Bryan Mills
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Why I’m vague…

8/30/2013

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I’m not.  I’m not vague that is. I also avoid being fixed in my view.   I had an interesting chat with a friend doing an MA thesis on ambiguity  and it moved around to thinking about the difference between vagueness and  ambiguity.  To me, and in fairness I’m no one in particular, vagueness refers to when information could and should be known but is withheld or not known. So, for example, if I ask a bartender when they start serving evening meals the answer should be known and specific.  A vague “5ish I think” isn’t helpful.  However if I ask the same  individual what time they stop and they reply “around 10ish depending on how busy” then I see that as a little ambiguous but perfectly acceptable, after all it may be the nature of that type of establishment.


 Taking this a bit further we can look at economics. In economics we ‘know’ very little.  The nature of economics and its component parts means it is hard to be certain.  I don’t know what the value of the pound will be tomorrow and nor does anyone else.  I can make a prediction but it will have a margin of error.  That’s the nature of markets.  But it also applies to policy.  There are no simple answers in economics; there are plenty of understandable ones but no yes or no answers.  For example the answer to unemployment is not simply to cut welfare benefits.  There is certainly a link between welfare and work motivation but if I cut welfare by 10% then employment won’t go up by a similar amount, in fact it may actually go down.  This almost presents as if I am suggesting somewhat liberally that we should continue to pay welfare at the same rate.  Actually
I am not.  What I am suggesting is that it is not a simple link.  If we rephrase the question to one on moral lines the answer will be quite different.  Do I think people should be incentivised to work then that is a clearer yes, on moral grounds I feel that is right.  Annoyingly if you say to me “I know what they should do about unemployment, cut bloody benefits that will sort them out” I will argue that it won’t.  I will suggest it is more complex than that and this comes across as ambiguous.   


So asking me my view on the link between benefits and unemployment allows you to mistakenly interpret my response as liberal, equally if the discussion goes further, with the questions phrased around moral and motivational links, I am capable of further surprises.  I can clearly state I see a link between incentivisation and work.  So if you ask me what I think a hard working family deserve I will say the minimum that society can provide based on their level of skills and work.  Why the minimum? If every hard working family gets a plasma TV, a holiday abroad and an en suite where is there motivation to work more hours and, more importantly, improve their productivity through training and education?  We should not be rewarded just for turning up.  Work isn’t welfare.

What I try to work with is basic underlying values that then allows for an acceptance of the more ambiguous world around me. 
I try to avoid harm, I try to be honest and I try to deliver.  How those are achieved varies by context but I don’t need rules.  


1 Comment

How the power of positive thinking and law of attraction works….

4/12/2013

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How the power of positive thinking and law of attraction
works….


It does, but possibly not as you imagine.  Those expecting some explanation  borrowing bits of quantum physics to make it sound sciencey or reference to the  universe in an attempt to fill a spiritual void will be disappointed.  But it does work and this is how I  rationalise it….


 Stephen Fry once said that he believed in coincidence, it was linked to that famous anecdote “I was thinking about my
brother/sister/friend and he/she phoned – it can’t be coincidence”.  Hmmm yes it can.  The fact is you think about people often, both consciously and subconsciously.  What would be freaky is if this never corresponded with one of them calling – the law of averages dictates there will be coincidence (nothing spooking just playing the numbers).  Likewise there are so many opportunities that by ‘thinking positively’ you will bump in to one.


Thinking positively simply means you are trying to look for opportunity rather than failure.  You cannot and are not influencing the
universe with your thought patterns; instead you are simply looking at everyday life slightly differently.  Let’s explore the power of negative thinking first – how does that work? Well let’s say you have bad luck in relationships, you always do.  Someone new comes in to your life;  they’ll only let you down, best not get involved. They seem keen though, maybe you should chat to them. 
So you do, a bit, sort of cagey.  They seem patient, they must be after something, and no one is this nice, best ignore them a bit, don’t seem keen. Days turn into weeks, weeks into months and they seem to drift away from you, just like all the rest – you knew it!  Waste of time!  Same goes for work opportunities, holidays, food, list is endless.


