A global focus that Wales can achieve
Wales Business — By Alastair Milburn on July 9, 2010 7:00 am
Grounded: do we need to take a plane now that the internet is so powerful?
I’M TAKING part in a really interesting course at the moment.
I’m among the first cohort of the Professor Brian Morgan-inspired 20Twenty Leadership Programme – a 10-month course chiefly comprising two-day modules once a month.
The title has nothing to do with cricket. In fact, I believe it has two objectives – to provide leaders in Wales with 20/20 clarity of vision and focus to take their businesses and organisations forward.
It is also supposed to prepare and help the 30 or so people on the course to learn the skills and develop the high growth plans which will drive our businesses – and Wales – to success and glory by 2020.
But, of course, to achieve all that, you need to have some understanding of what the world will be looking like in 2020, in order to ensure your business is armed and prepared to exploit the new opportunities which will undoubtedly arise.
But 10 years is still a long, long time in business. Think back to 2000 – what didn’t we have? No BlackBerries, no iPhones, Twitter, social media, or online, streamed video – and I certainly didn’t know how to text. How did we ever cope?
So it was with some trepidation that during our most recent session of the course we were asked to predict the key market conditions and components which we believed would exist in 2020, and how Welsh businesses should exploit them for future success.
These were the key thoughts:
- Globalisation – technology will completely break down all geographical barriers (we’re almost there now);
- Dramatic expansion of broadband services and capabilities;
- People will work longer, and live longer, creating a huge base of knowledge and experience;
- The emerging BRIC economies (Brazil, Russia, India and China) will continue to thrive;
- Our urban areas will continue to grow;
- Energy efficiency will remain the global priority.
We then compared our thoughts with the findings of a couple of key futurologists. The results were identical. So what does this exercise tell us about Wales and the opportunities it faces over the next 10 years?
It does indeed suggest that Wales will be a skills and knowledge-based workforce with the ability to offer its services via modern communications channels to the world.
It’s simplicity is frightening. For those of us who really want to, technology will enable us to turn ourselves around to face the whole world, and sell our services to the whole world, not just Cardiff, Swansea, Wrexham, or Pontypandy.
And why not? My company’s PR and marketing services are totally transferable. If we’re good at what we do, why can’t we promote businesses and other institutions in their home countries – or, increasingly, over the web?
You don’t need to physically go to China to devise and implement an online media campaign for a manufacturer of widgets in Shanghai. You don’t need to visit Brazil to devise a campaign to attract foreign students to the University of Brasilia.
Those may provide extreme examples, but you get the point. Language may remain a barrier but that still leaves the vast, English (and Welsh) speaking world to do business with. And that is why I have been so encouraged by the contents of the Economic Renewal Programme announced by the Minister on Monday.
Here’s a reminder of the key elements:
- Business support will now be focused on the six sectors of ICT, energy and the environment, advanced materials and manufacturing, creative industries, life sciences, financial and professional services;
- The Welsh Assembly Government will ensure 100 megabits per second broadband is available to all businesses in urban areas, with 30 megabits for rural locations by 2016;
- International Business Wales will be scrapped.
Does this have a familiar ring to it? It certainly will for anyone who has worked in a Welsh company for the past few years, because those key elements contain many of the things that business has asked for. I sense that, for the very first time, there is a collective thinking in Wales about what we can do to thrive going forward, and the key tools businesses such as mine require to do so.
I’ve been trying to do business with the rest of the world via third party organisations such as IBW since 2005, and it just hasn’t happened. Give Wales the tools (broadband and a highly skilled and highly knowledgeable workforce) and the world is there for the taking. Put simply, we don’t need the IBW.
For too long, we’ve wrapped ourselves in endless debates about finding the right structures, the right support, the effectiveness of IBW, who should be doing what, who should be given what. Now is the time to just get on with it.
Tags: economic recovery
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2 Comments
The ERP has gone down well with big business in Wales, but has completely ignored the average Welsh SME.
WAG like to say that they have have the biggest consultation excersise, but this is a front. The reasons why:
1) The consultation document did not ask for specific policy questions regarding the re-organisation of the DE&T. I’m shocked to see the changes after reading the inital consultation document. The ERP answers questions that were simply not asked in the consultation process.
