The Importance of Demography and Demographic Change - update

Note to readers: this is a stocktake post that is updated from time to time.

Last November we repeated an earlier story I had written on the importance of demographic change to Australia.

Issues associated with demography and demographic change continue as an important topic in Group discussions because of their importance to so many aspects of life and practice. For that reason, this post provides an update on main posts on the topic across several blogs.

The blog demography.matters continues to be a good international entry point to discussions on demographic issues. Like this blog, the demography matters writers have experienced some difficulty recently in keeping the blog up to date, but it remains a valuable resource.

An annotated list of some of the posts I have written on demography and demographic change follows in chronological order.

12 October 12, 2006: Demography, Universities and the Trades in Australia. This and the following post on 30 October 2006, Demography, Universities and the Trades in Australia - a postscript, discuss the impact of demographic change on numbers entering university and the trades and the links to the public policy and skill shortages.

31 October 2006: People Management in Professional Services- the Demographic Time Bomb looks at the impact of demographic change on the professions.

8 November 2006: Impact of Demographic Change in Australia provides an introduction to some of the issues associated with demographic change from an Australian perspective.

On 14 November 2006 I began a series of posts examining the NSW State Government's new ten year plan from a New England perspective. Assumptions about demography are central to the plan.

In NSW Ten Year Plan - New England's Needs I set out my perceptions of the needs the plan might meet. This post includes supporting demographic data. My next post, Does the NSW Ten Year Plan Meet New England's Needs?, looked at the structure and objectives of the plan against the needs as I saw them. My conclusions were not positive. This was followed by a concluding post, NSW Ten Year Plan and New England - Conclusions, drawing the analysis together.

5 December 2006: Demographic Change - a note on Germany looks in a preliminary way at one aspect of the relationship in Germany between demographic and structural change.

7 December 2006: Australia's Population - June 2006 outlines the latest population statistics released by the Australian Bureau of Statistics.

21 December 2006: Australia's Aborigines - A Note on Demography looks in a preliminary way at the demography of Australia's indigenous peoples.

26 December 2006: Australian Migration Statistics 2005-2006 looks at the latest Australian migration statistics.

2 January 2007: Africa, Demography and Productivity Change - a miscellany looks at African population issues.

3 January 2007: Australian historical population data provides a link to Australian Bureau of Statistics estimates of the Australian population since 1788.

On 18 January 2007 in Sydney Government releases draft Mid-North Coast strategy I reported the release of the the Government's strategy for this area as defined by them. Assumptions about population growth are central to this strategy. I followed this with a post on 23 January, Sydney Government's Coastal Planning Strategies, looking at the coastal strategies as a whole. I was again very critical of the demographic assumptions.

In Personal Reflections 26 January 2007, I mused further on this topic, following this up on 28 January 2007 in Demographic Change in NSW - the future with a further examination of the realism of the assumptions underlying the population projections.

On 7 March 2007 in NSW's Aboriginal Population I provided some data on the regional distribution of Aboriginal people. On 8 March 2007 in Aborigines and the Development of Public Policy - a Methodological Note I looked at data problems. Then on 9 March in Australia's Aborigines - another demographic note I provided some more demographic data on the Aborigines.

3 April 2007: Australia's Aging Population - Treasurer Costello releases second Intergenerational Report provides links to material on Australia's aging population released by the Federal Government.

28 June 2007: Mr Howard, Mr Brough and Australia's Aborigines - 3 includes statistical data on both the Aborigines and various national groups within Australia. This post followed and part corrected the data in Mr Howard, Mr Brough and Australia's Aborigines - 2 (24 June 2007).

6 July 2007: Regional Variation and Australia's Aborigines discusses the distribution of Aboriginal people across NSW as shown by the latest census data.

On 5 August 2007 in Sydney's Sluggish Population Growth, I commented on Sydney's growth compared to the other capital cities, querying again the Sydney Government's planning assumptions.

7 August 2007: Pacific Perspective - Pasifika and New Zealand's Future discusses demographic change in New Zealand.

On 13 August 2007 in US Market for New Law Graduates I discussed, among other things, emigration of younf professionals from Australia.

15 September 2007: Imperial cities, global cities at a time of change looks at the rise of London and the lessons for Australia. Imperial cities, global cities - a postscript (23 September) extends the argument, drawing from comments on the first post.

Australia's Population - March Quarter 2007 Introductory Note (26 September 2007) and Australia's Population - March Quarter 2007 at State Level (28 September 2007) discuss new Australian population data.

