Catch 22 with British and EU bureaucracy

2

My blog-silence has been broken by my frustration at some very silly and wasteful EU / British rules that cost us all a lot of money and bring negligible benefit. Let me explain. Those who know of my company, MyWorkSearch, will be aware that we have an online portal that provides a wealth of resources to assist individuals on their job-search journey. We have recently added content and functionality so we can deliver employability courses that are funded by the Skills Funding Agency (SFA) and European Social Fund (ESF). The payment for an employability course is not that much, however, a technology delivery model makes it viable. To be entitled to the funded course Paperworka person must be unemployed and eligible for benefits in the UK.

Our funding comes via a contract holder, known as a Prime. Our Prime is subject to strict audit rules and should any process or paperwork be incorrect can be required to repay monies they have received. This can be several years down the line and in a low margin sector risk the on-going viability of the Prime. Clearly this creates a risk-averse approach.

So far I am sure that all who read this are nodding their heads and thinking that this is as it should be. Unfortunately, what it has created is a monster of bureaucracy that prevents help being provided to people who need it and adds overheads to providers and government that ultimately we all end up paying for. Meanwhile, the system appears to be designed in a way that stops intelligent change taking place.

The latest example we have run into is with regards to eligibility. In order to provide a short (20 – 30 training hours) employability training course we need to see a copy of a person’s passport or birth certificate. This presents us with two problems. The first is that many people, especially those who find themselves in need of these funded employability courses, don’t have a passport and have long since lost their birth certificate. Getting copies requires time and money. The second is that an employability course can be effectively delivered online, however, demonstrating eligibility and getting a learner signature requires face to face interactions and thus limits who can be assisted and where they are located.

If employability courses don’t make a difference they should not be funded at all. If they are helpful there should not be barriers that prevent their swift provision. What is the point of restricting or delaying assistance that gets people from costly benefits recipients to contributing taxpayers? We have a cumbersome system designed to prevent fraud without anyone stopping to consider how many people are really likely to masquerade as unemployed and entitled to benefits in order to get a free employability course. Nor do they appear to have considered the relative costs of the occasional eligibility mistake versus the bureaucracy overhead that every party bears for every assistance recipient.

Notwithstanding that self-certification would probably be fine, there is a middle-ground solution. Only an eligible person can claim unemployment benefits and Jobcentre Plus could readily issue a confirmation that the checks have been undertaken. Indeed they already have a process for this. The challenge is that the SFA and ESF won’t categorically confirm that a Jobcentre Plus document is sufficient proof. A Prime naturally needs to avoid the risk of clawback so in the absence of a clear SFA statement it insists that its supply chain dots every i and crosses every t.

I regularly speak to other small providers. We all have our examples of how the system has been daftly designed. But what truly adds insult to injury is our inability to get this changed. The SFA only deal with the Primes and smaller providers who are at the mercy of the rules have no route to dialogue or mechanism to obtain clarification. The Primes do not wish to jeopardise their contracts and have to conform to a system where they are informed of the rules they must follow and know that any mistakes can prove very costly. Meanwhile, now that much of the SFA’s funding is mixed with EU monies, there is always the ultimate joker card that trumps all arguments. Brussels makes the rules and we have no choice but to enforce them.

Entrepreneurs tend to be passionate about what their business does and also adept at finding solutions to problems. I really value that our service helps people find employment. We change for the better the lives of many people. I am so frustrated that I work in a system that is so poorly implemented and where there is no route to effect change. I could make it my mission to expose ineptitude and obsessively campaign for improvement. However, doing so would no doubt commercially hurt my business and take time I don’t have. So I just grit my teeth and get on with it, observing considerable waste at a time when we are all told that government expenditure must be cut. How very sad that I and so many others are put in this position. It does not make me proud to be British or European.

I am very busy

The trouble with being an entrepreneur is that there is always something that needs doing. An area that can be improved, a new initiative to be got off the ground or simply a fire to be put out. And then there are the demands of family, from pleasurable activities with spouse and children to the inevitable chores. All in all, finding spare time is challenging.

