The Skills Shortage in Birmingham, UK

Skills Report
Birmingham Mail, 30^th May 2014

STUDENTS TO MISS OUT ON SKILLED JOBS – Beverly Nielsen, Birmingham City University (UK).

Students from Birmingham will miss out on an increasing number of top jobs in the city due to lack of skills, according to a new report. Managerial, Professional, and Technical jobs in the city are more likely to be taken up by young people elsewhere i.e. outside Birmingham.

The Centre for Economic and Social Inclusion (CESI) said the report “points to a skills crisis facing the UK’s regional city”. The report reveals that almost 50% of new students at the main colleges in Birmingham are studying low-level courses. It predicts that there will be skills shortages in Social Services, Health, Education, Manufacturing Design, Engineering, and Computing.

Adam Crews, Senior Research Associate at CESI found that the city is falling behind the rest of the West Midlands in terms of employment opportunities and economic activity. He also reported that subjects taught in the post-16 sector across the region, don’t prepare young people for well-paid employment or rather the young people choose options that don’t prepare them for well-paid employment.

Researchers found that half the courses taken in the city at colleges were at the basic level 2 and a third are short term. Total employment is set to rise by 5% between 2013 and 2022 particularly in the Managerial, Professional, and Technical sectors.

Key Challenges

1.  Birmingham has lost out on market progress in the region.
2. A growth in jobs that are in declining sectors and which attract low earnings.
3. Schools and colleges are failing to provide effective advice.
4. The further education sector is failing to address the mismatch between skills taught and the demands of the labour markets.
5. Looming shortages of graduates with business and management qualifications.

----------------------------------------  END OF REPORT   -----------------------------------------

FullEmploy was setup to reduce unemployment and the skills shortage and maintain them at low levels. However, I’m finding it difficult to get lists of skills required by industry. After emailing 6 companies close to where I live in Bartley Green, only 1 company replied and only to tell me that they will not be sending me a list of skills let alone setup a meeting with me. The other 5 companies didn't have the courtesy of replying. This stopped me from writing to the other 14 companies in the same business park let alone research another 10 nearby.

I need a change of tack. This time I’m going to approach the other 3 players in the plan: the Unemployed, Training Organisations, and the Skills Funding Agency who should pay for the training. I planned to start with the Unemployed to get commitment to the plan before I go to the others. The Training Organisations are split into 2 categories: Academic and Practical training.

Now that Birmingham City University had conducted research on behalf of CESI, we need to send it to all post-16 education establishments to make them aware of the problem. Maybe they’ll have better luck at persuading companies to handover skills required by industry. One point on the report says that schools and colleges are failing to provide effective advice to young people. How can they when companies are refusing to cooperate.

In the light of this report, I’m going to try again quoting excerpts from the report and offer to pay them reasonable expenses. After all, producing a list of jobs and the skills required to do them, will involve extra resources and time which has to be paid for.

I tried selling this idea to local Councillors but they said that they couldn't help as decisions are taken at Cabinet level. Besides, the cabinet operates within the remit imposed by Central Government vis-a-vis the austerity measures which require the public sector to reduce spending by 25% over 4 years between April 2011 and March 2015. The people will give their verdict in next year’s general election (2015).

First, I need to get hold of this report – it’s right up my street. I also need to publish my findings on the MPC News and the FullEmploy websites. Then I need to promote these websites widely and invite would-be employees who will be given shares in those companies. Employees have to be unemployed and living in the ward where they’ll work because FullEmploy will build an office in every logical ward that has a collective population of 25,000 people.

For background information read this.

Day 10: How do the Perceptiveness, Persistence and Risk Taking Characteristics affect FullEmploy?

Welcome to day 10 of the Characteristics of a business owner cum entrepreneur. I know it's been over 2 months since I blogged but it should be worth the wait.

Perceptiveness:
When delegating or negotiating you not only need to be flexible and open-minded but you also need to be perceptive to the needs of your counterparts. When delegating, it's crucial to perceive your subordinates' feelings so that you can better understand what they think you expect from them and you can more accurately understand their contributions so that it makes it easier to incorporate them into your plans. With negotiations, perceptiveness can help you avoid pitfalls and get better deals.

FullEmploy's staff cooperate with each other; they don't negotiate. They all work on the same remit. If different methods of solution are suggested they may be tolerated but they will be reviewed based on the effects on the original remit.

Persistence:
This sounds similar to the Drive characteristic which is the energy to drive projects through. Persistence is usually invoked in the face of failure. Theory has it that successful people look for the opportunity in every failure. FullEmploy has formalised this into what it calls the Business Development Lifecycle (BDL). This is where staff consider WHAT activity they're required to do; the RESOURCES needed to do it; HOW it's going to be achieved; and WHAT ACTUALLY HAPPENED.

The BDL imposes that staff do a brainstorming session to come up with a series of methods of solution. Then using the best one in their action plan and the remainder as alternative method of solution in a contingency plan for that activity. Then they produce a Monitoring Plan not only to monitor the progress of the agreed upon method, but also on the effectiveness of the chosen resources including the human resources.

These reports are analysed and regularly reviewed at set milestones in the action plan. If a failure occurs before a milestone is due, then if the failure is minor, an alternative method and/or resource can be used. But if the failure is major and that none of the alternative methods and resources can ameliorate it, an emergency review is convened where a new plan is created or the project is abandoned.

Risk Taking:
When a project is being planned, many alternative methods of solution are proposed. The best ones are used in the project action plan and the rest are used as contingencies for each activity. During planning "What if" analyses are performed to stress test the plan.

Sometimes you get conflicting answers some of which suggest that the project should be abandoned. The entrepreneur has to take a measured risk but should treat it as an activity and monitor the risk as part of the monitoring plan and review the results at the review meeting or emergency review.