28 September 2007: New England Australia Demography - Stocktake of posts as at 28 September 2007 is as the title suggests.

Teasing Neil - but with a serious point (16 October 2007) compares the demography of two very different Australian electorates, Sydney and New England. I followed this on 18 October 2007 with a look at the demography of another electorate - New England's Federal Electorates - Cowper.

20 November 2007: Global Demographic Trends - Introduction began a series on global population trends. This was followed by Global Demographic Trends - A few macro numbers (23 November 2007), Global Demographic Trends - the decline of Europe (26 November), Global Demographic Trends - the rise of Africa (30 November) and then Global Demographic Trends - Asia (8 December 2007).

NSW Demographic Snapshot as at 30 June 2006 - Introduction ( 29 December 2007) outlines the geography of NSW as an entry to a discussion of NSW demography. This was followed on 30 December by NSW Demographic Snapshot as at 30 June 2006 - fastest growing councils 1.

3 February 2008: Report of the NSW Aborigines Welfare Board, year ended 30 June 1940 includes demographic data on NSW's Aboriginal population in 1940.

20 February 2008: Australian Short Term Visitor Arrivals - January 2008 discusses newly released statistics on the country of origin of Australia's short term visitors.

Denise North appointed to the Australian Fisheries Management Authority Board

Senator Eric Abetz, the Commonwealth Minister for Fisheries, Forestry and Conservation, has announced the appointment of Ndarala professional Denise North to the Board of the Australian Fisheries Management Authority.

The Australian Fisheries Management Authority (AFMA) is the statutory authority responsible for the efficient management and sustainable use of Commonwealth fish resources on behalf of the Australian community.

AFMA manages fisheries within the 200 nautical mile Australian Fishing Zone (AFZ), on the high seas, and, in some cases, by agreement with the States to the low water mark.

Ms North has held diverse senior executive roles across a range of sectors, most recently in commercial and strategic roles with SingTel Optus. She has also worked as a management consultant, in the not-for-profit sector and as an industry analyst and policy advisor with the Australian Government.

Ms Northﾠhas a BEc, MBA and GCDC (AICD), and is Chairman of Streetwize Communications Ltd, a not for profit,ﾠand of the Council of International House, University of Sydney. ﾠ

Evidence Based Management

As part of our series on evidence based professional practice on the Managing the Professional Services Firm blog I have just put up an initial post on evidence based management.

As you might expect, this is a topic of considerable interest to Group professionals given our management improvement focus.

The proponents of evidence based management argue that it can prevent managers and management constantly reinventing the wheel. They also argue that it can help counter the fashion waves that constantly plague the management domain.

We agree with both points. However, effective application is far from easy in part because there is as yet no agreement as to what evidence based management really is.

Belshaw joins the Learning Circuits Blog Team

I am pleased to announce that I have accepted Dave Lee's invitation to join the Learning Circuit's blog team with the mission of introducing a more international focus into the LCB discussions.

For those who do not know LCB, the blog is sponsored by the American Society of Training and Development to provide a forum for training discussions especially related to e-learning.

I feel honoured to be asked.

Those who read my personal blog will know that education and training is a key obsession of mine. The same focus comes through on the Group's Managing the Professional Services Firm blog. If we don't educate and train our people properly, how can we achieve firm or national objectives?

Ndarala people do a very wide range of work in the education and training arena. I am presently discussing with my colleagues the best way of bringing this to a wider audience.

Proposal Writing Check List

Photo: Noric Dilanchian

Ndarala Group member Dilanchian Lawyers & Consultants (Sydney) continues to set the web standard both for the Group and its members and, more broadly, for all professional services firms.

In this context, I noticed a useful post on the Dilanchian blog on proposal writing that is likely to be of interest to all those who have to write proposals. I like the way that Noric has added a further reading section at the end of the post.

On Financial Metrics - professional services

Note to Readers: This post first appeared on our Managing the Professional Services Firm blog back on 19 July 2006. We are repeating it here because it provides a simple introduction to some of the key financial metrics relevant to consulting.

In discussions with some of my colleagues on time, time keeping and performance measurement, I found a degree of confusion about some of the terms I used in discussion. For that reason, I thought that it might be helpful to a broader audience if I provided some simple definitions.

Gross Fees

Gross fees simply describes the total value of work we have or will bill the client.