It was in this context that I attended Silicon Valley Comes to the UK this week (http://www.svc2uk.com). This is an annual week long programme of events around the UK aimed at audiences ranging from university students to established company CEOs. What makes it special is that almost 40 extremely successful US technology entrepreneurs and investors (http://www.svc2uk.com/speakers) gave up their time to spend a week in the UK, freely giving of their experience and advice. Over the week they influenced thousands of people, inspiring them to achieve more and providing invaluable real-world guidance. I am certain that every one of the visitors had many other pressing demands on their time. Despite this they made the trip and enthusiastically participated. All too often one hears of self-interested entrepreneurs and financiers. I wish these critics could see what good this group of businesspeople did in the UK this week. Whilst writing this blog I want to especially thank Sherry Coutu (http://www.svc2uk.com/speakers/61) and Reid Hoffman (http://www.svc2uk.com/speakers/28), the main drivers behind SVC2UK. I really liked Reid’s comment that “Entrepreneurship is important because it is how you invent the future” and I think the future will be better because Reid, Sherry and their network made the time to selflessly share. Certainly my MyWorkSearch to-do list just got longer!

Sour grapes and transparency

Many psychological studies have emphasised the importance of fairness. We can all put up with considerable hardship however what makes it feel far worse is when our situation has arisen as a consequence of unfairness. In business all too often we are unaware of why a decision has not gone our way and therefore do not know whether it was our fault through not being as good as necessary or someone else who simply did a better job. We very rarely have insight into a patently unfair process.

One of the positive things happening with government procurement is the greater transparency into the decision making process. Far more data is published and therefore one has a better, albeit not perfect, insight.

Two things have happened this week that I have found very frustrating and I cannot get away from the feeling that I am suffering from a severe case of sour grapes! That having been stated, what has happened is still wrong and is very disappointing.

The Cabinet Office are sponsoring what is a great initiative. In an effort to benefit from the innovation that tends to come from smaller enterprises and to encourage government to do business with this type of company they have created the Innovation Launch Pad.  Here companies can submit ideas and the best ones get a higher profile and access to help in advancing their proposition to government. MyWorkSearch submitted two ideas (idea 1 and idea 2) and in the first, expert review stage, they both were scored 5 out of a maximum of 5, something achieved by only a handful of submissions. Whilst I am clearly biased, given these scores I think it reasonable to claim some merits for both proposals. The current stage of the competition is for those with civil servant email addresses to register and rate each idea, clicking on a thumbs-up for those they like and a thumbs-down for those they don’t. Our second idea has the distinction of – by some margin – receiving the most negative ratings of all the several hundred submitted proposals! Given that the idea clearly is not daft my only explanation for this level of antipathy is that civil servants are associating our idea with public sector redundancies and that a vote against us is a vote against redundancies. Absurd and unfair though this is, there is nothing I can do about it and it is therefore highly unlikely that what on the face of it is a good idea, will have a chance to progress to the next round.

The second occurrence this week was the announcement that The London Boroughs Recruitment Partnership, a consortium of twenty-five boroughs and three associated bodies, have appointed a firm as their sole supplier of recruitment advertising and strategic HR services.  The announcement includes the fact that the contract has been expanded to include additional services such as outplacement to help LBRP members during the current period of change. MyWorkSearch looked at bidding for this major contract however the published requirement was that whoever bid for outplacement also had to offer recruitment advertising. The two services have nothing in common and I can see no logic in requiring both from the same company, especially as there is only one large provider in the UK that within its range of business lines has both services. We knew we could not win and therefore decided not to bid. Several months later it is this one organisation that has both offerings that has secured the contract. They are are a reputable and professional company and will in all likelihood do a good job for their client. However they won a major piece of public sector work in what was superficially an open but in reality a shoddy process. This is not fair to the companies that would have liked to secure the work and it is not fair to the tax-payers and employees of the twenty eight organisations that procure through The London Boroughs Recruitment Partnership.