 So how does the flipside of this work?  Well first of all don’t say yes to everything – that’s a disaster.  Failure to deliver, lack of integrity and lack of sincerity will reduce the pool of opportunities by damaging your reputation.  But if you look up from the gloom you can spot that the girl in the supermarket always smile at you, and it’s not a smile she gives everyone.  You see that the offer of a little more responsibility at work is a gift not a drag and leads on to some new challenges, new scenery and a new salary!  It
is not about saying yes but about saying£maybe there is something in this” a little more often – after all what have you to lose…….  



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Thoughts on enterpirse, creativity and service

3/27/2013

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I continue to ponder enterprise and entrepreneurism and have recently settled down into three broad themes.  To me, and it really is only my opinion, the challenges of business are creative, operational and service level.  With that in mind I feel syllabus can be more easily defined and delivered.

Beginning with creativity, not every business will be that creative, in fact this is perhaps where we can begin to separate out ‘business person’ from entrepreneur.  Although each business faces challenges that need overcoming, and a creative mind can assist here, not every
business has this central to its purpose or to its founder’s key strengths.  For example many businesses simply reproduce another business model but in a different location or with a slight twist.  These businesses are low on creativity but nevertheless successful.   We need to explore whether or not we want a specific educational and training element of our delivery focused on this requirement.  I personally feel we do, but also that we need to separate it and then reintroduce it to be sure that it has
been adopted.  When it is buried within a business plan lesson it is perhaps lost forever.

The operational perspective is the one I seem to be most often asked about, though the conversation normally begins with the request to deliver enterprise to the students or cohort.   Without some sort of operational efficiency no business is going to survive.  This is the core business studies stuff, available from introductory level right through to post-graduate.  It is the bread and butter of business schools, and let’s stop knocking them while we are the subject, and allows any business to flourish. An understanding of systems, of HR or marketing all allows a business to prosper.  It has become trendy of late to criticise business schools but in truth we are often missing the point there.  The purpose of business schools is to produce efficient effective managers.  The sort you want running your business.  If you run your business you want, or at least need, to be that too!

The last of our trio is customer service.  My goodness this seems to be lacking these days in all walks of life.  You see
when you set up a business it is there to serve your customers, not you.  You and ‘it’ need to ensure you are providing what the customers want in the way they want it and at a price they want.  This does not mean running around and trying to please everyone, what is does mean is looking after those you have set out to please.  Cancelations should not happen, lateness should not happen, service outage should not happen.  We need to work with people to develop the mind-set of service.  If you left your last job because the customers annoyed you and now you want to set up your own business think  again!


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Fixing the world

3/5/2013

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 I have always been interested in the interconnectedness of things, of cause and effect, of actions and of consequences.  Playing this over in  my mind I started wondering if actually problems are simpler to resolve than we realise.  
 
The way I see it a lack of connection or a lack of awareness of  what might connect brings about most problems.  Don’t overthink this though- I’m not  saying we need to map out all connections.  What I am suggesting is that if we  think of a few simple principles and then work with them our lack of awareness of connections won’t matter so much.  
 
If we step outside our own little fog of expectations and instead look at the world as an on-going process neither for us or against us we may be  able to do some interesting things.   I think we have got hung up  on our selfish right to do stuff regardless of impact.     Take a simple case in  point – the drive home.  Really we  are all just trying to get home; we are not in a race, not police officers, just  people all trying to get somewhere.   So what do we do, do we just get along?  Often we stress ourselves about who is  ‘right’ or who has the ‘right’.  Rather than just pulling out slightly to  avoid the bonnet of a misplaced car we feel the need to blare our horn and  swear.    Where  is the interconnection here you may ask?   I can guarantee your stress has not reduced. Someone’s error has made you cross, or rather you have allowed someone’s  error to make you cross, and in addition you have now angered another person. Both of you have gone off  in a slightly worse mood even though nothing actually happened.  
 
This ripples through the rest of the day, now you may be a little more snappy at work, a little more curt with your partner and so on and so forth.  None of these needed have happened as the ‘benefit’ of imposing your right outweighs its ‘cost’.  Try another example.  On the way home from a bar you are all having a sing-song,   a harmless bit of fun you tell yourself. 
But in so doing you have woken a few people sleeping, scared the odd  individual making their way home and put pressure on the bar’s licence renewal –  is that really worth it?  Could you not have waited until there was no one around? 



