91Èȱ¬

Bleeding-edge political thinking by the Tories. Parker will use his automatic cr*p detector to clean out the stables and get rid of the jobsworths. Also, it is nice to see a productive use of private equity skills.

When 91Èȱ¬ news 24 carried the announcement of this appointment they also said the he was not going to be paid.

Perhaps all Tory politicians and political appointees should also waive their salaries for the benefit of the public good? This act would undoubtedly enhance their public standing.

Re: "Cleaning out the stables"

He will be busy with his shovel for many months to come. Only then will we see what he has to offer the capital.

Hopefully someone who actually understands how business works and how to motivate staff will be just what we need. We've had far too much left-leaning mumbo-jumbo that only works in Wonderland.

What we need is someone who can truly understand that you need good people to do a good job (and that means making sure the good people are kept motivated), but that at the same time you need to weed out the shirkers and the slackers, and the management jobsworths who can spend hours justifying why nothing can be done yet struggle to actually accomplish anything worthwhile.

Let's hope Bob Crow shows himself to be truly interested in getting London moving rather than scoring political points when a layabout gets laid off. Somehow I doubt that's going to happen.

Dear Robert
Not only London is up for grabs, have you noticed just how many British companies are now owned by Foreigners, and how much money is LEAVING the country in Profits for abroad. I'll Put Hypothosis to you, that Britain is being Milked dry, and will soon be the poor man of Europe, and is the ONLY country applying and introducing regulations from the EU, as they are issued, "where is this so called opt out Brown thinks he's won"? not much indication that these so called socialists are working for Britain, and thats Pretty obvious by the latest by - election results, BRITAIN is being sold down the drain by an incompetant socialist agenda, inextricably linked to the EUOPEAN PARLIAMENT.
"HRH"---- will be side lined by 2015. another UK PLC r.i.p.

Why do we keep having the personality of these public officers pushed in our faces?

I don't care who runs London so long as they do a good job in providing clearly perceiveable added value.

Given the way the public authorities have swallowed most of the cash in the country over the last fifty years it is about time the matter was given a fresh look by new faces.

The jury will remain out on whether or not this is a good appointment as with all these things the proof of the pudding is in the eating.

If this appointment is successful then we can all feel content that the shabby croneyism that so sullied both New Labour and their predecessors is now past. I think this is the biggest test of all.

Best intentions on Boris's part, but what is the flip side? It's probably too early to tell, but the first will be a slimming down of the GLA. So long as he DOES sort out the rubbish, and works a way of sustainable garbage disposal, we'll be able to live in a healthier city. Maybe he can get onto Camden Council and ask why on earth I can recycle a bottle with the one triangle, but not a lid with a one trinagle, and not even a salad container with the one triangle.

But really, a bit of prudence, and careful management is just what London needs. Plus an independant ONS.

I still ask another, unrealted question: why no reprts on the fair trade conference in Cairo. Is it just me, or is the 91Èȱ¬ missing an important world development: small men saying no to structural redevelopment, and forming trusts where they can direct development as they see fit. There will always be corruption somewhere along the line, but it's bettter if its a local man who is accountable.

That's my diatribe today.

Firstly let me say I enjoy reading Preston's Picks and your latest article"private equity buys London" makes interesting reading. So keep on reporting and ignore some of the less than generous comments about your style etc.

It will be interesting to see how well Tim Parker is able to adapt his private equity skills to meet the challenges of the much more enforceable accounting systems and rigid managements procedures that exist or are in operation in the public services sector.

Will "Tim and Boris" for instance decide that what London needs is to replace some of the more traditional bureaucrats and their departments with slick private enterprise bodies (or Quangos) to ensure those services become more effective and cost efficient. In that case what will happen to all those existing people and departments and would it really be feasible.

If people such as Tim Parker are as good as they claim or appear to be, why are they terrified of becoming national figures of loathing and contempt simpley because they have made their fortunes by loading up substantial companies with huge debts (without any risk to themselves) that could sink those companies.

None the less I wish him and Boris well and it will be interesting to see if this becomes a test model for future Conservative thinking.

Reading some of the other comments points up the schizophrenia in most of us. It's great, say several posters, to at last have someone who understands business and will strive for value and efficiency. Yet what is the current round of post office closures - fiercely resisted by Conservatives (and others): exactly what a private equity owner of the PO would do - analyse the branch network and cut out all the underperformers. And when this is proposed, we - many anyway - suddenly lose our thirst for hard-headed efficiency.

this was a dull afternoon until i read salomanbrown's (no 5) post. what total and utter tosh, but hilarious nonetheless!

this private sector knows best thing is tripe too. good quality management in any sector is what is important in motivating, enthusing and valuing employees. the latter of course have to bring something to the table including diligence, flexibility and maybe a lack of cynicism and then maybe the job can get done efficiently.

I suppose current and former AA employees will have quite strong opinions of this chap but lets wait and see what he tries do achieve before judging.

Hmm .. so he's good at making money for himself and his pals .. how? easy! .. by cutting jobs and conditions for the workers .. more concentration of wealth into the hands of the few. oh well ..

