A Spanner In The Works

I own certain tools that are always handy, useful, comfortable and my favourites to call upon. I would be sorry to lose them. That ratchet screwdriver I have had for 25 years, the swiss army knife I carry that gets used everyday for something or other.

The Welsh Assembly government have announced a new Fund for South Wales Valleys and other needy areas of £6m. It is a supplementary fund to the existing SIF  (Single Investment Fund)  providing grant aid from European money. The main objective of the new Enhancement Area Fund is to generate employment for Disadvantaged and Disabled workers by encouraging businesses, located within the Strategic Regeneration Areas of Wales, to undertake capital investment projects. Financial support ranging from £10,000 to £90,000 is available.

Fantastic! So far so good, but I am sorry – is it me? Here’s a fund that has fished out £6m from the pond and has had to play a ‘disabled’ and a ‘disadvantaged’ card to do it. That and the other usual restrictions are enough to push aside most projects. That means the fund will sit there until someone notices it is greatly under subscribed and they will have to apply for some variation, or give it back.

So now we have great looking WAG publicity material and the Assembly look business like and trendy up front, and once again can’t deliver. At the minimum £10k grant for eligible projects they would need 600 projects. At £90k each they would need 67 projects. Suppose it is somewhere in between. Say, 300 projects at about £20000 costing double that although the percentages for various eligible aspects are not all the same.

Let us be clear. That would mean finding 300 projects that can show a need for grant investment, that do not have a local focus only, that are not in the retail sector or are for portable equipment, and do not displace any other work locally. Other restrictions apply and of course they must be employing disadvantaged or disabled folk to some significant degree and purpose.  

Then there are the unspoken restrictions centring around the recruitment systems for suitable grant projects which involve the Relationship Managers and the application process which takes a good while and has a few hoops to jump through.

I might be quite wrong but I think they are going to have difficulty fulfilling their purpose. Am I missing something here? That money would be better used in some of the support that is actually successful such as the HoVIP (Heads of the Valleys Innovation Programme) scheme.

One could argue the money is only available because the disabled and disadvantaged button has been pushed and any money is better than none.  If that is the case, fine, but let’s not pretend it is a wonderful tool. I think it will stay at the back of the toolbox.  

If your business needs better business tools contact Bob Shepherd – http://bobshepherdassociates.co.uk

You Get What You Pay For

The problem is they don’t know there is a problem. South Wales Business Support directly and indirectly through the Welsh Assembly is beaurocratic and time consuming. In some cases it is worth working around and waiting around. In many cases it is not.

The stories are legion of businesses going some way down the road of business support only to see it fizzle out after months of misplaced effort. In some cases the only gainer is an ‘adviser’ or ‘relationship manager’ who has drawn a salary from an agency.

The idea seems fine. A bunch of Not for Profit agencies combine with a government backed support system to deliver much needed advice and guidance to new and existing businesses. There are grants as well, bigger ones through the Welsh Assembly directly and smaller ones delivered in various forms through local authority Economic Development Departments. (Already it is sounding complicated.)

At the time of the launch of the revised support system the Chartered Institute of Business Consulting gave a platform to the main architect of the revised support plans. He started by saying that he had come to the job from the outside world. A collective sigh of approbation was heard around the room. The fact that he made that point is indicative of the general opinion of the support system previously. Next he said he approached the reorganisation with the intention of making it simpler. Again a collective murmur of approval went round the room. Two ticks on the list so far and we are doing well.

He said the Assembly’s grants would all be placed in one pot (The Single Investment Fund) and the applications for whatever flavour assistance would all be directed through it. This received neutral reaction. Interested to see whether they could really pull that off the audience of professional consultants and independent business advisers were prepared to give it a chance. From there on the layers of beaurocracy were disappointingly replaced. It is public/euoropean money after all and some accountability has to be accepted.

Any thoughts that the newly established Relationship Managers were there to actively help anyone were quickly dispersed. They have unwieldy paperwork to justify their existence, they are poorly trained and in some cases with little experience of business. In effect they are there to police the applications as a filtering layer.

The FS4B set up is the revised and streamlined Business Eye. If you haven’t been paying attention that was set up out of the old Business Connect, itself spawned from Business Gateway) It is intended to be a posting network of useful operators who can resolve the biggest gripe of the ordinary business – we don’t know where to go. A good idea in theory and hardly worth the money in practice. The Assembly say "Since the 1st of April over 6000 businesses have accessed support from the Flexible Support for Business Regional Centres and 7,000 individuals have accessed support from the Start Up programme.”

Sounds wonderful. They will say also that 71 % were satisfied with the ease of the process and 88% were satisfied with the quality of advice given to them. I don’t know what questions were asked, but something is wrong here. Even experienced FS4b local Managers will scoff at that. Informed advisers will roll their eyes to the ceiling.

An article published by the BBC under their Politics Show is to be found at http://tiny.cc/ebPnf which adds weight to my views. The defensive statement by the Assembly displays a self satisfied complacency at worst and a woeful ignorance at best. Brian Morgan, Professor of Entrepreneurship at UWIC, said the business support offered by the assembly government was "overly bureaucratic, top-down and lacking in real focus". He was being very polite.

The front end publicity is excellent for Welsh Assembly Business support. The delivery does not match the expectation set. Having sat at meetings and heard the senior Enterprise managers talk about business support they are either following the company line with a large spoonful of cynicism or they are blind to the level of incompetence that seems to be rife. The old special consultancy grant is now referred to as the ‘small SIF’ and a manager was pleased to inform us at one meeting that 70% of the applications were rejected, making no mention of the dozens that never got that far.

The training courses have some generic value. But they are inadequate for anything but the basics for a brand new would be entrepreneur. FS4B will not understand your queries or your situation if it is at all complicated and the most of best advisers have left the agencies. The Relationship Managers are a joke to most people and the time scales for any assistance are enough to put you off. Any serious business intent is going to be misdirected, poorly advised and sent up some cul de sacs.

In short, there are two rules

- most businesses are not eligible for most of it most of the time

- and much of the time you are wasting your time.

The attraction of free support is misplaced economy. You are far better off going to a knowledgeable consultant who will require payment but will help you with practical support and realistic advice. Bob Shepherd Associates can help the small business with practical understanding and business advice to get the best out of a badly weighted system if it is available to you and link it to the rest of the finance world.