All entrepreneurs learn the lesson from any setback (failure) and continue in the light of the new experience i.e persist until successful. Napoleon Hill once said "A quitter never wins and a winner never quits". FullEmploy's interpretation of this is "A quitter never wins but a winner knows when to quit". A horse racer knows when to stop flogging a dead horse and a shrewd business person knows when to cut his/her losses.

Day 9: How do the Optimism and Open-Mindedness Characteristics affect FullEmploy?

Today's Characteristics are Optimism and Open-Mindedness.

Optimism:
This is similar to confidence except that confidence is about the present and optimism is about the future. When delegating, you need to communicate the requirements clearly but with confidence. The confidence shows that you know what you're doing which will inspire confidence in your subordinates,

Optimism should be expressed in how things will turn out i.e. successful with exciting results. You have to be careful not to lull them into a false sense of security; this is why contingency plans are created. In fact, the presence of a contingency plan improves understanding, confidence and optimism.

FullEmploy uses the Business Development Lifecycle (BDL) to create and execute plans: it starts by researching what is needed so as to create an action plan. It holds brainstorming sessions to identify methods of solution (MoS) for each task to be undertaken. The best MoS is used in the action plan and the remainder used to create the contingency for each task. Then a monitoring plan to gauge the effectiveness of the MoS, equipment, tools, raw materials, training, staff, and money as well as the progress in achieving the set targets.

Then the action plan and the contingency plan are executed and the monitoring plan is executed in parallel which means a separate monitoring team will be created. At regular intervals, milestones, the progress reports and the monitoring reports are reviewed to inform the planning of future milestones.

The whole process is to increase confidence and optimism in the project and give the ability to react should exceptions occur.

When negotiating contracts or building relationships, communications must be clear and delivered confidently and with an air of optimism which must be based on reality. This necessitates careful research and planning. Since optimism is enhanced by prior success, managers at FullEmploy will use the aggregation process to collect data on past projects and learn from mistakes and build on successes.

Open-Mindedness:
You need to be open-minded when planning so that you can be creative. When you involve staff from lower levels, you need to be open-minded to include their contributions within reason. A certain level of open-mindedness is necessary when negotiating contracts so that you become clear of their requirements. Similarly, when building relationships. Bear in mind that the content of contracts is based on info gleaned during the relationship building process.

Another area that requires open-mindedness is when determining the future and structure of FullEmploy. This is where you encourage staff to contribute based on their experience. However, their contributions must resolve the problems FullEmploy is addressing vis-a-vis unemployment and the skills shortage.

Open-mindedness at FullEmploy is embodied by the management structure. First of all, all staff are managers and have the duty to contribute to the planning process which are designed to achieve FullEmploy's overall aims. At ward level, the planning committee is made up of the Client Managers chaired by the Ward Manager. At area level, the planning committee is made up of the Ward Managers chaired by the Area Manager. And so on. This should keep all members of staff throughout the company well informed of proceedings.

This structure is essential to enable higher level managers to paint an economic picture of the unit they're managing, and share it with everyone else. So everyone is contributing to the planning and using best practice created by others as a matter of routine.

Day 8: How does the Leadership Characteristic affect FullEmploy?

Today's characteristic is Leadership.

There are many debates about leadership especially with its link to management. Leadership and management are treated as separate roles e.g. those on the Board of Directors are treated as leaders and lower management as, well, managers.

At FullEmploy all employees are treated as managers and are expected to learn and show leadership. Because of the hierarchical structure of FullEmploy, a manager is a participant in a higher team and a leader / manager of a lower team. For example, a Ward Manager is a participant in the Area team but a leader of the Ward team. The Client Managers have to show initiative in the way they carry out their duties. They also manage people with whom they build relationships; except that these people don't report to them, it's the other way round.

At FullEmploy managers are duty bound to show leadership by laying down the law which their subordinates must follow. However, everyone has to show flexibility within certain parameters that don't compromise the core values. FullEmploy's view of leadership is that it must be done by example and that all the other characteristics must support that leadership. In fact all the characteristics of an entrepreneur must be adhered to by all staff.

This gives an insight into how higher level managers should lead their teams i.e. show them what FullEmploy wants to achieve and that teams are duty bound to achieve them. These higher levels have external responsibilities i.e. external organisations/people.

Leadership is best shaped by taking into account all the other characteristics in an integrated way:

A leader must be organised; communicates clearly and confidently; is decisive yet flexible; works by delegating tasks to subordinates and has the drive to see them through. A leader must be focused not only on the task at hand but also on what it contributes to the overall aims and objectives of FullEmploy. Leaders at FullEmploy are expected to take an interest in the Health and Fitness of their staff so that they can carry out their duties; and adhere to Health and Safety regulations.

A leader must be optimistic when delegating tasks and open-minded when involving staff in the planning phase but mustn't compromise core values e.g. the general direction of FullEmploy as it's solving problems not just making money.

When communicating, a leader must not only ensure understanding by actively seeking feedback but also by being perceptive to their nuances and body language. This is also a prerequisite when involving staff in the planning phase. A leader must also perceive the Political, Economic, Social, and Technological impact on FullEmploy as explained in the SWOTPEST document.

The most enduring characteristic of a leader is persistence in the face of many setbacks and subordinates tend to look to the leader for guidance on the way forward. But they don't have to be alone. If the setback is minor, they can take the initiative to ameliorate it but still report the incident and the plan to circumvent it. If its a major setback, then they should seek guidance from a higher authority.

This recognises the fact that some projects do fail. In FullEmploy's case, the project is to reduce unemployment and, to do this, the skills shortage must also be reduced. Failure in the methods of solution can be tolerated as new ones will be created. When creating an action plan, a brainstorming session is held where methods of solution are created. The best one is used in the action plan and the rest are used in the contingency plan as alternative methods of solution. This is repeated for each task in the action plan.

