Impossible Things with David Terrar S1 E12
DAVID TERRAR [00:00:26] Hi, this is David Terroar and Impossible Things with David Terrar Episode 12. And this one’s going to be a really interesting episode. Let me first explain a bit why it’s called Impossible Things. It’s partly to do with Arthur C. Clarke’s third law, where any technology that sufficiently advanced seems like magic, and partly because when the queen in Alice through the looking glass talks about doing six impossible things before breakfast. So we’re all about interesting, impossible stuff. Today’s guest is Richard Skelett. And I must disclose the fact that actually about four, five, six weeks ago I started working for Richard and his organisation. So this is a chance for me to kind of turn the tables on him, usually he’s grilling me about sales figures. I can grill him about the Future of Work today. So, Richard. Richard Skillet of Globalution, welcome. Can you introduce yourself. And what Globalution is.
RICHARD SKILLET [00:01:15] Oh, wow, David. It’s fantastic to be here. But listen, I did say to you that I had to face the radio. Okay? I think “the bonus, David…”
DAVID TERRAR [00:01:32] That’s not so good. But your hair looks good I mean, yo know, in terms of the lockdown here hairstyles, we’re all looking reasonably tidy
RICHARD SKILLET [00:01:40] Yeah. It’s more than look isn’t it, David? At this stage of ageism. What we’re trying is to look a bit younger.
DAVID TERRAR [00:01:48] Absolutely.
RICHARD SKILLET [00:01:48] David. Delight to be here. Thank you very much. In all seriousness. And you know, so Globalution. Well, the name, first of all is. I’ve always believed that there’s a revolution that’s needed, you know. And actually I still believe it was need pre-COVID. You know, this COVID is basically just a symptom that we’ve got and Peter “Drucker” believes everything should be outsourced. And that’s the camp I’m in, I believe, and I still stay. And I was on the ground in the in the very early days. He spends their part to maintenance develop turn to open source “I can’t see”. And actually, it’s interests, not the deals have changed since the early days. And my feeling now is that the outsourcer really idoesn’t take much risk anymore. Gets the majority the upside. So the customer, I don’t think naturally kind of goes off and gets really what they should be delivering. And what we’re in a position to talk about is that we’ve got a range of services which stretch all the way from looking at the cultural value, behavioural aspect with the sense of “entitled” transformation. You know, all the way through to tax and finance, basically. So we’ve got a complete suite. So it’s that holistic approach that I think is going to go off and bring in the new operating models that we need now.
DAVID TERRAR [00:03:15] Fascinating stuff. Now, I heard of you that you talk about people as both assets and liabilities and the asset liability curve associated with each of us to explain that at least.
RICHARD SKILLET [00:03:29] Yeah, well, we tell people their assets don’t we? And the thing is, it’s not true. It’s not true by the actions that the companies go off and take. As an example, if you look at training. The UK has been on a 10 year decline year on year for the last decade. And whose budget it gets cut? It was forced budget cut in COVID training, isn’t it? So these things get cut here. Let’s cut the training budget.
DAVID TERRAR [00:04:01] And it’s exactly the time when we should be developing our staff.
RICHARD SKILLET [00:04:07] Precisely, you know. And we spend less than 400 pounds now on training, I suspect, for fourth quarter of the EU league, you know, So that’s not a great position, is it, particularly? We know that we’ve got a huge investment in the rescaling. And I think it’s important for us to understand that we have “like we are a liability and an asset curve”. That’s the truth of the matter. We sat on the balance sheet as a liability. That’s where we sit on the balance sheet. We have a liability asset curve and the business has a liability and asset curve on us that they need to manage. So we need to better understand that area.
DAVID TERRAR [00:04:52] Interesting. I’ve seen you quote some research about how productive the average kind of knowledge worker is. Tell us a bit about that and how that affects this?
RICHARD SKILLET [00:05:04] Well, the CIPD? Going back some time. You used to kind of talk about if you were 76% productivity, you’re kind of top of the tree. And I’m kind of thinking, hey, I never got an A plus for 76% in the past nine. In fact, I better not talk about my D’s and I E’s actually to consider your hypothesis here. But I was kind of shocked to see a recent survey. It was across 2000 employees and basically what they were saying basically. So these is employees, they are just saying that only focussed of working for about four hours per day. And we had “Boris Johnson” just, I think was at last week talking about the need for to increase our productivity. And I think that, again, this is very, very important. So we need to be kind of looking at how “you outline” what I would call our “cautional” balance sheet. We don’t have a balance sheet. And to help you align our “cautional” balance sheet with the company’s balance sheet aimed at looking at how we can increase the productivity in the road for both parties.
