Thursday, January 5, 2012

Sometimes doing less is doing more

So what will 2012 bring to those of us dedicated to encouraging enterprise? Over the last few weeks I have been considering what it requires to give the country a much needed business boost. Whilst I cannot claim any amazing insights my general conclusion was that we can often stimulate growth by stopping doing things! Vast sums of money are not needed - just goodwill, strength and determination. So to add to the numerous New Year lists here is my humble offering of a half dozen ideas which need some work but will hopefully provoke debate:

1. Speed up the planning process. Forget the controversy over the government plans and lets assume that the Green Belt is fully protected. Planning officers must be dragged into the real world. Any development - residential or commercial - on brownfield land which is say less than 5000msq and is designed to the highest BREEAM standards automatically gets planning permission. This improves the quality of stock at a stroke and is a much greater stimulus than enterprise zone status. It allows planners to concentrate on more strategic developments and hopefully improve the plethora of "rabbit hutch" housing that springs up everywhere.

2. Reform economic development. There are some truly inspirational EcDev professionals in local authorities. There are also some blockers. Let each LEP control all of the staff and budgets for EcDev in their areas. This should allow LEPs to really influence what happens. It puts budgets in control of businesses who are best placed to know what business needs and should avoid the repetition of meetings, papers, local initiatives etc. More money should get to the front line as staff numbers are rationalised and the leaders in EcDev are finally given the authority to do what they know needs to be done.

3. Free local authority assets. Remove all restrictions on what local authorities can do with their asset base. If they want to sell and spend the funds then let them. We vote for our representatives so give them the power to improve the area as they see fit. If they mess it up then local voters have only themselves to blame. It would herald a new era of freedom and true localism. I know of many councillors who could really make a difference given the opportunity instead of tinkering within archaic rules.

4.Change government contracting. We hear many promises about helping SMEs to access government contracts but little happens. With immediate effect any government contract of less than £10m pa can only be let to an SME. The government would get better value for money, more innovation, less "cronyism" and greater transparency.

5. Encourage philanthropy. There are too few people acting as philanthropists. We need a new era of giving and sharing - not through ineffective taxation but directly. Encourage giving in big companies via a simple annual league table of FTSE250 companies based on percentage of CSR to turnover. Make sure that it has to be displayed prominently. It will allow people to make up their mind what type of company they want to do business with. Amongst the rich reform inheritance tax to penalise those who "want to take it with them".

6. Stop giving government support to large companies. Most business people are sick of seeing large multinational companies getting handouts because they threaten to move or invest elsewhere. They should be able to raise their own investment and I doubt if one penny of government support has actually contributed to an increased take for the Treasury. We should be encouraging growth via start ups and new emerging businesses not propping up tired leviathans.

Well that should set a few hares running!

Friday, December 23, 2011

A merry public sector Christmas?!

All employees planning to dash through the snow in a one horse open sleigh, going over the fields and laughing all the way are advised that a Risk Assessment will be required addressing the safety of an open sleigh for members of the public. This assessment must also consider whether it is appropriate to use only one horse for such a venture, particularly where the re are multiple passengers.

 Please note that permission must also be obtained in writing from landowners before their fields may be entered. To avoid offending those not participating in celebrations, we would request that laughter is moderate only and not loud enough to be considered a noise nuisance.Benches, stools and orthopaedic chairs are now available for collection by any shepherds planning or required to watch the ir flocks at night.

While provision has also been made for remote monitoring of flocks by CCTV cameras from a centrally heated shepherd observation hut, all users of this facility are reminded that an emergency response plan must be submitted to account for known risks to the flocks. The angel of the Lord is additionally reminded that, prior to shining his/her glory all around, s/he must confirm that all shepherds are wearing appropriate Personal Protective Equipment to account for the harmful effects of UVA, UVB and the overwhelming effects of Glory.Following last years well-publicised case, everyone is advised that Equal Opportunities legislation prohibits any comment with regard to the redness of any part of Mr R Reindeer.

Further to this, exclusion of Mr R Reindeer from reindeer games will be considered discriminatory and disciplinary action will be taken against those found guilty of this offence.While it is acknowledged that gift bearing is a common practice in various parts of the world, particularly the Orient, everyone is reminded that the bearing of gifts is subject to Hospitality Guidelines and all gifts must be registered. This applies regardless of the individual, even royal personages. It is particularly noted that direct gifts of currency or gold are specifically precluded, while caution is advised regarding other common gifts such as aromatic resins that may evoke allergic reactions.

