Last week, the Welsh Assembly Government announced that their business support structure was to change to become more customer-oriented and to move away from the plethora of programmes and initiatives that have plagued Wales for as long as many of us can remember.
Like many others, I broadly welcome this approach which finally focuses on addressing the needs of small firms in Wales and I am glad that officials within the Assembly Government have had the courage to go down this pathway of reorganising the business support structure, although I would contest whether the Welsh Development Agency (WDA) needed to be abolished to achieve this.
Perhaps the greatest shame is that it has taken so long to carry out these changes, especially as we are in the eighth year of devolution with full control over business support.
During the last five years of writing this column, I have been consistent in my backing for a business support structure that listens to its customers, namely the small firm sector in Wales, and this has been reflected in my other work on this area. For example, in 2001, I wrote a pamphlet “Creating an Entrepreneurial Wales” for the Institute of Welsh Affairs Gregynnog Papers series in which I argued that developing the small business sector required a skilled and dedicated resource operating inside an integrated framework of funding partners and specialist providers which is client-driven rather than programme-driven.
In this paper, I suggested that such a system could replicate the principle (if not the practice) of the English model of Personal Business Advisors (PBAs), whose role was focused on developing long-term relationships with ‘growth potential’ companies. The role of the PBA would be to offer an independent ‘project management’ role by diagnosing the needs of the business and identifying the organisations able to satisfy those needs. Such an approach, if adopted in Wales, would enable the best of private and public sector support to be delivered to Welsh business and enable the range of business and management skills to be improved dramatically. The relationships formed between the PBAs and the client firms would ensure that any needs arising from changes as the business grows would be dealt with appropriately.
The PBAs for this scheme could be recruited from the existing business support and training structure if the emphasis was taken away from the delivery of agency-generated programmes and towards the satisfaction of client needs. Ironically, this was exactly the type of role previously played by the WDA in their original attempts, over fifteen years ago, to support indigenous firms before switching their main resources towards the attraction of inward investors. This should not be surprising – as the entrepreneurship guru Professor Allan Gibb has pointed out on numerous occasions, many of the advances in small business support and training occurred during the 1960s and 1970s but these were not built upon. Indeed, the reinvention of wheels in the SME support sector is considerable and much time and effort is wasted in replicating what we already know.
Whatever Government takes power in May of this year, I personally believe that this new approach needs time to make a real difference to the delivery of effective assistance for indigenous Welsh firms. Whatever the structure put into place to help small firms in Wales, it is clear that we need to devote more resources to developing the competitiveness of those firms wishing to grow further. If we do not, then it is clear that we will not succeed in steering the economy of Wales out of its current doldrums. In particular, the Assembly must not ignore the vast experience and expertise built up over many years within the enterprise agency movement in Wales.
The Assembly can do very little nothing about interest rates, corporate taxation or the strength of sterling. However, they can take immediate action to develop the relevant policies and structures to identify, support and grow those indigenous businesses within Wales that can make a real difference to the prosperity of our nation. That is their challenge for the future.
Like many others, I broadly welcome this approach which finally focuses on addressing the needs of small firms in Wales and I am glad that officials within the Assembly Government have had the courage to go down this pathway of reorganising the business support structure, although I would contest whether the Welsh Development Agency (WDA) needed to be abolished to achieve this.
Perhaps the greatest shame is that it has taken so long to carry out these changes, especially as we are in the eighth year of devolution with full control over business support.
During the last five years of writing this column, I have been consistent in my backing for a business support structure that listens to its customers, namely the small firm sector in Wales, and this has been reflected in my other work on this area. For example, in 2001, I wrote a pamphlet “Creating an Entrepreneurial Wales” for the Institute of Welsh Affairs Gregynnog Papers series in which I argued that developing the small business sector required a skilled and dedicated resource operating inside an integrated framework of funding partners and specialist providers which is client-driven rather than programme-driven.
In this paper, I suggested that such a system could replicate the principle (if not the practice) of the English model of Personal Business Advisors (PBAs), whose role was focused on developing long-term relationships with ‘growth potential’ companies. The role of the PBA would be to offer an independent ‘project management’ role by diagnosing the needs of the business and identifying the organisations able to satisfy those needs. Such an approach, if adopted in Wales, would enable the best of private and public sector support to be delivered to Welsh business and enable the range of business and management skills to be improved dramatically. The relationships formed between the PBAs and the client firms would ensure that any needs arising from changes as the business grows would be dealt with appropriately.
The PBAs for this scheme could be recruited from the existing business support and training structure if the emphasis was taken away from the delivery of agency-generated programmes and towards the satisfaction of client needs. Ironically, this was exactly the type of role previously played by the WDA in their original attempts, over fifteen years ago, to support indigenous firms before switching their main resources towards the attraction of inward investors. This should not be surprising – as the entrepreneurship guru Professor Allan Gibb has pointed out on numerous occasions, many of the advances in small business support and training occurred during the 1960s and 1970s but these were not built upon. Indeed, the reinvention of wheels in the SME support sector is considerable and much time and effort is wasted in replicating what we already know.
Whatever Government takes power in May of this year, I personally believe that this new approach needs time to make a real difference to the delivery of effective assistance for indigenous Welsh firms. Whatever the structure put into place to help small firms in Wales, it is clear that we need to devote more resources to developing the competitiveness of those firms wishing to grow further. If we do not, then it is clear that we will not succeed in steering the economy of Wales out of its current doldrums. In particular, the Assembly must not ignore the vast experience and expertise built up over many years within the enterprise agency movement in Wales.
The Assembly can do very little nothing about interest rates, corporate taxation or the strength of sterling. However, they can take immediate action to develop the relevant policies and structures to identify, support and grow those indigenous businesses within Wales that can make a real difference to the prosperity of our nation. That is their challenge for the future.
Comments
The quality and skill level of putative PBAs is very patchy in Wales and finding 200 competent people at the lowish salaries usually given will not be easy.
The idea of cutting out the 'middlemen' between the convergance funding and business seems a good idea in principal (because the agencies have been very greedy!)but may come a cropper in practice because most PBAs, mentors, advisors , consultants (call them what you will) will still need an organisational framework within which to work (or be trained/accredited within) and who in the past have carried some of the administrative burden and insurance liabilities. Therefore, there will still be a role for enterprise agencies and their like. Stand alone PBAs even with a sophisticated CRM appointment making facility backing them up, may still find it difficult to sustain themselves - they are essentially one man/woman bands and we all know what happens to one man band businesses.
The better option may be to deliver through 'consortia' or locality based groups of PBAs who have banded together for mutual support - through business clubs for example.
There is also the difficulty that WAG will have in deciding what accreditation and qualifications these PBAs should have. Experience is clear that the best PBAs could often be the least formally qualified because they may be older and have spent their time learning from life as it were rather than from some academic institution.
There is still a vital economic role for enterprise agencies to act as 'trusted partner' intermediaries between government and business and as deliverers of EEC funds. Maybe there should be considerable reform of these entities and certainly they should lose the word 'enterprise' from their descriptive title. What we really don't want is another classic case of baby, bathwater and plug hole situation.