And this brings me full circle. Two instances of poor practice that have negatively impacted upon my company, an enterprise I care very much about. Ironically the transparency of the process has made the unfairness that much more obvious. But what to do? I could obsess over it and have it churn away. I could try and fight the process and bring about change. I think instead I’ll just write this cathartic blog and then move on! Sometimes life isn’t fair and in business this rough goes with the smooth.

Year 3

2

We are just signing off our second full year of accounts and this brings home to me that MyWorkSearch is not quite the startup I consider it to be.  Indeed to be totally accurate the company is now 27 months old.  The business has gone from an idly discussed idea to fully formed business with a wholly functional technology product, numerous awards, management structure and processes, employees, customers and multi-million sales.  I still have my original business plan and whilst our core proposition remains the same it is amusing how wrong I was about so many aspects of who we would sell to, how and at what price.  On the one hand I can take pride in our ability to adapt to the market and opportunities, however I also have to recognise that a considerable sum of money was speculated on a venture that turned out very differently from the forecasts that underpinned the investment decision.  I don’t think that this is inherently bad, however it is important to recall this lest hubris sets in.

We now face our next set of challenges.  When we started we were pioneers in suggesting that the labour intensive process of (re-)employment transition assistance could instead be delivered using technology.  The prevailing wisdom was that our type of service could at most be a support resource to the assistance provided by a consultant.  We were not calling into question the value that a consultant could bring.  We just observed that in many cases there simply was not the funding to provide help in this way and that an effective alternative was necessary.  We thought it could be done through smart technology and decided to invest our time and money in making this happen.  Now that we have proven it is possible and become successful we have competition.  In many ways this is a good thing.  With very few exceptions, the absence of competition indicates the absence of a market.  Also, having competitors keeps us on our toes and ensures we do not assume our current market leadership is an entitlement.

So where to next?  We have made good progress with our employer proposition. Each week new organisations subscribe to our services and we are winning repeat business, demonstrating customer satisfaction.  We are partnering with an expanding number of organisations and it is clear that so long as we don’t do anything daft we will continue to develop our market presence.  Our government work is also progressing well.  This summer, in the UK, the Department for Work & Pensions starts the Work Programme.  Many hundreds of thousands of people per year will be assisted first into employment and then helped remain in work.  Delivery is sub-contracted via regional ‘Prime Contractors’ and with funding tight and the numbers requiring assistance high, technology solutions are one of the few methods of making the Work Programme viable.  This presents us with a huge opportunity and this week we launched our Work Programme mini-site at www.myworksearch.co.uk/wp.

Working with those whose employment challenges are more severe has allowed us the opportunity to once again embark upon intensive product development and stretch ourselves as we consider how to meet the needs of this client group.  We started work last year on our Nudge Engine® – functionality throughout our site to examine a person’s progress with MyWorkSearch and make personalised, useful suggestions – and have significantly expanded this for the Work Programme.  Our head of research, an occupational psychologist, has created a number of transferable skills questionnaires that can elicit what a person has the potential to do and then MyWorkSearch takes this data and helps both author a CV that presents the client’s capability in the best way and also finds relevant vacancies.  Other innovations include sophisticated activity management with jobseeker performance reporting provided to the Work Programme advisor helping the client, integrated chat to provide jobseekers with help when they need it and user journeys that can be customised and locked-down.  We created a table of MyWorkSearch features and were pleasantly surprised when we reviewed just how much we had developed.  At the very least we expect to positively impact upon the lives of many thousands of people who are struggling with the difficulties of extended unemployment.  However if our approach proves successful with those whose employment problems are more severe it is quite possible that we will have a transformative effect upon the welfare to work sector.

So we may no longer be a baby startup – but it certainly doesn’t feel like we are coasting or can rest on our laurels!

Thrilled!

I have had a simply superb fortnight.  My colleagues and I work very hard to make MyWorkSearch a success.  We have to get very many things right, from product development to customer service to back office efficiency to revenue generation.  Drop the ball and a relatively new business such as ours can founder.

