research launched by Ingenious Britain finds that on average small business leaders across the UK are spending almost a third of their day on tasks that aren’t core to business operations.

One in four small to medium sized enterprise (SME) owners and managers spends 50% of the day on non-core activities and one in 10 is guilty of spending up to 90% of their time on activities that aren’t directly related to driving business growth.

The research found that SME business heads see retaining existing clients as their number one priority and winning new business and growing their organisation are the biggest challenges they face.

But rather than freeing up their time resource to work on the core activities, which deliver maximum return on investment to their business, they are drawn into operational aspects of the business such as HR, IT, finance and training.

The findings were presented yesterday at a think tank event for SMEs in London, hosted by small business community Ingenious Britain. Ingenious Britain today launches a new initiative to encourage SMEs to think about the small steps they can take to maximise their time and capacity to achieve growth.

Key findings of the report include:

· Reluctant to relinquish control: Given the choice, 30% of small business leaders would choose to outsource IT services but many are still resistant to the idea of outsourcing other part of their business. Many prefer to keep what they perceive to be the ‘crown jewels’ in-house — HR (14%), training (13%) and financial management (14%) are lower on the outsourcing agenda

· Customer is always right: Servicing existing clients is overwhelmingly the number one priority for SME business owners and managers with 82% citing it as important. Clearly in a tough economy businesses are desperate to retain existing clients. Interestingly, improving internal processes (62%), whilst still important, came bottom of the agenda

· Growth is tough: Not surprising growing the business (55%) and winning new business (54%) are the biggest challenges facing UK SMEs. Whilst servicing clients was seen as the number one priority, it was seen as the least challenging (2%)

The independent research was commissioned by Ingenious Britain, it surveyed 200 small business leaders across four vertical markets; financial services, retail, manufacturing and telco. The research examined their approach to business management and growth.

When analysed by vertical sector, financial services was found to be the most protective regarding outsourcing business operations, with only half of respondents saying they outsource some part of their business. Two-thirds of SME business owners and managers in retail, manufacturing and telco sectors were more open to relinquishing control and outsourcing part of their business.

“Striking a balance between running a business and growing a business is an age-old challenge for SME business owners and managers," Mark Moore, founder of Ingenious Britain, said.

"But in a tough economy and double-dip recession, it’s more important than ever that business owners take a step back and reappraise where their value in the business lies and how do they apportion more time to delivering ROI. Some might see this as daunting or requiring a complete overhaul to existing business processes.

"Our attitude is the opposite; take a step-by-step approach towards specific business areas breaking them into more manageable chunks. Business owners should focus on specific issues and business areas, rather than spreading themselves too thinly.”

Miranda Ballard, co-founder of Muddy Boots Real Foods limited, said, “As a small business, these research findings ring so true to our experiences of running a business. There is a constant battle with our time, trying to maintain the business but also to keep expanding at the ambitious rate that we really want to. It’s always tough to feel like you’re giving up control of aspects of your business but outsourcing the production and distribution of our burgers and meatloaf have simply been two of the best moves we’ve made. We weren’t making any new sales or contracts when we were standing behind the prep table in the kitchen and delivering them ourselves.”

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