13 March, 2014

Your industry can’t attract staff? It’s up to you to solve the problem

You’ll be aware of the strange phenomenon of the national skills shortage coexisting with high youth unemployment. It’s a problem across the developed world, driven partly by demographics and partly by economic activity. Industries across the spectrum are finding it difficult to attract skilled staff, and frequently the call is for ‘the government‘ to restrict entry into popular courses like law and accounting, and to increase the number of engineering or ICT graduates, plumbing apprenticeships or whatever.

While governments have increased funding for technical subjects, it would take a very brave government to start directing who should do what courses, at what level. Who’s going to force your son or daughter to do a course that they don’t want to enter? Last time I checked, we don’t live in a dictatorship. In any case, government workforce planning never works, except either in very macro or micro situations. (By the way, the number of practicing lawyers and accountants in New Zealand isn't much different to what it was 15 years ago.  However, law and commerce have become default qualifications for many who in earlier times would have studied liberal arts, and with better employment outcomes, so hardly a problem. For liberal arts fans, please note  that the general increase in tertiary education participation over the last 10 years means that the number of arts graduates is higher today, so we're not talking about the arts missing out).

Demographics and population aside, the real problem is that we technology industry employers haven’t done enough at an early stage in the education process to get kids excited about working in our industries. Parental and academic snobbery made learning a trade something to be seen as second-best. TV nerd stereotypes haven’t helped, nor the persistent media myth that manufacturing is dying. ICT, manufacturing and engineering have done little to counter this and attract our brightest and best.

Our tertiary education system is generally very responsive to market demand. If the kids start turning up demanding more places in a trade or technical programme, the universities and polytechnics will figure out a way to satisfy that demand. Right now, it isn’t there, and it’s up to employers and industries to stimulate it. Singapore didn’t direct its schoolchildren to do engineering; but government and industry together got them excited about the opportunities and provided the places for them to learn.

Kids aren’t stupid - they just need information. It’s simple - tell people (parents, students and teachers) about your industry. Do it early (at the start of secondary school, not the end) so they don’t give up on maths and science. Tell them how much a plumber makes by the time they’re 30. Tell them about the opportunities for big-rig truckies (who need a clean licence, so keep out of trouble). Tell them about the vast array of jobs you can do, places you can go and money you can earn in the tech industries. Tell them that the easiest way to get rich (boat/bach/Beamer) is to build your own business and to do that you need to learn about making/growing/designing/delivering/managing stuff, and the easiest way to learn that is to get a technical qualification and start working for a successful business. Tell them about your industry's heroes like Peter Maire, Neville Jordan, Rod Drury, or Sam Morgan. Get them excited - tell them.

Disclosure: I’m a former non-executive member of the NZ Tertiary Education Commission.  Updated from an article first published 10 April 2007

17 February, 2014

Turnarounds and the importance of hope

In a discussion about turmoil and the likelihood of an organisation getting into trouble, I was asked what’s the most important thing to do once you’ve established that there is a mess and what to do about it. My answer was simple: “restore hope“. I could have used other words like confidence or faith or belief or trust. The point is that you need to get the support of many people if the turnaround is going to work, and giving people hope is the first step in the journey to recovery.

Don’t get me wrong here. I’m not talking about pussy-footing around the harsh realities. You need to be upfront and honest. But you have key constituencies who need to feel hopeful about what you’re doing:

  • The board: The first people that need to have hope that the business can be turned around. If you can’t convince them, you may need to work with owners to replace them (or give up).
  • The banks: They need to be certain that you will do an even better job of managing the situation than they could if they sent in the administrators. And they’ll need constant reassurance - setbacks spook them, and there will be setbacks.
  • Key staff: These are your core team, the ones you need to stick around to make things happen. They’ll be vitally important in restoring hope in the rest of the organisation and outside.
  • The rest of the staff: Yes, even if massive redundancies are likely. This might sound naive, but people respond better when they know what’s going on, why and that they will be treated fairly, that at least the business may survive and some jobs with it. You also may need to persuade them to stick around because you’ll need some/many to continue to operate the business; and you'll want to reduce he likelihood of industrial unrest, personal grievance cases and unsought leavers. Staff are also important in keeping customers, suppliers and channels onside. And don’t forget that staff have families and friends both as influences and as informal communication channels to the wider world. If the staff don’t have hope, then their personal networks will be even more negative.  I’ve sometimes had to lay off over half the staff in companies I’m turning around, which is hugely devastating to the organisation’s morale. You’ve got to rebuild it quickly to get people energised about saving the business.
  • Customers: This might sound bizarre, but customers are often the easiest to restore hope in. They will be unsettled, but if you can assure them that the plan will work and their needs met, then it’s down to performance. (NB. Banks and their ilk are a special case when their customers get spooked). Staff hope is vital in restoring customer hope, which is why I mentioned it ahead of customers.
  • Suppliers and channels: Your suppliers and channels are businesses too. They’ll want to know about continuity and about getting paid. It’s a bit like customers - unsettling but performance will assuage their fears. Even if you are in receivership, they usually still want your custom, although payment terms may get somewhat harsher! Again your staff have a key role.
  • Shareholders: A straightforward message of decisive action and progress should suffice. Basically you need them off your back, so you and the team can get on with the job. Use the board to run interference, although you will need to get involved with the powerful ones, especially if board changes are needed.
  • Communities: I’ve done a major restructuring of the largest employer in a small town. You’ll have the local mayor and councillors, the local MP, and the local newspaper all over you, desperate for news and out to hang you if they can. They’re a bit like staff. You can’t give them guarantees (especially if you’re closing down in their patch) but you can actually enlist their help in alleviating the problem. Getting them hopeful that some good (however small)  will come out of the process can help keep them off your back.

This isn’t a simple process done once at the start. It’s a continuous communication exercise, with setbacks and achievements along the way. Of course, the best way to restore hope is to get the tough stuff over and done quickly- preferably cut once and cut deep, if you can. That’s harder to do in a large complex organisation but you can still apply the principle within each affected unit. Restoring and maintaining hope is vital - early on and all the way through.

First posted July 24th, 2008

13 February, 2014

How to survive a new CEO

Some years ago, CIO Magazine published an article on how to survive the arrival of a new CEO.  The messages are still valid today:
  • You need to decide real fast if you want to be on the new team - get with the programme, or get out.
  • Initial impressions count - don’t stuff up in that first 100 days - and be available.
  • Demonstrate goodwill to the new regime, and mean it (especially if you were a contender).
  • Don’t start moaning about your pay, the plan, or your colleagues - you were part of the old order.
  • Understand and accept the new CEO’s agenda and imperatives.
  • Understand the new CEO’s style, and work with it.
  • Demonstrate a grasp of the big picture, and avoid patch protection.
  • Take on one of the big new projects, and demonstrate commitment to the new order.
It’s a bit like the message in ‘Who moved my cheese?‘ Embracing change is a lot more fun than fighting it.  Having been the new CEO on several occasions, I can vouch for this. I need to make decisions fast, and I want to get the new regime working fast. I have to make my mind up very fast about who’s in or out. 

First posted August 16th, 2007