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zero hours contracts

We have been really bemused in the SWL Office this week as our politicians find a burning (?) issue to push back into public awareness, and as ever this issue gains momentum as it is liberally sprinkled with spin and hyperbole

Let’s start with Iain Duncan Smith in the Guardian Friday 17 April 2015 – apparently the “Solution to [negative perception of] zero hours contracts is to rebrand them as flexible-hours contracts”

This really isn’t helpful to any Business Iain.

The solution to the negative perception of zero hours contracts is to understand what they are and why they can be good for business and can be good for colleagues
As every Retail and Hospitality business knows a flexible hours contract is just that – Colleagues will be certain to be paid a guaranteed minimum of say 16 hours (and not pay any NI) but could be offered more hours in line with Customer Service needs
Also as every Retail and Hospitality business knows a zero hours hours contract is just that – Colleagues will be not be paid any guaranteed minimum, but will be offered some hours in line with Customer Service needs, which they may or may not accept
In reality Zero hours Contracts are just the latest manifestation of “Casual Working” – both sides happy to engage with no future commitment

So what’s the problem?

It’s all about the Political Spin around Zero hours Contracts

  • In 2012 The Guardian named “the seven private sector companies exposed as zero-hour employers”
  • This week Chuka Umanna (Shadow Business Secretary) said IDS was “trying to dress up insecurity as flexibility”
  • Then as a calming influence Ed Miliband used “epidemic” and “exploitative” to describe Zero hours Contracts

We wondered what is the size of this epidemic?
Office of National Statistics in March 2014 says only around 8% of all employers use these contracts, and that UK has 583K workers on Zero hours Contracts which is around 4% of the workforce.
Of course a lot of workers on Zero Hours are some of the 2.5M Students in UK (who incidentally aren’t complaining at all) The Times Higher Education survey in Jan 2014 indicated 14% students have FT jobs and 57% Students are working part time. Interestingly the students motivation was mixed – for subsistence, for leisure and also “to show a work ethic for future employers”…hardly “exploited”
The most useful recent comments came from Helen Dickinson, director general of BRC: “The key issue for zero-hours contracts is that where they are used, they are used responsibly”.

Delivering Better Customer Service is what every Business and every Consumer wants. It needs a foundation of correct forecast of Customer numbers and correct HR contracts so that work planning can be individually tailored to serve Customers at every location in a B2C business.
To efficiently deliver Customer Service Businesses need to use a mix of every contract available to access the whole of the workforce.

what an idea...

It feels there is nothing like emerging from a good dose of Austerity to make Senior Management really look at how the business is being run and ask some much harder questions.
It’s not so long ago that HR Directors were the least powerful in the Boardroom and the Training Budget was always written in pencil to allow for reductions prior to it being unceremoniously eliminated for yet another year
In 2010 McKinseys Worldwide Executive Survey (1400 CEOs/Senior Executives) was finding Organisations highly resistant to change and not looking at Opportunities which could be accessed by filling a Capability Gap
Not so in 2015!
The latest McKinseys Worldwide survey sees a completely different attitude. From 2014 CEOs have been increasingly focussing on Metrics of Training and looking for Business Impact, and in 2015 many CEOs feel they have the correct metrics in place to firstly align Training with Business Opportunities and then truly see the impact of Training in realising those Opportunities
When we look at UK originated research we see the same picture. The Chartered institute of Personnel and Development’s (CIPD) qualitative case study research found that the organisations have been successfully implementing new initiatives and processes to measure & enhance the impact of Learning & Development (L&D aka Training!)

The CIPD survey was really very broad in its approach, and so it is amazing that this CIPD work has a produced such a conclusive consensus in its findings.

From Barnardo’s Children’s charity in UK, Mattel in US, Ministry of Defence and Southampton NHS Foundation Trust in UK, PwC and Macdonalds worldwide the message is all the same – Training/L&D is being properly funded and supported by major organisations because the Training is aligned with Organisation’s needs and its impact can be measured in Qualitative and Quantitative ways – this is really excellent progress!