Disbursements

Disbursements are simply the cash-out costs directly involved in doing the job.These may be very small, bus or taxi fares, phone costs. However, in some consulting work they can be very substantial, especially where subcontractors are used.

Net Fees

Net fees, the amount we actually get for the job, equals gross fees minus disbursements. This is our real income.

Work in Progress

Work in progress or WIP represents work done but not yet billed. It includes disbursements where these are to be charged to the client.

Billings

The term billings simply describes the value of work actually billed to the client. These billings will include disbursements if these are to be recovered from the client.

Write Ups, Write Downs

Actual billings need not equal WIP. When we come to bill, we may find that we cannot bill the client for all the time involved. In this case, we have to write WIP down. In other cases, we may be able to bill more than the time directly involved. In these cases WIP is written up.

As an aside, write downs are not necessarily bad, write ups not necessarily good. A firm without WIP write downs may be undercharging, a firm with write ups over charging. It depends upon the circumstances.

Prepayments

Clients may pay us in advance for part of the work.In some cases, law is an example, these may be placed in a trust account and excluded from firm accounts until the funds are drawn down upon billing. In consulting, advance payments may be made upon contract start or on meeting certain milestones to help fund the job. In these cases, the prepayment is formally a liability in an accounting sense, diminishing as work is done and WIP created.

Financial Flows

These simply definitions provide the basic financial structure for the standard professional services firm.

As we do the work we create WIP. As our future billings, WIP is a key asset of the firm.WIP minus any write downs plus any write ups then translates into billings as we bill the client. So in balance sheet terms the WIP asset has been replaced by accounts receivable. Then as the client pays, accounts receivable become cash.

Management Issues

All this is pretty simple stuff. However, it does raise some important management issues.

To begin with, the fastest possible translation from WIP creation through to cash receipt is obviously very important and provides a first point of focus. Many firms focus on parts of the process only, usually billings to collection, whereas the whole process needs to be understood.

Secondly, disbursements need to be properly understood and managed especially where these constitute a significant part of gross fees. This is very important for independent consultants leading collective bids.

Thirdly, WIP itself needs to be properly understood and managed. In my view, this is one of the most common areas of failure within professional services.

As a first example, take the standard Government fixed price contract with payments against milestones. Failure to identify and manage WIP in this type of contract quickly leads to over-working at points along the job path, resulting in reduced hourly yields.

As a second example, firms who focus on billings sometimes ignore changes in WIP. They do so at their peril. A billings focus may help get WIP to billings, but this may conceal the fact that the firm's real position is deteriorating because increased billings come from reduced WIP. For that reason, performance statistics need to incorporate both billings and WIP measures.

WIP information is also important for multi-service firms working in different marketplaces.

Even in a single professional field like law, there are considerable variations between customer types and fields of law in areas like pricing, the pattern of WIP creation, write ups, write offs and billings. These need to be understood and accommodated.

Contracting Woes 1 - Introduction

This is a short post to introduce a new series of posts.

The relationships between contracting and consulting is a vexed issue for many independent professionals, including many Ndarala members.

The downsizing that has taken place in waves since the seventies has in turn released waves of professionals and managers onto the market, many of who have then looked at contracting as a way of earning income pending acquisition of new jobs, in some cases as a new career option. Because the economics of contracting and consulting are different, these waves of new contractors have had an adverse impact on the consulting marketplace.

More recently, firms have moved to outsourcing and to flexible working arrangements including greater use of contractors. This, or so it is argued, has expanded the contracting marketplace. In fact, this is only partially true.

The importance of contracting to Ndarala members means that there has been a fair bit of analysis in the Group about contracting from the viewpoint of contractor, consultant and customer. We thought that it might be of interest to a broader audience if we reported on some of that analysis.

To make the material more reader friendly, we are going to use this post as a main entry point, progressively adding new posts at the end as they are completed.

We welcome feedback telling us your experiences.

Project Management for Professionals - Completing the Plan

Note to Reader: this post completes the current series of notes on project management for professionals. A list of previous posts can be found at the end of this post.

We now come to the last stage in the project management cycle, completing the plan.

The first goal in this stage is to obtain client acceptance of the project result. This means that the client agrees that the quality specifications of the project parameters have been met. This part of plan completion overlaps with and is also an integral element of plan implementation.

The second goal is to ensure that we record and gain from the lessons arising from the project.