At work we can do a similar thing, it’s not my job we can say, not my responsibility, I leave at 5.  We can push our rights to the fore regardless of the impact they have on others.  This is not a manifesto for obedience and puritanical values mind.  I am not advocating mindless compliance.  What I want to suggest  is that we think a little about the action we are doing and if our only
justification is that it is ‘our right’ then we may want to stop and think. 



Your need to leave at 5pm is based on a combination of your right and desire to get home (I guess), but that individual you serve that pushes your  time five minutes over may  actually have a far better day not having missed the close of business – let’s face it there are hundreds of genuine reasons for lateness.   Now the stress of lateness has been replaced by gratitude and a more positive mood, it has cost you nothing  and that’s a powerful thing to have done, to have changed someone’s life for the  better……


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Contingency plans - first admission of failure 

2/1/2013

4 Comments

 
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Contingency plans

I have been thinking a lot lately about contingency plans and my habit of stating that I don’t believe in them.  It seemed sensible to expand on this a little.  I start with the premise that there is no plan B.  This is of course something the current Government is keen on repeating so am I in agreement with the Chancellor?  You can see why I feel the need to explain myself. 

My concern is that by creating a serious of contingency plans we actually plan to fail.  We create ‘get out’ clauses for ourselves and so don’t throw ourselves fully behind the task at hand.  In addition we of course waste time creating more plans.  The psychology of failure interests me and my worry is that by reconceptualising failure as simply one of the plans not working we accept too readily defeat.  

Ok so the flip side of this is that I am going to stick stubbornly to plan A despite the obvious failings of that course of action and clear evidence of a lack of progress.  Not quite.  What I prefer is to pursue plan A but remain flexible and adaptive.  You see I am not really a fan of plans full stop.  I prefer goals and strategies and tactics to achieve those goals.  This may seem like semantics but what I am moving towards is a known goal or mission and a toolkit of methods to get me there.  I select the best tool given the information I have and work away toward that goal, when evidence suggests that my progress is not as swift as I may desire I shift to an alternate tool. 

You need to be very clear about what your goals are, clear but not overly specific.   You need to extract the essence of the goal, to identify which base things really matter.    For example my goal may be to have a nice chilled evening with my partner.  That’s enough though.  If I start to over specify which location, which type of food, which type of film I am likely to frustrate my attempts to reach the goal.  Instead there are a number of ways of achieving this and whilst the goal remains fixed the methods are free to vary.

The same is true in business.  We perhaps have a goal of improving customer satisfaction but then equip our teams with a variety of methods to achieve this.  Having a fixed plan, and worse a plan B if that one fails, both prevents the type of reflexive behaviour needed to achieve the goal and allows us to fail without remorse. 


4 Comments

Business lessons from surfing…………..

10/5/2012

5 Comments

 
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Business lessons from surfing…………..

After three decades of surfing and a couple thinking about business I thought I would try to meld the two together.   I will try to follow a journey from the beach out and back again and just share some insights I think I’ve picked up along the way.  I can’t guarantee you’ll either surf or do business better at the end – but one thing surfing has taught me is there often is a chance.

Getting to the beach:

Over the years I have seen a lot of people fail at this first hurdle.  They consider the wind direction, ask a couple of friends or even get so far as to drive in that general direction and then quit.  It is easy, God knows easy in Britain, to look and decide it’s not perfect.  When you are young you are so full of beans you go in anywhere and anything, as you progress through your twenties you get a little fussier.  Luckily you still have some residual fitness and talent from those Halcion days of youth.  You can reflect on foreign surfs in perfect waves and decide it is not worth your bother; you have a pint instead or watch the footy.  This is the first mistake.  Surfing has taught me that you should never miss an opportunity.  Never decide in advance that something is going to be bad, that it is going to be less than perfect.  By not being fussy you get twice the number of days in the water, maybe more.  You remain fit, you hone your skills.  Don’t wait for the perfect job so you can do well, do well now.  Don’t wait for the perfect business opportunity do business now.