This change is well characterised by the Macdonalds approach where the management focus has shifted “from training delivery to performance consultancy with the introduction of a new development programme designed to build performance consulting skills across the business”

Landing Beneficial Change is not for the faint of heart. It demands a true understanding of the AS IS level of performance in both Quantitative and Qualitative terms, including putting the Customer’s aspirations “centre stage” Then it needs empirically based calculations of the TO BE Impact of Change, and finally a measurement of the NEW AS IS , again fully engaging with Customers and Stakeholders
Using SWL’s Productivity Methodology and CCESWL guarantees to deliver you the full value of your Training investment not only Financially, but most importantly in the eyes of your Customers

uber 2015 & thomson 1980's


Bravery & Customer Certainty has always been characteristics of real business innovators, and never more so than when you are an incumbent in a high volume Consumer market.

You might be thinking that the link between 1986 Thomson (now TUI) and 2015 Uber is tenuous… but in fact it is not as big a stretch as it looks
McKinseys were commenting last week about how difficult it is for incumbents to truly innovate in a digital world, compared to new entrants.
Amongst others they cited Uber and Zipcar in transport and Airbnb in Hotels as new entrants who have revolutionised their markets.

As a new entrant Uber are supremely confident in the behaviour of their target market. They know that they can get drivers who will enjoy more pay for less hours worked, they have already recruited 50K drivers in UK (BBC stats), so they have their supply.
As for demand, well the Uber customer wants to use their phone app to seamlessly buy transport, and so they welcome Uber into each new market.
For the acid test just look at Austin, Texas – Uber launches, Taxi owners protest, City Officials support Taxi owners, Consumers rebel in large numbers, City officials back down, Consumers are happy, Uber is established in a new market. Customer Certainty QED

It is all about a DNA level understanding of what your Customer really wants:
As McKinseys point out it is hard for Incumbent businesses to pre-empt or to fight back, but not impossible, after all they have scale, funding and existing Customers.

McKinseys point to incumbents in Banking & Healthcare who are forcing innovation by embracing the use of their Big Data, using Mobile Internet, and most importantly properly engaging with their Customers to exceed their increasingly higher expectations.

This is where Thomson signposted the way for incumbents nearly 30 years ago
Wind back to 1980s when there was no internet as we know it, POS was called EPOS (E for Electronic!) and Travel was the first business to truly use computing to sell its products. Of course we were still a long way from Consumers making their own bookings, but the 6500 UK Travel Agents did use a mix of traditional and new methods to get their share of the 10M+ holidays sold in the UK each year.

The mix was simple – In the mid 1980s Tour Operators paid for 100M+ Brochures which were distributed through Travel Agents to excite customers, the Customers went into Travel Agents shops and the Travel Agents called Tour Operators Phone Reservation Centres to make their Customers bookings from Tour Operators. As an alternative the Travel Agents could make the booking using NEW online “Viewdata”.

Thomson knew their 4M+ customers intimately and had the highest loyalty in the industry. They invested heavily in Design of their Viewdata system and Training of Travel Agents own staff, then when the online Viewdata technology platform became reliable they decided to take a bold move – to dispense with their Reservations centre (around 500 FT staff) and only accept online Viewdata bookings. Thomson had Customer Certainty – they knew that their Brand & Customers would force the Travel Agents to book through the technology platform.

This move was viewed as very risky in a business where margins were wafer thin, but Thomson Brand was strong, Customers prevailed and Thomson were still market leaders when Tui bought the company in 2000.

Safely Delivering and beneficially Landing Innovation is a “Customer Back” process.
At its heart is Customer Certainty – a foundation of intimate DNA level Customer Understanding which is continuously maintained – a knowledge base which is incremented on a daily basis and acted upon by a responsive organisation.

Using SWL’s CCE – SWL’s Continuous Customer Engagement approach guarantees to deliver you this knowledge , whether you are an Incumbent Market Leader or a New Entrant with a Big Idea.