Given these goals, key steps in plan completion include:

a. Making certain that the client is happy throughout the project with regular feedback

b. Checking each project output before delivery to ensure that it meets specification.

c. Making sure that the client is satisfied with performance at each milestone and with each deliverable. If the client is dissatisfied, then the reasons for this must be clearly established. In this context, it is important to distinguish between:

(i) Client dissatisfaction relating to the original specification, ie, it may not in fact meet the need it was expected to meet. This can arise at any stage in the project. Resolution of this issue may require project modification.

(ii) Client dissatisfaction relating to our performance against specification. In this case we need to be very clear on the grounds of dissatisfaction to ensure that we can take the appropriate corrective action

So long as steps a) through c) have been carried out, final client sign-off should be a formality.

d. Ensuring that we thank everybody who has been involved in the project.

e. Carrying out a full project review to identify and capture lessons.

The process to be followed here is summarised below.

Objectives

The objectives of the debrief should be to:

1.Identify any deficiencies in performance from our viewpoint or that of the client and suggest ways of overcoming them in future.

2. Identify those features in performance which were particularly good to see what lessons they might hold for our work in general.

3. Identify any other general lessons from the project which might be of broader application to our work, including intellectual property and any spin-offs.

4. Specify resulting action items.

No Fault Debriefs

All debriefs should be carried out on no-fault basis. We should be concerned with deficiencies in our collective work, not those relating to individual performance. Any problems here should in fact have been identified and dealt with.

Debrief Process

Consistent with the debrief objectives, each debrief should among other things:

1. Review performance against budget and time lines.

2. Look at the level of client satisfaction with the result, together with any client suggestions for improvement.

3. Examine project management and production issues to identify any areas where we could have improved performance.

4..Identify any broader issues requiring modifications to policy and procedures.

5. Discuss possible spin-offs.

Prior the debrief the project manager should collect any necessary information and identify any obvious issues for discussion. Following the debrief, the project manager should write up the results, with copies to the project and debriefing files.

Previous Posts in this Series

• Project Management for Professionals - Introduction
• Project Management for Professionals - What is a Project?
• Project Management for Professionals - Conceiving and Defining the Project
• Project Management for Professionals - Planning the Project
• Project Management for Professionals - Implementation

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.

Towards a Discipline of Practice - the Ndarala challenge

We have begun a series of posts on our Managing the Professional Services Firm blog discussing issues associated with the development of a discipline of practice, essentially how we do what we do as professionals.

Our experiences in trying to make our own collective work across disciplines and geographic space are one of the drivers behind the series. For that reason, I thought that I should share some of the Ndarala experience with you.

Ndarala Overview

Ndarala is a funny animal.

We bring together professionals and professional practices from a range of different management related professions - law, a range of management consulting disciplines, training, education, engineering, IT. While most members are in professional practice, we also have members who are employed in management or professional roles in a range of organisations.

Our members are widely spread in geographic terms, creating issues for communication and cooperation. Voluntary participation is central to our operations, meaning that we cannot compel people to do things, to follow particular approaches, in the way a conventional organisation can.

Our professional spread means that we can see at first hand the profound and sometimes subtle differences between professions. Each profession has its its own field of knowledge, its own language, its own culture instilled during early education and training. All these combine to create barriers between and sometimes even within professions even when dealing with common problems.

Multimedia Project Management Example

A simple example to illustrate the point.

Back in 1995 several of us were involved in cooperative activities intended to facilitate the development of a multimedia industry in Australia. This was then an emerging industry spanning sectors and technologies. As part of the industry development side, we decided to organise a seminar on project management since our experience in the IT and communications arena suggested that enhanced skills here were critical to success in an emerging project based sector.

Because multimedia spanned technologies and sectors, we decided that the best format for the seminar was to bring together a number of speakers from different areas to talk about their own experience with project management. So we had speakers from IBM, an independent film production company, an events management company, a consulting company and a law practice.

The seminar was a great success measured by audience response, but it almost failed as it became clear just how different were both the terms and apparent approaches used for what was, after all, a common task, the management of a project. This required us to change track in mid seminar, spending time using multiple white boards to compare and contrast different approaches. As we did so, the similarities became clear. Further, and this was perhaps the greatest benefit from an attendee perspective, our different speakers were drawn into a comparative discussion on approach.

Drawing from this experience, when we came to set up Ndarala the following year (1996) as a network connecting independent management related professionals, we decided to try to build common practice techniques including a focus on project management as a core approach. In doing so, we ran into a series of new problems.