What if it’s flat:

Some days it is flat.  I don’t mean ‘surfer flat’ I mean really properly flat.  On these days there is no wave to catch.  You now have two choices.  You can let this get to you or you can do something else.  If you let it get to you then you won’t have surfed and you will have also ruined your day and perhaps other people’s.  Try not to do that.  It isn’t worth it.  It’s just a bit of fun.  In business sometimes things go wrong, who am I kidding, in business all the time things go wrong.    Don’t do nothing and don’t vent.  Life has a rich tapestry and the surf will be back tomorrow.  Go run, go chat, tidy the office, do something.

The paddle out:

Small days this is uneventful and life is easy.  Small days the rewards are limited.  On big days you feel that you may well simply die there somewhere midway.  The sea is wonderfully relentless.  It does not keep score, it won’t give you a break and it really doesn’t care that it is not fair.  It will not yield but it will, if you are fit enough, not hold it against you when you break through.  In business you get knocked back, you get held under.  You can choose to quit at any point, you can wait for the world to play fair or you can just keep paddling, getting fitter and getting closer.  One thing is certain in surfing – the last third is harder than the first two.  At the point of greatest exhaustion you are closest to success.

Re-group:

I swear the wave of the day goes past just as I am taking my spot in the line-up.  As I sit and catch my breath a Siren calls.  I have at time turned and gone for that quick reward and in so doing found myself one-third of the way back in.  Maybe it was worth it, maybe I miss-footed in tiredness.  Either way I am now one-third of the way back in and three-thirds’ tired.   When you have reached business success don’t be in too much of a hurry to bask in your just reward.  Take time to re-coup your energy, to establish your position and to be sure of the market.  After all your entire journey here may have just been a lucky rip current.

Be comfortable:

The thing is when you surf you are often out of your depth (literally and metaphorically).  The water is not a safe place; the waves are almost too big.  You get the best days by being on the edge.  Comfort lies sat on the beach on a towel and we have already walked past that.  It is ok to be uncomfortable that is a natural instinct that keeps us sharp and alive.  I find myself in many situations where I am out of my depth (metaphorically) and I simply think about whether it will kill me or not.  Once you realise a meeting won’t kill you it becomes a lot easier. 

Don’t be a git:

So now you are here ready to surf, ready to enjoy the fruits of your paddle out.  You are not alone and you have no special right.  There are some sensible guidelines; the person closest to the breaking wave has priority.  This is based on a combination of that being both the best and most dangerous place to be.  There are probably enough waves for everyone.  Oh but what if I am competitive, what if I snake around, what if I sneakily position myself so that I am always in that position?  Then I will get more waves.  Well you can do this, you can try and use a technicality but to what end?  You will have gotten a few waves but people will hate you and rightly so.  In life you will not be remembered for your surfing prowess but for being a git (stronger than that but I’m keeping it clean).  You have to ask yourself do I want respect or do I just want, want, want.  Of course you may find a few that respect your meanness, but I wouldn’t count on them on a rainy night when your car won’t start.  The same is true in business.  You can get to the ‘top’ by being mean, by being ruthless but when people think you are a git is there really any point.  Buy yourself some toys to ease the pain of being friendless by all means.  Easier just to be successful and fair.

Get up again:

You will fall off.  There is no point being overly cautious.  It will not hurt (excluding some big surf and reef breaks of course).  It is better to try and fall than to lie on your belly.  The growth in popularity of certain surfing activities is largely tied to the fact that they are easier.   That’s fine but unless you have dropped down the face of a too hollow wave, gone vertical back up and dropped back down again something way too steep to tuck into some sort of a barrel you haven’t done that.  You either have or you haven’t it is that simple.  Now I am not saying that unless you do that you aren’t surfing, far from it, what I am saying is don’t take the easy way out.  Try it, push, fail, try again.  No one out there is perfect; no one out there is making every wave when they are pushing like that.  The people making every wave are lying in a couple of feet of water on a bit of foam with their wetsuit on backward.  Their happy, that’s their business, but we’re not on holiday.  In business the easy way is rarely the way to success.  Simplify of course, but don’t expect everything to come easy to you.  Don’t make it hard, get the right tools when you can, but always push.


5 Comments

Everything that’s wrong with training…..

