TED Video – Surprising science of motivation

August 30, 2009

A very interesting TED video by Dan Pink on motivation of employees.

  • “Rewards by their very nature narrow our focus, concentrate the mind”
  • “monetary incentives don’t work or often do harm”

Asking why there is a discrepency between ‘what science knows and what business does’.

(found via @EdwardMellett RT)

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Why are companies so averse to training?

August 25, 2009

Reading the comments on a recent Telegraph article (via RateMyPlacement’s tweet) someone mentioned that many companies either cutting back training or do not spend any meaningful amount on training at all.

It struck me as being very true, yet something I find quite staggering really. I know of a fairly small business consultancy but with major multi-national clients, who you’d think would practice what they preach to clients and invest time and money in ensuring their non-consulting staff are trained up in the latest techniques (especially for things like creating training materials/books etc. which require specialist knowledge and the latest software) but they don’t…

I’m sure many would ask “why waste money on training someone up for them to just walk out the door?”, to which I would say well they might… but surely by demonstrating your commitment to them (through training) they are more likely to stay and once trained should be more productive and produce higher quality work.

Companies may also say they are perfectly able to import the skills needed, through hiring people who are already trained and have X years experience. But doesn’t this lead to more people jumping ship? If you see a possible career advancement (if you were trained up) that kept getting filled by those from outside the business you are likely to leave. Probably costing more to the company through disruption and lost productivity than any training!

I could see it leadig to an endemic problem within the employment market, where eventually nobody will be able to join a company (especially at the slightly lower end) without so many years experience yet have no way to actually get that experience because no companies are willing to give people the opportunity to advance themselves. (It was nigh-on impossible for me to get an accounts assistant role as I had no relevant experience, apart from my degree and a non-relevavnt year-long industrial placement).

I firmly believe training of staff should be a key objective of all managers, start looking further than the upfront cost.

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Crowdfunding: The future of raising capital for SMEs?

July 29, 2009

In yesterday’s FT there was an aritcle, “Financing model with bounce”, looking at Trampoline Systems and their efforts at raising £1m of new capital for business expansion.

They failed to get much interest from venture capitalists and “[s]o Trampoline hit upon another route: “crowdfunding” – raising small stakes from a large group of investors, particularly through online communities and social networks.”

It follows the same idea, but much smaller scale, of SellaBand and Slicethepie. Where bands can raise money to record and publish an album from small investments by fans, in return the investors get an exclusive copy of the cd, other gifts, and in some cases a return from sales.

But would it work for a business? I’m not so sure, firstly the amount of money that needs to be raised is likely to be much higher than the minimum amounts on these two band-based sites. Although for the very smallest start-ups it could be quite useful if raising money from banks or other means is not possible.

Also it requires the person looking for funds to fully engage with their potential investors. Who is going to put their own money into something (whether that is £5 or £10k) if they don’t get a clear idea of what the business is about, don’t like the product, don’t see that the fund-seeker has a clear plan on where to use the money, don’t see a benefit for themselves.

Andy Baio, chief technology officer of Kickstarter, an online platform which raises funds for creative projects through crowdfunding, agrees: “The success of projects hinges on two factors: first, rewards for supporters. It doesn’t need to be financial, it can be a phone call or a credit on a film, or an exclusive update on the project. Second, their ability to promote it to their social network.”

So the key issue for me basically boils down to transparency. How open are you willing to be to secure the funds. To get anything meaningful from complete strangers requires the fund-seeker to be absolutely transparent, candid, easily contactable and involved with reaching out to potential investors. Without absolute transparency the market cannot work as there is asymmetrical information.

I like the idea, and think it works for the small scale of £5-£50 where it can be an impulse investmet, but for the larger scale I don’t think it is possible. I reckon potential investors need to ‘touch and feel’ it firsthand before even considering it; and are super-rich going to bother to take the time to look for these investment opportunities, I doubt it.

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The Milburn Report – Fair access to the professions?

July 22, 2009

The Milburn Report looking at fair access to the professions raises some interesting points about internships and the barriers to wider take up of them. Here are some of my thoughts, building on those from the RateMyPlacement.co.uk blog post today:

I think one of the main barriers to entry for those seeking to get into the professions is a lack of knowledge of what opportunities are available, family contacts within those professions, and understanding of how to get in.