Risk Taking is more associated with entrepreneurs than leaders who must take calculated risks. One entrepreneur who became successful and hence CEO of the eventual company, admitted that he doesn't know much about leadership and management in the conventional sense. I tend to agree with that notion because people seem to define what leadership and management is and people are obliged to conform with that definition.

Steve Jobs was a technical boffin and yet he found what his customers wanted and built products that satisfied those wants and became exceedingly successful. This proves that he didn't need any training in leadership and management in order to be successful.

I'm studying a course about Business Organisations and one of their conclusions is that the biggest enemy of creativity is conformity. One example is that a Business School concluded that the biggest characteristic of leaders is charisma; so that's what they taught. Industry ended up with a lot of charismatic leaders who were short on delivery. Remember that knowing the problem is half the solution.

Day 7: How does the Health & Fitness Characteristic affect FullEmploy?

Today's characteristic is Health & Fitness. It's relatively short but sweet.

Health & Fitness

Although this is a personal trait, FullEmploy would take an active part in encouraging Staff to stay Fit and Healthy. In the future, FullEmploy may consider subsidising gym membership and work with gym companies to help us ensure the staff achieve stated aims. Otherwise, the subsidy will be stopped.

FullEmploy would adhere to the work/life balance and working directives not just to comply with the law, but because having adequate rest not only prevents burn-out but also improves productivity.

Because FullEmploy solves problems if we were to create our own gyms for staff and their families, we'd be creating unnecessary competition for existing providers. This is why we work alongside our partners rather than compete with them. In the near future, we'll buy shares in these businesses so that we can share in their success. If they should struggle, we would intervene as shareholders and in our role to safeguard jobs.

You may ask what has this got to do with Health & Fitness? Well, it's the health and fitness of the businesses themselves. That is, the policies and procedures and the business processes must be working seamlessly and efficiently so as to achieve the Aims & Objectives of FullEmploy, their partners and those businesses we provide services to.

Day 6: How do the Flexibility and Focus Characteristics affect FullEmploy?

Today's Characteristics are Flexibility and Focus.

Flexibility

There are 2 areas where FullEmploy can exercise flexibility: internally and externally.

Internal flexibility lies with giving staff an opportunity to contribute to the overall policy and, to some extent, shape local policy in line with central policy. That way, FullEmploy can be all things to all people depending on local circumstances.

External flexibility is where we're negotiating with our partners. This is where we fine tune our methods of solution that we provide for them. If we see that policy, local or central, is getting in the way of solutions, then we'd consider changing it.

FullEmploy has a certain number of core values which brought it into existence. These core values cannot and must not be compromised. According to Meatloaf's lyrics: "I will do anything for [you]; but I won't do that". That actually sums up flexibility - be flexible up to a point and no further.

Among these values, which have become policy, is that FullEmploy would accept unqualified, unskilled or inexperienced people as staff or candidates, because full training will be given. Another value/policy is that, in any ward, only candidates who live in that ward will be accepted; and will be found jobs with businesses who operate from that ward first, then in neighbouring wards.

Focus

There are different levels at which FullEmploy can focus its efforts. The most important ones are when building relationships with our partners:

1. Employers
2. Training Providers
3. Funding Agencies
4. Politicians
5. The Unemployed
6. The General Public

As well as the different areas to focus on, FullEmploy will place different emphasis on areas of policy particularly that its activities accomplish the underlying value of reducing unemployment and the skills shortage in disadvantaged areas. FullEmploy's Ethos is to solve problems first and make money second. In fact, we'll be paid FOR solving the underlying problems; and that's what we'll be focusing on.

During negotiations with our partners, we will focus on the immediate problems facing them not just recruitment. For example, an employer may require to fill a vacancy to satisfy short-term demand but may worry about future demand. Others may be worried about their viability. So, our customers extend beyond those who offer vacancies - the Government refers to this as safeguarding jobs.

Day 5: How do these Characteristics affect FullEmploy?

Today's characteristics are Delegation and Drive.

Delegation

FullEmploy adopts the reversible Top-Down approach i.e. the Vision, Aims & Objectives will be delegated down the hierarchy from top to bottom. Results will be communicated up the hierarchy after aggregation. Intermediate results can also be delivered to partner organisations such as Local Authorities, Councillors, and MPs.

A certain amount of responsibility will be delegated and office managers will be required to hold Board Meetings with lower level office managers to discuss the intermediate results and the way forward. There will be 2 such meetings per month: the down meeting and the up meeting. The up meeting is to discuss the aggregation of data; and the down meeting is to discuss the results as they come back from higher levels i.e. they would contain results from other offices. This will aid the sharing of best practice and would give a clearer picture.

Most of the work will be done by the Client Managers as they collect the raw data and the office managers will aggregate it at Ward, Area, County, Region, and the UK as a whole. Even though responsibility is delegated to ALL levels, work will still be carried out to achieve the Vision, Aims & Objectives of FullEmploy.

Drive

My definition of drive in this context is the energy you have, to help you carry out tasks and engender this energy in others to do the same. To enable this, FullEmploy created its structure in such a way that the manager of one office and the managers of the lower levels form a Board of Directors who have complete responsibility for that unit but still have to operate in such a way as to achieve FullEmploy's Aims & Objectives.

Guidance on what the strategic direction and Aims & Objectives of FullEmploy, are fed down the hierarchy from CEO to Client Managers and everyone in between. The effectiveness of this guidance and new experiences are fed back up the hierarchy to the CEO who changes policy as necessary.

It is said that no one can be all things to all people. So local managers are enabled to shape local policy to fit local conditions within FullEmploy's Aims & Objectives. This should energise the local teams into being more productive which would enable them to achieve their goals.