We submit for industry awards from time to time as it is a good external validation that we are getting things right.  A very important aspect of our service is the way we communicate knowledge to MyWorkSearch users.  It was therefore especially pleasing that we have been shortlisted in ‘The most innovative new product or tool in e-learning’ category in the 2010 e-learning awards.  We will discover in November whether we have won.

We are members of Microsoft BizSpark.  This is a superb programme run by Microsoft to assist technology companies in their first few years through providing a wide range of assistance.  Each year the UK BizSpark team organise a Summit and, as part of this, invite members to submit their business to a Dragon’s Den of experts who pick the best company.  This year 77 companies were entered and 6 were selected to present.  MyWorkSearch was not only one of the six.  We won!

The judges used the G/Score methodology to evaluate the businesses.  This provides a comprehensive framework to assess a business and results in a thorough appraisal of an organisation’s strategy, structure, commercial offering and achievements.

Earlier this year we were selected as the Best Business Startup in the European LinkedIn Business Awards.  It is great to see we are still on track.

Don’t take your career for granted

I had a bad day today.  We are in troubled economic times, there is high unemployment and I found myself at MyWorkSearch on the wrong side of a bidding war when trying to hire someone.  There is a particular capability I think MyWorkSearch will benefit from and, in a sector I know rather well, very few people who have the required skills and approach.  So I approached someone I rate and offered this person a very attractive financial deal combined with huge flexibility on how they would undertake their role.  Unsurprisingly, their current employer was not best pleased at the prospect of losing this person and they made a successful counter-offer.  Putting the personal disappointment and inconvenience to one side for the moment, this experience has brought home to me just how very useful it is to have a much sought after capability.  Even in a bad market employers will do whatever they can to secure or retain an unique set of skills.  And this was an employer that has been making redundancies and freezing pay.

If there is one good thing that comes out of this recession and the horrendous impact of unemployment on so many families, I hope that many more people will think about their career and the value they bring to an employer.  In a world that is increasingly harsh and pragmatic the person who has something an employer absolutely needs will find life a lot more secure.  I think far too many of us for far too long have done what we enjoyed or stumbled into and have not focused on directing and managing our careers.  We may be good at planning and strategy when undertaking our jobs, but do we apply these skills to our own working lives?

I started this blog by complaining about my bad day.  If all goes to plan I will soon have a good day when someone else I know who is also brilliant will, I hope, accept my employment offer.  And if this person reads my blog at least their day will improve when they either accept a great offer from us or discover just how much they really are worth to their current employer!

My iPhone and what it has taught me about business

Many, many years ago, my first ‘mobile’ phone was built into my car.  My next one was a small briefcase that I hauled around if I needed to make calls.  Over the years phones got smaller but essentially they did the same thing: they allowed incoming and outgoing calls.  Then ‘smartphones’ emerged.  As well as making calls one could have a diary or run an application.  Whilst ownership of this type of phone provided some sort of geek bragging rights, the reality was that they did not work particularly well and were impractical to integrate with other computers and servers and thus were often more hassle than value.  The Blackberry was the first device to really make email easy and it integrated superbly well with Microsoft Exchange, meaning that my diary, calendar and email were always up to date on both my computer and my phone.   However, certainly in the early days, the Blackberry was a one-trick pony.  Other than the email suite, the device did not offer much more.  I played around with a number of Windows Mobile and Symbian phones but, despite being comfortable with technology, I always found them hard to use well.

Then I got an iPhone and I was blown over.  Every element of the user interface worked well.  It was thought through, logical and had great design.  It was a joy to use.  What was truly impressive was how Apple had created an environment whereby other developers could create applications to work on the iPhone that were doing vastly different things but despite this still functioned in a similar fashion and were intuitive to use.  No other device on the market managed to combine this flexibility with ease of use.  Rival capable devices were typically hard to use and each application had its own learning curve.  How was it that all those rival companies that had big R&D budgets, numerous talented engineers and the same customer research data had either failed to recognise the requirement or failed to deliver it?  What had no doubt been regarded as impossible had been achieved by Apple.

