Tuesday, November 28, 2006

Project Management for Professionals - Introduction

Project management is all about the effective management of projects, sets of discrete activities intended to achieve discrete ends.

Most people think about projects in terms of major tasks. In fact, all jobs can be broken into projects by grouping related activities against desired ends.This means that project management techniques can be applied at all levels in organisations to improve performance.

This new series of posts describes our approach to project management. They are not intended to be definitive, but to provide a guide to effective project implementation

All professiomals stand or fall by our ability to meet client need. If successful, we will get further work from that client or through his/her contact network. If we fail, the reverse holds true.

Project management is all about the effective management of projects, sets of discrete activities intended to achieve discrete ends.

Most people think about projects in terms of major tasks. In fact, all jobs can be broken into projects by grouping related activities against desired ends.

This means that project management techniques can be applied at all levels in organisations to improve performance. It is not sufficient, however, just to meet client need.

Our profitability depends upon payments for our time, upon payments for our intellectual property and upon recovery of disbursements. So we must not only meet client need, but also do it in the most cost effective way possible.

We also need to ensure that we capture all the lessons and intellectual property belonging to us generated by the project. Effective project management of individual assignments is critical if we are to achieve these various objectives.

However, the importance of good project management does not end here. In practice, all activities can be turned into projects by grouping related activities against desired ends. In turn, this allows project management approaches to be used at all levels in all organisations to improve performance.

Against this background, these posts will provide a step by step approach to the adoption of simple project management techniques.

Note on Copyright

Material in this series is drawn from the Ndarala Group Short Guide to Project Management. The material is copyright Ndarala but may be reproduced and quoted with due acknowledgment.

Friday, November 24, 2006

Management Trends

At present Australia, and many other parts of the world, are transfixed by what used to be called leveraged buy-outs.

From our viewpoint, such activities do pose significant performance risks that may affect the future, even the very survival, of the target. However, there was an interesting article here in Fortune presenting a counter viewpoint.

In essence, the burdens imposed on public companies by compliance costs and short term performance requirements have become such that you can make a profit simply by taking the company outside the system. Makes one think!

Wednesday, November 22, 2006

Getting value from your web site - Dilanchian case study

Graphic from Striking gold with kiwifruit, story from the Dilanchian web site

One of the messages that we try to get across to Ndarala members is the important role that a web site can play in promoting their expertise to a broader marketplace.

We are not talking here about revenue from advertising or from e-commerce sales through the site, although some people do make a lot of money there, rather the use of the site to support ordinary professional activities.

Ndarala member practice Dilanchian Lawyers & Consultants (Sydney) provides an interesting case study here.

Dilanchian bills itself as intellectual property & innovation professionals. The firm competes against some of the biggest firms in the country, working in a marketplace where clients often equate size with substance.

To compete, the message Dilanchian wants to get across is the way the firm combines expertise with modern approaches - Noric sometimes uses the word funky to define the message. The web site is a key marketing tool.

When you look at the site you will see that it has clean lines, a modern feel. It also incorporates a blog.

Since their new site went on line a couple of months ago, Noric and his team have focused on building content. This has started to attract real attention with, as an example, their story on Kiwi fruit featuring (among other places) in the latest WIPO SME newsletter. They are also attracting a small but steady stream of new clients through the site.

Tuesday, November 21, 2006

Institutional and Process Issues in Science Commercialisation

Note to readers: This Ndarala staff paper briefly reviews some of the institutional and process issues associated with the commercialisation of scientific research. Our aim is to encourage debate in an area of great importance to institutions, industry and government.

When some of us first became involved in science commercialisation more than twenty years ago, a core concern was the need to bring universities and other scientific research bodies more effectively into the commercialisation process, to break them out of the academic ghetto.

While this is still important, we now have concerns that the focus on commercialisation and the associated search for commercial funding has become too great and may in fact be distorting our academic structures.

Universities' Multiple Objectives

By their nature, universities have to meet multiple objectives in terms of teaching, research and the pursuit of knowledge. Their role is not just to teach skills, but to disseminate knowledge and encourage thought. Many of the greatest advances in practical knowledge have come, often by serendipity, as a consequence of intellectual curiosity and the pursuit of knowledge for its own sake.

The disciplines and rigours of applied research and development carried out within bounds set by commercial objectives and non-disclosure agreements can be quite antipathetic to these traditional academic objectives. The problem is most acute in some very successful departments where most postgraduate students, together with a significant proportion of staff, are in fact funded to do commercially oriented research.

The outcomes here can include:
  • Reduction in the quantum of curiosity inspired research, leading ultimately to a reduction in the knowledge available for real commercialisation. This skew can be reinforced by the attraction of the best students away from pure into applied science.
  • Reduction in the spread of knowledge as more science becomes tied up by patents or by non-disclosure agreements especially in the pre-patent phase. The effects of this at international conferences already appear to be significant.
  • Reduced career opportunities for students. This comes in part about because the traditional ways of measuring performance (theses, articles, conference papers etc) through exposure to scientific colleagues become less available, in part because of a narrowing of student focus that can then restrict subsequent job opportunities.

One side-effect of the decline in the traditional way of measuring performance is an increased emphasis on patents as a substitute for papers or articles. This has its own problems. Among other things, it can create an incentive for over-patenting.

In our view, resolution of these difficulties requires action at three levels.

At government level, there needs to be at least some focus on the provision of funding for scientific research and scholarship independent of commercial or commercialisation considerations.

At institutional level, we believe that there should be more focus on achieving balance between:

  • Traditional academic teaching and research
  • Tied research where the funding is provided in a way that is essentially fee for service
    Independent internal research carried out in the hope of prospective commercialisation

At firm level, we believe that firms acquiring technology from or utilising university departments to develop or test technology should be prepared to consciously consider allowing the students and academics involved to write and speak about their work within the constraints set by necessary confidentiality.

Industry can be its own worst enemy here in that an over-obsessive emphasis on secrecy can in fact reduce the incentive for scientific students and staff to participate pro-actively in the targeted development of the technology.

A thought through policy on disclosure can benefit both sides.

Overcoming Complex Institutional Structures

The institutional structures involved in the commercialisation of science can be quite complex involving a number of parties:

  • Students: Many scientific discoveries/projects involve students at honours or postgraduate levels working on different aspects of the problem. This can give rise to a number of problems including issues associated with the marking of theses and ownership of resulting IP. Failure to properly address these issues can and has resulted in subsequent commercial problems.
  • Staff: Staff can be involved in research as part of their normal work paid for by the institution out of institution funds or from funds contributed to the institution by a commercial firm or some combination of the two. Staff may also work direct for a commercial firm within rules set by the institution. Again there is ample scope for confusion over IP issues.
  • Institution commercialisation companies: Most universities have commercial arms that coordinate university resources to deliver commercial services and which may play a lead role in commercialisation on behalf of the University. The relationships between these bodies and other parts of the system can be complex and confusing.
  • Institutions, including universities and CRCs. The CRCs themselves are usually consortia with links back into both commercial parties and universities. Each institution has its own policies and costing arrangements in regard to both the supply of services and science/technology commercialisation.

This complex mix can create major difficulties including slow and sometimes opaque decision processes, conflicts in expectations, unrealistic expectations and failure to properly protect IP.
There is no magic bullet that will suddenly solve these difficulties. However, they can be eased to some degree through the creation of protocols and processes within institutions to clarify and support the commercialisation process.

In saying this, we recognise that most if not all institutions now have established policies and procedures intended to support the commercialisation process. The problem from our perspective is that many of these appear to focus on governing rather than facilitating the process.

In our view, both institutions and industry would benefit from action to simplify and clarify institutional policies and procedures. There would also appear to be a case for more cooperation and information exchange between institutions on the process side, facilitating the creation of common templates and process documentation.

Managing Cultural Issues

Commercialisation approaches also need to take into account potential cultural clashes.

Effective commercialisation requires targeted research carried out against sometimes tight deadlines. Individual lines of research may need to be dropped, new lines started. As the research moves into the industrial test phase, an increasing proportion of researcher time needs to be spent supporting the mechanics, reducing real research time.

These requirements can conflict with the universities' own unique cultures and structures. Problems can include:

  • Clashes between the academic curiosity that gave rise to the discovery in the first place and the need to devote an increasing proportion of time to the more mundane mechanics. This can be compounded by an unwillingness to give up pet topics and lines of research.
  • Clashes between the way performance is measured and objectives set within the institution at personal, departmental and institutional level and project requirements.
    Differences in time perspectives between university and commercial approaches. These differences can be compounded by institutional and industrial structures relating to the employment of staff. This may create problems, for example, if long working hours are required to make something work.
  • Divided reporting lines. For example, researchers may have a direct report to the head of the Department, dotted line report to the commercial partner, giving rise to project management problems.