It's a noble principle (NOT!) which I am sure he can apply to the people of London

I contribuuted to this blo. Where is my comment? Why was it rejected?

As adlibber found (No 12), I also contributed to this blog (this morning) but it is nowhere to be seen. Where is my comment? Why was it rejected? Why was no reason given or email sent?

Are we highlighting a problem here, or part of THE problem? Looks like I'll just have to move on, to where the real news is...

I bet you won't post this one! Or will you?
No house rules have been broken... so rules say it should get posted...

As adlibber found (No 12), I also contributed to this blog (this morning) but it is nowhere to be seen. Where is my comment? Why was it rejected? Why was no reason given or email sent?

Are we highlighting a problem here, or part of THE problem? Looks like I'll just have to move on, to where the real news is...

I bet you won't post this one! Or will you?
No house rules have been broken... so rules say it should get posted...

2nd time sent - just in case you didn't get the first (note - we do not get told whether a posting has been successfully sent or not)!! How much wasted time/effort is your "system" creating?

The system now appears to be working! Here is my original contribution sent again...

Good outcomes are not created by throwing more money at problems, but by introducing effective management systems that systematically remove problems.

Lean Management Systems, such as those used by successful companies like Tesco and Toyota, focus on providing customers exactly what they want, when they want, how they want...and in a very effective way!

Contrary to popular belief, and as pointed out at the CBI 2007 Annual Conference (where Tim Parker was one of the presenters), Private Equity firms predominantly focus on creating long-term value, prosperity and growth (400%+ more), and in the process create far better outcomes for everyone (including customers and staff). This can't be achieved through simple financial engineering, but by listening effectively to customers and introducing better management systems (like those used by Tesco and Toyota). It is worth noting that whilst there is still much more to do, companies such as Toyota and Tesco develop and recruit far more people than anyone else in their sector (e.g. GM, Sainsbury's), and leading Private Equity firms are also using lean management systems to develop their people, create more value and to grow enterprises too.

Contrary to popular belief (and when applied in the right way!) "Lean is not Mean", but creates far more "Value, Prosperity and Growth" than any other approach.

The "DNA behind Successful Outcomes" is out there ... and this move marks a significant shift in the landscape of Government ... one which both citizens and employees should be the beneficiaries of (not the victims) if the overall management system is adapted effectively.

David Clift
Author: "LEAN WORLD: The DNA of Success and the Path to Prosperity".
Member of the CBI East of England Regional Council.

Thank you leanworld for noticing. I sent my original post twice. It also broke no rules. Result? Nothing - no email or information of any sort.

Hi adlibber - no problem! I can only assume the originals must have got "lost in the ether" - not that we can tell for sure. it might be worth re-typing/sending your original comments in again, if you haven't given up now that is. Best of luck, Lean World

Who are you? A consumer or a human being? A return on funds employed that needs to be bought out using scam debt that will collapse the global financial system or someone to be outsourced to China because it makes more money for a select few who pay less tax than the cleaner.
What is the economy - something to serve the humans or something we sacrifice to and serve.

I don't know this guy and I hope for your sake in London he doesn't fit this profile.

Sometimes one has to look beyond the media headlines to understand what's actually going on around the world ... actually headlines very rarely present a great deal of fact/reality ... and good news or better ways of doing things rarely make the news either (that's left to the other 20th century distraction - called the 'celebrity culture').

To allay any concern you may have, 21st century Lean strategies improve individual well-being (e.g. reduce stress and staff overburden), improve local communities (create more jobs and support the local communities they serve) and are at the forefront of creating a more sustainable environment too (eg. it's not an accident that Toyota is at the forefront of the hybrid car revolution). Leaders/Managers help front line staff to expose problems, remove problems and systematically eliminate the barriers to create more/additional value for their customers.

However, not all private equity backed firms apply lean practices (and/or properly), hence we need to watch very carefully. Those that do however, thrive and grow, for the benefit of everyone (and not just the leaders in the private equity firms themselves). 1 in 8 people in the UK now work in a private equity backed firm, and on average they tend to recruit far more people in the UK than their equivalent counterparts in their sector. The success and long term focus of private equity backed firms to create more value (cf the more short term focus of many stock market listed companies) has also attracted a great deal of public/private pension money too (as they are long term, more predictable and less of a gamble) - so like it or not, virtually all of our pensions are heavily reliant on the continued success of private equity backed firms too.

Leading private equity firms are at a loss as to why more traditional enterprises aren't applying lean management practices as a matter of course (this was raised by them at the CBI Annual Conference), albeit it did understand the constraints placed on many of their leaders (e.g. stock market listed companies to report quarterly) to hit short-term targets, and the short-term decision making created by groups such as highly speculative funds that driving stocks turns in much less than a year (the opposite of Private Equity backed firms, whose shares are held for around 5 years, in order to develop and grow their value, free from many of the traditional constraints).

Think about London be run for the long-term benefit of all Londoners, free from short-term meddling/constraints, and in the most effective way possible, and that should more closely explain what we should hopefully see (so long as they have chosen wisely). Please be assured that if London were about to be run by a short-term speculative fund manager, used to gambling/profiteering on short term movement of stocks, I would be extremely concerned too and would have said so as well.

