Nationalise the Banks?

Banks are very profitable. The reason for this is that their existence is more or less guaranteed by the state. This allows them to take greater risks than they would otherwise prudently dare - although it's not a real risk at all,of course - given that they know they'll be propped up! (In the business this is called moral hazard!)

Sometimes that risk-taking leads them (or, rather, leads their depositors, employees and small shareholders) into trouble (eg Northern Rock) but most of the time, knowing they have an effective safety-net, they make very good money.

The taxpayer is funding this. A very excellent article by Martin Wolfe in the Financial Times (here) explains all this much better than I could. He says that the banks are utilities - performing a range of valuable services. They are, and do, but at a high (but usually hidden) social cost. Governments dare not let banks fail - and therefore can find many £Billions at the drop of a hat when one of them gets into trouble, whilst not being able to find a penny when non-banking savings schemes (for people on lower incomes) go belly-up. (These latter people are the REAL risk-takers!).

The standard approach is to say that the Government is in a double-bind. On the basis of a market economy, they can either surround the banks with rules and regulations and all the related banking industry state institutions (as now), or they can be true to market economy philosophy and let banks fail.

Martin Wolfe has this to suggest, "What seems increasingly clear is that the combination of generous government guarantees with rampant profit-making in inadequately capitalised institutions is an accident waiting to happen – again and again and again. Either the banking industry should be treated as a utility, with regulated returns, or it should be viewed as a profit-seeking industry that operates in accordance with the laws of the market, including, if necessary, mass bankruptcies. Since we cannot accept the latter, I suspect we will be forced to move towards the former. Little can be done now. But when the recovery begins, we must impose higher capital requirements."

In effect, do nothing but "monitor more closely". But he really should refer to the paragraph a little earlier in his article, when he said banks-

"are staffed by single-minded and talented people. They go round regulations, just as water flows round an obstruction."

Workers' control and management?

In my experience of business consultancy, the most useful management improvements, the most immediate and probably the most inexpensive, come from implementing relatively unsophisticated, "low-tech" (or, at least, "mainstream-tech") projects. To the detriment of so many firms, senior managers, especially those needing to make a career-enhancing impact, will often turn first to options that involve big budgets and wall-to-wall "transformational" programs (inevitably involving the hiring of expensive global consultancy firms).

Refreshingly, a recent article in the Financial Times (here) indicates that what's left of British manufacturing may be making some meaningful productivity gains by implementing just such "unsophisticated" projects. In this case they seem to amount to little more than delegating more decision-making to front-line workers and designing better products. According to the article, so far as the new management method is concerned, "The aim is to ensure [the workers] can make their own decisions about how to boost output and do not need detailed instructions from supervisers." These approaches have led to improvements in UK manufacturing productivity that, between 2000 and 2005, have bettered Germany and France, amongst others.

The article went on to say that, "According to Professor Stephen Wood, one of a team of workplace psychologists who supervised a study of the training methods of more than 300 companies, these efforts to empower workers are by far the most important of the various ways in which companies have sought to boost productivity."

I like what this implies. It gently questions the daily reinforced assumptions underpinning traditional management hierarchy - with its "thinkers" at the top and the "doers" at the bottom. Here's verifiable evidence, and there's much more of it, that maybe there are alternative management structural systems - systems which truly "flatten" the hierarchy and offer the possibility of job satisfaction coming from individual autonomy and real, co-operative control of the production process - from individual job content to the high level "value chain".

In the meantime, whilst the bosses think and workers work, another article in the very same FT (here) tells us that manufacturing employment in the UK is falling faster than most other places - a million jobs have been lost in the last 6 years.

"Manufacturing employment has fallen further in Britain in the past six years than in any of its main international competitors, according to data published on Monday.

While employment in UK factories has fallen by 21.7 per cent – from 4.2m to 3.2m – the number of manufacturing workers in the US has dropped 17.7 per cent over the same period. There were comparable falls in France, Japan, Germany and Italy of 13.5 per cent, 8.5 per cent, 6.8 per cent and 0.8 per cent respectively.... Since 2001, output volumes from UK plants have fallen by 1.3 per cent, a poor record by the standards of Germany, the US and Japan, which pushed up output by 18.6 per cent, 15 per cent and 12 per cent respectively."