These difficulties may be minimised by moving the research out of the university at an early stage. However, this is not always possible, nor is it necessarily desirable from a university perspective since it can reduce the benefits that might otherwise be achieved.

In our view, the problem is best managed through proper definition up front of the management arrangements to be applied to the commercialisation project.

Note on copyright:

This staff paper is copyright. It may be copied or quoted with due acknowledgment.

Global Changes in Public Administration

A number of Ndarala professionals have worked in or with Government at senior levels. Our people have worked as senior public servants, as ministerial advisers, as consultants to Government, as advisers to those dealing with Government. As part of this work, we have been monitoring global changes in public administration for a number of years.

Why is this important? There has been a global revolution in public administration since the 1970s. Some elements of this are good, others not so.

I have been pursuing some of these issues on my personal blog, drawing both on my own experience and work done by others within Ndarala. The views expressed are personal and to a degree partisan in that my interpretation is influenced by my own views and experiences. However, they may be of interest in explaining change.

The key posts are:

Sunday, November 19, 2006

Hints for Service Level Agreements

"If you're not measuring it, you cannot manage it."
This article, prepared by Noric Dilanchian (Managing Partner Dilanchian Lawyers & Consultants Sydney), discusses the way in which modern service level agreements reflect fundamental changes in the way we do business.Noric can be contacted at noricd@dilanchian.com.au or visit www.dilanchian.com.au

Traditionally trade in commodities and products dominated legal relations in commerce. Trading relationships were relatively simple. Typically customers bought things and then looked after their support, servicing or maintenance. ᅠFor these tasks there were more people in trades to fix things that broke.

It was often said that the best contract was one that was filed away after signature. That era is long gone. The act of "buying" now involves contracts which:

  • relate more often to services than things (ie products or commodities)
  • often involve linked transactions - for products, services and support
  • document ongoing legal relationships - not one off trades between suppliers and their customers.

This contemporary configuration exists in major contractual relationships between information technology suppliers and their customers for software, phone, hosting and Internet connection offerings. It is also common in other sectors.

The change from seller-buyer to symbiotic legal relationships has been driven by new or evolving technical, commercial, management and societal needs. In the legal arena this has increased demand for legal relationships which are customised, networked, collaborative or innovative. In turn, this has seen increasing use over recent decades of:

  • partnering
  • joint ventures
  • strategic alliances
  • outsourcing
  • collaborations.
Role of Service Level Agreements

A central feature of these relationships is the need for contracts to provide for practical considerations for service delivery and reciprocity between the parties. For that reason, service level agreements are a common element in mostᅠof the new organisational and legal forms.

All buyers and sellers can benefit from the types of clauses and schedules put into service level agreements. It is a myth that service level agreement features are exclusive to the IT, telecommunications and utility sectors.

Developing the Service Level Agreement

Setting a service level is about defining standards and quality and ultimately price and value. This is of course relevant to all contracts. However traditionally in contracts a lot was left to common sense. That was OK when the focus was on trade in things, in one-off deals, for standard offerings. It is not OK for modern commerce given its dependency on "essential services" or requiring customisation, servicing, consultancy and ongoing support.

What is the service level agreement solution to this need? Nowadays service level agreements commonly set out provisions for:

  • service definition
  • timing standards
  • minimum and maximum quality needs
  • compliance with set standards
    payment (incentives and rebates)
  • consequences for performance drops
    current and future needs
  • monitoring methods
  • security of premises and information
  • alternative dispute resolution; and variation of arrangements.

In service level agreements for the IT, telecoms and utility sectors, minimum performance standards can define the maximum percentage of downtime including during peak usage times, response times, the form of measurement, transaction volume, and the number of concurrent users.

To ensure legal remedies will be available, it is vital to prepare for and clearly state the consequences of performance shortfalls. It is also common sense to resolve issues before signature, and to deal with them before they become problems or litigation fodder.

For vendors and customers, flexibility for variations is achieved by providing for regular reviews, factors which must trigger costs variations, and compliance with changing market and technical standards and business-specific needs, processes and technology.

For customers, good service level agreements also include both remedies and penalties for missing set service levels. These penalties need to motivate the vendor to achieve customer objectives. Customers don't want to miss service levels over and over again.

Writing the customer's business objectives or goals into a service level agreement can be useful. To minimise third-party performance risks, it may be sensible for a customer to insert a clause stipulating that the primary vendor (ie prime contractor) remains accountable for shortfalls caused by third-party partners.

These are among the many ways of using the law to achieve better, faster and cheaper outcomes. ᅠService level agreements, or service level clauses in contacts, are tools which can benefit buyers and sellers providing "win-win" outcomes.

Note on Copyright:

This article is copyright Dilanchian but can be copied or quoted with due acknowledgement.

Preparing for a Business Sale or Collaboration

Owners want to sell for the right price. Buyers, licensees and collaborators want to buy, fully-informed. Here are four tasks to achieve a meeting of minds.
Noric Dilanchian, Managing Partner, Dilanchian Lawyers & Consultants, Sydney. Noric can be contacted at noricd@dilanchian.com.au or visit www.dilanchian.com.au.

In our work with clients we look for ways to improve results. We know from experience that clients who succeed in selling or collaborating, prepare for that eventuality.

Our research shows that four preparatory tasks help achieve great results.

The four tasks reduce the fear, uncertainty and doubt ("FUD") arising from the fact that a business is not a physical thing. Rather, it is a bundle of abstract concepts.

Of course, most businesses have tangible elements like a business name, brand, products, as well as people, systems and a leased location .

But the intangibles of a business require definition:

  • its operating legal structure which has clear financial and tax consequences
  • its accounts with line items which may be under-documented
  • customs and traditions honoured but not recorded
  • services, contracts, and terms and conditions for customers and suppliers, which are rarely fully written
  • its undocumented innovation methods that help save it from extinction

It's vital that the managers and owner of a business define this bundle of concepts before beginning transactions towards selling or collaborating.

This article is about how to make these transactions successful and smoother.

Task One: Effective Communication

First, astute clients communicate the nature and depth of proposed business opportunities to prospective buyers, collaborators and their advisers.

To this end, prepare an information memorandum or similar profile document which acts as a hook to draw a response from a prospective buyer or collaborator.

Without it, a business spends time and money giving prospective buyers and collaborators ad hoc information on demand. Supplying information only on demand may sometimes save costs. But this approach exposes transactions to FUD, adds stress to negotiations, erodes trust and increases the likelihood of oversights. A buyer who wants basic data will be surprised by a delay in its supply and may perceive the delay as a weakness. FUD thrives when positive information is absent.

Remember that presenting information graphically can be very effective. Prospective buyers and collaborators will appreciate a chart or diagram illustrating your business or proposal.

Consider creating an organisation chart, a business process map, a value chain diagram on your business model, and a diagram of your IT network typology.

Spreadsheet information is also useful. Consider preparing a break-even analysis, product development budget, and a historical statement of revenue and cost of sales.

Contact Dilanchian for templates for any of these. They aim to communicate how smoothly and efficiently others can merge or align their operations with yours.

Task Two: Build the Quality of Your Assets

Second, clever clients build the quality of assets.

This often involves improving the business's legal and intellectual property law protection. An intellectual property audit will analyse and document positions under copyright, trade mark, confidential information, designs and patent law.

If intellectual property protection or intellectual capital documentation is weak, a buyer or collaborator will lose confidence in your proposal. Once they or their advisers find gaps in your protection, FUD will grow and the deal may slip away.

Leases are a common problem area. When selling a business, a lease may be easily transferable to the buyer. However, you may have lease weaknesses to fix. These could include unresolved maintenance problems, an approaching lease expiry date, high rent or restrictions on using the premises for new purposes.

To compensate for these and other perceived weaknesses, the buyer may want a fee discount or legal fall-backs such as tougher warranties and indemnities, and even pre-defined liquidated damages obligations, guarantees and company charges. Build the quality of your assets by paying attention to these matters and you avoid or minimise the financial and legal consequences.

Task Three: Work on Deal and Transaction Structuring

Third, our clients do better if they work on deal and transaction structuring before starting negotiations.

This puts them in control of negotiations. They get to shape negotiation game play and define and draft effective terms and conditions.

It's an advantage to be the negotiator who controls the deal-making and its document preparation process. Contact your adviser to structure your transaction before negotiations begin.

How do you manoeuvre to secure a better price? One way is to present financial circumstances positively. For example, if your projected recurring revenue is from recently-signed customer contracts, prepare a forecast cash flow projection. If a disclaimer or rider is needed, supply the forecast as a best endeavours estimate, not a warranty as to definite future revenues.