9/7/2012

1 Comment

 
Everything that’s wrong with training…..

There’s something badly wrong with training courses.  Not training for skills or health and safety, those seem ok, but the type aimed at making you a better manager, a better salesperson, more innovative, more creative. The sort that normally takes a day or two and includes lunch (I hate free lunch).  Fundamentally not only do they not work but they actually have a negative impact.    

At this point I should present some empirical evidence, and perhaps I will in due course, but for the moment I am going to set out a scene and see if you are familiar with it.  These events usually follow the pattern of ice-breaker, motivational clichés and sound bites and brainstorming exercise – sound familiar?  Nothing inherently wrong with that.  At some point during the day you will look at what is wrong with the present situation, why we aren’t achieving our goals.  You may well finish on a high full of ‘plans’ to work differently in future.  Yet seldom do these materialise, another training day is required.

What goes wrong?  It is my belief that these days fail to deliver because of their very fabric.   Dig a little deeper and you will find that the speaker often has a background in sales.  There is nothing inherently wrong with this as a background or present or future; but it does lead to an uncritical belief in one’s own message.  Many of the triggers used by the speaker will be similar to those used by sales staff.  They will agree with you, they will agree with you a lot.  Nothing will be your fault.  The solution will be wound up in their product.

How often on one of these events do we brainstorm problems – maybe a SWOT or one of its derivatives?  And how often are those problems time, money, culture, targets, and management.  In other words the day has repeated back to us our own generic prejudices.  If you are trying to be creative then targets and management get in the way, if you are trying to sell then engineers just don’t understand the need for deadlines and customer focus.  You come away feeling you are right and that you are being held back.  The company is, perversely, happy as they feel you are now aware of the need for change (in their event you were the problem, in your event they are the problem – the culprit is never in the room).   

The real issue is that organisation, like life, are both complex and simple, both fluid and solid.  Just like relationships we can overcomplicate and create narratives and myths that bog us down.  After all surely a relationship is just a friendship with kissing?  Surly business is just some people getting together to share the effort of making money?

Of course there are issues in every sense and use of that word, but these are not solved by a flipchart.  No amount of identifying the need for cultural change will actually effect cultural change, for example. 

Now it would seem I have fallen into my own trap – I have talked at length on the problem, the issues.  Let me offer a solution and I promise to come back in more detail.  What is needed are events that dive straight in and get to grips with something tangible, with anything!  Don’t learn a new technique spend the day rearranging the office, canoeing or walking with a group of customers, being customers in another business – a rival’s or any business!  Enjoy just doing something different, but do it together.  You will see the business differently, see each other differently and see the company differently -   it really is that simple!

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Narratives we tell ourselves..................

8/24/2012

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Narratives we tell ourselves..................

I have been playing with the idea of stories for a while.  The way we repeat narratives that explain our world.  Ok, before you worry my account has been hacked by some radical PoMo rest assured I am not about to charge headlong down a Lyotardian  tirade abandoning logic and rationality along the way.  No, what I want to do is a little more subtle. 

Maybe if I tell a story myself it will help.  This summer (I live in a coastal region) I have, yet again, witnessed ‘family holidays’.  One particular instances stands out.  Whilst waiting for my friend to arrive for a surf (I was early) a middle aged, very cross, woman stomped passed and toward the road, followed somewhat chastely by two teenagers.  Her dialogue was along the lines “this was supposed to be a family day”, “you’ve ruined it”, and so on.  Now I’m not sure what they had done but past experience tells me in some way it wasn’t ‘family holdayish’. 

Almost daily I see either an irate father or mother or moping kids making themselves miserable being dragged around one of our beautiful towns or resorts.  Perhaps it’s the challenge of finding not one but two hard-to-come by parking spaces when the reality of ‘we’ll rent a cottage big enough for us and your sister’s family and take two cars,’ that seemed such a good idea on FaceBook three months ago, hits the reality of small seaside town.  Or once parked the stress of finding a cafe that can recreate a medium sized work’s Christmas do mid-summer kicks in, with the added quirk of kids who ‘don’t eat food with a vowel in the spelling’.

