No Such Thing As Free Advice

January 16th, 2017

This  is more related to business than the usual vague music and culture thing I’d blog about but I’m wary about putting it on my business site because….. well you never know. It’s nice to see that Birmingham appears to have achieved something in having one of the greatest increases in business start ups in the country. It’s always tricky to figure out whether these accolades are real or something the City has paid for purely for publicity. I’m happy to accept it on face value, after all, being the largest municipal area in terms of population then you would expect it have high levels of business start ups.

This is a warning to those people in that start up phase. At some point in your business development you will begin to engage with networks made up of other people in similar positions and a range of “business support organisations”. Many of these people purporting to provide business support are public sector organisations that will claim they can support you to find the right people in the public sector, or at the very least pass on their experience.

The public sector can be a confusing mess to people that haven’t been indoctrinated in the peculiar procurement rules that are often attached to contract opportunities. Help and support to navigate unfamiliar organisations is obviously welcome. Unfortunately these offers are frequently not what they seem.

Many of  the organisations providing this help and support are contracted via the European Regional Development fund who will reimburse them for the time they spend with you. The usual model for this is that you get invited to a lengthy presentation where vague allusions are provided to the level of support you can obtain. You will then be invited to a meeting where you can explain what you do. At that point you will be asked to sign a form agreeing that you’ve been given a certain level of support. Usually this is calculated on the length of the presentation and the meeting. On some occasions I’ve seen just a couple of meetings calculated at over £1000 worth of support.

Most SMEs are quite happy to sign this, on the face of it there is no loss to them. The support organisation can then claim the money for support back from the EU. Usually that’s the last help and support you will receive. You might get an email every  now and then trying to sell you training but nothing particularly tangible. In subsequent years you might be asked to go through the whole process again.

You might ask why this is a problem. It doesn’t cost the businesses much other than their time. You might actually benefit from the networking opportunities. What many businesses don’t realise is that there is a cap on how much funding you can get from the EU for these sort of things. If your business reaches its cap, signing it away to “business support organisations”, then it will not be able to apply for proper support that might be available in the future.

So, if you run an SME and get invited to one of these events; make sure you are fully aware of what you end up signing at the end of the meeting. It might be a nice little earner for the organisations apparently  providing support but it could have consequences for your business.

Posted in Birmingham, Misc | Comments (2)

2 Responses to “No Such Thing As Free Advice”

  1. J Grimley Says:

    There are lots of reasons to be annoyed about this:

    1. By the time the money reaches your business in the form of ‘advice’ it’s already been skimmed by a countless number of partner organsitions etc. That’s money that was budgeted to help businesses. It’s not, it’s benefiting quangos and soulless training organisations.

    2. It’s a massive distraction. You think these people are there to help you. They’re not, they’re collecting outputs. You could be using that time to find an actual client.

    3. Because the advice always comes with other output agendas, you are ‘advised’ to do things that are not necessarily in your interest. E.g. collaborate with your competitors, because of some half-arsed agenda about Clusters and Supply Chains.

    4. Because companies are encouraged to tick boxes without thinking to hard about it, and these numbers feed into official statistics, figures like Jobs Created + Safeguarded and various other business success statistics, a) are double counted and b) cannot be trusted.

  2. Daz Says:

    Yes, every one of those points chime with my experience.

    Also, (copied from Facebook as I didn’t want to waste what I thought was good response), the local guarantors should be doing more to ensure that the money is well spent. There is nothing to prevent these organisations giving some proper advice. Well apart from my experience that few offering this sort of advice really do understand public sector procurement.

    Much of it comes down to local areas wanting things like innovation engines and only being able to afford them through skimming funds like this. So money is directed to their infrastructure rather than business support.

    As businesses we’re expected to nod this sort of fraud through whilst potential contracts are dangled in front of us. In reality businesses will never get to meet anyone that has the authority or discretion to spend a budget. If they did the conditions are so specific they tend to exclude most businesses.

    My business is outcome measurement and outcomes is something obviously missing from this. They are paid on how many people they get through the door. Nobody ever asks me if I actually get any sort of business out of these things.

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