Finally, in the recent instance of the infant found tucked up in a manger without any crib for a bed, Social Services have been advised and will be arriving shortly.

An old story but scarily it could be so true!

Merry Christmas to all

Thursday, November 17, 2011

Business Link - what next?

So what follows the demise of Business Link later this month? Good news is that the website resource is being updated and expanded and remains one of the first ports of call for information on a wide variety of business related subjects. This is to be backed up with a telephone service but it is NOT an advice service and merely a navigation around the site for those in need or without access to internet services.

The government is also in the process of procuring a "Business Coaching for Growth" service which will target those companies with the best potential for high growth. This will be formally launched in April next year and should provide excellent support for the SME's accepted onto the scheme. There is likely to be a company contribution to the cost - which is reasonable - but the quality of assistance is likely to be much higher than that seen with other government initiatives.

Mentoring is now being accepted as a valuable resource and the website is a useful portal. However I have some reservations that this is in effect an unregulated "free for all" and in some cases could be used to gain business by unscrupulous operators or allow poor mentors to operate causing unknown mayhem. It is NOT, as has been suggested by some in government, a replacement for advice services. If quality can be driven up with mentors then again this is a useful addition to the landscape.

I am reasonably ambivalent about the loss of free advice to established businesses that do not display high growth potential. There is a wealth of private sector paid for support available and this should be the first point of call for the majority. Unfortunately the good work done by regional Business Link operators was often undone by the need to chase numbers, providing a light touch - often rated poorly by recipients. When you pay for support you value it more highly and take an active interest!

My biggest worry is the lack of a national start up service designed to help and support those entrepreneurs taking the first tentative steps on the road to self employment. I know that there are schemes for the unemployed but initial feedback indicates that self employment is dropping off the radar - unbelievable with jobs in short supply. However we should not wait for people to become unemployed before encouraging business start ups. We need to stimulate enterprise and for those facing redundancy, looking to change lifestyle or spinning out of a larger business or public sector environment starting a business is a logical step.

What is needed is a solid grounding, help with establishing the demand for the product or service and access to funding to give these start ups a better than normal chance of surviving. The 1980's saw an explosion in self employment, reducing the jobless figures and stimulating a "can do" attitude instead of the current dependant nature which appears to have infiltrated many areas of society.

Fill this start up gap and I believe that the government is close to covering the majority of the bases which should be expected by a pro enterprise administration. If it does that then the demise of Business Link face to face services will not have much of an impact. Fail to do so and you risk choking the supply chain of innovation which this country so desperately needs.

Thursday, August 18, 2011

Enterprise Zone - blessing or curse?

The subject of Enterprise Zones is the “hot” business topic of the moment with the news that areas within Lowestoft, Beccles and Great Yarmouth have been bestowed with this favoured status in the latest round of Government announcements.

There is no doubt that anything which is designed to support the economy in these areas is to be welcomed, especially given that the focus of this zone is on the vital renewable energy sector which is still in its infant stage.

Before looking at what this could mean for the local economy, we need to go back some 30 years to the first round of Enterprise Zones, which were introduced in the early 1980’s as an answer to the recession which the country was in the grip of following years of industrial decline. Even then the concept was nothing new with the idea first arising in the USA in the late 1960’s. It may surprise many, that both in America and the UK, the principle was invented and espoused by those on the left of the political divide but it required a Conservative government to bring it to reality.

Then, as now, there were financial and planning incentives for companies to locate in these “favoured” areas. However it should be noted that the financial incentives are relatively modest and short term and it would be a very foolish business person who would make a long term location decision based solely upon Enterprise Zone status. What being an EZ can do is remove a barrier for growing and ambitious businesses and speed up the pace of recovery and/or investment into an area.

The real challenge with such temporary incentives is to turn Great Yarmouth and Lowestoft into competitive business locations to both retain and recruit more companies to the area. This will require much more work than simply marketing land with “benefits” attached. It will require a complete change in mindset for politicians, business people and the local workforce to ensure that the benefits are lasting and that the inward investment does not turn into outward losses once the incentives cease.
NWES was itself born in Lowestoft during the era of Enterprise Zones and since 1982 it has helped create over 15000 new businesses and transform the lives of many local people. It is a combination of people and places which breed success and one cannot work without the other. As such the lure of EZ status needs to be coupled with a strong business support structure provided by organisations such as ours, designed to provide companies with the skills to survive and grow at a quicker pace than they would otherwise have done.