For a decade I have been running businesses that have invested heavily in creating software delivered business solutions.  I have observed that it is relatively easy to get developers who can write code that is reliable and indeed can engineer complex algorithms.  What is really difficult is creating a user interface that is a joy to use.  The wider the range of functionality the harder this is.  The more need there is to add an extra menu option or button or to create inconsistent operating rules that simply confuse users.  If a person’s hobby or career require mastery of complex software there is a chance that the individual will invest the required time to learn how to properly use it.  However most people are not this committed and they simply give up and either stop using the product or stick to a fraction of its real capabilities.

In February 2009 my company started building an online solution for outplacement.  MyWorkSearch was designed to provide the information a job seeker requires to manage their job search and the tools to assist the person in achieving this.  We spent over six months creating it and it incorporates considerable expertise and tremendous functionality.  Those who spent time using MyWorkSearch were extremely complimentary, however many also said that it was daunting.  Too many options, menus and features.  Unless one spent time getting to know the product one could find it overwhelming.  Over the next several months we made numerous improvements and this certainly helped matters, however it was clear we had no iPhone.  Our competition did not either, however this was not the point.  My colleagues and I felt that just because most people accepted that big software applications had to be complex, we should not.

So in December 2009 we started work on version 2 of MyWorkSearch.  We met with designers, usability experts and e-learning professionals.  We put together a team and have spent over six months intensively re-thinking MyWorkSearch and then implementing these new ideas.

On Sunday 11th July we will be upgrading to this new version.  I am so very, very pleased with what our team have produced.  We have been uncompromising in our efforts to push beyond functionality and achieve usability.  Whenever we have been stuck the iPhone has been a clear signal that the intractable does have solutions.  In a previous post I wrote about our observation that some users did not take full advantage of the resources we were making available and appeared to be giving up.  I hope that improving usability will make a difference to this.  We will be monitoring the outcomes and this is a topic I will be returning to.  Meanwhile I want to thank Steve Jobs and his team at Apple.  Sometimes it takes someone else to show that the bar was set too low.  As well as making a great phone Apple have also contributed to what is fast becoming the most powerful and effective tool available to those in career transition.

Virtual Operations

My blog entries are typically about the items at the time uppermost in my mind.  The fact that I have not written an entry for some weeks does make me pause for thought!

MyWorkSearch operates as a virtual organisation and in one of those weird coincidences as I was driving my car this morning I was thinking about the challenges that this presents and I decided to write a blog about it.  I arrived at my (home) office to be greeted by the news that those challenges had just ratcheted up by several notches as an important supplier has badly let us down.

When a small team of us started MyWorkSearch in February 2009 we wanted to keep overheads down and also have maximum flexibility.  There seemed little point in taking on the high fixed costs of an office at a time when we had no income and no certainty that our business would be successful.  Equally we knew that if the business prospered we might need to grow quickly and once again the fixed infrastructure of a conventional office could be an impediment.  So we decided to embrace technology managed for us by third parties.  Using a combination of cloud computing and outsourcing, all of our key services, such as customer database, email, telephony and file storage, could be provided by specialists and made available to our team irrespective of location.  Our costs would mostly be proportional to our usage and thus added expense would only be necessary as the company grew.

MyWorkSearch has done rather well.  Within six month of issuing our first invoice we had achieved over £1m in sales and monthly turnover, if maintained, would result in multi-million annual sales.  We have ten full time software developers and another ten people in assorted other roles.  All the while we have avoided taking office premises and operated as what is often described as a virtual organisation.

There have been a number of positive aspects from this approach.  I think the biggest one is that we have been able to hire excellent people irrespective of their location as our talent pool has not been limited by commuting distance.  Some benefits have been the flip side of a challenge.  In a central office one can often spot issues simply through management by walking around.  That does not happen in virtual organisations so it has forced us to think through our operations and document them.  We have been far more disciplined than many other small businesses would be and we believe we are well placed to embark upon ISO accreditation.  Another area often taken for granted is team communications.  In many businesses there are those ‘water cooler’ conversations where colleagues bump into each other and find themselves discussing an issue.  These unplanned meetings can be very effective.  We don’t have them in our company and we need to make the effort to speak and meet regularly.  A combination of regular conference calls, team meetings and away-days are our necessary alternative.