DAVID TERRAR [00:06:12] So I’ve also heard you talk about and I suppose this plays into that “splitting” how we should split or see our jobs in thirds “of thirds, and thirds of thirds”. Explain what you mean by that.
RICHARD SKILLET [00:06:24] Yeah, yeah, yeah. So I think we will have to have kind of some assumptions to go off and build out from. So the assumption that I can be on, often used for years now is “TAPI split the book into these bite sized chunks of third, third, third. Now that bottom third and you know that that’s the bottom third of things that we can get done by maybe some one ginger or maybe robotics or A.I., you know, so we got this kind of “bottoms up, chunky carb that we have”. Then we’ve got the table stakes that we have, you know, Brian Jones, Chairman of Board. David, you talked about the table stakes and stuff. We’ve got to make sure that we go off and deliver.
DAVID TERRAR [00:07:07] Yes.
RICHARD SKILLET [00:07:07] Then what we then what we have is that the third that goes off and makes that “differences stuff” at the top level. Now, here’s the crazy thing, in my opinion. You know us as employees, we’ve been trained to accept that, hey, we get paid a daily effectively. So it doesn’t matter if we do the bottom third or the top third, then we get paid the same amount of money. That doesn’t make any sense to me as an employee, to be quite frank and also it also doesn’t make any sense for the employer. Why would the employer want to pay for the same “fight for if I do something…” this doesn’t make any sense.
DAVID TERRAR [00:07:48] So in that context and how should we assume as employees be thinking differently?
RICHARD SKILLET [00:07:55] Well, you know, I think the starting point is to kind of recognise why you work? You know, why we’re working. You know, that you’re some of us if you look at and if you take the gig economy as an example, you’ve got people who are financially independent, can kind of choose of what, when and so forth, you know, but not everyone’s in that position, of course, the vast majority of not so. So basically you got money. First of all, we need to make money. Now, is that money, is it not disposable or is it disposable income? So let’s start to undwrstand that kind of balance there. And it’s interesting, my mom. “We’re allowed” to tell stories, Dave. So so here’s my mom back in 1960s, and audience you got to say you don’t loo that old, Richard, “some I’m just a kid at” primary school. And basically she’s got four jobs. Now, two of them are in retail, she’s “getting a fix hourly day rate” the other two, she’s a waitress. And she’s paid a variable income, then there’s no guarantee income. So basically in that role, we had kind of guaranteed income, peace that the non disposable income household needed came from the guaranteed job in retail. But the non disposable that came from our other roles. So one way to kind of think about this is maybe for us to think about like our little mini outsource search, perhaps, and we need to be thinking multi-portfolio. So, you know, so multiple portfolio “…been around” for a very long time. We’re never gonna see a rise in that area as we are at the moment, actually.
DAVID TERRAR [00:09:27] Now, yeah, I mean, as you rightly say, you and I and obviously your man back then with multiple jobs, but most people of our solar generation and maybe even after us, we’re used to a scenario where you work for three, four, five companies through through your career, but sequentially. And you’re saying now, I mean, as we know with the gig economy, our kids are much more likely to be working multiple jobs for different people. And that’s the way they should be thinking about the future in their point of view?
RICHARD SKILLET [00:10:02] Absolutely. And look at the direct relationship with the earlier point, David, about the lack of investment in training. How can companies invest in people if people are there for much “shorter tanks” and that supports the liability and asset curve element too doesn’t it? The fact that things have changed. So this employer-employee relationship model was fundamentally flawedt.
DAVID TERRAR [00:10:24] And of course, with COVID-19. It gets that much worse. And if you kind of combine that with automation, you sometimes talk in terms of like a tsunami of that’s going to hit the job market. And people really need to think differently and prepare for it, don’t they?