It is easy to get carried away with forecasts of job growth – which can often lead to disappointment when they fail to be reached. The evidence of the eighties zones is that of a total of 63000 jobs created only 13000 were new jobs – the remainder merely being displaced from neighbouring areas.

So how can the EZ status provide a long term benefit for the area? A major difference between the current crop of zones and the previous is that each of the areas has based their application upon favouring a particular market segment – in our case renewables. This should avoid the displacement seen in areas such as Dudley which saw farmland transformed into a shopping complex putting many local traders out of business. To cement businesses into the area we need to attract major investment which it is difficult to move and this means infrastructure.

The Local Enterprise Partnership and councils have a task ahead of them which will require them to be fleet of foot and willing to concentrate effort and resource in the EZ, perhaps to the short term detriment of other places and schemes.

-         Planning needs to be overhauled with clear policy for the area available within the next 2-3 months and a guarantee that the planning process will not last more than a few days and weeks for eligible schemes.
-         Where infrastructure is needed it takes priority over ALL other schemes
-         Coherent marketing messages need to be ready within the month and distributed widely to potential interested parties
-         Local businesses need to be properly engaged to avoid short term displacement, negative comment and curtailed investment
-         Workforce training needs to be a priority in the targeted sector of energy
-         A strong economic development team needs to be assembled at short notice drawing far and wide for the very best professionals in the sector
-         A strong business support offering is required to meet skills and funding gaps inhibiting investment
-         The leading lights in the energy sector need to sing the praises of Great Yarmouth and Lowestoft as we will be in direct competition with Humberside for he same investment.

The task has only just begun and all that the EZ status gives us is a head start, but for business that is usually all they need and if we are to avoid the mistakes seen in previous generations we need to grasp the opportunity for this area to be the centre for the UK renewables industry and not lose out to other more entrepreneurial locations as happened with the oil and gas exploration sector in the seventies.

History can act as a useful guide for the future of Great Yarmouth and Lowestoft and there can be no excuses for not taking full advantage of this helping hand to transform the local landscape and finally break the dependant nature of these great towns.

Thursday, May 19, 2011

Some words of encouragement for your LEP

Over the years I have had the privilege, honour and sometimes curse (!) of sitting on a number of public/private Boards and committees. My thoughts go out to all those who have recently chosen to sit on the Boards of the Local Enterprise Partnerships (LEPs). From my experience I would like to offer a few words of encouragement and warning designed to help each LEP achieve its aims and objectives.

These thoughts are in no order of importance and purely reflect my own experiences:

 - Set out your aims and objectives straight away
 - Be clear as to what you can and cannot achieve - do not try to be "all things to all men"
 - Do a few things well rather than many things badly
 - You are not a council committee so do not behave like one!
 - In setting up your constitution remain faithful to the simple premise of "one person one vote" and ensure that there is a private sector majority of members
 - In no circumstances agree to a constitution which gives public sector "founder members" the right to overturn a majority vote
 - Run the meetings just like a private sector Board - tight, focussed and make decisions rather than procrastinate
 - The public sector has an important role to play so make use of the knowledge held and do not set out to duplicate functions
 - If other quasi organisations are "backed into" a LEP as an executive or similar do not just accept that it is fit for purpose. Start a full review and if necessary reappoint or renew.
 - Have a simple informative website but do not spend silly money on it
 - Insist on a 75% rolling attendance rate from all members or they are voted off
 - Public sector members are generaly appointees and as such there may be a rapid churn due to elections, reshuffles etc. Where possible gain commitment for continuity or decisions will stall
 - Ensure that everyone around the table has authority to vote on all matters i.e. no deferring to gain cabinet/member etc approval
 - If the public sector funds the executive it is reasonable for them to request some ground rules. Agree them at the outset to avoid misunderstanding later.
 - You are local ENTERPRISE partnerships - so address Enterprise and do not get sidetracked on peripheral matters
 - Do not get sucked in to publicity campaigns unless they are integral to the core aims or you get tainted and alienate a wide cross section of the community
 - Be sensitive to political situations but make the right decision not the politically expedient one
 - Be open and transparent to avoid conspiracy theories - publish all Board minutes on the website etc
 - Be bold - no-one remembers people who do not make a difference
 - Think about who needs your help most - large corporates or pre start businesses - do not get sucked into the "glamour" of association with big names
 - Think carefully about what you want the executive to do - keep it small and tight
 - Do not directly deliver ANYTHING - enable others to do this

And finally before you make any decisions just ask yourself what your answer will be when your 8 year old grandson asks exeactly what did you achieve on the LEP?!