Because all staff record their experiences on a central database, everyone else can share these experiences and learn from them. These experience are written according to the following guidelines: What was planned to happen? How was it planned to happen? What actually happened? Then a conclusion is written to tie them all together.

Day 4: How do these Characteristics affect FullEmploy?

Today's characteristics are Confidence and Decisiveness.

Confidence is description of the quality of communication, one that shows that you know what you're taking about. FullEmploy expects all staff to know how the whole business model works in general and how the specific parts of it they're working on in detail. This should be demonstrated to the people they're communicating with (see Day 3).

Confidence depends on how much you know about the subject matter. Hence staff must learn about the business they're dealing with before, during and after negotiations. FullEmploy has set aside time for this study and put under the discretion of the Ward Managers.

Staff must also inspire confidence in others and be perceptive to the confident outlook of other members of staff. If you're confident others become inspired by you.

Client Managers have to communicate confidently with the Employers and Candidates they're responsible for; the Training Providers and the Funding Agencies when reporting progress. The truth helps even when results are negative in which case the Client Managers and Ward Manager must get together to identify where the problems lies. If it lies within FullEmploy, they must assess it and formulate an action plan to deal with it and include that as part of the progress report. If the problem lies with the Training Provider, again the team must assess the circumstances and create a response that they would put to the Providers stating explicitly what's expected of them even as far as holding a joint meeting to resolve the problem.

Decisiveness. All members staff need to make decisions in almost everything they do. The business model determines what needs to be done already. However, there are times when the pre-determined activities don't achieve all what the customers want. Flexibility is required here but not at the expense of core values.

When an unplanned request for change is made, a decision to accept the change must NOT be made nor a discussion be entered into. The only decision to be made is to accept the REQUEST and explain the Change Management procedure and the Acceptance Criteria. Naturally, all members of staff will be working to a remit which gives them a certain amount of flexibility.

Customers will ask for bespoke work if possible which tend to be time-consuming and hence are expensive. These must be resisted and the customer sign-posted to the higher Manager for acceptance or otherwise. Staff must act decisively even at the risk of sounding inflexible. If the request is reasonable, the staff member can easily accommodate it but not if it takes them outside their remit.

Decisiveness is the opposite of Flexibility. Although you'll try to accommodate a customer's request, you cannot or rather must not compromise core values. You can make customers aware of FullEmploy's values and why you cannot compromise them. Remember FullEmploy is solving problems not just making money.

Day 3: How do these Characteristics affect FullEmploy?

Today's characteristic is Communication.

Communication is about communicating the objectives of your duties clearly and confidently and to ensure that your audience understand what you're communicating. One way for doing this is to ask questions that elicit whether they understood it. It's also important to understand the feedback from your audience and one way of doing is to repeat your understanding of what's being said.

Client Managers ----> Employers, Training Providers, Funding Agencies, Unemployed, General Public
Ward Managers ----> Employers, Training Providers, Funding Agencies, Unemployed, Councillors
Area Managers -----> MPs, LA Managers, Employer & Employee Associations at local level
County Managers ---> MPs, LA Managers, Employer & Employee Associations at regional level
Regional Directors --> Regional Cabinet Ministers, Employer & Employee Associations at regional level

The above shows the default communications of the staff. This is in addition to them communicating with each other.

Client Managers communicate with Employers to identify jobs and skills. They would sell the solution to the Employers and use the findings to report them to the Ward Manager and build the skills database. They would communicate with the Training Providers to establish training provision and create roadmap for the Unemployed to complete the training. The Client Managers would then monitor the progress of the training and report progress to the Employer and the Training Provider.

Client Managers would also communicate with the General Public to gauge the effect of unemployment on their lives. They would write news articles and sell them on to mainstream media at Local, Regional and National levels.

Ward Managers would negotiate contracts with Employers to hire the candidate based on a training contract negotiated with the Training Providers and a funding agreement negotiated with the Funding Agencies. They would also aggregate the data collected by the Client Managers and use it to paint an economic picture of the ward and communicate this with the Area Manager and Councillors as well as the Client Managers.

The Area Manager would aggregate the data aggregated by the Ward Managers in their area and use it to paint an economic picture of the area and communicate it back to the Ward Managers, local MPs, LA Managers, Employer and Employee Organisations at local level and onto the County Manager. The objectives of FullEmploy and the Trade Unions would have a lot in common e.g. safeguarding jobs.

The County Manager would aggregate the data aggregated by the Area Managers in their county and use it to paint an economic picture of the county and communicate it back to the Area Managers, local MPs, LA Managers, and Employer and Employee Organisations at regional level.

The Regional Director would aggregate the data aggregated by the Area Managers in their county and use it to paint an economic picture of the region and communicate it back to the County Managers, Regional Cabinet Ministers, Employer and Employee Organisations at regional level and onto the CEO at National HQ.

Day 2: How do these Characteristics affect FullEmploy?

Today, I'd like to discuss how Clarity affects FullEmploy.

Clarity is needed when communicating anything. FullEmploy communicates with its customers, consumers, and partners. Today I learnt that there's a difference between customer and consumer. In the past, I didn't think about, I just used them interchangeably. For what it's worth, a customer is one who purchases goods and services and a consumer is one who makes use of them. They can be one and the same. Clarity is also needed when you're defining your vision, aims and objectives.

