The sudden suspension on Monday in the shares of Rok - “the nation’s local builder” - would have surprised few in the City.
Since the company’s creation in 2000, there have been question marks over its strategy and how it relates to the company’s own unique style. Led by the gregarious and driven Garvis Snook, the business had the kind of razzmatazz you rarely see this side of the Atlantic. Its army of employees were mesmerized by loud and flashy internal conferences as the company’s top performers were rewarded with a “Rok Star” label. What Snook achieved was to lay down, in no uncertain terms, a corporate identity, vision and unity of purpose that his 3,800 employees were expected to sign up to and follow. And they did.
We all watched Rok’s trajectory as it grew, earning a reputation as a City darling that eventually achieved a price tag of about £430m at its peak three years ago. It began chasing larger and larger prizes, its share price proudly displayed in regional offices and key executives incentivised on rapid growth targets. The group went on to establish a lucrative and fast-growing insurance maintenance division, its air of confidence reassuring clients.
So where did it all go wrong? Well, analysts placed a red flag on the maintenance sector as soon as Connaught, Rok’s fiercest competitor, went under in the summer. Rok was notable by its absence from the queue of businesses looking to lap up the remains of Connaught, or its lucrative remaining public sector contracts.
Then there were the deteriorating economic conditions, which resulted in Rok confessing it would need to strike 700 people from the payroll at the beginning of the year.
And just as economic confidence in the repair and maintenance sector had reached its nadir by the end of September, the City’s belief in Rok’s leadership was fatally undermined by the treatment of one of its management team. The company was forced publicly to exonerate finance director Ashley Martin after he was suspended over allegations that he was responsible for accounting irregularities in the group’s plumbing business.
With turnover falling off a cliff and the kind of management controls you need in a downturn conspicuously absent, belief in the group’s strategy and team disappeared, leading to £70m debt and the burnt-out remains of yet another company, serving as a reminder that confidence can only carry you so far.
What clients want
Two years after construction’s mass exodus from the private sector, the tables have turned. Now, with the future of public sector projects looking increasingly bleak, it’s a race back to the other side as the scramble for work continues. The good news is that commercial, retail and leisure projects in this sector are finally moving and there is real work out there to be won.
In this week’s issue, we guide you through the UK’s top clients including BAA, Land Securities and Waitrose as they reveal what their development pipelines will look like over the next 3-5 years and how much of that work is up for grabs. It makes for reassuring reading - not only because most of the work is yet to be allocated, but also because the vast majority of clients featured are looking for new supply chain members to deliver it. So how do you make them pick your firm? The trick isn’t just about getting there first - it’s about giving the clients exactly what they want. See pages 38-42 to find out what that is.
Tom Broughton, brand director