I wish everyone the best of luck and great success in achieving all that you set out to do - your country needs you!

Thursday, February 17, 2011

Youth unemployment - why?

The latest unemployment figures make depressing reading if you are under 24, with 1 in 5 young people now being unemployed. Whilst the headlines will trumpet this fact, the reality is that youth unemployment has been on an upwards trend for many years, even in the "boom" times. Indeed given the greater numbers of university entrants now, perhaps the real amount of young people "not in employment" is much higher.

So why has this come about? For too long now younger members of society have been poorly treated by our generation, which seems to have forgotten the reason and importance of education as a preparation for the world of work. An obsession with league tables and exam passes, which can easily be manipulated, has led us to produce a cadre of young people who emerge into the real world of earning a living with the wide eyed gaze of a new born baby.

Now is the time to put aside ideological and political standpoints and agree a cross party approach to education which will not be touched for the next 10-15 years. If there is one element of our society which is calling out for a carefully thought through and implemented strategy it is education. For too long we have tolerated political tinkering (from all parties), the creeping influence of ideological views, poor teaching and incorrect investment.  Despite this there are numerous examples of clear thought, inspirational teachers and an understanding with business - just not enough to make a real difference.

I have taken a keen interest in the links between education and industry for many years now and can understand the frustration on both sides who are encumbered with a state of affairs which is not remotely fit for purpose. Perhaps the only league table that should be produced is how many pupils are engaged in gainful employment within 12 months of leaving school or university. At least then we can judge which schools prepare their young people for life beyond education. Of course there are many more factors to take into account but without a clear vision as to the purpose of education, from primary school to university, we are destined to retain high youth unemployment which is a crushing burden on society. If only a fraction of this money was invested into preventing unemployment everyone would be better off.

However any readjustment cannot be subject to the winds of political change, hence the need for a national education strategy agreed by all and with safeguards enshrined in legislation which prevents political meddling!

I employ 90 people - with a young average age. Recently we advertised entry grade positions and had 400 applications. Most were rejected through not meeting the simple instructions requested, poor spelling and CV's produced in something akin to text speak. Those individuals who were successful have been a delight to work with; enthusiastic, hardworking, willing to learn and bursting with potential. Academic qualifications do not mean a thing if there is no personality or social skills to accompany them - this is where many young people fall down.

We have a wonderful resource in our young people but now is the time to harness this and use it to build a bright future. The question is how many self interested politicians, antiquated union barons and short sighted CEO's will put aside their posturing to secure a great future for every young person leaving education?

Monday, January 31, 2011

Is Corporate Governance taken seriously?

In many ways the UK is considered a beacon when it comes to Corporate Governance - principally as a result of the 2010 Corporate Governance Code - but is it any more than window dressing?

Too many organisations - private, public and third sector - pay lip service to this important aspect of running a Board and company. Usually it is "added in" to a minor sub committee to report on once a year; and yet corporate governance has the ability to enhance the prospects of any company.

It is all about driving an enterprise forward whilst at the same time exercising prudent control.This must be obvious to all directors? Not really and little is likely to change when directors are often chosen via a "closed shop". Until we open our minds to the recruitment of directors and apply much more imaginative ways of selection, induction, development and appraisal then corporate governance is unlikely to change very much.

We have some building blocks in place - a sound Companies Act (2006), a patchy Corporate Governance Code (2010, a weak regulatory framework and some appalling laws which cut across the afore mentioned. How we arrange these blocks will dictate if we are heading for another spectacular collapse along the lines of RBS or Enron or taking a world beating role as the beacon of good governance.

No-one wants burdensome regulation but putting good governance at the top of a directors list of responsibilities will result in healthy businesses which allow the executive to drive forward from a firm foundation.

It would take little to transform corporate governance in the UK - and surely this would set us apart from other countries as a place for the reputable to do business? As a Chartered Director (there are still less than 1000 in the country) as a start EVERY listed company should have a CDir on the Board as a minimum within 12 months - at least this would show more than lip service to good governance.

To borrow from a leading expert in this field - Prof Bob Garratt - "A fish rots from the head"!