With a whole new generation of people being the first in their immediate family to go to university there is a massive group of people who don’t know what they have to be doing to get a good graduate job at the end of their university life. Those families who have experienced it know what they have to do and get out there and do it, this is where universities (and earlier) careers advisory services need to do a better job.

A lot of the time with the internships (Especially when younger) it is about who you know. Which naturally disadvantages those who have no contacts in that line of work (or don’t know they should be utilising them). The graph below show that around 15% of internships were secured through family and friends, I reckon that it’s actually quite a bit higher than this suggests (with people maybe applying online but then put down “my dad is head of ### dept.” and magically get accepted).

Milburn Report 2009 - Method of Securing Internships

Milburn Report 2009 - Method of Securing Internships

I agree about the 12-month industrial placements. I only applied to those university courses which gave the chance of taking a year out to gain some valuable work experience. Having gained great experience on my placement for a major car manufacturer, although not related to my accounting degree, I think everyone should be doing one. Although if everyone did one, there would need to be a massive rise in the number of placement opportunities available, as the competition is high enough as it is!

The experience you can gain from a year of working, doing proper work with a major impact on the organisation (like I was doing) not just little projects, is infinitely more valuable than 8 weeks over a summer holiday.

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More on financial transparency – a response

July 22, 2009

The below is my response to Leigh at Knowing and Making discussing further the financial product transparency plans in the Conservatives’ ‘Plan for Sound Banking’ (See here for my summary)

I wanted to read the actual document before commenting further. Which I have now done. The way it is set out in the policy document is a lot clearer than the couple of lines in Peston’s post (on which I based by initial reaction).

The idea of getting providers to send out a ‘price list’ and a breakdown of their usage over the previous year makes a fair bit of sense. As a first point it will help customers appraise their own usage and think about whether the deal they are getting now is right for them (although people having sound financial awareness would be a necessity in this case).

Although I am not so sure about forcing them to provide machine-readable raw data for customers to put into a price-comparison site. What format are they going to use that customers (non-technical included) are going to know what to do with, let alone have all institutions agree to implement a common format in the first place? Having the data organised in a standard way, allowing customers to manually plug in the numbers on a website would be perfectly acceptable. But what is to stop a financial institution from coming up with a revolutionary new type of charge, what happens then?

I am a bit uneasy about it being a statutory requirement, from a free-market point of view, as I think there are sound business reasons for companies to be more open and up-front about such things. If they believe in the service they provide to customers they should have nothing to fear from easier comparison, I think they should be doing it voluntarily. Bet they would like to not have to pay any commission too, so open-source comparison sites could be welcomed.

Definitely agree with the idea of cutting out the rating agencies. But that is a slightly different case from arguing for the consumer side of things as it will be ‘expert’ commercial entities doing the analysis and comparisons; not lay people. Will be interesting to see how they implement it!

The Conservatives’ Proposal for Sound Banking

July 20, 2009

Robert Peston this morning outlined the ley points in The Conservatives’ as-yet unpublished policy document titled “Proposal for Sound Banking”. [Update: document now available from here]

The plan boils down to:

  • Effectively scrapping the FSA. Moving the supervision of financial institutions (banks, building societies and insurers) to a new division at the Bank of England. And rename the consumer protection aspects of the FSA’s remit to the rather grand “Consumer Protection Agency”.
  • Force banks and credit providers “to provide much more information directly to individual consumers” about charges and other aspects of their products. Also get these institutions to provide this info in a form able to be utilised by comparison websites.
  • Get the Office of Fair Trading and Competition Commission to investigate whether consumer choice and market competition has been affected by the consolidation seen over the last two years.
  • Finally, they set out plans for macro-prudential regulation. With the creation of a “Financial Policy Committee” to control the leverage (ratio of lending to capital) of banks and building societies.

What does Richard think about this?

It is all very well shifting, merging and renaming parts of different regulatory bodies but will that really make a difference to how well regulations are enforced. It is highly likely that the same teams at the FSA in charge of monitoring the banks will just move over to the Bank of England. So what is the point? As Peston notes – “the FSA now faces a nightmare few months: given the high probability that its days are numbered, retaining and recruiting staff will not be easy.” Will it do more harm than good?

On the increased information on products to consumers. What more detail can they give? Financial institutions are required to detail everything in the terms and conditions etc. Is it really that hard to work out at the moment? If it is go somewhere else.