Problems in Inter-professional Cooperation - Profession determines Answer

The first of the new problems was the way in which professional background dictated answers.

Take an HR problem as an example: ask a lawyer and you will get a legal answer; ask an HR professional and you will get an answer set within the bounds of the HR profession; ask a professional manager and you will get a different answer again. Same problem, different solutions.

The extent of this problem was initially unclear to us, simply because it tended to be unimportant for practical day to day purposes. However, it started to become very important when we began looking at cooperative service development and marketing across professional divides.

Take a simple thing like a position statement where some of our legal, HR and management professionals were already providing templates to clients. When we came to look at these, we found that they were as different as chalk and cheese. Part of these differences lay in the differing knowledge domains of the different professionals. But part also drew from the different philosophical biases of the professions themselves.

This is a slippery concept, so let me try to explain. Risk avoidance is important to lawyers. They look for what might go wrong in legal terms, how to prevent this. HR professionals, by contrast, are more concerned with people issues, with control, with ensuring compliance, with firm wide procedures. Management professionals just want to get their job done and are impatient with anything that threatens this. Again, same problem, different answer.

This issue - the impact of different world views among professions - has been discussed at some length on the Managing the Professional Services Firm blog. We found that it affected our attempts to introduce common techniques such as project management by affecting the way those techniques were learned and applied in practice.

Problems in Inter-professional Cooperation - Cooperation is a Skill

We tried to overcome this problem by making more information available and by networking our people from different professions through special interest groups focused on common vertical interests. Here we struck two further linked problems.

Problem one is that we found that inter-disciplinary cooperation is in fact a skill. That is, it can only be learned through practice. We tried to accommodate this through seminars linked to our professional development program with a special focus on case studies. This was reasonably effective, but suffered from the second linked problem, that of time.

Professionals are time poor. This is especially true for independents because they do not have the back-up that can be available in bigger firms. Most time poor professionals simply could not afford the time required to do the type of thing that we were asking of them.

Problems in Inter-Professional Cooperation - a Growing Knowledge Gap

We also found that our difficulties were being accentuated by the growing knowledge gap between those members who were participating in inter-disciplinary cooperation and information exchange - the Group's leading edge - and our less active professionals.

Those who were participating began to develop a new knowledge base and associated language, one that was not shared by our less active professionals, so we had a gap opening up within the Group itself. It took us a while to really realise this, simply because those who were most active communicated more with each other and tended to assume that others also understood.

We are still working this one through.

At a practical level, we simply have to accept the reality of the gap. Again at a practical level, the gap normally does not matter in a day to day sense, since our people can access the newer knowledge as they need it through direct contact with other professionals.

Beyond this, we have been experimenting with different ways of presenting and communicating knowledge to try to make it more accessible. This includes the use of blogs to make material available to both our people and a broader audience.

The Power of Inter-professional Cooperation

In the midst of all this, we have been able to establish the power of inter-professional cooperation. The case study featured on this blog in December on the development of ophthalmic competencies is an example.

Identification of the potential role of competencies in meeting the needs of the Royal Australian (now Australian and New Zealand) College of Ophthalmologists came about because of the combination of our people's management knowledge with work previously done by Ndarala's training professionals in the competency arena. So we have two specialist knowledge domains in combination, one identifying the need, the second the possible solution.

The approach adopted to meeting the need involved the combination of knowledge about competencies to set a framework with the use of facilitation techniques to assist busy specialists to articulate the required information. Again, two knowledge domains.

Dario Tomat, the Group professional providing the facilitation, is an engineer who also has specialist training knowledge. The first was important in both understanding and gaining the trust of the doctors who saw Dario as a fellow professional, the second in structuring and writing up the outcomes.

All this contributed to the success of the project. Then, once completed it was written up as a case study (Group role) and then used as an example to provide a base for further discussion.

Back to a Discipline of Practice

Our work demonstrates both the value of inter-disciplinary work and the problems involved in bringing it about. This experience explains why, as a Group, we are such strong advocates for the development of a discipline of practice, one that can reach back into professional training itself.

Creation and Use of Case Studies

Case studies can be a valuable tool for consolidating and re-presenting experience gained in new ways and to new audiences.

In December we completed a guide to the creation and use of case studies on the managing the professional services firm blog. The relevant posts are:

• Creation and Use of Case Studies - Introduction
• Creation and Use of Case Studies - Training 1
• Creation and Use of Case Studies - Training 2