Why do we do this?  Simply we tell ourselves that families have nice holidays: crabbing, surfing, ice-cream and fish and chips, smiles and funny photos – something they can all reminisce about in later life. That’s what families do, and it must be even better if the whole family is there.  Kids must want to do these organised activities, dad must want a pint in the evening, mum must want ten minutes to look at some clothes.  Kids must miss their friends, dad must want to catch up on the footy, mum must ‘still have to run around after them’.  Kids must ‘not be grateful for what they have’, dad must ‘not understand that it’s no holiday for me’ and mum must ‘get left with all the bags’.  You see we turn an unrealistically positive narrative into a negative one through yet more stories.       

What if we tried to forget about them?  What if we didn’t always generalise about behaviour?  I know that personally some days I can be very selfish, lazy and shallow.  Other days the reverse – so if this is that case my character in this story isn’t very formulaic.  I would argue yours is the same.  I would argue your friends are the same.  This is not to say there are not trends and tendencies, but the interactions are a little more complex than our preferences for bounded rationality allows.  I believe that part of the success of the so-called reality shows comes from the one-dimensional characters.  Their behaviour is simplistically predictable and we are able to say ‘I knew it’. 

What if our stomping mother just enjoyed the beauty of Gwithian and the fine food in the Sandsifter for herself without needing the kids to love it too, what if her kids didn’t tell themselves it was going to be boring and what if dad had said “you get out here and I’ll park the car” allowing a sneaky listen to the footy results on the way back.    What if we all lived in unscripted real time?

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It’s all about the money.....

7/8/2012

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It’s all about the money.....

A fashion seems to have developed over the last few years around describing business as something other.  “Wealth creators should be treated as heroes” cries the Telegraph.  “Let the job creators in” pleads the Economist.    We have lifestyle businesses and we have social enterprise.  Against the backdrop of decadent corporatism we have this idea of socially aware business founders in it for the good they can do rather than money.   Poppycock I say (BS for my American friends).

Whilst the purpose of an enterprise (as in an endeavour) or organisation is to achieve its goals the purpose of a business is to generate surplus cash   - not jobs, not GDP growth, not opportunity.  Of course in generating that surplus labour may be employed, money may circulate and opportunities may arise – but these are happy by-products.   At this point you may be tempted to stop reading.  You may feel I don’t understand that in the future business will have to be more socially aware, more engaged.  The problem with this position is that it suggests this is a future state.  Go back to your Adam Smith and you will recall “It is not from the benevolence of the butcher, the brewer, or the baker that we expect our dinner, but from their regard to their own interest.”  Looking after customers makes sound financial sense – they come back – and there’s a few places I’m not going back to!  Competition encourages good service – providing staff are aware.  How many times have you been made to wait in a ‘dippy hippy’ cafe while they “like, you know, sort out, like, this stuff, like, we’ve like just got back from Indo, like and it’s really hard getting back into it”.  I’m, regrettably, off to Starbucks.

Closely allied to the idea that we are in business for lifestyle purposes (lifestyle not meaning BMW and swimming pool of course) is the idea that the whole country needs to move towards entrepreneurship.  “Entrepreneurs can lead us out of recession” with Julie Meyer acting as Field Marshal it seems.    Careful examination reveals the flaws in this battle plan.  Whilst rapid growth is often achieved in small firms by definition they start from a low base.   Doubling the number of staff is brilliant and from small acorns and all that – but moving from 10 to 20 staff in a year puts you alongside the recruits a Plc picks up a day.    Added to this is the worrying underbelly of this drive towards entrepreneurs, or perhaps we should call them freelance, or, why not give them their proper name – casual labour.    Too often the desire by larger companies is to outsource part of their labour need to very small, very expendable firms.  This trend is encouraged by public sector needs to show involvement with the private sector and grant initiatives.   These firms don’t last.  (My background is in the ‘subby’ fuelled world of construction).

Of course true entrepreneurs can and do contribute to economy.  From Smith’s self interest to Schumpeterian creative destruction they have a role in managed risk and adventuring.  We need the crazies, the hungry and the egotistical – but let’s not confuse that with self-employed subcontractors.  We need young people, all people in fact, to get a better sense of enterprise, of risk and challenge and of customer service and manners.  We need to foster creativity and technology and allow people to grow.  But what we don’t need is any more kids pitching to a ‘dragon’ a way of selling sweets to their classmates or an app that tells you how many minutes until the holiday.