There are two disadvantages to our setup that we have not yet solved and both are about people.  One is that some people do not have domestic circumstances or a temperamental disposition that permits them to work from home.  The latter may be a preference or simply a recognition that without the disciplines of an office environment it is easy to get distracted and find that hours have passed with little actually done.  The other disadvantage is our inability to take on trainees.  We are of a size that we could take on an inexperienced person or two and through on the job training develop their talents.  So far we have not found a way of doing this when people work at a distance from each other.

The news I received this morning was that a supplier we outsource a proportion of our call handling and support to has let us down badly and we need to replace them unexpectedly and quickly.  This would not happen had the team been employed directly by us, albeit in a previous business we did experience the equivalent when some builders cut through the cabling to our office resulting in two days without internet or phones.  The good news is that we have documented processes that will significantly reduce the learning curve for a new supplier and our technology is set up so we can redirect calls and data to this new organisation.  However the lesson for us is to dig deeper into the business operations of our suppliers as I think that more diligence on our part would have avoided the problem.

Nowadays many businesses with a handful of staff operate virtually.  What we are doing is relatively unusual as most organisations centralise around a location once they have grown beyond this.  However I think that technology developments will make virtual operations far more commonplace for startups and I would welcome hearing from others who have experienced this and seen how other organisations manage the challenges and take advantage of the opportunities.

Transition

I should be depressed; however I am not.  In addition to it looking like I will lose my bet, my company is soon likely to have to contend with a more challenging environment.  All the indicators are that the economy has turned and we are now on the road to recovery.  We may not be on the motorway, indeed it feels more like a windy country lane, however the economy is gradually becoming more benign with fewer bad news stories and reasonably frequent positive ones.

This makes it harder for MyWorkSearch which has clearly benefited from high levels of unemployment; with recovery there will inevitably be fewer potential users of our service.  However the reason for my optimism is that I am quite certain that even in a more buoyant environment there will still be employment change.  Some organisations will prosper and recruit, others will do less well and shrink.  Companies will merge and operations will move.  All of this will mean a reasonable level of ongoing demand for outplacement and career transition assistance.

The reason for my optimism is I am convinced that our hypothesis just over a year ago, that online outplacement would be useful, has proven correct.  As overall demand for outplacement shrinks the requirements that remain will gravitate to MyWorkSearch‘s online model.  So many thousands of people have now experienced the benefit of 24/7 unlimited assistance that it is hard to see many preferring the alternative of a handful of consultant delivered hours that the same budget offers.  As with so many other sectors, technology is changing the way this one operates.  Whilst my colleagues and I may need to work harder to secure new business, at least we will be doing so in the satisfaction that our country is suffering less hardship and meanwhile our business model is aligned to what the customer wants.

Over the next few weeks we will be upping our game in order to ensure we remain at the forefront of our sector.  We will be launching our new website and embarking on a major marketing campaign.  Hours of additional e-learning content will be added to MyWorkSearch and we will be rolling out a new design combined with usability improvements.  The benefits of feedback from thousands of users combined with six figure investment will see us capitalise upon our existing lead and ensure we are the obvious choice for outplacement purchasers.

None of this helps with my bet.  But if there is one gamble I have to lose, I guess that this is the one it should be!

We did it!

4

My colleagues and I started MyWorkSearch just over a year ago.  We have worked extremely hard to make this a successful business.  Considerable time, money and passion as well as rather a lot of stress!

So I am extremely pleased that our efforts have been recognised by LinkedIn.  This afternoon we were selected by them as Best Startup of the year in the European LinkedIn Business Awards.

Thank you to everyone who works at MyWorkSearch, thank you to our customers and, of course, thank you LinkedIn!