The idea that price comparison websites will help consumers is rather worrying. They exist to make money – through commission and referral bonuses – and nothing else. I believe promoting them may cause more harm to the consumer finance industry (savings, credit cards, mortgages etc.) through an inevitable drive to the bottom in headline price. Surely one of the problems in the lending binge was the downward pressure on lending rates from the likes of Northern Rock forcing others to lower their rates (too far) or miss out on customers.

I don’t know nearly enough to comment on the macro-prudential regulation side of things so I won’t.

—-

Check out Leigh Caldwell’s thoughts on the policy document, and why he believes the behaviour of financial consumers needs to hold greater consideration by regulators.

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A strategy map for graduate recruitment teams

July 15, 2009

I thought it might be interesting to apply the strategy map idea to graduate recruitment (similar to my application of a strategy map in a news industry case study here).

What are Strategy Maps?

Strategy maps are a tool that organisations can use for communicating both their chosen strategy and the processes, systems and skills that will be required to implement that strategy. They demonstrate “the cause and effect links by which specific improvements [in assets, processes and staff attributes] can create desired outcomes.” (Kaplan and Norton, 2000, p168). They give employees, at all levels, a clear view of how their jobs are linked to the overarching objectives of the organisation, hopefully allowing everyone to work in a cohesive manner towards achieving the organisation’s goals.

The Strategy Map, as a progression from the Balanced Scorecard, “show how an organization will convert its initiatives and resources – including intangible assets such as corporate culture and employee knowledge – into tangible outcomes.” (Kaplan and Norton, 2000, p168). The measures from an organisation’s balanced scorecard are based upon the strategy map, which connects the desired outcomes of the strategy with the measures which will drive those outcomes.

The Four Perspectives applied to graduate recruitment:

These are the points which I believe will, through a cause and effect relationship, allow the department and ultimately the whole organisation to meet its objectives.

Financial:

  • Improve corporate performance by attracting and retaining better people.
  • Reduced operating cost through improved efficiency
  • Greater asset and staff utilisation.

Customer:

  • Product Leadership – through market leading graduate scheme and easy to navigate & professional recruitment process
  • Customer Intimacy – Nurture relationships with potential employees.
  • Operational Excellence – Set tough targets and aim for fast, accurate and helpful recruitment experience.

Internal Process:

  • INNOVATE! – Embrace new methods like social media etc.
  • Improve customer value through improved customer management processes – Engage with them, project positive image through efficient procedures.
  • Become a good corporate citizen through fully transparent recruitment criteria and processes.

Learning & Growth:

  • Employee Competencies – Train in new technology and methods; support recruitment staff with gaining professional qualifications.
  • Technology – Be open to adopting new technologies and methods, such as social media tools.
  • Culture – Encourage functional excellence. Create an holistic company-wide view. Be more open…

My proposed strategy map:

Graduate Recruitment Strategy Map

Graduate Recruitment Strategy Map

This is just a rough idea of what I think graduate recruiters should be aiming to do (although I only know it from the applicant’s side). The above strategy map is for the graduate recruitment team, but could be for the HR department as a whole. I see this as part of a wider company-wide process of looking at the organisation’s strategy as a whole, and then individual departments/divisions having their own strategy maps to allow for greater detail and relevancy for those employees to see how their roles “are linked to the overarching objectives of the organisation.”

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Wimbledon in the recession

July 9, 2009
Wimbledon - The Hordes
Image by ucayman via Flickr

Wimbledon doesn’t really show any signs of there being a recession on.

I thought we are supposed to be in a recession with everyone feeling the economic pinch and cutting back their expenditure? I went to the Wimbledon Championships twice in the last two weeks, and on that basis you would seriously question how bad this ‘recession’ is.

Firstly the numbers of people visiting… it was absolutely packed, it seemed much busier than in the last two years. On day two of the chamionships they had around 43,000 people come through the gates!  That is around £1.25m per day (based on the pricing for the first 2 days and court capacities) in admissions alone.