Leanworld, I've been on the very nasty receiving end of Cohen, Moulton and Apax. I have a business studies MSc and nothing I saw convinced me Venture capitalism operates efficiently at all, quite the reverse. In our case it merely transferred money from the taxpayer to Apax, destroyed a once excellent business and ruined hundreds of innocent peoples' hope of a happy retirement. I'm offering to run your pension scheme free of charge for the next 3 years just to show you how it’s done.
You just demerge the company retaining a good cash generator in the half destined for receivership. It needs to survive 3 years to avoid a DTI enquiry so 6 months before then, sell the cash generator to the sibling company by installments. Stop selling goods so that the future MBO has a really good stockpile to buy from the receiver, (pity Arthur Andersen’s are no longer available). Then transfer pension liability 2 weeks before receipt of the last installment triggers administration. The only other costs are political donations to the party in power. Should net a few million so when can I start?

Robert, could you ask Ronnie why this technique wasn't included in his book? I'm desperate to hear his side of the story and how what he did differs from fraud. Unfortunately he turned down a meeting pensions expert Dr Ros Altmann had arranged with myself and colleagues. Even now, all he needs to do is return the money owing to the scheme when it collapsed. The DWP takes cheques and no questions would be asked. Until than can he seriously be wonder why he is so despised by honest respectable people?

Re #9 TonyRuT:

Reading some of the other comments points up the schizophrenia in most of us. It's great, say several posters, to at last have someone who understands business and will strive for value and efficiency. Yet what is the current round of post office closures - fiercely resisted by Conservatives (and others): exactly what a private equity owner of the PO would do - analyse the branch network and cut out all the underperformers. And when this is proposed, we - many anyway - suddenly lose our thirst for hard-headed efficiency.

The answer to your apparent conundrum is simple: not all organisations should need to be profitable. In addition to the Post Office network, I would suggest other contenders for such an exemption: the NHS, the national rail network, the national train service, the armed forces, the emergency services, the mail service, the prison service, etc. etc.

I fully agree with answer given to the apparent conundrum offered above (No 21), and the examples provided.

Choice is often promoted as THE best way to make things more effective. However, choice is not a necessary pre-requisite for effective management, though it can sometimes help.

Enterprises leaders should be listening, learning and improving the way things work all of the time, and supporting their staff to do so too; thereby systematically removing the barriers front-line staff face to creating value for others.

Sometimes enterprises do not do this well, for a variety of reasons. This is where choice can help, as it removes the ability for one enterprise to stifle progress and stop more effective services from being provided (and not necessarily for profit either!).

It is important to get the best possible leaders (with the right qualities) in place, rather than simply rely on competition. Competition in some areas can force prices up and efficiency down (e.g. 10 people having to go down the same street to post first-class mail, instead on 1) and this type of result should be avoided wherever possible.

David Clift

jrpg123 - Thanks for the reply (point 20). I am sorry to hear about your experience. As I mentioned, not all Private Equity/Venture Capital groups are applying lean management (or in the right way!). It is worthy of note that one outcome of the current 'credit crunch' is those that who are not at the moment, are actually starting to listen/learn how to do things better, so it should not be too long before better practice spreads across the whole. The challenge for the public and private sector is to do a similar thing, and the changes highlighted in this blog could well become a catalyst for change across the whole of the UK. Let's hope they do it in the right way, and help them out if they are not! For instance, I am already helping to create Lean MBA programmes as we speak.

David Clift
Lean World

Test Only

David, thanks for your comments(post 23). One of the greatest concerns that I have is that Apax, the venture capitalist involved, portray themselves as decent respectable people and Sir Ronald Cohen, the founder claims to be the father of British venture capitalism.

Our mission is to help management teams create value for the benefit of the company, its employees, and ultimately the millions of individuals whose pension funds and investment plans commit to our funds. We provide this service with the utmost integrity and professionalism.

Perhaps Cohen –who learnt English at school has a different understanding of these words.
What is quite extraordinary is that, BUSM, a once magnificent British company, the largest in Leicester in the 1960’s and a double Queens award winner in the 1990’s seems to have been simply used as a vehicle for destroying its sibling’s liability for UK, US and German employee benefits. A far better plan was already available.

The company, founded 1899, manufactured shoe machinery. It had 60% of the world market and exported 90% of its products. When it fell into Apax hands in 1995, after a failed floatation, there was no question it needed restructuring. However arguably the UK’s finest engineering brains were already designing new machines to sell at the margins needed to restore profitability. This work, absolutely essential to the long term survival of any engineering company was promptly stopped.

Two billion of the world’s six billion people still don’t have shoes. Your shoes, Robert’s and Cohen’s are almost certainly made by BUSM manufactured machines which unfortunately always were far too well built! The world market was still potentially enormous and yet Cohen destroyed debts -other people’s assets. Had he chosen to create wealth he would have been applauded by everyone.

Nor is this story unique. According to the GMB, other insolvencies owned by venture capitalists accounted for more than half the money required to bail out pension schemes, around £2B. This isn’t wealth created and I’m at a loss to see how this benefited UK PLC or how people can be expected to trust venture capitalists.