The vision, aims and objectives of FullEmploy couldn't be clearer:

Aims
          - reduce unemployment and maintain it at low levels
          - reduce the skills shortage and maintain it at low levels
          - get the Government to pay for the training to create a level playing field for the employers
          - create income streams to replace unemployment and skill shortage reduction schemes
          - find accommodation for the homeless and then treat them as for the unemployed

Objectives
          - Build a geographical hierarchy of offices
          - Hire office managers one for each office
          - Hire 5 Client Managers for each of the 9,523 offices
          - Build relationships with Employers to identify jobs and skills required to do them
          - Use the identified skills to build a skills database
          - Build relationships with the unemployed to identify capabilities and shortfalls
          - Where there are shortfalls, arrange training on the identified skills
          - Build relationships with Training Providers to identify if they can provide skills
          - If not, we'll work together to build capacity
          - Build relationships with the funding agencies to pay for the training
          - Build relationships with the politicians to help us get the Government to pay for the training
          - Monitor the progress the candidates are making in attaining the skills and/or qualifications

The above will be communicated to all our partners in the solution to the unemployment and skills shortage problems namely the Employers; Training Providers; Funding Agencies; the Unemployed; and the Politicians.

Day 1: How do these Characteristics affect FullEmploy?

In the next few days, I will describe how the Characteristics of an entrepreneur affect FullEmploy. Some will be short and will be discussed in one article while others will be one article per characteristic.

     1. Being Organised

There are 3 types of organisation
a) the physical structure
b) the busness model

c) personal organisation

a) FullEmploy's physical structure is that it's organised as wards within Areas within Counties within Regions. The legwork is done by the wards who employ Client Managers to do the work. Each office will be managed by an office manager and they'll communicate with each other up and down the hierarchy.

b) FullEmploy's business model is to build relationships with Employer's to identify jobs and skills to populate a Skills Database; build relationships with  the Unemployed people to identify their capabilities and shortfalls with regards to the identified skills; build relationships with Training Providers to deliver the identified skills; build relationships with Funding Agencies who will pay for the training.

Externally, FullEmploy would build relationships with Politicians who would help us get leverage in industry and get Central Government to accept responsibility for training to create a level playing field for Employers who can then gain access to a skilled workforce. One of the Structural Imbalances is Low Productivity which led to the UK losing market share of the global economy thus increasing the balance of payments deficit. So, it's in the Government's interest to pay for the training in order reduce the skills shortage.

c) Personal organisation is how a person organises the work which implies use of Project Management techniques such as Prince 2 the UK standard. However, when you implement a task, you need to organise your thoughts which is akin to preparation and rehearsal. It's this sort of preparation that can make you look confident and that you know what you're doing. Implementing a task should be treated as a mini-project in it's own right. This is where you consider 'what' needs to be done; 'how' you're going to achieve it or present it; and 'what actually' happened i.e. did things go according to plan? Were your expectations accurate? Can you learn from what worked and what didn't? This can form your Continuing Performance Development.

Characteristics of an Entrepreneur - Day 4

I've so far described the first 12 characteristics in the past 3 days; here are the last 4:

      13. Optimism

Flexibility is to open-mindedness as Optimism is to Confidence. Optimism is descriptive. Hence, when delegating work, the strategies you describe must be optimistic i.e. they must at least sound achievable. Presenting it with confidence bolsters that notion. People tend to ask questions for clarification. These are the easy ones. Others ask "what if" questions. If you involved them in the planning process, they would've asked them then; and contingency plans would've been drafted to cover them.

Optimism reminds me of positive thinking - if you think positively, positive things would happen. However, experience has shown that even if you do think positive, there's still a chance to fail. That's why a proverb was coined to warn about this: "if at first you don't succeed, try and try again". This implies that you have to know when to stop "flogging a dead horse", and pick another one.

      14. Perceptiveness

Under communications we said you not only need to ensure that your audience understand what you're presenting but also that you understand their feedback. To do this, you need to be perceptive so that you can accurately perceive body language as well as words which would enhance your understanding.

I don't relish reading but from articles about communications that talk about non-word methods people tend to concentrate on these methods that they don't listen to what's being said. If you accidentally cross your arms, for instance, your counterpart will take offence because that's how people have been taught communications. Some unscrupulous negotiators use this to great effect i.e. they give the other side the impression that they'll get what they want even if it isn't in the contract.

So, perceptiveness goes beyond understanding what's being said or the body language but also the implications of these nuances. Also, you need to perceive future events so that your forward planning can deal with such events by creating appropriate contingency plans.

      15. Persistence

Although Drive is the energy to see things through to completion; the will and the discipline to see them through, usually in the face of adversity, is persistence. Under optimism, we discussed a few proverbs such as "if at first you don't succeed, ..." and that you have to know when to stop "flogging a dead horse". You need to be optimistic if you want to continue doing something persistently.

It's said that if you think negatively, you'll fail 100% because you won't even try. However, if you think positively and optimistically, there's no guarantee you won't fail. For example, James Caan, the entrepreneur, bought a chain of sandwich shops that were losing £100,000 per week. 6 months later he cut his losses and used the savings for other projects. In this example, it's fatal to persist with the undertaking. Napoleon Hill said "a quitter never wins; and a winner never quits". It should read "a quitter doesn't always lose and a winner knows when to quit".

      16. Risk Taking

This is what defines an entrepreneur. Some entrepreneurs say that you don't have to take any risks. For example, an East End entrepreneur started with only £200 capital and used it to run a business from his bedroom. His business model was to double his capital every so often. That way he doesn't become dependent on lenders. Richard Branson sold Virgin Music for £1bn to pay off Virgin Atlantic's debts so that he doesn't become dependent on lenders.

You only need to take a calculated risk when you face obstacles that stop you from launching a new business or expanding an existing one. You also take risks when an obstacle threatens the viability of your business. Some entrepreneurs think that the higher the risk, the greater the reward will be and take high risks on that basis.

The big banks of America and Europe took unacceptable risks and became bankrupt as a result. But, with the exception of Lehman Brothers, they were rescued by their Governments. However, the minnows were allowed to go bust - a great injustice. We had warnings that this can happen - remember Nick Leeson, the Rouge Trader? He bankrupted Barings Bank with illicit derivative trading - the same mechanism that bankrupted American and European banks.