RICHARD SKILLET [00:10:40] Yeah. Absolutely. You know, the stats you know, so COVID’s a “symptom” you know. So COVID is a “symptom”, basically. And the facts are companies don’t need as many people, the bottom line is we don’t need as many people. And that’s a result of that. There’s a story about the jobs, the number of jobs that we now create a few hours a week to create fewer jobs. And if you look at the reports, you know, we talk about a hundred million people being affected by automation, A.I, and robotics, 10 million in the UK. And that was claimed to be by 2030. And that’s the government telling us that’s, you know, so. And I actually think it’s much earlier than that now. I think COVID has gone off and brought those kind of time frames forward because now we’re seeing an acceleration way in terms of investment and to A.I. Machine Learning robotics. And for us, as individuals you know, we’ve got to kind of be thinking to actually about who to be compete with, you know, with “pristine the rise we saw the cost arbitrage argument” is back again, because what we’re seeing is that we can people use to move for jobs, but jobs are gonna move to people “magnet”. Isn’t it? We used to relocate for jobs. “Jobful” relocate somewhere else. So everybody seen an acceleration in that area. And of course, you know, we’ve got this kind of AI machine robotic and this argument over “open station or replacement”. These are really kind of big, big, big things. And how can you strike the balance in terms of ensuring it? You can deliver your shareholder value that’s needed and do goo. And actually doing good is not enough now, we need to kind of go off and do social great, to be quite frank,.
DAVID TERRAR [00:12:29] I completely agree with that. It’s interesting. So us to really we as workers in this environment, you talked about our own personal balance sheet. Where we’re in it need to be thinking about ourselves as like many businesses and considering our own balance sheet. Investing…
RICHARD SKILLET [00:12:49] Yeah, of course. And so here’s a starting point, who’s trained us on this? Have we taught this at school? Di we taught this at college? Have we thought kind of this stuff at university> You know that the answer’s no. So we’ve got a challenge about kind of the mentoring and the coaching to support it, you know, and companies invest time and money to protect their balance sheet and improve it. So “what odds” is there on us? About “…” should we invest? Coming back to the area about training as an example. You know. To put a little fun. Well, how much money do we spend on ourselves? To develop as an example, you know, taking that up. And also, I think there’s also an area that if we’re going to see people though, you know, going off and setting up businesses, being, you know, we’ve got this in the U.K. We’ve got this “I-fair of five”, don’t we?Argument. And it’s all about tax. Hey, the “got did come to golf and say”, hey, we need to collect more taxes. Let’s go off and go to these people who are self-employed. Those people are trying to set up their businesses. That’s an example there, David, is that, you know, “that’s” entrepreneurship “usually have a tax.” Many people don’t understand that they could be paying 10% tax if they were able to go off and put the credit models into place. So this is the thing about looking at your balance sheet. You know, there’s a whole education piece that’s required by.
DAVID TERRAR [00:14:20] Fascinating stuff. Now, we focussed a lot so far on the kind of like the financial side of the field trip work in A.I efficiency and seeing yourselves as well as both an asset and liability and thinking of ourselves as know, mini outsourced and the way we might do things better. What are the aspects of the future of work are important, do you think?
RICHARD SKILLET [00:14:42] Well, the operating model needs to change, okay? the operating model needs to change. And we’ve got this area around kind of looking at fixed costs. And, you know, and there’s this variable cost. Now, I just want to kind of tell you another quick little story, actually, which I think maybe which I think we’ll get this message home.
DAVID TERRAR [00:15:06] We got time.
RICHARD SKILLET [00:15:08] I’ve got a call from an ex-engineer who says, hey, Richard, you’ve always been really clear about people starting up companies and so forth. And he’s an I.T. engineer working for a gaming company, a global gaming company. He’s based in the UK and one of their regional offices. So basically, he’s supporting a number of users. Now says, hey, I want to start a business, Richard. So I think a recession is a fabulous time to start up a company, incidentally. So if anyone thinks that a company, this is the time maybe can do that in another another session. So ask a few questions. The questions are how much money you’ve got that you can invest? And he’s only got six weeks “salary basically to invest into his business”. So that’s a bit of a problem. The next questions I can ask might I say how busy on a scale of one to 100, how busy are you? And that’s a difficult question. So you’re looking for the end that the mean averages and he says 70% and that kind of stacks up with some of the things that we talked about earlier the third, third, third and so forth. Yeah. My next question to him was what percentage of your work is your company doing could get done by either machine or kick done by “a junior?” And he says, well, “look, I think if you got a junior to do that, an apprentise” with a little bit kind of skill set, can probably take 50% of my work off me. And my final question was, well, how quickly could that happen? I quickly you got a “jitender up to speed” he says, well, about three months. Now, do you see the business case that exists there? You know what we’ve got. Can this person go off and have a conversation with someone in their organisation and says, actually, you only probably need me for about a third of the time because the third that you want me to do is not hire third, you know. So those are the things you’ve got to be kind of looking at your operating model and what “other idiot (?) David” s that is, you know, is this about cost? You know, we talk about kind of ship services and outsourcing. And the key thing is here, can you get an income contribution towards your cost base? So imagine if a “third void” exchange programme run all the time as an example forever. That would be great for a businesses isn’t it? So got to be thinking about, I mean, look at our operating model. How can we begin to think about removing costs as a re-occurring symptom? And how does that begin to kind of go off and affect the ecosystems? We help with our suppliers, the suppliers to become partners and so forth. A big, big subject, that one.