2) For such big changes within the department, why wasn’t there an on-going dialogue with the major players? One consultation response is not enough for such a major restructure. I dont think that the business community expected such changes, and this is poor engagement. Quality not quantity of consultation is the key.
3) The ERP as it stands now should be going out to consultation. There is no formal way to respond, and no period of consultation. Such major change, such as scrapping FS4B, IBW, SIF, should go out to consultation.
4) Where was the consultation when choosing the sectors? The ministerial advisory group seems to work in a silo away from the other players. Where was the engagement with the wider business community when choosing the sectors which will benefit from the ERP.
5) Does the wider business community suppport the new strategy?
6) Where are the details so we can debate the document and reply?
7) Is there a detailed list of what will and won’t be changed in DE&T?
the list could go on…
Indeed this is only pointing out some of the failings in the consultation process. As I said, for changes so vast to the DE&T, just to offer a consultation document and no real further engagement is a shambles and a kick in the teeth for all those businesses who will be hit.
One consultation document does not make up for the changes that are being made.
In the ERP itself, it mentions supporting tourism businesses by giving and undisclosed amount to help tourism businesses – but only by putting this money towards infrastructure. Yes, we need better infrastructure, but not at the expense of helping individual SMEs.
Interestingly, retail businesses are mostly ignored in the ERP. Although WAG mentions wanting to care for the wellbeing of communities, how are towns around going to keep their local shops open and vibrant when there is no support for this sector from WAG? It has always been an underfunded sector, but now there is even less help available. Has DE&T got a plan how to help town centres and small shops with FS4B being scrapped? – the answer seems, yet again, from WAG that they will support infrastructure and this will then help local shops. Well, it will also benefit the Tesco in towns across Wales, and to a greater extent. How are SMEs going to compete?
It says a lot about the mentality of WAG when they use the stats from the CBI and their usual strap line – that just under half of private sector employment in Wales is in big businesses. Obviously they have taken the views of the CBI hook, line and sinker. WAG does not know how many people are employed by SMEs, but it is way over a half of private sector employment. SMEs are hardly mentioned in the ERP, neither does it mention how many businesses in Wales are SMEs.
Shockingly, the ERP states that it does not want to help individual businesses as it will disadvantage others. This was a justification to scrap the FS4B. This is a disgrace. How about the towns all over Wales where local shops are closing and there isn’t another butcher/corner shop/bakery… against? They are the only ones in the town and at risk of closure. Also, how about the help for businesses who want to compete against the Tescos of this world to survive? No help for them? Of course not, this would be bad news for DE&Ts friends in the CBI.
DE&T like to mention that broadband will be available to all businesses in the next 6 years. In fact, this has been repeated so many times that it made me realise that this is about the only firm commitment from the ERP. Lets scrap FS4B, IBW, SIF….. and so long as we have a broadband target, then this will make up for it? Of course it wont. Where are the targets and aims to we can really evaluate the ERP?
One of the most important support for SMEs in particular is Business Rates reductions. Surprise surprise, this is hardly mentioned in the ERP – only small section which mentions what has already been announced months ago. Business rates may not be in IWJs portfolio, but considering his ‘aim’ of working with all departments, and the fact that there is such a heavy amount of input from other departments….why is such an important issue as rates being basically ignored? Oh yes, I forgot….business rates are less of a burden on bigger businesses, so there was no real need to consider rates reductions for those pesky SMEs.
The ERP says that we should not favour Welsh businesses in procurement opportunities. Indeed, because of European law, you can’t do this. But there are ways of making sure that Welsh SMEs can win contracts. This seems to be ignored. All that is mentioned is that SMEs should be supported to fill gaps in the markets in Wales. No plans of how and when to do this….or how this is possible without FS4B or one-2-one support. Yet again, no details on how to help Welsh SMEs, instead a warning to them not to expect any favours from government. After all the work of the procurement taskforce (which I was a bit dubious about at the time, but looking back, it seems like the good ol’ days, they must be worried how this is going to work.