You'd think that derivative trading would be made illegal in return for bailing out the failures. But no; these bankers are having their cake AND eating it too. When Goldman Sachs say they made a profit, they don't mean they made an economic profit; they mean they made a profit on derivative trading. What's worse is that the tax authorities didn't receive a penny from those "profits" because derivative profits are not taxable. However, the tax payers pay for their losses.

If you want to make profits tax free, become a banker. What's more, your losses are covered by the taxpayers. Not really, ordinary derivative traders go bankrupt when they lose - look at what happened to the small banks. Talk about false profits. Doesn't that remind you of false "prophets"?

Tomorrow, I'll start describing how these characteristics affect FullEmploy. Some characteristics are so vital that they'll be one article.

Characteristics of an Entrepreneur - Day 3

I've so far described the first 8 characteristics in the past 2 days; here are the next 4:


      9. Focus

This is an obvious one as if you have too many tasks to do at the same time, you won't do any of them any justice. Yet people don't deliberately lose focus; they're distracted by other people. So if somebody tries to distract you from your task, follow Brian Tracy's advice: point to somebody else and say "go and waste his time".

      10. Health & Fitness

Not many people associate Health & Fitness as a characteristic of entrepreneurs yet people will happily talk about entrepreneurs needing to work long hours and do most of the task themselves - the proverbial wearing of many hats. If that doesn't knock the stuffing out of you, nothing will. All this implies that you need to be Fit & Healthy.

However, if you're working long hours, there's a chance that you're not taking adequate rest or sleep. This will harm you in the long run. Another characteristic of entrepreneurs is Delegation. By delegating tasks, you'll free up time to plan strategically and rest adequately. Remember to work on your business not in your business.

      11. Leadership

Not many people associate Leadership with entrepreneurs. Some of them are known to be serial entrepreneurs - Richard Branson being the best example with over 400 companies in the Virgin Group. Such entrepreneurs become leaders because of their proven track record; they don't need to look important or confident - they can look fake. Branson's contributions to the economy make him important. With all that success behind him, he's naturally confident. In interviews Branson looks and sounds ordinary. That's because we all are from the PM to the shopfloor worker. The difference between a successful person and an unsuccessful one is opportunity. Most successful people create their own opportunities. Branson must have exercised leadership early on as soon as he hired people to work for him. This is because all levels of management require leadership skills. This means that Branson is not the only leader in the Virgin Group.

      12. Open-Mindedness

This is like Flexibility - there are limits to how many tasks you'll take on or how many ways to do the same thing. If you operate an open-door policy, the amount of work you'll end up with will drive you to distraction, and you'll lose focus. I suppose open-mindedness comes in when considering possible solutions; and flexibility when considering other people's contributions. Remember that these must take into account the organisation's core values which cannot be compromised.

Open-mindedness implies that you need to tolerate many points of view. This is legitimate for long-term planning. Some people are not aware of the long-term objectives and they see the diverse viewpoints as a distraction which contributes to the loss of focus; and they ditch most of them. They achieve short-term success but fail in the long term. Sentences like "So that's this is for" can be heard when describing some of the things that they ditched.

See you tomorrow for the 4th instalment.

Characteristics of an Entrepreneur - Day 2

Yesterday I introduced what I learnt from my research i.e. the 16 characteristics of an entrepreneur. I also published my understanding of the first 4 characteristics. So, below are the next 4:

      5. Decisiveness

This is the true mark of leadership especially when done with flexibility but a leader must lay down the law for everyone else to follow and this necessitates decisiveness. Again the central theme is knowing your vision; aims & Objectives; and the strategies to achieve them. This enables you to make decisions with confidence but decisiveness comes into its own when the decision maker is under pressure.

You need to be decisive when
a) Negotiating
b) Delegating
c) Communicating
d) Being Flexible
e) Leading
f) Risk Taking

      6. Delegation

All levels of management need to delegate work. The ultimate responsibility remains with the manager. In the past, managers used to delegate authority to do work according to a set remit with the ability to make decisions within certain limits known as tolerances. Nowadays, although this practice still exists, delegation has shifted a gear and responsibility, within stated tolerances, is also delegated but control is retained by the manager.

In order to achieve that control, the manager sets milestones with clear targets and monitors progress independently of the people doing the work e.g. by interviewing the recipients of the products/services as well as asking for progress reports. In other words managers are taking a strategic view and allow the people, to whom work is delegated, to take care of the operational issues.

Most managers are operational managers in that they're responsible for implementing strategic plans. However, when they delegate work to lower levels, they create strategic plans for this to be controlled. These are called "operational strategies" and can be created at all levels. This is reminiscent of functional decomposition where a large problem is broken into smaller problems which themselves are broken into even smaller problems or problemettes. This gave rise to the top-down approach which is difficult to accept - it's still waiting for wider acceptance. The solutions of these problemettes has to be communicated up the hierarchy using a bottom-up method.

      7. Drive

My research found that what this implies is that you've got to have the energy to see tasks / projects through to completion. You need to be fit and healthy in order to have that energy.

      8. Flexibility

Managers at all levels need to be flexible and seriously consider other people's input to solutions. This implies that such people need to be involved in the planning phase so that their input can be used in the right context. Shopfloor workers have experience of what works and what doesn't and this is very valuable info for the planners as it can result in more realistic estimates and the shopfloor workers would feel involved which means there's no more them and us. This is not just about flexibility but also common sense.

See you tomorrow for the 3rd instalment.

