Public & Private Sector Business Models
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Neil Farnworth, Enrich Training and Consultancy at Paritor's Music Education: Management and Innovation Conference 2011. About the conference: This is a national conference and will focus on the relationship between new business practices and a future vision of music education management. It will take place over one day and bring together prominent leaders in both the field of music education and business in order to provide a comprehensive overview of this rapidly evolving area. The role of music education is changing with funding uncertain and the added opportunity of becoming the core of the music hub it is time to be equipped for the future. The aim of the conference is to present music educators with the modern and innovative practices as well as a structure for management assisting them in their quest to future proof!
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Public & Private Sector Business Models
- 2. Neil Farnworth Enrich Training & Consultancy
- 6. Key elements of a commercial business PEOPLE MARKETING PROCESSES FINANCE
- 7. People Balance your concern for profit with concern for the well-being of your staff Recruit well: Always look for indicator of future performance Be a good communicator & develop your leadership skills Set clear expectations, targets and goals Manage performance Consider their reaction to change and manage it well
- 8. People PERFORMING HUMAN RESPONSE TO CHANGE SHOCK DENIAL BLAME SELF-BLAME UNCERTAINTY PROBLEM SOLVING TIME PERFORMANCE
- 11. PRODUCT OR SERVICE Product development Features/benefits Range Life cycle PLACE OR DISTRIBUTION Wide range Dealership channels Stores / Direct Mail WEB PROMOTION OR COMMUNICATION Advertising Public Relations Direct Mail Personal Selling PRICE Cost–based Marketing-based Competition-based THE MARKETING MIX
- 12. Unique Selling Point Elevator Pitch PROMOTION OR COMMUNICATION Advertising Public Relations Direct Mail Personal Selling
- 14. 5 Streamline processes through the application of information technology Align all business processes in order that they add value to your customers Ensure that processes operate effectively between the functions of your organisation Processes
- 15. 5 Processes Business Functions Processes Generating revenue Maintaining standards Customer satisfaction
- 16. Value Chain Based on Michael Porter’s value chain THE SUCCESSFUL MANAGEMENT OF PRIMARY & SUPPORT ACTIVITIES LEADS TO ACHIEVEMENT OF MARGIN SERVICE AND VALUE TO THE CUSTOMER ARE INTEGRAL TO THE ‘CHAIN’ Infrastructure, Procurement, Technological development, HR Management SUPPORT ACTIVITIES MARGIN Reception ‘ Operations’ Delivery Marketing & Sales Service PRIMARY ACTIVITIES
- 17. Value Chain Based on Michael Porter’s value chain SERVICE AND VALUE TO THE CUSTOMER ARE INTEGRAL TO THE ‘CHAIN’ WHAT ‘QUALITY CRITERIA’ COULD BE APPLIED TO EACH ACTIVITY IN THE CHAIN TO ENSURE GOOD PERFORMANCE? RELIABILITY RESPONSIVENESS ASSURANCE TANGIBLES EMPATHY Reception ‘ Operations’ Treatment Delivery Marketing & Sales Service PRIMARY ACTIVITIES
- 18. What skills will we need to develop in order to prepare for the future?
- 19. ENTREPRENEURISM What is an entrepreneurial process ? Spotting opportunities Building capacity Marshalling resources
- 20. Where we want to be What we need to achieve The ‘What’ each department will contribute Day to day progress Developing a strategy Operational strategy The ‘How’ each department will operate Vision Mission Objective Objective Objective Operational targets
- 23. Does it all seem too much?
- 25. We win for you… www.tendersdirect.co.uk ‘ Music’
- 26. Help for you to win 01392 248 548
Editor's Notes
- Welcome to “the application of modern business practices to music services”. Hello and welcome to this talk my name is Neil Farnworth from enrich training and consultancy. We specialise in improving the performance of organisations by working with their most precious asset which is people. During the next 40 minutes I'm going to ask you to consider the type of organisations currently delivering music and performing arts education, and what the shape of those organisations may look like in the future. We will look at common business models and some of the elements of good practice in their operation. At enrich we deliver consultancy and training in all areas of business practice and I believe that today we will encourage you to consider the business processes and people skills that you will require to carry forward for successful delivery of music and performing arts services.
- How many of you in the room are currently involved in the delivery of music education services from within the public sector.? And do you think that the shape of the service that you currently work in will remain the same in the future? Okay so lets have a look at the difference between public and private sector models. Please feel free to add any issues to my list which you feel may be relevant to others in the room. Talks through the two sectors.
- Forming a Community Interest Company (CIC) is the new and popular solution for small and medium sized Social Enterprise ventures. With less red tape than a full Charity registration, a CIC is specifically intended for social and community enterprises. Community Interest Companies (CICS) are limited companies, with special additional features, created for the use of people who want to conduct a business or other activity for community benefit, and not purely for private advantage. This is achieved by a "community interest test" and "asset lock", which ensure that the CIC is established for community purposes and the assets and profits are dedicated to these purposes. Registration of a company as a CIC has to be approved by the Regulator who also has a continuing monitoring and enforcement role Co-op
- So let’s explore how we need to operate in a commercial way. Whether that be within the public sector having to be more commercially aware and satisfy the current political climate is outlined by the administration in Parliament or whether it means a transition into a fully commercial private sector company. Take comments from the floor and elaborate
- Let’s examine in more detail what we need to do to apply good business practice in these areas.