Think creatively, ask questions and use your contacts.ᅠIf you want to sell your business, think about buyers you might have overlooked. Email your brains trust, pose questions, hire a business broker or commission a report from a specialist consultant to identify prices and likely buyers. Sometimes buyers come from outside your pool of competitors. There may be recent entrants in the market unaware of your proposal.

Another way to create value is to remember that it's your team of people that create your intellectual property, not machines. Astute clients build the morale of their people and ensure their contracts and arrangements are attractive to prospective buyers and collaborators.

eview and properly document commission schemes, update contracts, if necessary, and remove irrelevant key performance indicators for your people.

In setting the sale price of a business, industry conventions or ratios play a part. These norms can limit your price, break away by:

  • highlighting cost-reduction possibilities - list any volume discounts, no-fee deal arrangements or fee waivers in place for long-term loyalty
  • illustrating how your order processing system is scalable, profitable or above industry norms
  • using surveys to prove higher-than-normal customer satisfaction rates
  • using customer retention statistics to prove lower-than-normal customer churn rates.

Think of negotiations and transactions as theatre, improvise by all means, but work with a script.

Task Four: Design your Strategy

Fourth, during proposal design, deal-making and negotiations, wise clients perfect outcomes with transaction-specific strategies.

For example, if you're selling, attract more than one bidder before entering serious negotiations with any one bidder and you benefit from competition between them. If you feel uncomfortable doing this, use a representative. To act as your representative a solicitor, accountant or business broker can really make a difference here.

Some structures require special care. A transaction-specific strategy for a non-incorporated joint venture proposal should always involve clearly defined and measurable outcomes for the collaborators. Commission a business planner to work with you in building a business plan for the joint venture. Test the financial plan with your accountant. Build IT to manage the enterprise.

Check contracts for the due date for all payments. The purchase price usually requires a part-payment on exchange of contracts and the balance on completion. Sometimes buyers seek payment by instalment. If this is unavoidable, protect yourself by withholding revenue or delaying the transfer of title to key assets until payment is complete.


To achieve the "meeting of minds" that facilitates legally-binding contracts, you need to communicate well with buyers and collaborators. The four tasks reduce FUD for them by:

  • lowering the real and perceived risks of doing business with you and your enterprise
  • improving the intellectual property of the business, helping build the monopoly they seek
  • creating an easier, turn-key transition with fewer loose ends.

Our research shows that by completing the four preparatory tasks and using an information memorandum, you greatly improve your chances of a successful business sale or collaboration.

Note on Copyright

This article is copyright Dilanchian, but can be copied or quoted with due acknowledgement

Tuesday, November 14, 2006

Formatting Confusion

Just a note. I switched this blog across to a new format in Beta Blogger only to create considerable internal formatting problems on previous posts.

I will try to fix these up in due course. When I work out how!

Use of Blogs to Support Professional Activities

I find it interesting that there is still resistance among professionals to blogs and the use of blogging as a professional tool.

I now use blogs in two main ways.

At a personal level I have found them a very time effective way of keeping in professional touch. This was very important early this year because I was feeling very stale and isolated, wondering if my own professional competency had gone stale in the face of other pressures.

At the time I started really focusing on blogging I had not fully realized the fundamental change that had already taken place in the blogosphere, the fact that a remarkable number of professionals around the world were using blogs for discussion, as a marketing tool, as a way of promoting their ideas. Further, because they posted so frequently, in many cases 3-5 times per week, there was a currency to their comments making it easy to see trends. In addition, the comment facility on blogs allowed for a degree of response and interaction, making knowledge transfer easier while also building contacts.

Perhaps the most important feature of blogging at this level is the way it acts as a huge information screening device. Most bloggers look round their world for things of interest to them and then include links in their posts. I presently monitor some fifteen key blogs on a daily basis, quickly scanning to look for things of interest. Given average post patterns, this means that I scan up to 12 posts per day, reading some in more detail. The 12 posts will probably contain up to 30 links, of which I will click through on 3-4 and again scan. 30-40 minutes per day keeps me in touch in a way that is simply not possible with either conventional web searches or the print media.

Perhaps it’s not surprising that blogs have taken over as a key information resource for so many professionals. Certainly I no longer feel either stale or isolated. I know that my professional competency still stands up on a global basis, and that’s not a bad thing to know.

The second way that I have been using blogs is the more time consuming one, as a publishing and promotional device. My conclusion is positive, although the lead times involved in getting sufficient content up to attract interest and be credible are substantial, far more than I had expected. You really have to post several times a week to achieve impact. It is also important to post comments on other blogs. One side effect of all this is the establishment of contacts with fellow professionals.

Given these positive experiences, I would strongly encourage all professionals to experiment with blogs and blogging.

Monday, November 13, 2006

Building Local Tourism -a comment

We have now put up two linked stories on this site, both dealing with tourism development. The first story, Building Local Tourism, discusses what is involved in developing tourism. The second, Frustrations of a Tourism Official, sets out the response of a tourism official to the first story. Both stories were first published in 2004 but remain relevant today.

Australia faces particular problems - these are not unique just to this country - in the drift of people to the bigger cities and (in the Australian case) to the coast line. Regional communities are attempting to meet this challenge with varying degrees of success.

A number of Ndarala's Australian professionals are involved with regional and community development. Others work in different fields but live in Regional Australia. So issues relating to regional and community development are of considerable interest within the Group.

All communities are affected by change. Sometimes those changes are so large that they simply overwhelm local ability to cope. More often, local responses are possible. One of our frustrations lies in getting this message across. As an example here, see the short linked story on the Regional Living Australia blog about the failure of regional communities to make best use of the web.

Building Local Tourism - Frustrations of a Tourism Official

Note to Reader: This response to our article on building local tourism was prepared by a rather frustrated local tourism official. We are sure that many will share his frustrations. Ends

I have read the last Forum article. It is a good summation of regional visitations. A number of issues are apparent to me from the article and can be substantiated through my own experience.

Need for Local Coordination

The first issue is the the need for local coordination of local government efforts, visitor centres and the local industry so that they have a common knowledge of just what is being promoted.
I fear that this is near impossible because of the movement in and out of the industry by major players / personalities. Then, too, marketing reflects what the locals think is good in many cases, not what the consumer/market wants.

This is what I call the " local dollar influence" in the decisions on local brochures and marketing programs.

The need for coordinated marketing of local product at all levels and all mediums

This can only occur after the product has been identified. This is the problem on the coast. Some people think visitors come here for the beach as they did in the 1950s and 1960's for an extended period. Some still do,but other desires are now more sophisticated and are focused on for example, nature based tourism and retail shopping for some isolated visitors.

The market is now more sophisticated, especially in product sought and accommodation. Often I drive past 1960 motels at (town name removed) with no one in them. Why?? the consumer has gone up the market chain as their wants and desires have changed with affluence.

Changing Attitudes

As I see it, the hardest thing is to change the local's opinions and prejudice. As an example, in one area the councils want to change the name of the regional tourism organisation because one influential Mayor thinks that would give local ownership. Local ownership is obviously a good thing, but not when it conflicts with market realities. In this case, Tourism NSW market research says that the consumer sees the area in terms of its existing name. Any new name will require time and expense to establish. So there is a conflict between local political and market realities.

Failure to Appreciate the Value of Market Research

There is also no appreciation of market research on just who is the visitor in regional NSW, as far as local politicians and some operators go. Any area which did go down this path (market research) would save a lot of time and money and get better results.

Lack of Support

Another issue is the lack of support for local tourism bodies by local operators. This problem in NSW contrasts with other States where the industry has got its act together, eg Queensland ,Western Australia. On my last information NSW lags at the bottom of the tourism list apart from Sydney's international potential.

Problems in Attracting International Visitors

The problem for regional NSW is that despite the anticipated growth of international tourism of 8%, those areas will see very little of it, due to distance and the attitude of product wholesalers who look at the bottom line and only promote the major icons Sydney, Port Douglas etc.

Here we suffer from the problems of years of disconnected promotional efforts at state and local level. NSW is a very big state. It is inevitable that regional tourism will suffer in promotional terms as compared to Sydney. We also need to develop and promote key regional icons in competition with Sydney, not as an add-on.

Problems in Domestic Tourism

Domestic tourism is only figured to grow 1% per year, which makes it very hard for regional areas, unless they promote their uniqueness.

If short visits are the new industry (caused by work, family commitments, petrol prices,generally high regional airfares and limited funds), then I think that local areas will have to look at developments in the inter regional tourism markets.