Excuse me while I go make some money...........   

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2011 - the year we gave up on Financial Services...

1/2/2012

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I think we may look back on 2011 as the year we gave up on financial services as a growth engine.  A pretty strong statement but I feel the last year has shown the industry to be little more than a house of cards.  It’s not that the Occupy Wall Street protests have shown us the way; it’s not that we have all turned from capitalism to some form of social enterprise ‘love in’.  It is simply that we now see it as vulgar and impotent.  As Wilde commented on conflict “As long as war is regarded as wicked, it will always have its fascination. When it is looked upon as vulgar, it will cease to be popular.” This is how I feel we now see this industry.  Spoilt, common, dirty.  This is not to say this sector does not play a vital role and certainly not to say it is staffed by incompetents – I have many friends in the industry I would happily trust with my wealth.  What I feel is the industry is now tainted too badly to recover.

We have tired of complaining of bonuses and excess, with a Government looking only for post-parliament jobs in ‘The City’ these fall on deaf ears anyway.  No, I feel that we have come to see the sector as incompetent, bumbling and bloated.

 Let me give you a case in point.  Back in August there were reports that “FOOTSIE will rise by end of year”.  Who was stating this?  Goldman Sachs, Citigroup, JP Morgan, UBS and Investec amongst others.     Their claims ranged from 5,800 to 6,200.  It ended at around 5,572.  So even the best estimate was 4% over and the worst 11%.  What they were in fact predicting was that the market would return to where it was at the start of the year, in fact pass that and see a return of 20%.  Ok so we all make mistakes, it is a predication after all.  But who in August felt we were pulling out of a recession, felt the sovereign debt crisis was near an end?  Based on simplistic fundamental analysis what would posses someone to predict the year would end on a boom? 

Let’s roll back the clock.  The European sovereign debt crisis has turned into a debate on the Euro.  This of course misses the point.  All that has happened is institutions have leant money to countries that are struggling to pay.  The reason I say this in a blasé way is that this is the simple function of bond traders – to lend money to people who can pay it back.  Not rocket science.  So with all these data available how did they come to lend to countries that struggle?  What lazy thinking was this?  Well part of the problems stem from the bond markets treating the Euro zone like a homogenous whole but lending to specific countries.  This is like a bank lending to one of your friends based on a credit check averaging all of your friends.  Now that may well suit that individual well – we all have friends who we ‘lend’ money to save in the knowledge it is a gift – but surely those who buy bonds are a little more sophisticated than this?  It would seem not.  They adopted lazy thinking, that if one country failed the others would have to bail it out.  They abandoned notions of moral hazard and capitalism and adopted a benefits culture.

Next we have the continued myth that the financial sector is central to our economy, that it pays for everything with the taxes that are so unfairly levied on it, that without it we would be derelict.   I have commented elsewhere on the folly of this.  The ‘City’ amounts to about 9% of GDP, the investment arm about 3% and the risky end of that about 1%.  Important clearly, we need every percent at the moment, but clearly the risky end of this industry contributes little proportional to its damage potential.   Look directly at the FTSE100 itself and you can see this.  Within the top 10 companies we find HSBC.  Within the rest we struggle to get to the 9% represented by GDP.      

Returning to tax it is worth noting that the taxes that companies in this sector bemoan amount to a staggering £48bn.  Of courses that is the total take for all business, not just this sector, and is eclipsed by the £158bn we all pay in income tax, the £100bn in VAT, £26bn in Council Tax and £101bn in NI payments, but then we can afford to pay more, can’t we?

We have already handed out billions to this industry and I am sure there is more to come.  We have undergone ‘austerity’ so as to assure a low rate of interest the Government seems bent on not using.  Overall we seem to be devoid of a Plan A let alone Plan B.  Unfortunately it would seem we will bumble forward for a little longer yet.  “Steady as she goes” never really was a plan............

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    Dr Bryan Mills

    "There he goes. One of God's own prototypes. Some kind of high powered mutant never even considered for mass production. Too weird to live, and too rare to die" Hunter S Thompson describing the author in 1971.

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