Profile: Paula Bell, FD of Ricardo Group

Chugging down the A27 on my way to Ricardo’s technical facility in Shoreham,
I’m overtaken by a silver Mercedes SLK350 sports car driven very assertively by
a rather glamourous blonde. As I pull into the visitors’ car park, I spot the
Mercedes two spaces down from my rather sad MPV.

Given Ricardo’s core business ­ automotive engineering consultancy ­ you’d
sort of expect a few performance cars to litter the forecourt. There’s even a
vintage sports car parked by the reception of the rather stark, modernist
interior of the building. It’s a new reception area that opened in September
last year ­ and it still smells like a new car.

Paula Bell, now 42, has been in the financial driving seat at Ricardo plc
since November 2006, and in that time she has played a major role in
diversification of the business, and transforming Ricardo’s balance sheet and

It’s very hard not to warm to Ricardo’s group finance director. The softly
spoken Geordie has an uncanny knack of putting people at ease. There are no airs
and graces, and not an ounce of arrogance. Bell is intensely professional,
immensely good company and surprisingly feminine, in stark contrast to the male
dominated industry in which she has carved out her career.

She’s not one to dwell on the issue of gender in business. Nonetheless,
CIMA-qualified Bell has single-handedly succeeded in softening some of the
slightly rough and masculine edges of Ricardo, which employs 1,700 people
globally, of which around 900 are based in the UK across facilities in Shoreham,
Leamington and Cambridge. The company’s annual report, an attractive tome
adorned with splashes of colour and retro graphics, is a case in point. “That’s
the feminine touch,” Bell jokes. “If it were down to the engineers, everything
would be Ricardo royal blue, even the chairs in reception.”

Harry Ricardo started the business 100 years ago as a car manufacturer but
quickly realised that consultancy would be a far more lucrative business to
develop. The company’s core market is to provide technical consultancy to the
automotive market, but in the last five years Ricardo has diversified ­ very
successfully ­ into new areas and geographies.

Renewable energy, such as the technology behind wind farms, and low carbon
research, will be a major focus, as will other forms of transport, including
rail and marine. Bell believes Ricardo will generate new revenues of £30m from
each in the next three years. Meanwhile Ricardo’s defence business ­ it
specialises in modifying Land Rover Defenders for the military by adding armour
protection and mountings for weapons ­ is a growing business both in the UK and
the US as the war in Afghanistan rages on.

Despite the recession, Ricardo is recruiting furiously to plug skills gaps
for its new areas of focus. “At the end of the day, this is a people business.
If we want to move into new sectors we need to invest in the talent and
experience of highly skilled people to create growth.”

Bell’s successful strategy to reduce gearing in the business from around 40%
to its current level of near-zero net debt since she joined will also pave the
way for acquisitions, although that’s certainly not something they’ll be doing
in the next year.

“After that, if we see something attractive, there’s no reason why not,” she
There’s also a geographic focus to Ricardo’s diversification strategy. It
already has facilities across North America, Europe and Asia and is currently in
the process of building an engineering facility in Shanghai, with the aim of
recruiting 300 people in China over the next few years, “because quite frankly
that’s where the growth is going to be”.

The main thrust of the umbrella strategy has been to reduce Ricardo’s
reliance on an automotive industry in crisis. It’s a recession that has seen
General Motors file for bankruptcy in the US and just last week, GM said it
plans to cut 10,000 jobs as part of a restructuring of its European operations.
Toyota, meanwhile, has seen sales plunge to a hoped for 7.3 million vehicles
this year. The British automotive industry alone has been in the front line of
the downturn, with output falling faster and further than any other sector since
the summer.

“Five years ago, Ford and GM together would have been 50% to 60% of our
business. It’s less than 5% now,” Bell explains. “At that time there were two or
three big project cancellations and a very profitable business turned into a low
profit business overnight. That really set the scene and made us realise you
can’t run a business model based on one or two key clients.”

Although the passenger car segment of Ricardo’s business still generates the
majority of revenues (54% in 2009) that rather foresightful diversification has
more than paid off. For the year to 30 June, Ricardo posted pre-tax profits of
£15.7m, up 1% on the previous year, despite revenues falling 2% to £178.8m.