Also, sectors that have been chosen as the special 6, don’t include retail/agriculture/tourism….. Basically the sectors which have a high% of SMEs in them. I wonder why that they were not chosen by the elusive ministerial advisory group…..
SIFbeing halved into the 6 sectors and infrastructure will hurt SMEs..
These 6 sectors will have panels which will write the sector plans. These panels will consist of academia and businesses. Although. Although having business input into these sector plans is vital, I’m worried that SMEs wont have the resources to be able to be on these panels. Bigger businesses can afford the time to do this, but a small busness/owner manager would struggle to do this. How is DE&T going to ensure fair SME input into the groups writing the sector plans?
DE&T also want to build relationships with businesses which have high number of employees- Big business yet again. On the other hand, the ERP suggests that SMEs are local businesses and therefore they should be catered for locally. Maybe through Local Authorities at a time when their budgets will be cut. It is clear in the document that WAG want to deal with big business and leave SMEs to others to deal with. This is shameful.
One last point I would like to say here (though I really could go on) is agriculture. There is a large segment on this in the ERP on how DE&T are going to support the rural economy. Well, talk about re-inventing the wheel…..the work that is mentioned is already planned by the Rural Development plan. Talk about stealing clothes.
What DE&T needs to do desperately
1) The DE&T need to map what has changed in the department and what they indent to replace it with. We have no idea what is being lost or put in its place.
2) They also need a further round of consultation with stakeholders to see their reaction to the ERP. Some things the business community might be in agreement about, but in others they definitely are not. This ERP document needs to go out to consultation. Why have they not done this?
3)This needs to be done by the end of the month as the implementation plans are being finalised by then. Of course, they must feel though they dont need to wait for industry reaction as they have had the nod from the CBI.
4)DE&T need to thoroughly explain how help for SMEs will change and how much help they will gain / lose as a result of the ERP. Basically, show how SMEs if they will be better off of not.
I, and many others in the SME sector are worried about the ERP. DE&T might be happy that the CBI and a few others are supporting them, but the main business sector has been ignored and is now being left with uncertain support from the government, when they need that support the most.
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To take support away from supporting SMEs is shocking. They new approach from WAG is to support big business and hope they drag indigenous Welsh businesses with them. Making larger companies the driver in Wales when they only account for less than 1% of businesses here.
It looks like to me that the CBI have a special hotline to IWJ. Maybe he’s scared of David Rosser?!
I hope for the sake of Wales that I am completely wrong about the ERP.
AJ, thanks for your comprehensive reply. It merits being run as a piece in its own right.
Your concerns about SMEs are a common refrain. I have been doing some work recently on carbon capture and storage and learned that Scottish Power is to build a plant here in Wales to further this new technology. “Why couldn’t that be a Welsh energy company?” I wondered, apropos of nothing.
I had the chance to put this example and question to the DFM’s office and his staff are confident that the ERP provides for growing start-ups and SMEs into Scottish Powers. A fairly unremarked-upon piece of research crossed my desk recently (I still have it, but can’t remember who carried out – happy to look if you’re interested) showed how an overwhelming number of Welsh companies are sold around the five-to-seven year mark. The compelling conclusion was that most Welsh businessmen and women can only take an enterprise to a certain level and lack the experience to overcome the “What do we do next?” problem. This is something we must deal with if we are to move from an economy of many, many small businesses that come and too quickly depart.
In fact, as an aside, it would be interesting to attempt to work out how much time and money is lost through such a fast turnover of businesses, because it is disruptive, as we all know.
But I also think it’s worth remarking upon Alastair’s piece. I have known him for over a decade now, and he is the kind of fearless and resourceful entrepreneur (with a first class team behind him, it must be added) that we need to be creating the right climate for, to allow him and others like him to flourish. We need to ensure that we listen to the voices from the coalface because, by the fleet-of-foot nature of the type of business he is engaged in, suggestions such as the one he has made above can be implemented swiftly and relatively painlessly. We must have fluidity and adaptability, and it is better to learn lessons on this from those whose lives literally depend upon it.