Friday, 12 March 2010
The trouble with Innovation – Part 3
In this part of our discussion regarding Innovation, we want to turn the focus to the UK market place and some unsung heroes, some tirelessly working in the trenches, others ‘fishing in the ocean of opportunity’ at the moment, not being ‘on assignment’.
We are referring to Independent Consultants and Senior Interim Managers. How exactly they fit into the innovation debate will hopefully become clearer very soon.
And the main issues and theme we need to explore is that of Trust.
Part of the challenge most Independent Consultants and Interim Managers find themselves facing is the fact that engaging assignments and workflows don’t always flow or fit together. The challenge is that when on assignment, they are not feeding or seeding the pipeline enough for when the current assignment ends and when the assignment has ended, their next role or project might be weeks of months away from coming to fruition.
There is in effect no clear matching of supply and demand in the market place, as most assignments and engagements are won on relationships and not pure experience, skills and competencies.
That is particularly true if you ‘swim down the narrow channel’, by this we mean only follow one strategy in procuring your next assignment; which generally means you speak mostly to Executive Search or other Recruitment Consultancies.
It is in this area that we feel very little positive innovation and engagement has occurred over the last few years.
Now we acknowledge that the internet has potentially speeded up and shortened the entire recruitment cycle significantly, however, is this innovation or just advancement?
Our assertion is that the internet was pure advancement, not innovation in this sector.
It is furthermore our belief that most searches and matches occur on a pure issue of timing and serendipity alone. There is no effective clearing house to match skills to needs in a way that clears the market effectively and efficiently. For this we evidence a report commission by ExecutivesOnline in September 2009 (see ExecutivesOnline Interim Management Trend Update) in which it was found that 48% of Interim Managers where ‘Not on Assignment’ as of September 2009, the euphemistic phrase for being out of work. If there were such a ‘clearing house’ the unemployment rate amongst Interim Managers and Independent Consultants would have been markedly lower, but probably higher than the national Unemployment rate, due to a variety of other socio-economic factors, including luxury factors such as choice, to mention but one.
Sustainability and risk management and more specifically innovation in these two critical business management areas are what we desperately lack at this key juncture in our economic cycle. We will address these two themes in further in future articles.
To conclude our assertions made in part 3 of our exploration on the trouble with innovation is that now there should be an opportunity created to more effectively match supply and demand in the labour market. However, there is a fundamental disconnect between public sector and private sector and permanent and temporary work. This statement is a blatant generalisation, however public sector and permanent employment does not conform to pure market driven principles, where tenure is protected, to some extent, from external market forces. On the contrary many an independent consultant has had to contend with the shock of a new equilibrium and have realised that to ‘stay in the game’ they have had to adjust their prices downward, sliding back down the supply curve, in order to try and find the intersection with the demand curve. On oversupply of consulting and interim management talent has ensured that the market clearing price for services have been adjusted markedly lower, than was the case before the credit quake of 2008 – 2009.
So what we are looking for is innovative new business models that will ensure the exploration of a new and sustained equilibrium and market for talent and talent matching in the future.