Characteristics of an Entrepreneur - Day 1

While researching the market for FullEmploy, I came across a claim that there are 16 Characteristics of a Business Owner. The majority of business owners are essentially entrepreneurs; so these became characteristics of entrepreneurs. The characteristics are:

1. Being Organised
2. Clarity
3. Communication
4. Confidence
5. Decisiveness
6. Delegation
7. Drive
8. Flexibility
9. Focus
10. Health & Fitness
11. Leadership
12. Open-mindedness
13. Optimism
14. Perceptiveness
15. Persistence
16. Risk Taking

The most recognisable characteristic is Risk Taking and the least recognisable one is, believe it or not, Leadership. When entrepreneurs start their careers few people believe in them let alone recognise them as Leaders. It's only when they succeed that people see them as Leaders - of innovation at least.

16 is a perfect square whose square root is 4. So in the next 4 days I'll be describing what these characteristics mean to me. On the 5th day I'll remove some characteristics that I think are identical and add more characteristics that I think are also relevant. So, I'll begin with day 1:

1. Being Organised - you can organise objects, activities, time, etc. This is akin to management e.g. management of objects is called Resource Management; activity management is called Project Management; time management doesn't have a posh name. You don't need to be a Resource Manager or a Project Manager as these can be delegated; you do need to know what's involved in order to control them. So when an entrepreneur organises activities, he/she has to know how they fit together and what the expected results are before delegating them to a Project Manager. When people see you as being organised, they see see you as being in control which inspires confidence and puts you in a Leadership position.
2. Clarity - you need to be clear on what you want to achieve overall, the Aims & Objectives i.e. the stepping stones on how to get there; and the methods of solution to achieve the Aims & Objectives. You also need to show that clarity to the people you delegate work to. This inspires confidence and is seen as a mark of Leadership. Clarity is also needed during negotiations which is not included as a characteristic. However, an entrepreneur needs to be a skilled negotiator in order to get their idea accepted let alone funded.
3. Communication - once you're clear on your overall vision and its constituent Aims & Objectives and techniques, you need to communicate them to the people who'll eventually do them. You must make sure that they understand what's expected of them. During execution the people who do the work will report on progress at regular intervals. This time you have to show them that you understand what they're reporting. With the best will in the world, sometimes resources and techniques don't work according to plan and you have to be prepared to be flexible. Clear, concise communications delivered confidently can inspire confidence and increase the chances of success. Maybe communications replaces negotiations as a characteristic.
4. Confidence - this has to be the result of delivering the other characteristics. It's easy to look confident when you know what you're doing i.e. when you're clear about your Aims & Objectives and the techniques of achieving them. However, expressing an air of confidence for the sake of it, can lull you, and others, into a false sense of security and, if the people you're dealing with eventually find out, you'll lose your reputation. Many people "fake it till [they] make it". This should be done as a last resort after everything else has failed. Confidence is a component of other characteristics:
   a) Communication: you need to communicate confidently as well as clearly
   b) Decisiveness: you must make decisions with confidence which shows the other parties involved that you're serious and that you know what you're doing.
   c) Delegation: when you give people work to do, as well as communicating what's required clearly, it needs to presented confidently.
   d) Flexibility: Although you may need to accommodate other people's ideas but you believe their suggestions are out of place, communicating these facts clearly and confidently will make them accept your methods more easily. I've always advocated involving the workforce from the earliest opportunity.
   e) Leadership: clarity, confidence, decisiveness, flexibility, etc together make a leader. One of these characteristics alone doesn't quite cut it.
   f) Optimism: this is almost synonymous with confidence except that optimism is descriptive whereas confidence is conveyed through body language and tone of voice.
   g) Persistence: being able to continue in the face of setbacks enhances other people's confidence in you.
   h) Risk Taking: your confidence motivates others to share the risk with you.

As you may have guessed, the words in red will be discussed later on. So until tomorrow, have a great time.

Business Basics adopted by FullEmploy

I believe that all types of business have similar processes to each other and that some of these processes are so basic that they apply to all businesses without change. The only things that change are the way these processes are implemented due to current circumstances. These processes are:

1. Business Foundations
2. Business Support Functions - Admin and Functional Support
3. Business Processes - the most variable as they depend on the type of business

1. Business Foundations

This is encapsulated by the 4 Corners of the Business World:

a) Business Premises - All business activities occur within premises

b) Staff - All business activities are performed by people

c) Resources - Equipment, Tools, Raw Materials, and Training are needed to perform these activities. The Staff need to be Trained to use the Equipment and Tools to shape the Raw Materials into the finished products/services that'll be sold for a profit.

d) Money - the above 3 corners give us an idea of what the costs are going to be. In this corner, it's the sources of money available that are discussed when starting up a new business or expanding an existing one. Profits or cashflow will be the source for everything else.

Entrepreneurs should start by describing their venture in terms of the Business Foundations i.e. where are their activities going to be performed; how many Staff will be needed; what Equipment, Tools, and Raw Materials are needed; and what training is required not only on the use of the Equipment and Tools but also on the techniques required to produce the products/services.

The Money aspect should be discussed when all the necessary processes have been planned. The above will give you a running total of expected expenditure.

2. Business Support Processes

a) Payroll, Pension, HR

b) Accounts including accountancy

c) Legal Services

d) Customer Services including relationship management

e) Skills Development

 f) Product Development

g) Sales and Marketing

h) Procurement

In big companies, Payroll and Pensions are in one unit and HR is in another. Training, hence Skills Development, is an HR function but they don't carry out the actual training; they simply coordinate the training activities i.e. provide a monitoring role. In a later blog, I'll describe the need for delegation where authority is delegated with the work but control and responsibility remain with the delegators.

Similarly, Sales is in one unit and Marketing is in another but they work closely together. In small to medium-sized enterprises (SMEs) Sales and Marketing are usually in one unit if at all. Usually Sales staff double up as Marketing operatives. Customer Services is part of the Sales Unit as it's the Sales team who close the deals and provide after-sales care. The Marketing team simply bring in the sales leads.