This is very hard to sell to many coastal operators who see the lucrative high spending Sydney market as the answer. It amazes me the bias of some local areas against surrounding areas. Last week, I did some market testing on the visitors to a local caravan park. The majority were from one major nearby centre, the rest from another. The local operators know this and do their own marketing on this basis. Where do you see this in "official" documents??? you don't!!! as the bias is to the metropolitan market.

Again, I think regional areas are in need of accurate figures for just who are their visitors and what segments of the market are they utilising, as a starting point.

Increasing Competition

I do not think a lot of people associated with regional tourism know just how increasingly competitive it is out there in the market place. There is a particular problem in some areas that some retirees who are new to the industry, are balancing their new visitor businesses with their lifestyle needs. This further complicates the issues as they try to run a 24/7 business on a 35 hour week approach.


Tourism can benefit local communities, although it is not the panacea that some people see it to be. But major changes in attitude and approach are required before we can make real progress.

Friday, November 10, 2006

People Management in Professional Services - a training primer

Note to reader: This Ndarala staff paper by Jim Belshaw explores some of the issues associated with improved approaches to training within professional services firms. The paper is an edited version of comments previously made on the Ndarala blog on Managing the Professional ServicesᅠFirm. Ends

At a time of demographic change and increasing competition in professional services, improved people management is critical to improving firm performance.

This short primer focuses onᅠone element in improved people management, improved approaches to training. I have deliberately kept theᅠargument as simple as possible given that my main audience is not training professionals as such. My aim is to provide a simple primer on training from a management perspective.

The post is written against a background of major change in both education and training. Those interested in the debate on the training side can find out more from the January 2006 Ndarala staff paper Is Training Snake Oil?.

Setting a Context: Professionals vs Managers

I thought that the best way of startingᅠwas by focusing on the difference between managers and professionals because this links to one of the issues that I mull over from time to time - why do so many professionals make lousy people managers? And, more to the point, just what can be done about it.

I know that this is not a new issue. In engineering, for example, the problems involved in promoting good engineers into management positions removed from direct hands-on engineering has been a topic of discussion for years. In medicine, the sometimes inability of doctors to communicate with patients is well know. The inability of some senior partners in law firms to manage is infamous.

While the issue is not new, I was reminded of it again in a recent discussion with a senior professional on a management issue. The professional is highly intelligent, even brilliant in his field, and also has an interest in management issues. Yet he simply could not see the issue in question. He gave instructions, his staff should get on with it!

When I looked at the discussion later, I realized that the core of the problem lay in the role, training and even language of the professional as compared to the manager.

A manager's core role is to manage the resources available to him/her to achieve the objectives set for the area. Performance is always measured, or should be, by the results of the area.
In contrast, the professional's role is to carry out specific professional tasks. The core focus is on the performance of the individual professional in undertaking those tasks.

This difference in roles is reflected in training.

The professional's training dates back to the craft system of the middle ages. It focuses on the individual acquisition and application of the knowledge, skills and values associated with the profession. The core focus is individual, not collective. The subsequent rewards offered by the profession, and especially the critical recognition of peers, are all based on individual performance. It is no coincidence that the Nobel prize is awarded to individuals, not teams.

The manager's training is different.

To begin with, we have to distinguish here between the acquisition of technical skills such as financial analysis and broader management skills. Many of those coming out of business schools become technical experts and should more properly be classified as professionals rather than managers.

Beyond this, management training focuses on managing people and other resources. Further, most managers become managers by doing, by actually managing with increasing degrees of responsibility. In contrast, many professionals are suddenly thrust into management roles when they get to a certain point in their career and are then, suddenly, expected to manage.

Differences in role and training are also reflected in differences in personality. Perhaps more accurately, different personalities are attracted into the professions as compared to management. The professions tend to attract people who prefer individual endeavour, whereas managers are more collectivist.

I recognize that these are broad generalizations. Some professionals are very good managers, some managers are hopeless managers. Nevertheless, the differences are real and mark very different cultures.

The bottom line in all this is that it is not surprising that most professionals are not good managers and that professionals and managers can experience difficulty in talking to each other.

The War for Talent

There is presently a war for talent across all areas within professional services. This war can only get worseᅠgiven an aging population in developed countries. Better training is - more precisely should be given the way training is often managed in practice - a key weapon in the war for talent.

Starting with three general points.

First, at organisational level, training should be thought of as the process by which staff acquire the knowledge and skills they need as they need them. This simple definition draws out certain key points:
  • the focus is on organisational needs
  • training is defined as a process. Attendance at a few continuing professional development seminars or individual short courses is not training in the way I am defining the term, but instead should be thought of simply as training activities
  • the training process focuses on the acquisition of specific knowledge and skills as needed when needed.

Second, it seems clear that the great majority of knowledge and skills acquisition- probably well over 90 per cent in most organisations, 100 per cent in some - is informal and takes place on the job. This simple statement has significant implications:

  • From experience, most organisations define training in terms of specific defined training activities. This limits the training function to 10 per cent or less of the total knowledge and skills acquisition within the firm
  • The value of the on the job training depends upon the training and supervisory abilities of existing staff. If these are poor, then total learning across the firm will be significantly reduced
  • Firms who want to maximise returns from training need to manage both formal and informal learning.

This brings me to my third general point.

Part of the current debate in training deals with doubts among trainers and others as to the extent of real returns from training. These doubts are partially due to measurement difficulties, what should we be measuring, how should we measure it? But they also flow from the narrow way in which training is defined.

In my view, and this extends my second point, training can offer significant economic pay-backs if, but only if,the training process focuses on and integrates total learning within the firm, including informal learning.

An example from my own experience to amplify this last point.

The engineering profession in combination with the aerospace industry developed the concept of the learning curve, expressed as a" graph that depicts rate of learning, especially a graph of progress in the mastery of a skill against the time required for such mastery." (http://www.answers.com/topic/experience-curve-effects)

Linking this across to our current discussion, in simplest terms, the shorter the learning curve with new staff or existing staff doing new things, the greater the return to the firm.

To illustrate.

Some years ago I had to establish a new section in the Australian Treasury to process applications by foreign investors wishing to invest in Australia. This was my first experience as section head. We were under delivery pressure and were carrying out a new activity in a politically sensitive environment.

Recruitment of staff was difficult and took time. There were general staff shortages compounded by the fact that my new section was in a relatively unfashionable area of the Department. However, we still had to deliver regardless.

I did have access to one staff pool, new graduate recruits. The conventional view at the time was that it took at least twelve months before such staff really became useful. I did not have this luxury, I needed them to be able to do things quickly. So I defined structured on the job training with a graduated mix of process and research tasks, combined with staff seminars, thus mixing formal and informal training.

I was not surprised to find that people improved more quickly than expected nor that I had a generally happy team. I was surprised at the extent of the improvement. I found that it took my people about three months to get to the competence point usually expected at the end of the first year, a huge performance gain. Later when I did an analysis of the 33 or so people I had working for me during this period, I also found that their later promotion patterns had been better than the Departmental average even though their qualification level on entry had been lower than the Departmental average.

Different Training Types

One core difficulty with training as a process and a key reason why training fails is that it can involve a mix of outcomes each requiring a different approach. Mix them together and you can get a mess!

I need to clarify just what I mean by the word outcomes. In the current context, I am not talking about the results from specific training activities, but am instead applying the term to broad generic training categories.

I will describe these in a moment. From a practical management perspective, the key point is that both managers and individual professionals can use them to help make judgements about training. Further, you do not need to be a training expert to do so!

The key training outcome categories I am talking about are:

  • knowledge -how & what to do
  • skills - the capacity to do
  • judgement - when to do
  • and attitude - willingness to do.

Individual elements in this mix are better suited to different training modes.

Knowledge, for example, can be acquired via self-study with the acquisition measured through oral or written test. This allows for a variety of delivery modes including eLearning.

This is also an area where the new computing and communications technologies and especially the internet are steadily undercutting training's traditional role as a supplier of knowledge by giving people the ability to access information when they need it. This makes the firm's information systems an adjunct to the training process.

By contrast, skills acquisition requires practice, practice that may need to continue after the formal training has been completed if the skill is to be really internalised. Certain types of skills may be capable of being taught, practiced and measured via simulators. Others, the softer management or communications skills are an example, require direct oversight and group interaction.

Judgement takes skills acquisition one stage further and can only be acquired through experience, including observation of others.

We can now see why on the job training is so important, why 90 per cent plus of knowledge, skills and judgement formation takes place as a natural by-product of work. Only while working can you acquire the firm and environment specific information you need and the actual practice required to build knowledge and skills. "Formal" training can supplement, not substitute.

The final training outcome category, attitude, is actually a slippery one because so many things combine to create attitude. I have no doubt that training can be valuable in giving people information on the attitude to be adopted in regard to specific clearly defined things. However, the use of training to achieve broader attitudinal change is, I think, very uncertain.

