WHAT SPINS MY WHEELS: Business Advisory Council - keen to support SME productivity & growth - Nov 2018

1.   Future of Work – Business Advisory Council

In November 2018 the Prime Minister’s Business Advisory Council was formed and identified four key areas for attention:

1. Building tomorrows skills. 

   1. How can business practically demonstrate their commitment to ensuring workers in NZ are supported to gain new skills and transition into new jobs as the nature of work changes?

   2. How can business support operationalising micro-crediting and fees-free learning policy?

   3. How can our tertiary institutions support this in a practical way, learning from best practice models overseas?

2. Accelerating our regions

3. Attracting high quality investment

4. Unleashing our SMEs

The Business Advisory Council report (May 2019) analysed the impact of new technology on New Zealand productivity and makes 12 specific recommendations with the intent of providing a tangible call to action for every business and the public sector on how NZ can work together and ensure that every New Zealander shares in the growth and opportunity automation can bring.

 Skills, Retraining and Education

Challenge

Recommendation

Significant numbers of Kiwis need to be retrained and reskilled every year to close the anticipated skills gap and mitigate the risks posed by automation.

New Zealand private and public sector employers need to be at the forefront of this transformation, adopting impactful and best-practice retraining strategies.

1. Kiwi employers should pledge to double their investment in annual employee training, re-training and upskilling and publicly report on this investment as a credible signal of leadership in ensuring Kiwis are well prepared for the Future of Work.

2. Board directors should ask the following of their organisations:

   • What is the organisation’s strategy to at least double the rate of real productivity growth using automation technologies?

   • What is the organisation’s human capital strategy to train, retrain, upskill and empower its people to thrive in the Future of Work?

   • How will the organisation change or enhance its culture, behaviours and operating models to ensure it delivers the benefits of automation?

The Future of Work quickly becomes the Future of Education, and New Zealand needs to deliver scalable and effective ways to teach the key competencies demanded by future labour markets; cognitive skills, social and emotional skills and most significantly, technological skills.

The education system, including content and delivery methods, needs recreating to prioritise training in Future of Work skills, specifically technology skills.

1. A national digital and technology curriculum should be developed and made compulsory, at appropriate levels in the education system.

2. A “National Digital Certificate” should be created as a scalable way for businesses to retrain employees in the technology skills needed for most future roles.

A scalable mechanism is needed to encourage and require Kiwis to take personal responsibility to reskill throughout their lives. This will become just as important as saving for retirement.

5. A “KiwiSaver for Skills” should be established by creating citizen directed Lifetime Learning Accounts for individuals to tap into throughout their careers to acquire new skills or pursue higher education.

 Targeted SME and Sector “Surge Support”

Challenge

Recommendations

SMEs and sectors that provide New Zealand with a comparative advantage hold the key to harnessing the benefits of automation by solving a large part of our productivity problem.

Despite SMEs making up 97% of Kiwi businesses, there is no Provincial Growth Fund equivalent for SMEs and many struggle to scale and adopt the technology needed to supercharge their businesses.

There is a strong correlation between SMEs that use three or more Apps to run their businesses and 30% more profitability.

11. High-performing, or high-potential sectors (which have self-selected) should be surged with support and targeted investment and incentives to achieve scale through automation (for example, accelerated depreciation on innovative technology assets, R&D tax credits).

12. A “SME in a Box” scheme should be created, which outlines clear, user friendly steps towards greater productivity in SMEs, including:

–  Encouraging and specifically recommending App and technology use through loans, grants or investment to enable adoption and associated training.

–  Partnering with book-keepers, banks and other service providers to SMEs as a vehicle to roll-out this scheme.

ARTICLE: When your SME business grows up OR your ready to take step back: Appointing a General Manager

When a small/medium business is going from strength to strength, evolving as it grows, the business owner must also evolve to keep up.

They might be strong in product knowledge, operations and/or sales and identifying opportunities within their market. But, to keep up with the demands of a larger business, the SME business owner needs to also think about staff management, financial management, marketing and sales management, and systems development - areas which may sit outside their wheelhouse. 

 If your business is currently going through this and you recognise that you're being stretched beyond capacity, a possible course of action is to consider appointing a General Manager. 

 It's such a critical position that the recruitment of the first GM will probably be the most challenging in the history of the business.

Even with capable, high-quality candidates, it is unreasonable to expect that the appointment of a GM will immediately allow the SME business owner to step away from the business. You will need to invest time, knowledge and energy into this person to eliminate the risk of them not working out and causing disruption.

 To avoid these pitfalls when the time comes, here are some of the most effective ways you can ensure you recruit a valuable GM:

1. Recruit from within - Consider if an existing manager could make the transition into the GM role. Consider potential and whether some education and mentoring could bridge a gap in knowledge.

2. Carefully scope the role. Create a job description with the help of a trusted adviser that understands SMEs and their unique dynamics - Document the role, responsibilities and performance measures.

3. Update the Organisation Chart - show the new GM position reporting to the MD/Founding Owner and carefully consider who will report to the GM. Consider how you will communicate this with your lead team and the timing of it.

4. Consider recruiting the new GM into a manager role first (in the field of their greatest strength) with a plan to promote them to GM after 1-2 years. This will provide a ‘trial period’ before fully handing over the ‘keys’ to the business.

5. Invest time in coaching and integrating the GM to close any ‘gaps’ in knowledge, experience or skills, and seek comprehensive feedback on how the GM is handling the role and aligning with the MD/Founding Owner. Structured meetings with a mutual party (e.g. your trusted adviser) can often create more open and honest feedback resulting in a more seamless transition.

If this is where you are at, and you'd like guidance from someone who has led many businesses through this same transition, I'd love to offer my assistance.