Phil Parnell's turnaround of Drambuie shows how business leaders can revitalise a famous brand without sweeping away the heritage. Are there lessons here for government too?

When everyone around you is losing their heads (and I'm thinking, primarily, of the government) and all you want to do is escape to a small Scottish island and become self-sufficient, it is uplifting to come across individuals who are so inspiring that you wish they could be put immediately in charge of the country, or the banks, or even the England football team.

I met a man recently who, in the space of three years, transformed the fortunes of Drambuie. Over the best part of a century, three generations of a family company presided over the steady rise and dramatic fall of the drinks business, its decline hastened by diversification into all sorts of unrelated areas, including premium car dealerships, art collections and Caithness Glass. By 2005 the company was losing nearly £1m a year and owed the banks £8m.

Enter, stage right, Phil Parnell, former chief executive of Dunlop Slazenger and veteran of Guinness and Diageo. He spent time assessing the business, and concluded that Drambuie was a famous brand crying out to be rebuilt and that management were committed to doing it. He then formulated a strategy to rejuvenate the brand and revive the business. Three years later it turned a profit of £3.25m, and had grown shareholder funds from £11m to £19m. It raised marketing expenditure by 50 per cent last year, which meant that despite losing volumes as distributors destocked, the recession proved no more than a minor inconvenience to growth plans.

Job done? Not quite, said Parnell. He may have set the company on the right track, but rebuilding a brand is a long-term project, requiring patience, persistence and, critically, belief. He fostered that belief among everyone in the company by involving them closely in strategy, including holding regular cross-agency brainstorming sessions for PR, advertising and strategy consultants, so that they now act as engaged, empowered teams.

How refreshing, how novel—and how eminently replicable. Why don't more companies do it? What's more, why do so many new brooms (take note Michael Gove) insist on sweeping away all that went before, rather than building on the best of what they have?

It is, arguably, easier to bring about such changes in smaller companies, and the passion for the brand among Drambuie employees reminds me of coffee and tea company Bettys & Taylors of Harrogate, which is at pains to control its growth in order to preserve its distinctive culture. But while small is beautiful, big doesn't have to be ugly.

Someone else who has impressed me is Chris Ingram, erstwhile head of global media agency Tempus, which he built from scratch and sold to Martin Sorrell's WPP in 2001 for £432m. Ingram sustained the entrepreneurial culture in Tempus as it grew by allowing as much autonomy as possible in the businesses he acquired. But he recently returned to his true love—small business—which, as he says, allows you to "take decisions in the back of taxi cab, an agility that gives you a huge advantage over big business, which can be left breathless".

It's a breathlessness that comes from being strangled by the systems, processes and formulas that so many big businesses seem to feel they need to wrap themselves up in, losing sight of their distinctive essence and their customers in the process.

Unilever, for example, is still trying to work out the best way to manage its brands after a dramatic rationalisation a decade ago reduced its portfolio by 75 per cent. Arguably, it made the mistake of trying to cure a weakness, complexity, rather than building on its strength—its heritage. It may have seemed a triumph of corporate neatness, but consumers are not quite so tidy-minded and Unilever's cast-off cash cows—Birds Eye, Oxo, Brooke Bond, to name but three—continue to provide healthy income streams for their new owners.

Not that you'll often find big companies such as Unilever admitting to mistakes. Entrepreneurial businesses have more humility. "It's OK to make mistakes, provided you admit to them and learn from them," Ingram told me. "Being honest about your mistakes makes your successes more credible, because people believe you."

Another entrepreneur, Alex Pratt, founder of Serious Brands, agrees. "Failure is under-rated," he writes in his book, Austerity Business. "It keeps your ego in check if you can learn to lose well and often."

I wish that truism could be applied to politicians, the management of big banks and the England football squad.