DAVID TERRAR [00:17:47] It’s very interesting, this operating model to topic, because it’s it’s crucially important for organisations, but it’s not necessarily very easy for organisations to say who’s responsible for it because it kind of spreads across lots of parts of the company, doesn’t it?
RICHARD SKILLET [00:18:02] Yeah. Yeah, it does. And typically you’ll find that it’s really the CEO’s job. Of course, the CEO just, most CEOs spend so much time looking at this sort of bad road investor relations, don’t they? Yeah. And, you know, and if you’re gonna change an operating model, how do we go about that? Particularly when we have major issues? Just I mean, we can’t even go off and do the most simplest transformation programmes successfully, 76% of them fail. You know? So we can’t go off and do those things. And that’s where I think that, you know, a little plug for us David here, if you don’t mind. The approach has got to be end to end now. You’ve got to be kind of looking at the culture and the value behavioural aspect. That’s a big, big part. And it moves in to the research, doesn’t that? Hence, we applaud as an important role to play as an example. And it goes all the way through marketing sales. That would be a huge outsourcing year incidently. It’s untapped at the moment. Sales and marketing has always been what your sales and marketing is primed for outsourcing, absolutely. “Everything” we can attack in the digital arguments. Then we’ve got to get H.R., you know, how can we go off and put digital architectures and technology architectures into place “that we don’t have a resource architecture model?” These are kind of big subjects and, you know, big, big challenges ahead.
DAVID TERRAR [00:19:29] And so really fascinating stuff. I’ve got a last question to ask you about the future. So we’re saying that the future work is definitely been changed by the crisis. And things have been accelerated to the changes are happening quicker. What are some key things we should be thinking about for these next phase where we’re all locked down, spring up for beginning to kind of get back to a different place than before? What should we be thinking about that for this next phase?
RICHARD SKILLET [00:19:58] Well, I’m gonna come back to the operating “and you’re back to the operting” it’s Rolls-Royce. Now tell another story. So this is kind of, hey Rolls Royce we got and have an idea about aeroplane engines. We go off and say, hey, fabulous, got this great idea. We can get paid per mile. We’re gonna make a lot more money and a lot more profit. So we go off and look at in a variable income into place. It can be the same as looking at software as a service than solution companies as they go off and pay for what use. Now, you know, if you’re gonna go off and have a variable income and I think we’re all faced with the variable incomes now, the recipe for disaster is having fixed costs. Because that’s not gonna cut off quite clearly, kind of go off and work very well. But I think the other the key area that I think is vitally important is around “sl”. You know, the political, economic, social, technology, environmental, legal. How do we begin to kind of balance that? Because that’s something it’s really been forgotten about. And it’s now beginning to come to the fore. So how would be able to put solutions into place that are going to increase our investor shareholder returns? But that’s what they want. And how can we kind of make sure that we can go off and do social great? Social good isn’t good enough. So those would be. So I think when it comes down to looking at solutions we’ve got to build solutions “that are gonna be good under sl”, which are going to be good for the investors.
DAVID TERRAR [00:21:31] Excellent, Richard. That’s all being fascinating stuff. We just kind of made a start on the future of work topic. But we’ve we’ve covered an awful lot, that’s been really great. Thanks. Thanks for joining the programme.
RICHARD SKILLET [00:21:42] Super then, David. “rememeber next time, fix the radio”
DAVID TERRAR [00:21:47] I’ll let you turn “off” the camera off next time. There will be next time, all good stuff.
RICHARD SKILLET [00:21:52] David, it’s been super. Thanks very much.
DAVID TERRAR [00:21:58] And so that’s all about one aspect of the Future of Work with Richards. Coming back to that topic for definite, if you want to have more content like this, if you come back to my Twitter feed “@DT” and the Disruptive LIVE’s Twitter feed and their Disruptive Live and their Disruptive Live page on LinkedIn, you’ll get more content like this and you can find it at impossiblethings.fly to. Looking forward to Episode 13. See you again soon.