Competency Based Approaches

The terms competency and competency based approaches have become very fashionable in Commonwealth and European countries, much less so in the United States.

While we have problems with their rigid and formalised application in the vocational education and training arena, they do provide a critical building block in the training process because they provide a bridge between the definition of the need to be met one one side, the training approach to be adopted on the other.

Let's start with a very simple definition.

Competence means no more than a person has the knowledge, skills, judgement and attitude required to carry out a task or set of tasks to a required standard. So when we talk about competency based approaches we are talking about the required standard on one side, what is needed to achieve the standard on the other. Once this has been defined, then it becomes easier to identify performance gaps and to take corrective action.

In practice, the whole process can be quite hard because it may require different ways of looking at work. For example, it means putting aside activity lists - and a remarkable number of people think of a position in terms of a long list of activities that have to be carried out to do the job - to focus instead on the core features of the job. What are they, how do we measure them, what are the key inputs required for success?

Some firms have already adopted this approach. For those that haven't, getting started need not be too complex. You can look at the problem in terms of specific positions. Alternatively, you can focus on classes of activities. You won't get it right the first time. Rather, we are talking about a process that can be refined over time.

Individual vs Organisational Needs

An interesting thread in the current global debate on the future of training relevant to our current discussion is the potential conflict between individual and organisational needs. Many training and development professionals in particular argue that much training failed because it failed to meet the needs of individual participants in the training.

The real position is far more complex since, from our experience, there are three sets of needs that have to be taken into account if corporate training is to be effective:

  • theᅠneeds (objectives) of the organisation
  • the needs of the trainees' work area or areas
  • individual trainee needs.

The problem is that these needs can conflict. For example, an organisation wide program to upgrade general management or marketing skills may fail because of resistances at workplace and individual level. These conflicts need to be identified and managed as part of the overall training activity.

Of importance here is what we see as fundamental shift in developed countries in people's attitudes to work itself, a shift that has had a direct impact on individual approaches to training.
The end of life long employment together with constant corporate restructuring has forced individuals to change their attitudes to work. Whereas they were previously prepared to consider things that would aid their career within the individual organisation, people's focus has now shifted to things that will assist their career beyond the organisation.

This has had a significant impact on individual attitudes to training. People are simply less willing to do training unless there is a definable individual payback. Will it give me a marketable skill? How will it look on my CV? Will it build my network, give me new contacts? These changing attitudes need to be taken into account in the design of training activities.

Need for Realism

I suppose my starting point here has to be the need for realism. You are suddenly not going to turn all your professional staff including partners into effective on-the-job trainers. It's just not going to happen.

But you can aim to improve performance. Starting from the premise that a lot of professionals are just plain bad at the training element in jobs, a small absolute improvement may in fact represent a very large percentage increase! So how to do it?

Immediate Steps

Recognising that performance improvement takes time, I think that there are a few immediate things that you can do:

  • Start by looking at the existing skills and approaches of your more senior people. Do this along two dimensions, their existing approach to people management and development, their technical skills. From experience you are likely to find a range all the way from people who are keen on training and people management (some of these may well be hopeless at it) through to people with great professional competence but with poor people and communication skills.
  • Then look at existing staff demands for training. What does this tell you? Interestingly, my experience has been that there is a direct but inverse correlation between staff demand for training and the standard of management. That is, the worse the manager the more likely there is to be a staff demand for training!
  • Then think about where you think from a firm perspective the greatest needs are.

All this gives you a rough framework. Now at this point I would focus on those people who who have most to offer from your perspective if only you could tap and transfer their knowledge and skills more effectively. How might you do this?

This may sound paradoxical, but one simple device that I have found that works well with the highly competent but busy professional with poor people communications skills is the internal seminar on a topic of relevance to the firm and the professional.

Often these people have thought deeply about what they do at a professional level. Getting them to share some of this through short internal professional development seminars can be a very effective device. It can also build linkages between that professional and other firm members.

The second thing that I would look at is some form of structured but not necessarily formal mentoring program. Again, this has the advantage of establishing links between staff. The program needs to be structured so that those participating know clearly what is expected on both sides. At the same time, there can be real advantages in keeping it relatively informal.

With some firms, this type of program can be a way of tapping knowledge and expertise from senior people who are close to retirement or who may even have retired. This can have advantages on both sides. The senior person feels valued, the firm and the more junior staff member gains.

Integrating Appraisal Systems

In the longer term, training approaches need to be integrated with staff appraisal systems.
This is a large topic in its own right. At this stage, I would only make the point that one measure of an effective appraisal system should be its linkage with and input to the development of training approaches. If there is no linkage, I would query the value in that firm of both training and appraisal.

Performance Measurement

One common problem in professional services firms is the way in which performance measurement systems work against people management.

Yield on time is obviously critical in any professional services business. At the same time, you cannot expect people to put time into training - doing it or participating in it - if the only real perfuming measurement is billable hours. So if you are serious about training, you have to find some way of recognising it.

This finishes this shortᅠtraining primer. Comments are welcome.

Note on Copyright

The paper is copyright Ndarala 2006. However, it can be quoted, copied or reproduced with due acknowledgement. The following should be included for citation purposes. Jim Belshaw, "People Management in Professional Services, Ndarala Staff Paper, August 2006.

Thursday, November 09, 2006

Special Feature - Is Training Snake Oil?

Note to readers: Sandra Welsman's article on the future of Australian higher education pointed to a rapidly changing environment, the key trends and what they might mean for the Australian University system. One of those trends is the growing importance of vocational training to the system. This starts with short courses and then extends into the full hierarchy of training offerings. This trend is clear. Yet, or so many would argue, it coincides with a malaise in the training arena itself.

On 16 November 2003 Sam Adkins and his colleagues published a long post on the US Learning Circuits blog (http://learningcircuits.blogspot.com/). Written from the perspective of corporate training and the corporate training department, the post looked at some of the reasons for the decline in the relevance and validity of the corporate training function. The post generated a huge response. This Ndarala staff paper reviews the debate. End

Sandra Welsman's provocative article (11 January 2006) on the future of Australian higher education suggested that by 2016 the highly structured Australian higher education system as we know it today may no longer exist, collapsing under the combined pressure of technological change, demographic change, global competition, regulatory change and changes in student demands and needs.

In its place, there would be a more complex system with a multiplicity of providers of varying sizes linked through alliances providing a wide range of options in terms of courses, content and delivery mode to an increasingly sophisticated student marketplace no longer prepared to accept previous educational shibboleths.

As she had intended, Sandra's views gerenerated debate, including debate among her fellow education and training professionals within Ndarala. A driver in that debate has been the problems, some would say malaise, within the training sector itself, problems that have direct implications for higher education changes.

This Ndarala staff paper draws together some of the threads within the on-going debate.

"We are the Problem. We are selling Snake Oil"

On 16 November 2003 Sam Adkins published a long post - We are the Problem: We are selling Snake Oil" - on the US Learning Circuits blog (http://learningcircuits.blogspot.com/). Written from the perspective of corporate training and the corporate training department, the post looked at some of the reasons for the decline in the relevance and validity of the corporate training function.

Sam began by noting that he had read the long tortuous posts bewailing the malaise of our educational systems. In his view, the problem was not there but lay with trainers themselves. Sam argued that there was now ample data to show that:
  • Training did not work. Around $US65 billion was spent every year in the US for training that had a dismal knowledge transfer ratio (2%), a dismal learning transfer rate (20-30%) and only accounted for 10% of the way peopleᅠacquired knowledge.
  • eLearning did not work. Trainers had been in denial about this. The drop-out, no-show rate was peaking at 70-80%. Users hated it because it was a learning product that was fundamentally incompatible with the workplace. Just-in-time really meant do-it-in-your-own-time. Work always trumped any other activity.
  • Blending Learning did not work. How could it? If snake oil did not work, how could bottling it in a variety of different containers increase its effectiveness? Look at the messaging of any vendor using the term Blended Learning - these were thinly veiled efforts to sidestep any complaint over a specific form factor. Customer complains about one and the conversations shifts to another. Clever
  • Knowledge Management did not work.. File management systems worked. Content management systems worked. Knowledge is not housed in hardware or software. It is a product of wetware.K M and eLearning will never merge. It is too late and doomed to failure. KM is now anathema to customers and eLearning is being replaced by collaboration, simulation and real-time workflow products. Merging two mythical creatures just gets you a hybrid mythical creature (shades of Chimera).
Collectively, this meant that trainers had been selling snake oil. They had to recognise this and directly address the problems if they were to halt the decline in corporate training.

Reader Response.

