Unlocking Leadership Potential in SMEs: Why Blended Learning Makes the Biggest Difference

In the United Kingdom, small and medium-sized enterprises, or SMEs, make up the backbone of the economy. According to 2024 government figures, there are around 5.5 million private sector businesses in the UK, and nearly all of them, 99.9%, are SMEs. These businesses account for 60% of employment in the private sector and bring in 48% of its turnover. Despite their size and significance, many SMEs find it tough to build strong leadership capabilities across their organisations.

SMEs are often pressed for time and money, and many don’t have a dedicated HR or learning and development function. But as they grow, it becomes vital to move from a founder-led model to a broader leadership team. So leadership development becomes less of a ‘nice to have’ and more of a must-do.

To meet this challenge, what works best is a blended learning approach to leadership development, one that mixes different types of learning and support. This could mean blending diagnostics and 360 degree feedback with experiential learning and practical workshops, using digital accelerators like online learning paths and tools for logging reflections, and backing them up with live, human elements like peer coaching groups. It also means blending external expertise with in-house capability, which helps to keep costs down while ensuring that programmes are tailored to the business’s culture, stage, and strategy.

The Leadership Development Challenges SMEs Face

Leadership in SMEs looks different from leadership in large corporates. Leaders tend to juggle many roles at once, decisions are often made quickly and informally, and structure is usually pretty minimal. As a result, SMEs typically face a range of challenges. These include having limited time and budget for leadership development, a heavy reliance on the founder or a small senior team, and difficulty spotting and supporting future leaders. There’s also the problem of not having access to structured tools like personality profiling or 360 degree feedback, and of promoting people based on technical skills or loyalty, rather than leadership readiness.

Many SME leaders find it hard to step away from the day-to-day and make space for strategic thinking. A common question we hear is: How can I help people grow as leaders without sending them off on long training courses that take them away from the job? The answer lies in designing a plan that supports their career goals and the organisation’s needs, and doesn’t overwhelm anyone in the process.

Tailoring Leadership Development to Different SME Types

Not all SMEs are the same. Whether a business is just starting out or already well-established will make a big difference to the kind of leadership development it needs. Here are three common types of SME and the kinds of challenges they might face:

Small, Family-Run Businesses

These businesses often rely on strong personal relationships and long-standing ways of working. But that can also mean leadership roles are unclear, and change is sometimes resisted.

Key challenges include:

• Planning for leadership succession within the family or close team

• Informal decision-making and blurred boundaries

• Reluctance to bring in outside support or tools

Fast-Growing Start-Ups

Start-ups tend to move at a pace. Roles evolve quickly, and processes are often fluid.

Key challenges include:

• Promoting people too early or without proper support

• Constant change makes it hard to embed development

• Over-reliance on the founders’ leadership style

Established Mid-Size Businesses

These organisations may be past the start-up phase but still need to keep lean.

Key challenges include:

• Generational divides or mismatched leadership expectations

• Tension between consistency and innovation

• Pressures on performance with little room for traditional L&D

(We’ll share specific recommendations for each group later on in the article.)

A New Kind of Blended Learning

At Esendia, we see blended learning as more than just mixing online and face-to-face content. It’s about combining the best of what your organisation already has with the strengths of an external partner.

For instance, many of our clients already use personality profiling tools like OPQ, Insights, or Hogan, and have trained internal people who can deliver those insights. We then bring in our 360 degree feedback tools, as well as the structure and rhythm of our Programme Module on the Esendia Platform. This takes pressure off the internal programme lead while allowing them to stay in control of delivery.

In terms of delivery, we collaborate. We might provide coaching — either one-to-one or in small peer groups, while the client organisation adds in its own expertise. That could be fireside chats with senior leaders or technical sessions from in-house experts. Together, we create something co-owned that really works.

And to be honest, we love working this way. Some of our best work happens in close partnership with in-house teams. Even better, in many cases, clients take on more and more of the delivery themselves in year two, using the structure we’ve built together.

Making It Work: A Strong Project Kick-Off is Key

To make this kind of partnership a success, it’s really important to start with a strong foundation. At Esendia, we always begin with a project kick-off that clearly sets expectations on both sides. That means:

• Defining roles and responsibilities

• Agreeing on goals and success measures

• Talking through risks and how to manage them

• Setting a clear delivery and communication plan
  

It sounds simple, but it makes a huge difference. When everyone’s clear and aligned, the programme runs more smoothly and feels like a natural extension of the business, not a bolt-on.

And here’s the thing: we genuinely enjoy this way of working. There’s something very rewarding about building a programme side by side with an in-house team, supporting them in the early stages, and seeing them take it forward with confidence.

Case in Point: Blended Learning at Esendia

Our blended learning programmes bring together a mix of diagnostics, coaching, experiential learning, and structured reflection. They’re designed specifically for SMEs and mid-sized businesses, and they get results.

We’ve helped organisations identify leadership potential through 360 degree feedback and grow confidence in future leaders with coaching and feedback loops. We’ve worked with clients to link personal development plans to longer-term business strategy and to build stronger internal networks through peer learning.

The common thread? We start with the right diagnostic tools and build something practical and flexible around what the business really needs.

Final Thoughts: Leadership Development Isn’t Just for Corporates

Some people still think structured leadership development is only for big corporates with lots of time and money. That’s just not true. SMEs can create brilliant, cost-effective programmes that are more agile and more human, especially when they blend the right methods, people, and tools.

By grounding your approach in diagnostics and tools like 360 degree feedback, personality profiling and skills audits, and wrapping them in peer learning, coaching, and real-life projects, you can create a programme that sticks, and scales.

Whether you’re leading a small team, growing a start-up, or managing a mid-sized business, now’s the time to take leadership development seriously. And the good news? It’s absolutely doable.

Our Top Recommendations for Different SME Types

Small, Family-Run Businesses:

• Introduce 360 degree feedback carefully, using trusted relationships to encourage honest conversations.

• Focus on communication, delegation, and how to navigate difficult conversations within close-knit teams.

• Combine familiar in-house voices with outside perspectives to avoid resistance to change.

Fast-Growing Start-Ups:

• Use diagnostic tools early to spot talent and identify gaps.

• Build coaching into fast-moving project cycles or team huddles.

• Prioritise peer-to-peer learning and bite-sized experiential tools over long formal courses.

Established Mid-Size Businesses:

• Run a skills audit to see where new capabilities are needed.

• Balance internal development with expert-led workshops that fill in gaps.

• Create structured leadership development pathways with diagnostics, reflection, and support baked in.

To learn more about how Esendia helps SMEs develop leadership and support sustainable growth through blended learning, visit👉 www.esendia.com/blended-learning