Similarly, Accounts and Legals can be separate units in big businesses; SMEs can outsource them. The Accounts unit keeps track of all transactions which are used to prepare the financial reports and submit tax and VAT returns to HMRC and Returns and Accounts to Companies House. The Legal unit would give advice on compliance and a defence on any litigation.

Skills Development is a strategy used by HR when developing staff. Product Development is similar to Skills Development but is applied to goods and services. It's also a province of HR as it's the Staff that are developing the products.

3. Business Processes

This section is different for each business. For FullEmploy it involves the following:

a) Building relationships with Employers to identify jobs and job skills and negotiate a contract where the Employer either keeps the post open until the training is complete; or hires the candidate as an apprentice and sends him/her for training as any other employee. This will be done in 2 stages: Client Manger gets job details and uses it to create a Business Plan for the candidate; then negotiate with the Employer.

b) Build Relationships with the Unemployed providing them access to the Skills Database which will contain background info on the Employers so that he/she can select a job that is closest to his/her capabilities. When a candidate joins FullEmploy, he/she is assigned to a Client Manager. Then when he/she selects a suitable vacancy, he/she is reassigned to the Client Manager who manages the Employer that holds that vacancy. The candidate still has to go through a vetting procedure/interview to make sure they're suitable.

c) Build relationships with Training Providers to ensure they have the required skills, if not, we'll work together on building capacity. Details such as cost and duration are noted and shared with the Employers and Funding Agencies. This relationship will include monitoring the progress candidates are making on the course provided. Strict and difficult decisions need to be made regarding where inefficiencies lie.

d) Build relationships with Funding Agencies to see if they can pay for the training. If not, we'll negotiate with the politicians especially Cabinet Ministers. FullEmploy's aim is to get the Government to pay for the training as Industry bosses are reluctant to train staff because they get poached by companies who can offer higher salaries. The latter is our selling point i.e. we don't poach staff from one company and place them in another. If the Government pays for the training, it'll create a level playing field thus preventing wage inflation which translates to lower prices hence lower inflation. FullEmploy will coordinate this activity by creating a Skills Database to reduce the skills shortages and the Government will only pay for training on this particular skill for this particular job which has a vacancy with this particular Employer.

e) Build a relationship with Politicians who can help us perform the activities in d). Once we get the politicians on board, they'll help us gain credibility and persuade the Cabinet to pay for the training.

f) Build relationships with organisations that can supply unemployed people. I've identified Shelter and Crisis, the Homeless Charities, as sources of more difficult candidates because we have to house them before we can find them jobs. This problem needs to be resolved. If we can't get a sufficient number of unemployed people from the various sources, we'll have to advertise for unemployed people and either negotiate with employers if they can pay for the training and recruitment - the chances are they won't. So we have to use e) to get political leverage.

g) Once we've proved the concept in one ward, we'll deploy it in every ward in the UK. This will be done by using the top-down approach which was the original method I wanted to use until I was persuaded to start small and grow organically like everyone else. I wasn't persuaded by that argument because I wanted to be different. What stopped me was the money required (£1.5bn). It was too much for anyone or any syndicate. Another thing that stopped me is credibility as this is my first venture - I sold it to myself by planning to hire 12 Regional Directors who'll hire as many County Managers as there are counties in their region who'll hire as many Area Managers as there are Local Authorities in their Counties who'll hire as many Ward Managers as there are wards in their area who'll hire as many Client Managers as necessary to reduce unemployment and maintain them at low levels in a reasonable period of time.

h) Once we've proved the UK model, we can deploy it internationally.

Why FullEmploy was created

The Ladywood Constituency of Birmingham, UK has the highest unemployment rate in the UK and has had that position for decades. This is despite the fact that Birmingham City is the UK's second city; Europe's largest local authority and biggest landlord; and the City Centre has 31% of the companies in Birmingham. The City Centre is within the Ladywood Constituency, This can only mean that they DON'T employ local labour and haven't been doing so for decades.

When these companies are asked why they don't employ local labour, they claim that they are unqualified, unskilled, and inexperienced. This was used to form one of the policies of FullEmploy: we'll employ and help local people who are unqualified, unskilled, and inexperienced. To enable this to happen, we've ring-fenced each constituency so that we'll only help people within that constituency so that we can focus on the problem. In other words, we'll operate in a constituency by constituency basis. We'll operate on a ward by ward basis but find opportunities for the local people within the constituency they're in.

Birmingham City Council has the largest per capita budget in the country - £3.5bn for its 1m inhabitants - that's £3,500 per man, woman and child. Yet it's spent on prestige projects and the local people don't see much benefit of all that money; they just look on as people from outside the constituency get the jobs they should've had or look at somebody else's wealth that they don't benefit from. Perhaps the new policy of FullEmploy will help reduce the chronic unemployment in Birmingham's inner city areas.

Birmingham City Council members are experts in getting inward investment into the city; it's just that the new employers either bring their workforce with them from outside Birmingham or are very selective when recruiting staff. Personally, I don't blame the employers, they need the staff who CAN do the jobs available. This has become another policy of FullEmploy: identify jobs available and the skills required to do them; then train local people in these required skills so that they become attractive to the new employers as well as existing ones.

The idea is simple, if the local people miss out on current opportunities, there will always be more opportunities sometime later. If not, FullEmploy will help them start their own businesses. It's a well known fact that when there's a plethora of skills in a particular area, that area attracts inward investment without the need to give inducements.

So, the Ladywood Constituency has the highest unemployment rate in the UK; although Birmingham has a high level of oppurtunities, they're largely not available to the local people because most of them are unqualified, unskilled and inexperienced. To make matters worse, nobody is doing anything about it.

FullEmploy will do something about it. In the coming days I'll outline the vision, aims, and objectives of FullEmploy and show the way forward. It'll be a learning exercise for all concerned including the local people involved.