The post generated a huge response. Sam's views and the nature of the responses form the core of this paper in part because of the issues raised, in part because they provide an interesting counter point to the internal Ndarala discussion. Of importance here is the fact that the current geographical distribution of Ndarala professionals means that our discussion focus falls more within the Commonwealth and - to a lesser extent - European than the US streams of thought.

This leads to considerable differences in emphasis and focus.

This point can be illustrated by taking Australia as an example. The Australian education and training system is far more centralised and unified than the US system. So thoughts and concepts drawn from the combination of UK/Commonwealth and Australian experience are applied in a cross-system and unified way very different from that applying in the US.

A second interesting difference is that the majority of Ndarala's professionals interested in education and training have come to the area from different professional backgrounds whereas the majoirty of those responding to Sam in the original post appear to be first and foremost training and development specialists. Again this leads to interesting differences in perspective.

Education versus Training

Sam made the point up-front point that his data related solely to the corporate market. Accepting this, there was surprisingly little reference in discussion to the differences between education and training, to the evolving role of higher educational institutions in vocational training or to the changing relations between training and other parts of the education and training sector. Yet all three are important to the broader discussion.

At least in countries such as Australia and New Zealand, the delivery of various forms of vocational training has been the major growth area in higher education leading to an increasingly complex suite of offerings. This growth has been paralleled by a decline in interest in traditional non-vocational educational offerings.

At the same time, both subjects and approaches from the training arena have migrated into the education sector at all levels. There has been a rapid increase in the number of vocational subjects taught at school level, a significant growth in the degree of articulation and overlap between the previously separate school, technical training and university sectors, while approaches developed in vocational training (competencies, learning outcomes) are now applied from primary school up.
The broader implications of these trends lie at the heart of much of the internal Ndarala discussion about education and training. Some key threads in the discussion can be briefly summarised:
  • Structural change: The on-going convergence between sectors lies at the heart of Sandra's arguments about likely changes in the structure of Australia's higher education system.
  • Impact on down-stream curricula: Concepts and subjects once the domain of later university or technical training including that provided through corporate training departments are now widely taught at primary and secondary schools. Examples include process techniques such as project management or mind-mapping as well as subjects such as business studies whose curricula essentially mimics courses previously the domain of the universities or business schools. The educational value of some of this may be open to debate. However, what is clear is that the school level changes will force (are already forcing) changes in down stream offerings including corporate training.
  • Education vs training: One vexed and much debated issue in all this is the educational impact of the increasing overlap between education and training. Education focuses on critical thinking, whereas training is concerned with acquiring or enhancing the capacity to do a particular thing. The distinction between the two has always been a little blurred. Basic skills such as reading, writing or arithmetic have to be aquired, and indeed the perceived failure of the school system to give students the necessary skills has been a topic of public debate within countries such as Australia. Again, universities have long played a major role in particular types of vocational education. But today, or so many Ndarala people would argue, the overlap has become so great that education's traditional role in teaching critical thinking is in danger of being lost.
Fitness for Purpose

Many of the responses to Sam emphasised the need for training to properly meet needs. For example, failures in eLearning lay not so much in the system (here many argued that Sam's definition itself was too narrow) as in the innapropriate application of the approach. Many people also made a distinction between training or teaching - the process from the viewpoint of the trainer or teacher- and learning - the process as seen by the participant. A number suggested that in fact eLearning should be called eTeaching to make the distinction clearer.
The need for the form of training to be linked to the type of need to be met would be accepted by most if not all trainers. However, one surprising feature of the discussion in this case was the apparent absence of any structured way of linking different training types to differing training needs.

This has been a subject of some debate within Ndarala.

Most training involves some mix of knowledge (how & what to do), skills (the capacity to do), judgement (when to do) and attitude (willingness to do). Individual elements in this mix are better suited to different training modes.

Knowledge, for example, can be acquired via self-study with the acquisition measured through oral or written test. This allows for a variety of delivery modes including eLearning. By contrast, skills acquisition requires practice, practice that may need to continue after the formal training has been completed if the skill is to be really internalised. Certain types of skills may be capable of being taught, practiced and measured via simulators. Others, the softer management or communications skills are an example, require direct oversight and group interaction.

A key debate in the Group centres on the issue of just how far one can push the boundaries within delivery modes to accommodate different requirements within individual modes dictated by on-ground clientᅠrealities. Recognising that boundaries do shift with time and experimentation, our experience suggests that there remain certain types of training that cannot be delivered effectively in an on-line environment.

Competency Based Approaches

In all cases, however, you cannot define the most effective training mode until you have defined the learning outcomes, the exact results to be achieved from the training. This links to another important issue, the role of competence or competencies.

In this regard, one interesting feature of the debate from our perspective was the absence, with the exception of one disparaging remark, of any reference to competency based approaches.
To us, the importance of competency based approaches lies in the way they provide a structured approach to the definition and analysis of learning outcomes. In turn, this provides a base for the development of the best training approach in terms of content, delivery mode, assessment technique and subsequent evalation of results.

We would be the first to agree that Government mandated competency structures can create institutional rigidities. Indeed, some Ndarala professionals have withdrawn from the development and delivery of certain types of vocational education and training for just that reason. At the same time, our experience suggests that competency based approaches do provide an effective bridge between the definition of the need to be met on one side, the training approach to be adopted on the other.

Individual vs Organisational Needs

Another interesting thread in the debate was the potential conflict between individual and organisational needs, with many arguing that training failed because it failed to meet the needs of individual participants in the training.
From our experience, there are three sets of needs that have to be taken into account if corporate training is to be effective:
  • the organisational needs (objectives) of the organisation.
  • the needs of the trainees' work area or areas.
  • individual trainee needs.

The problem is that these needs can conflict. For example, an organisation wide program to upgrade general management skills may fail because of resistances at workplace and individual level. These conflicts need to be identified and managed as part of the overall training activity.

Individual Responsibility, Individual Needs

In discussions on ways of meeting individual needs, many participants pointed to changes in the way people learned with a particular emphasis on the on-line environment.

We would agree that younger generations who have grown up with technology respond to it and use it in different ways. We would also agree that the way people process information has changed. However, we would also argue that there has been a fundamental shift in developed countries in people's attitudes to work itself, a shift that has had a direct impact on individual approaches to training.

The end of life long employment together with constant corporate restructuring has forced individuals to change their attitudes to work. Whereas they were previously prepared to consider things that would aid their career within the individual organisation, people's focus has now shifted to things that will assist their career beyond the organisation.

This has had a significant impact on individual attitudes to training. People are simply less willing to do training unless there is a definable individual payback. Will it give me a marketable skill? How will it look on my CV? Will it build my network, give me new contacts? These changing attitudes need to be taken into account in the design of training activities.

Impact of Technology

Discussion on the impact of technology on the training function formed one one of the most interesting elements in the Adkin's debate. Of especial interest were the comments on the way that new technology has challenged the traditional training function, reducing its role and value.

Education and training has traditionally been the primary vehicle - the gate keeper - for the acquisition of new information and knowledge. We can see this in the old concept of the autodidact - the self taught man - as compared to those who had undergone formal education.

Today the web has made us (or at least those with access to the technology) all autodidacts.
This has had a significant impact on the traditional training function in that certain needs have diminished or even disappeared. This process will continue. As it does, training systems whose primary focus is in fact giving students access to information are likely to come uinder further challenge.

We see this as a real opportunity for the training profession. Increasingly, part of the role of the trainer is likely to become facilitating access by information overloaded, time poor trainees to required information when and as they need it.

This does not mean, however, that trainers will cease to be trainers becoming instead information management specialists. The trainer's focus will remain on the acquisition of information, knowledge for specific training purposes. In simplest terms, the on-line environment will provide an increasingly rich resource from which trainers can select the appropriate menu.

In turn, this will free the trainer to focus more on the purpose of training, including the skills enhancement component.

Assessing the Returns from Training

This final section of our discussion looks briefly at the returns from training.

Accepting that returns from individual training activities can vary greatly from negative to very positive, we have no doubt that investment in training is positive in aggregate terms. However, there is a problem here in that the returns from training can be divided in at least three ways:

  • There is the return to the individual participant. From an individual viewpoint, this may be negative, neutral or positive.
  • There is the return to the organisation. This return can be broken into two parts. There is the direct return from the training itself. Then, with good training, there are also spin-off benefits over and beyond those directly associated with the training. Again, these collective returns may be negative, neutral or positive for any individual training activity.
  • Finally, there is the broader national return. The skills acquired through training are carried on beyond the organisation providing the training to benefit others, creating externalities. This category of returns is likely to be positive in a national sense so long as the training has been of reasonable standard.

