Ok, so right off the bat, I have to admit to having a sneaky admiration for the Welsh. Of all the home nations, they do not have as strong an identity as the Scots or such a history like the Northern Irish, nor are they as rich as the English. However, by Jove, they are just wonderful in their warmth, their togetherness, their desire to be one with the land, their love of the language and so on and so forth. This is highly visible when you see things like football and rugby games, but those are the very visible signs. It is at the informal levels that you can see evidence that a strong, yet understated, current of nation building is happening. Mix in the rumours that King Arthur was in Wales, dragons can still be found in some of the valleys, mention the bravery of the miners and the ancient history of tin mining in Wales, the ruined castles, and all go forward to make a plucky little admirable country.
With this background in mind, I agreed a few years ago to teach at Swansea University School of Economics and Business. Once or twice every year, I toddle over to Swansea, spending eight hours on the train, to meet with the students and faculty at the business school, talking about a variety of topics ranging from banking, financial institutions, stochastic calculus, regulatory regimes, career opportunities in Banking, etc. In addition, I am also part of the advisory board of the business school. Something that we in the board are heavily pushing is to try and fix two things within Wales. (1) The low productivity of the Welsh economy and (2) the diabolically low rate of job creation and ‘Small and Medium Scale Enterprise’ (SME) creation.
Consequently, the business school has been heavily engaged in pushing entrepreneurship and economics as a discipline, in conjunction with a variety of local Welsh authorities, sprinkled with a liberal dosage of EU funding. It is a steep climb. One way of checking the health of the local economy is to walk up and down the high street. Over the past three years, the Swansea high street has been-to put it politely- pockmarked with a whole series of boarded up shops, charity shops, pound shops, kebab shops and the like. The number of buildings with weeds growing out of their walls and roofs is astounding. I have never seen anything like this before. In other words, the demand is simply not there or even if it is there, the demand is being fulfilled from somewhere else rather than from Swansea high street. One does not need to say that an economy exhibiting a high street like this has challenges.
Today I was shocked to hear that in Swansea, 42% of the jobs belong to the public sector. Tesco is the largest employer with a majority of jobs relating to the bottom of the food chain and the next one is Admiral (the insurance firm), where the jobs relate mainly to call centres. Now, there is nothing wrong with this, but one cannot really have high productive growth, good value generation and good high paying white collar jobs simply based upon call centre, checkout and public sector jobs. It is like a bloody inverted pyramid with most of the jobs frankly being administrative /unproductive from the public sector or from very large firms. In the event that one large firm decides to up and leave, it shocks the locality horribly, which doesn’t recover at all, as we have seen over the past few decades losing one large manufacturing firm after another.
One needs the manufacturing jobs, the high value added service jobs and other similar jobs. Research has pointed out that a good heavy duty sprinkling of small and medium scale enterprises provides the bedrock of prosperity, jobs, good social relations, high productivity growth, demand and in turn offers the funding for good public services. In this case, we are upside down, as we are overloaded with a public sector which is being funded via debt or grants and in the coming decades, both avenues of funding will either become very expensive or rare.
So what do we do? What the business school is therefore doing in conjunction with various Welsh governmental bodies is try to encourage the formation and proper functioning of SMEs in Wales. At this moment, the programme is primarily oriented towards Swansea and Bangor environs, but will extend to all of Wales in the fullness of time.
The programme is based upon a pilot programme run in North West England where SME owner/managers were given up to £10,000 equivalent of training, coaching, education and mentoring. This resulted (as measured by an independent evaluation) in an equivalent return of minimum £15k value to each firm’s owner, average turnover increase of £200k, profit increases and 1/5th of the pilot study members went on to set up new ventures. Soft benefits included increased job creation, better leadership, improved staff development and a better motivated workforce. These are good results and now it is being rolled out to Wales with an aim to train 1000 SME owners in 2010 – 2012.
I have set up and run several small enterprises and one of the biggest problems a small enterprise owner has is that there is nobody to talk to, nobody to bounce ideas off, nobody to tell or teach about technical skills, no ability to grow from a single man team to a multi man team, no ability to stand back and evaluate oneself and the strategy of the firm. The programme hits these points. The owner / managers devote 2 days a month for 10 months in a variety of targeted intervention programmes relating to leadership, team management, economics, financial, strategy, business problem solving, etc.
Part of the programme includes a 1-2-1 coaching session with a professional coach over the 10 months. They also have a volunteer mentor from business, with whom they end up spending about an hour a month or so. The mentor (they are debating whether to call them as grey wolves or wise owls) provides an independent voice to the SME owner/manager and just provides that little bit of help and independent advice that they so desperately need. The first meeting is face to face, but the subsequent meetings are over email/phone or over a beer. The first sessions have just started in January 2010 and the programme is looking for suitably qualified bankers, consultants, relationship managers and business people who have experience of SME’s (either directly owning, working for or lending/advising them).
If there is anybody in and around Wales who can assist, or who has any links with Wales or who travels to Wales on business or perhaps just somebody who might be interested in making a direct difference in getting Wales up the prosperity curve, please drop me a note. I am very happy to link you up with the programme manager. Don’t be shy or sell yourself short, many times these SME owners just need somebody to talk to and have a bit of a common sense debate and discussion over business matters. They are not looking for heavy duty Lord Digby Jones, but Joe Blogs who is in business. This is obviously good for us, but more importantly, it’s good for our country and good for Wales.
Looking forward to hearing from you.