If we do a quick and very rough calculation of people buying things there:

  • Strawberries & cream (say 1/3 buy 1 @ £2.25) = £31,927.50
  • Water/Soft Drink (3/4 buy 1 @ £2) = £64,500
  • Pimms (1/4 buy 1 @ £6) = £64,500
  • Lunch (2/3 buy 1 @ £6) = £172,000
  • Gift/clothing from shop (1/2 spend £20) = £430000
  • Total = £762,927.50

Now that is a very rough estimate (and I think on the low side) of what people might be spending on their day out at Wimbledon.

Personally, as a tennis player and fan, I think Wimbledon is very good value for what you get:

  • Top professionals playing a few feet away (on outer courts anyway)
  • play going on from 12 until around 8 or 9pm
  • the atmosphere (a big thing for some, especially the afterwork city-types who come in after 5pm to sit out at the long bar drinking Pimms and people-watching)
  • etc. etc.

I started off this post planning to say that it is incredible that so many people have visited Wimbledon this year (in the heart of a recession) when it costs so much. But now I am not so sure, compared with other sporting events/entertainment it is actually quite good value. Football at Arsenal for example costs anywhere from £32-£92 for a 90-minute match…

It will be interesting to see how attendances at football stadia across the UK are affected over the first couple of months of the 2009/10 season. I predict falls (Except maybe for the very biggest clubs).

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Impact of Web 2.0 and Social Media on graduate recruitment

June 21, 2009

In this post I want to explore what kind of impact Web 2.0 and social media are having on graduate recruitment and how I think recruiters should tackle it.

Quick summary of Web 2.0 and social media:

Web 2.0, described by the founder of Flock as the ‘participatory web’ is all about websites providing a platform for users to share, collaborate, and interact with each other (i.e. Flickr, Facebook etc.). Social media on the other hand is content created by ordinary users using easily accessible tools; according to Wikipedia it is: “transforming monologues (one to many) into dialogues (many to many) and is the democratization of information, transforming people from content readers into publishers.” It can be seen in the form of blogs, forums, wikis.

So what impact are these having on graduate recruitment?

I see it impacting in two main areas: (1) information about companies and their recruiting processes getting much greater exposure, (2) students and graduates making much more informed decisions about which organisations to apply to.

1. the rise of blogs, social networking sites, forums and wikis have led to a massive increase in the number of people sharing their experiences of companies, their recruitment processes, and what is actually involved in a job. So students and recent graduates now have much more information readily available to them than even five years ago. There are both positive and negative aspects to this… applicants may share the details of recruitment processes, I don’t think companies are particularly pleased when details about their current assessment centre case studies appear on the internet! But it can lead to candidates being more prepared for what to expect, reducing their nerves and enabling the company to see the true person.

2. With all of this extra information available at their fingertips, students/graduates are able to make more informed choices about their future careers and graduate employers. By having all the information about a particular role, career, or company available at their fingertips graduates are able to refine their job search to the most relevant careers and companies, and make more informed, relevant and honed applications. Benefiting both the applicant and the recruiters.

So how can recruiters get the maximum benefit?

Some organisations were quick to get a presence on social networking sites, and some of the biggest graduate recruiters have had diary-like “blogs” (PwC used to, but I can’t find any on their website nowUpdate: PwC now have a section dedicated to blogs by 8 employees at PwCPeople). But in the beginning these invariably were monologues, with no two-way conversations between readers and ‘publisher’. The only way I can see organisations benefiting from either a presence on social networking sites or engaging in social media is to provide and maintain a dialogue with the readers. One good example I have found is Ernst & Young‘s Facebook page , where someone is actively involved on “the wall” responding to and encouraging questions from prospective applicants. But this is only US-focused… What are the EY’s HR people doing in the UK about engaging with social media?

I see this simple act of engaging with applicants (much like real-life graduate job fairs), as adding to each applicant’s experience of the organisation, and that may help sway them to apply to your roles. Having a page on your careers website where someone writes a diary about their work life, while providing a good idea of what is involved in a career, does not really cut it in terms of answering people’s questions and providing a human aspect to the big corporate image!

But what about the things the recruiter cannot control?

With all of this user-generated content, it is possible for a few people sharing a negative experience of your organisation for your image to take a big hit (i.e. “Dell Hell”). To counteract this, not only is it necessary to have a right-first time approach to costumer-facing areas of a business but also to engage your target audience on their own turf. You have to be involved in the parts of the web where people might post comments, questions, or rants, and ideally respond to them, get involved.