Much of the Adkin's discussion on returns focused on the return to the corporation and especially the direct return. We would agree that this return needs to be measured in a more rigorous fasfion. However, we would go further. We believe that:

  • Measurement should also generally take into account the return to the individual participants. If this is negative then the training is less likely to be of value to the corporation.
  • As much as possible, measurement at corporate level should attempt to assess the broader spin-off benefits to the corporation from individual training activities.
    Corporations should also look at and take into account broader national spin-offs from their training activities.

We have included the last point for two reasons.

First, this type of assessment can offer broader potential PR benefits in regard to both staff and external stakeholders.

Secondly and more importantly, aggregate changes in corporate training activities can have significant effects on the supply of skilled people within the economy. If each corporate limits its measurement of training returns to direct returns and thenᅠrelates training spend to those returns, the presence of externalities means that overall industry training spend will necessarily be lower than the optimum case.

To illustrate by an Australian example. The Australian electricity industry went through a process ofᅠrestructuring, corporatisationᅠand in some cases privatisation. As part of this process industry participants cut back on their recruitment and training of linemen. This subsequently led to very major shortages, imposing substantial additional direct and indirect costs on the industry. These costs exceeded the previous savings.

In making this point we do recognise the problems involved in overcoming this type of situtation, including the difficult free-rider problem. However, we believe that if firms do attempt to measure broader costs and returns, then they are going to be in a better position to respond proactively.


The paper is copyright Ndarala 2006. However, it can be quoted, copied or reproduced with due acknowledgement. The following should be included for citation purposes. Ndarala Staff Paper, Is Training Snake Oil?, January 2006.

Building Local Tourism

Note to readers: Regional development is a key area of interest for a number of Ndarala professionals. This 2004 article by Jim Belshaw focuses on ways of improving tourism performance, one area where most local communities have a chance to build an external income source while also enriching life for themselves. Further writing by Jim relating to tourism issues can be found on the New England, Australia and Regional Living Australia blogs.

This article focuses on ways of improving tourism performance, one area where most local communities have a chance to build an external income source while also enriching life for themselves.

Tourism performance is normally measured in three linked ways: number of visitors plus average stay plus average spend. So if you are going to increase your revenue from tourism, you have to increase the number of visitors and/or the stay and/or the money spent.

Who Comes Now

Understanding existing visitor traffic is an obvious starting point. This includes not just those who stop or stay, but also those who pass but do not stop. Who comes, why do they come, why don't they stop?

Then look at their points of contact with you. What do they do there, what information do they get, what perception will be formed of our community?

These points of contact are not always obvious. Let me take an example on a road I know quite well, Thunderbolt's Way.

At Nowendoc there is a little bush style public toilet next to the hall. A number of visitors stop there because it is well maintained and clean. Yet there is no information about Nowendoc or the surrounding region, one of the most beautiful if relatively unknown parts of the New England. A public notice board plus a stand for brochures would have a small but useful impact.

Perhaps the best way of establishing points of contact is via a simple mapping exercise. Look at traffic patterns and then travel the routes, identifying decision and contact points. Check what information is available at each point.

In doing this, look at the way patterns vary over the day. On a Sunday morning for example, where do people stop for coffee? If there is only one place open in town, then you need visitor material there.

The Visitor Experience

The next step is to look at improving visitor experience. Improve this and you build length of stay plus average spend. Then those visitors who are already coming give you more cash by recommending your area to others.

Improving Visitor Experience: Information

The easiest starting point in improving visitor experience is to give the visitor more information. The more things a visitor has to do, the more things that a visitor has to learn, the more interested he/she will be.

Visitors like things that are different, that will add to their experience in a particular area. Now there is a real problem here. Because we know our own area, we do not think of things as something a visitor might like. We ignore obvious possibilities.

Worse at times, we focus on things that we are proud of but which are not necessarily important to the visitor.

To address these problems, start by listing just what information is in fact already available for visitors in brochures or in electronic form. In doing so, identify material that is out of date or incorrect.
Then look at just what events, attractions or potential attractions you have. A brainstorming workshop can help here.

In carrying this step out, look also at attractions/features in your immediate region that might be packaged with local attractions/features. Too many communities think just in terms of their own immediate attractions and may be jealous of and even in competition with adjacent areas. One outcome here is that the visitor experience is fragmented into small and ineffective packages.

You should also do some web searches on your area to find out just what comes up. Search first on the name, then combine the name with various terms relevant to your area. This will tell you just what the external electronic world sees of you.

But do not stop there. Also look at equivalent places in Australia and overseas. What do they feature, how do they feature it, what might be relevant to you, what can you learn?

You now have a list of ideas and possibilities that you can compare with already available material. From this, you can generate a list of material that you might prepare to enhance the visitor experience.

A journey starts with a single step. Most communities do not have a lot of promotional dollars. So start by preparing the easiest material first, adding to it over time.

Improving the Visitor Experience: Service

If you understand your existing visitor patterns, have mapped the key contact or decision points, know just what you have and have a plan in place to extend visitor information, then you are already a long way down track.

But you also need to improve the visitor experience through improved service.

One part of this is to make things as easy and pleasant as possible for the visitor.
Placing relevant information at key contact/decision points is an important first step here. As part of your initial mapping exercise, you should also have looked at things such as cleanliness, opening hours. What can be done to improve things?

Then there is the broader question of the standard of service experienced by visitors whether in shops, motels, cafes etc. What need to be done to improve this?

This can be a very difficult area because it may require behavior changes. For that reason, community support is very important. A visitor welcomed as a guest by the community is much more likely to return and to recommend the place to others.

Marketing your Community: Initial Analysis

Many of the things already discussed will contribute directly to marketing focused especially on developing the existing visitor flow. Marketing beyond this point depends upon your own unique circumstances. However, there are some general principles that you can use to guide your thinking.

To begin with, how you market and to whom depends on what you have to sell and to whom. This may seem self-evident, but the reality is that it is often over-looked.

To take a simple example, if your primary focus lies in capturing passing trade, there is probably not much point in investing time and effort in things such as tourism trade shows. Instead, you are better off focusing on:

  • Cooperative action to promote the particular route or routes.
  • Together with actions such as those already described designed to increase gains from existing traffic.
If, however, you want to attract people to your community as either an end-point destination or at least a stop-over on a bigger trip, then your approach has to be different.

The starting point here is to work out just how much you hope to gain.

Start with the average spare bed capacity since this determines the size of your marketplace. Is it 6.5 or 65 or 650 or 6,500? There is not much point in aiming to attract 3,000 bed nights over twelve months if your projected bed availability is only 600. Instead, you have to focus on the day visitor.

Then move to the messages you want to put across. As a general statement, most tourism marketing suffers from blurred messages. Yes, your community may have a whole range of things to sell. But if you try to promote too much, then the image will become blurred and will be largely lost. You are much better off concentrating on a small number of flagships.

This holds true even for larger communities. Take Tamworth and country music as an example. When Tamworth first started in this area, no one could have foreseen that the Country Music Festival would become an international success. Now country music provides a central platform supporting a whole range of visitor activities.

Now in thinking about messages you have a choice. Do you want to focus on an image for your community as the central message (hard) or do you want to promote specific activities (much easier)?

Recently I listened to a Wilcannia community forum broadcast on ABC. I have always known about and wanted to visit Wilcannia. Listening to the forum I decided that I really must visit the district.

Forget about the town problems canvassed at the forum. From a tourism perspective, Wilcannia (or so it seemed to me) had to do two things. Problem one was to increase the number of visitor stop-overs along the existing highway route. Problem two was to find a special identifier to get people to visit the town in its own right. And here the combination of the history of the Darling with the aboriginal heritage provided a potential solution.

Marketing your Community: Revisit the Visitor Experience

In thinking about your core messages, look again at the visitor experience. Will it actually support what you want to do?

Here you have to put yourself in the shoes of the visitor.

The starting point here is obviously the flagship experience(s). How well developed is this/they? How much choice is there for the visitor? What might be done to extend it?

The next point is just what other attractions you have that might be packaged in some way with the flagship experience. Just because visitors have come for one experience does not mean that they won't want to taste other things. Choice is all important.

Then look at the things that support the visitor: accommodation, meals, sport, souvenirs etc. What is available here, how might you add to it, how do you tell the visitor about it?

Let me take a very simple example. Take tennis.

Parents travelling with children may be looking for something to do with them. In the case of my own family, we always play tennis on holidays whether in South West Rocks, Port Douglas or Armidale. How often have we found that while tennis is listed as a local facility, there is in fact no easy way for the visitor to access the courts. No contact telephone number, or a number that does not answer! So do not list a feature if the visitor cannot in fact access it.