“We’ve weathered the storm extremely well,” Bell says. “You need a really
strong balance sheet with cash flow to be able to operate a growth model and
expand the business. My financial strategy has been very focused on cash.
Diversification puts more pressure on good credit management processes. If we
weren’t sure about a new client, we’d make sure we got paid up front to protect
our cash position. We refuse to succumb to pricing pressure and we refuse to
relent on our cash terms.”

Government legislation and the setting of new CO2 emissions targets for car
manufacturers look set to be “a fantastic business driver” for Ricardo as harsh
financial penalties will inevitably force the industry to invest in new
technologies. “It would cost the 14 main car manufactures in Europe something
like ?35bn (£31bn) if they don’t hit these targets and they’ve got to come to
people like us to help them,” Bell says.

There is no softening of the CO2 legislation targets on the horizon, despite
the economic situation. And, although Bell admits that car manufacturers haven’t
rushed to invest in the new greener technologies, she’s confident that it’s only
a matter of time.

Meanwhile, Paula and her finance team of 45 will continue to focus on
improving the cash position of the business, underpinned by the concept of
business partnering in finance. “That’s been a journey. We have ten FDs in the
business who concentrate on making us more money. As an FD, you’ve got to have
the integrity and financial controls to run your business successfully, but at
the same time we’re here for one purpose ­ to improve shareholder returns.”

Paula’s criteria for new finance recruits is stringent. “We want people with
a commercial edge and the ability to influence and coach non-financial people.
How do you influence an engineer to think about cash? That’s no mean feat.
Finance people like that are quite hard to find.”

It was only by chance during a ten year stint at Rolls-Royce that Paula was
given an opportunity to develop her own broader commercial skills, after the
business unit she was in was restructured and she was propelled into a business
development director role running the M&A programme for the group. “I was a
long way from my comfort zone, but it was one of the most valuable parts of my

Paula is adamant she’s no petrol head ­ although judging from her driving
style and choice of vehicle (yes, it was her in the Merc), she certainly has
more than a passing interest in cars. She admits finding some of Ricardo’s
projects exciting – working on the transmission for the new Bugatti Veyron and
the Formula 1 side of the business ­ using technology to help Formula 1 teams to
meet regulations. “But a bit of detachment is good. I like to drive a nice car
but I’m not so interested in the technology. My job is to make money from it.”

The future for car manufacturers may hang in the balance but Ricardo is well
placed to thrive, thanks in no small part to Bell. She’s off on maternity leave
at Christmas for the second time, but you get the feeling that she’ll still be
in the driving seat while she’s away.

“Doing the family thing is my new chapter. You can do both ­ I thought it
would be impossible.” I just wonder whether she’ll be trading in that Mercedes
for a more sensible family car.


Paula Bell attended comprehensive school in her native Whitley Bay, just
east of Newcastle, and began her exceptional fast track career by training as a
chartered management accountant while working for the Port of Blyth. In 1989 she
followed in the footsteps of her father and joined Rolls Royce; five years later
– at the age of only 26 – she was finance director of Rolls Royce Industrial
Controls, becoming its youngest ever appointed director.

A five-year stint as director of finance for Anglian Water – another
female first – was followed by an eighteen-month spell as finance and property
director of Gatwick Airport, before returning to the technology sector with

Earlier this year Paula was awarded the prestigious First Women Award for
Science and Technology 2009, sponsored by the CBI, which recognizes trailblazing
and pioneering women in business.

Since Paula joined Ricardo, the number of women in senior management
positions has risen to 35.“It’s still only 10% but it was zero when I joined,”
Bell says. “We don’t recruit on gender but if you have more women in senior
positions, women are more open minded about joining the company. It means we
have a bigger pool to fish from.”

She admits working in a male-dominated environment has its challenges.
“You can get excluded from conversations in the boardroom. If you think
something is a bit unfair, you need to constructively challenge. If you’re
confident enough to do that the problem will go away.”

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