- Balancing your concern for profit with your concern for people is always a little difficult. Historically in a capitalist economy workers would be exploited expense of profit in the private sector and workers may be protected or enjoyed better rights within the public sector. In recent times legislation particularly employment legislation has to some extent led to a better balance being restored. A good example would be British Airways versus virgin Atlantic/virgin blue to illustrate concern for-profit and concern for staff. In terms of good business practices we should be upholding current employment legislation. It makes economic sense to retain staff and therefore recruit good staff in the first place to avoid having to replace them should they decide to leave, or should we decide that they simply “weren’t for us” Elaborate here on importance of your recruitment and selection process. Leadership : encourage followers by setting an example, being credible and trustworthy. Strengthen others by communicating well and sharing information and power. Communicate your vision and strategy, ensure that everybody understands where you are leading them in order that they can follow you can easily. Experiment, take risks that always learn from times when things don't go as well as they should have done. Celebrate success regularly. Recognise individual contributions and don't be afraid to praise your team. Manage your staff well through times of change, understand them and want their resistance might be. Set targets and goals which are relevant to your business objectives otherwise people will feel disengaged. Do not change the goalposts unnecessarily. People like to know exactly what is expected of them at work. Managing performance should be a positive process. All too often managing performance has become a way of ensuring that you have a sound court case when you want to fire staff! In terms of good business practice regular reviews, sound objectives formal appraisals all contribute to the positive experience of managing performance Change management requires good planning, heightened awareness and excellent interpersonal skills. Firstly however it's important to have an understanding of how we all react to change and I'm going to do that slide.
- Talk though So what do you need to be mindful of?
- The benefits of a marketing plan are: that it will help you to attach your business to meet the needs of the market in advance of the market shifting. It will help you to set future goals and everybody in the business. It will inform your product development plans. It will help you to keep ahead of the competition. It will assist you in in securing funding for projects. It also encourages you to analyse the effect that previous decisions have had on the business. Consider what attracts your current customers and make your business attractive to other groups of similar customers. The power of attraction is a far bigger influence on people than having to persuade them with sales techniques.
- The benefits of a marketing plan are: that it will help you to attach your business to meet the needs of the market in advance of the market shifting. It will help you to set future goals and everybody in the business. It will inform your product development plans. It will help you to keep ahead of the competition. It will assist you in in securing funding for projects. It also encourages you to analyse the effect that previous decisions have had on the business. Consider what attracts your current customers and make your business attractive to other groups of similar customers. The power of attraction is a far bigger influence on people than having to persuade them with sales techniques.
- Talk through slide giving examples of
- Exercise DO SWOT
- This adequately describes the lean process The lean process is concerned with providing more from less or fewer resources. There are three key strands to the lean process. These are purpose, process and people. The purpose of your organisation which should be to provide value for the customer. The processes in an organisation are a sequence of human actions need to be carried out in the right order and with the right timing in order to achieve the result. There will be key processes required to deliver the service (teaching would be an example here in the provision of a music service) there will also be additional processes required to support the key processes. (Administration and payroll would be two examples here). These processes are of absolutely no interest to the customer yet we cannot provide value from customer without them. These processes are often form the bulk of all processes within the organisation. The lean process is concerned with reducing the number of processes required and streamlining the processes to be as efficient as possible. When considering people we must think about how we use our management techniques to align people within the organisation effectively in order to add value for the customer. We may even consider alignment people outside of our organisation, for an example, within our supply chain where we may form relationships and encourage working practices there which also add value to our customer.
- Does each step in the process add value? Or is it there because of the way you are organised? Labour theory of value: (Marxist) price and value of product is proportional to the human effort put into the product. If people are working hard they must be adding value??? Makes no sense today How many steps in a process lead to rework? Where are the bottlenecks? Where is there excess capacity? Where is flexibility built in to meet the need of the customer?
- Value chain 5 generic categories of primary activities & 4 categories of support activities. Everything we do in the practice should contribute to achievement of margin
- EXERCISE Get them to determine Quality criteria
- So let’s take the top two items from this list and consider them in a little more detail in the next two slights
- Will customers pay for this? Real opportunity or just an idea? How can I muster resources? What will resources cost…..cheap? What skills do I need to develop? What capabilities do I need to build?
- So, is winning a bit of a tall order?
- First impressions of public sector! Bamboozled with jargon!
- These are many common myths that STOP businesses even trying. Business too small – we have won for many one man bands and those with low turnovers as from January 2010 you no longer are REQUIRED to have 3 years accounts to apply Complex – yes it can be but once you know the rules of the game – it is good to play and win All about money – It CANT be. All public sector contracts have to evaluated on the Most Economically Advantageous Tender. (MEAT). The weighting applied to the financial section will vary form contract to contract. It may be 10% it may be 85% I don’t know them – for high value contracts put out to tender it has never been so good for ‘stranger’ organizations to win form no previous relationship – in fact sometimes a relationship can act against you as well as with you. Certainly for low value work – a relationship is great and needed.
- A single tender search on 11 th May – there were 56 tenders found. 5 of which were live. This was under a single category for music (of which there were 4). These are a mix of both high and low value work. Category Title Events Management (Outdoor), Sport Events Museums, Visitor Centres, (Interactive Software, Audio Visual, Multimedia) Musical Instruments, Pianos, Musical Venue, Recital Hall, Recital Studio, Subscription Services (Books, Journals, DVD, Music CDs etc)