My Business Consulting CV

PROFILE SUMMARY
For 5 years, until 2007, I was an internal business consultant at the UK Government Department of Communities and Local Government. I led and participated in many business change and improvement projects. I was responsible for helping deliver real change through a combination of insight, experience and practical knowledge.

My career prior to that also majored on business improvement. I am confident in leading or participating in teams. I am adaptable; and motivated towards seeking beneficial and lasting organisational change. My overall approach emphasises the need to focus not only on the “hard”, but also on the “soft” management issues - if change is to have the chance of being truly embedded and to provide new organisational capacity for future challenges. I have worked with external consultancies and management at all levels.


QUALIFICATIONS
MBA, UK Open University Business School
Member of Institute of Management Consultancy


KEY SKILLS AREAS
Business Appraisal and Performance
* Business options identification and appraisal.
* Issue clarification and prioritisation.
* Business case review/ development.
* Business planning process review.
* Process mapping, analysis and re-design.

Change Management/ Organisationl Development
* Project Management.
* Client engagement and stakeholder analysis.
* The “case for change”: developing effective change strategies.
* Identification of obstacles to (and catalysts for) change.
* Management climate & aligning culture with business objectives.
* Facilitating workshops & practical change programmes.


EMPLOYMENT SUMMARY
Business Consultant
Feb 2001 to Jan 07, Business Consultancy Unit, DCLG (UK Govt Dept), London

Investors in People Adviser
Nov 99 to Feb 01, Highways Agency, London

Project Leader/ Deputy
1996 – 1999, HR Directorate, DETR HQ, London

Manager
1992 – 1996, Strategy & Corporate Services Directorate, DOE HQ, London

Office Manager
1987 – 1992, Department of Transport & HMIP, Leeds

Trade Union Official
1977 – 1987, Civil and Public Services Association (CPSA, now PCS)

Clerical Officer
1973 – 1977, Department of Transport, Leeds



EMPLOYMENT DETAIL
Business Consultant
Feb 2001 to Jan 07. Business Consultancy Unit, DCLG HQ, London

Recent Assignments (leading or supporting roles)
* Designed and led implementation of an IT-underpinned “New Ways of Working” project for improving HR alignment with business priorities, and radically improving access to new management information. Key outcome: better value from corporate resource deployment.
* Led project to identify options for improving inefficient, multiple-stream grant disbursement regimes. Key outcome: options identified for developing single disbursement IT platform and radical cost savings.
* Led assurance audit and review of Local Government Finance organisation - quality assuring systems and processes underpinning the main local government grant calculation and distribution arrangements. Key outcomes: assurance about processes, and options identified for further improvements.
* Led two projects aimed at defining frameworks for measuring the benefits of an intranet-enabled absence management system; and an internal postings system. Key outcomes: improved focus on key performance metrics; providing foundation for development of re-engineered processes.
* Led local authority housing grant project to scope and define requirements for replacing business critical IT system. Key outcome: basic framework delivered for developing an improved, web-enabled process.
* Led project with the “Business Planning Champion” Board Director. Organising and delivering a series of workshops and papers for critically appraising Departmental business and financial planning processes, and to identify opportunities for improvement.


Investor in People Adviser
Nov 99 to Feb 01. Highways Agency, London
* Provided guidance and designed supporting systems for achieving IiP accreditation. Key outcome: IiP status awarded, Oct 2000.
* Worked with external consultancy on business planning process review.


Project Leader/ Deputy
1996 – 1999 HR Directorate, DETR HQ, London
HR Transformation Program
* Led (or deputised) several major projects aimed at moving the personnel department towards an outsourced, strategic HR management capability.
* Facilitated process analysis workshops, developing State A and State B process maps.
* Led wider communication effort and stakeholder analyses.


Manager
1992 – 1996 Strategy & Corporate Services Directorate, DOE HQ, London
Head of Finance Team - Financial management, budgeting and monitoring for large, diversified Division. Developed and implemented new finance management system - subsequently managed migration to whole of the Strategy and Corporate Services Group.


Office Manager
1987 – 1992 Department of Transport & HMIP, Leeds
Statutory framework for new trunk roads schemes; handling objections; Public Road Inquiries. Led team. Set up back office and admin support systems for the new Integrated Pollution Control regime.


Trade Union Official
1977 – 1987 Civil and Public Services Association (CPSA, now PCS)