That may be very hard with the likes of Twitter, but on targeted forums (such as those at WikiJob) it would be possible for a recruiter to develop a good dialogue with the people they need to attract to their organisation. I can see that this may pose issues for many organisations in terms of cost for someone to sit there and answer questions. But they could make a good start by embracing the ‘democratisation of information’ and opening up about all the steps in their recruitment process and what they are looking for (e.g. on the wiki pages at WikiJob).

Richard’s Conclusion…

Social media and web 2.0 platforms are here to stay, and with ever more internet savvy students and graduates it will be a necessity for graduate recruiters to get involved and by developing a dialogue with your target audience portray the true culture of the organisation, not stick to the publishing model of brochures and static websites dictating what you are about. Let graduates feel it and make their own mind up, trust me they will be taking what you say in your brochures with a HUGE pinch of salt. They would rather hear what it is like, and what is involved, from a real person (preferably one of their peers).

So recruiters: you will have to do it eventually, so why not start now and be the company all the graduates want to work for!

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WikiJob Poll: Is the recession over?

June 17, 2009

This is the latest post in the WikiJob Poll analysis series. This time I will be looking at WikiJob users’ views on whether or not the recession is over, and how that compares with other people’s views.

The latest poll asked “Is the recession over?” (with answer options of Yes or No) and as of writing this there have been a pretty credible 262 votes cast. With an overwhelming victory for those thinking the recession is not over yet; 216 votes compared with 46 votes for ‘Yes’ (see Chart 1).

WikiJob Poll: Is the recession over?

Chart 1 - WikiJob Poll: Is the recession over?

I had been keeping an eye on the poll’s progress and that ratio has been pretty consistent from the very beginning so it would appear that WikiJob users have not experienced much, if any, of the supposed “green shoots” appearing in the economy.

The CBI recently announced that it believed the UK economy was stabilising but that we wouldn’t begin to see a return to growth until early 2010. (www.cbi.co.uk). This was based on the second quarter GDP and inflation results along with the CBI’s own forecasts.

On the 17th the Office for National Statistics released the latest unemployment figures with a rise in May of those claiming job-seekers allowance of 39,000, less than what some economists had predicted.

Most WikiJob users would, I guess, base their impression of the recession on their experiences and probably from a jobs perspective (given WikiJob is about jobs!). I am sure there are many students who have just finished their exams, and who have been unable to get a position lined up earlier in the year, who are now really stepping up their efforts in finding a graduate role, but coming up with limited opportunities and massive competition. The stats aren’t great: with a fall of nearly 5% in the number of 18-24 year olds in employment.

The poll results probably also reflect the industry preferences of the WikiJob users (see Chart 2).

WikiJob Poll: What industry are you most interested in?

Chart 2 - WikiJob Poll: What industry are you most interested in?

With the users’ interest  heavily concentrated in the financial and professional services industries [Accounting, Consulting and Banking account for over 2/3 of respondents]. I see the banking and consulting sectors as being particularly hard hit (out of the options), slightly less so the large accounting firms. But still none of these compare to the pain being felt in the manufacturing sector in particular by the smaller specialist manufacturers which the UK seems to specialise in.

From what I have read many, better-informed people than me, believe that while the economy is showing signs of stabilising and some even believe there may be some positive signs. But current students and recent graduates don’t seem to be experiencing these, and are currently pretty pessimistic. An interesting employer perspective I received in talking with graduate recruiters druing my job search was that those companies who completely cut their graduate recruitment following the dot-com crash found that in the last couple of years there is a dearth of people coming up through the ranks to occupy the vital junior/middle management roles, which was why they hadn’t cut their graduate recruitment this time round.

I will close with a couple of quotes:

Alan Clarke, UK economist at BNP Paribas, said: “We are certainly moving in the right direction and this is one of a number of very encouraging signals that we have seen.”

and finally Stephen Boyle, Head of RBS Group Economics, said in his UK Monthly Economic Update “Signs of stabilisation are one thing, a sustained recovery is an entirely different matter as demand conditions remain weak. The sustained upward movement in long-term interest rates in recent months threatens to pour weed killer on any green shoots…”

Good luck in your job hunting, many jobs are still out there, at least you are giving yourself an advantage with the fantastic resources available on Wikijob and its forums.

WikiJob Stats Man (read more of my thoughts at richardthinks.wordpress.com)

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