Marketing your Community: Select Your Marketing Channels

Once you have decided on your core messages, you then have to decide how to get them across. Here the channel depends upon the message. By channel, I simply mean the specific marketing path required to reach the target audience. So you have to select those channels that best fit your message.

There is a real problem here in that tourism, like most areas, has developed its own marketing jargon. I simply do not find terms like empty nesters to be of much practical use.
This means that you have to dig down below the conventional terms to first define and then target the market you are aiming for. This takes a fair bit of thought and some lateral thinking, especially for smaller communities with limited resources.

Again to illustrate by example. Say that you want to make your aboriginal heritage and experience a central attraction.

Step one is to get information into the readily available general channels such as those offered by Tourism NSW. Certainly useful, but here you may be one of many. So you need to do more.
Step two is to look at your web presence to ensure that your community appears towards the top of any web search on terms such as Aborigines, Australian Aborigines, Aboriginal heritage, Aboriginal history, Aboriginal tourism. This may involve paying a search engine so that your site appears as a feature.

Better, in that you are now reaching people with specific interest in the subject. But wait, in terms of a famous ad, there is more.

Look beyond this to specific groups.

For example, all schools now incorporate material on Aboriginal life and experience in their teaching. Many Sydney schools organise excursions to reinforce this. So put together a package and send it to selected Sydney/Melbourne/Brisbane schools inviting them to visit and also asking them to put material on notice boards, tell parents about it in a school circular.

The Role of the Tourism Plan

As you develop your ideas, you should put them into some form of tourism plan.
This need not be complex.

The key thing about planning is not the plan itself, but the process involved in creating it and then monitoring progress against plan. This helps us identify and capture lessons from experience, to learn by doing.

Persistent and Consistent

The key to success in tourism development is to be both persistent and consistent. It just takes time to develop new things, get a message across and to learn from experience.

One of the real tragedies in tourism promotion, at least in NSW, is the way in which constant organisational changes at state and local level lead to changes in tourism boundaries, promotion messages and activities.

This may not matter for a city such as Sydney that already has a huge national and international footprint. However, it can be absolutely devastating for a region or community trying to get its message above the static in a crowded marketplace.

The New England region can be taken as an example. Sixty years ago this was one of Australia's best known regions. By the mid nineties, after multiple changes in tourism boundaries and messages, Tourism NSW market research showed a fundamental collapse in market awareness of both name and regional attractions.

The bottom line in all this is that you must adopt a longer term focus in planning for tourism development. Results will come, but only if you allow the necessary time.

Wednesday, November 08, 2006

Australian Education 2016 - Looking Back

Note to Reader:This provocative article by Ndarala professional Dr Sandra Welsman (Frontiers Insight) explores changes in Australian education, especially tertiary education, looking back from the perspective of 2016.

Sandra paints a very changed world in which today's institutional structures and approaches have been replaced by a changing multiplicity of new forms and approaches.

The article first appeared the The Australian's Higher Education section 11 January 2006 and is reproduced with Sandra'a approval. Sandra can be contacted by emailing insight@frontiers.net.au.


For Australian higher education, recent decades have been tense. Some institutions have struggled and faded. Others, belying the view that universities endure because they adjust traditions with caution, have inventively flourished through financial squeezes.

The next 10 years will see more assertive change worldwide.

In this scenario, key drivers are, as ever, those of the marketplace: demographics, demand shifts based on need, cost and reward, and competitive new suppliers. Government regulation might hold back the market but not for long. Institutions and individuals cannot wait; they need to presciently, creatively and actively chart their own ways ahead.

2016: The Scene Looking Back

It is now 2016, and new knowledge production, its testing and trade are vital but routine socioeconomic activities. Special protections fell away from university research and teaching as markets turned from seller to buyer-driven. A stunning diversity of education and education providers are now recognised against robust globally calibrated measures.

To advance their careers, younger Australians in 2016 need one good qualification plus edgy knowhow gained from challenging work responsibilities in business, government and service professions. Demand for big, formal degrees declined noticeably from 2008 in favour of tailored credentials earned via workplace tuition. In contrast to skilled trades and personal services, more professional work in law and accounting is outsourced to clever, cost-efficient centres overseas. Lead Australian firms excel in thinking and action across disciplines, cultures, markets.

Post-school education in 2016 is on-call, practical and rewarding intellectually, emotionally and materially. Before committing to a formal university or institute degree, including some trades, consumers weigh up whether whole-of-life returns will exceed fees, costs and loss of at-work earning and learning. Some, young or older, are still investing in education per se, but the 1990s push for lifelong learning has lost traction. Research degrees are the exception, with many PhD completers now distinctly middle aged.

Schools and Universities Merge

Upper school education is fast merging into universities and institutes. This started with school-based vocational education and training; then, in 2005, the notion of general-studies colleges appeared. Mimicking the US paths of decades gone by, governments funded school finishers to take a liberal mix of subjects at regional or suburban universities before earning entry to select institutions for professional courses.

Clashes with market realities were clear by 2010. Young adults, impatient with school dependency, rejecting more years of "just learning", headed to flexible employers anxious for their services. University enrolments dropped; creative work-based edu-ventures emerged.
In retrieval mode, clever regionals negotiated with school systems to transfer final school years into their degrees, delivered from 2010 via mini-campus networks.

The Asian Challenge

Asian institutions have grown fast and purposefully in quantity and quality and now serve expanding local numbers. Most Asian students, wary of being stereotyped as substandard on their English, now optimise time, money, learning and university experiences at worldly Asian or localised arms of well-known US or European Union universities plus a few Australian providers.

Asian student flows into Australia, shaky since 2005, slumped from 2008. Relief among academics about course standards and pressures was offset by widespread financial restructuring.

Africa could be a new client region but world higher education is too hotly competitive for conventional Australian institutions.

Australians Head Overseas

"Born global" high-achiever Australians are enrolling in Asian or US enterprises, over there or at branches here. They will pay for international education that gives them an edge in networking and career. By 2010, our new elite seven universities noticed many bright and young students heading overseas for first degrees (with travel deals keeping family close) rather than spend three years in a "local". Some of the seven now offer "under/postgraduate" fast-tracks but Australia might not recapture this vital cohort of students.

Emergence of Local Diversity

Entrepreneurial education surged from 2007, responding to and shaping marketplaces. Entities of all sizes and histories are inventing new ways (in-class, in-work, in-bed) to supply learning services to students and employers, and pioneering course content to old universities.

By delivering perceptive, intellectual, practical products, innovators won access to public grants and a level playing field. We have new criteria for research, course accreditation, even research training. Whether universities were slowed by their rules or by government regulations is debated in academic journals (few others care as they race to transform).

Thriving universities have worked to focus academic curiosity towards research and teaching outcomes with impact across stakeholder communities. Here, academic freedom is not deployed unthinkingly as a barrier to change nor is collegiate voting used to delay reform. Decision-making takes place after genuine consultation. Leaders have had to change, too. University protocols, rules and benchmarks have improved markedly, with dilution of simple measures such as peer review and publication in little-read journals.

Indeed the personality of academics seems to be evolving, hastened by performance criteria and baby boomers deciding to adapt or retire (some of them revealing entrepreneurship once discouraged by the stricture of disciplines).

As enrolments reduced from 2008, competitive forces revealed the true positioning of the 45 Australia-based universities in local and global marketplaces. The strength and performance of entities, judged against what they promise, are explained in ways intelligible to students, employers and investors worldwide.

To much surprise (and financial distress), innovative competitors stripped business education and "last male bastion" technology courses from unfocused or too feminised universities. Those ossified business school models unable to manage and compete as in the real world suffered more than others.

In 2016 there are 60 universities diversely active in Australia. A minority are public entities. Across all types of enterprise, most academics have chosen contracts that double their teaching. This allows them to focus on excellent course design backed by scholarship.

They are well rewarded for their work. Although equity pressures still protect institutions in regions and outer suburbs, privatisation (tested on three universities in 2009) is a powerful answer to entrenched costs and performance issues.

Respected new-model tertiary institutes emerged and perfected the teaching of adaptable skills and multi-disciplinary thinking for complex, changing workplaces at all qualification levels.

There have been university-college mergers, myriad start-ups and some separations. But the big shock, and the clear start of a new era, was the closure and sale of seven under-used city campuses by a consortium of governments in 2012.

About the Author

Sandra is managing director of Frontiers Insight, a Canberra/Armidale consultancy specialising in the development and application of new analytical techniques in the areas of planning, innovation and program reviews. Sandra's previous positions include founding director Australian Centre for Agriculture and Law at the University of New England, CEO of the ACT Electricity & Water Authority, General Manager Business at the Snowy Mountains Authority as well as various SES positions in the Defence Department. Sandra's qualifications include an honours degree in science as well as a PhD in law and admission as a barrister.