Examination of Witnesses (Questions 300-319)
THE WORK
FOUNDATION
24 FEBRUARY 2004
Q300 Mr Clapham: Given what you have
said, Mr Nathan, about the technology that is out there but yet
we are just failing to ensure that it reaches the potential that
it ought to reach and could reach, how can we encourage employers
to take on the full potential of it? Is it possible, for example,
to list quite simply what the benefits would be for the employer,
the business, the employees and the economy? Would such a listing
of those benefits be helpful, do you feel, in encouraging employers
to come forward?
Mr Nathan: I think it would be.
One of the things that struck us very strongly with the employers
that we were talking to was that they responded to the key lesson
and to numbers and the headline figures on those. A lot of this
information is out there; there is a lot of academic study and
a lot of other study on how technology is used by organisations
and how organisations achieve the performance benefits that they
are looking for. It is not difficult to set out some of those
lessons and set out some indication of the extent of the gain
that we get. The problem is that all of these findings have been
around for a while and the really tricky thing is implementation.
It is less taking the technology on than what you do with it that
makes the difference. This is what the literature shows. If we
were going to provide a prompt card for employers saying, "This
is what you can get out of this stuff", it would need to
cover a whole load of points on the other side saying, "But
only if you do this, this and this, and it will take longer than
you might think from talking to some of the technology industry
sales people that you have talked to". On the one hand there
are these benefits that there is now good evidence we can realise,
but on the other hand it will take some time for employers to
get there, particularly if they have got systems already in place
which they need to dismantle and work around.
Q301 Mr Clapham: You explained a little
earlier about how information and communication technology evolves
within business. Is it therefore that each business requires different
kinds of skills with information technology or is it possible
to be able to ensure that people, for example, coming on to the
labour market have the skills which would be generally applicable?
Mr Nathan: I think that you can
give people a general grounding in the types of activities that
technology is likely to be used in and in some of the programmes
and systems that are currently being used, but new programmes
and new systems are being brought out all the time and at the
moment we are not, as far as I know, at a stage of radical change.
Each new addition of software X and software Y is an incremental
improvement on what the previous version did; there is not a completely
dramatic change, so I think it would be possible to do that, yes.
One of the things which struck us from the research was that we
focused on the service sector, on the work that generally takes
place in offices or buildings that have office functions, and
we looked at quite a broad spectrum of industries from very big
multinationals to very small high street firms, and a lot of the
same stuff was going on in each of them. There is a big area over
that that if we had given them the same training they would all
have been able to go away and do it a bit better than they previously
could do. On the other hand, these firms also used bespoke applications.
They were working in different industries with different supplier
and customer networks, and so there is stuff that employers will
need to do in that area to train people in the systems that they
need to use.
Q302 Mr Clapham: From your research is
it fair to say that the information communication technology systems
in the larger companies develop precisely in the same way as they
would develop in a smaller company?
Ms Carpenter: I am not so sure.
I think that larger companies are likely to have the time and
inclination to go for something bespoke in a way that smaller
companies do not. Whether or not they then get a better solution
depends very much on the people working inside the firm, and I
can think of examples where large technology systems have been
rolled out in big firms and have not been what was required, but
what we need to be able to say to sellers and providers is that
these are not exact views; these are questions that we want answering
as it were. That is a much better place to be starting from than
looking around for stuff that is ready to go and trying to fit
it in somewhere. A lot of the issues that we have talked about
generally impact particularly on SMEs because of these time and
capacity issues, because the IT person in a small firm is likely
to do a number of other things as well, so they do not always
have the time or the inclination to keep themselves up to date
to be able to negotiate on the basis of equality with the people
they are trying to sell stuff to. On the business support side
there are specific things that the Small Business Service and
other DTI associated agencies need to focus on.
Q303 Mr Clapham: Finally, have you looked
at some of the programmes that the Education and Skills Council
are operating and do you feel that the Learning and Skills Council
is appropriately focusing itself on what is required in terms
of the training of people to deal with information communication
technology?
Mr Nathan: This is not something
that we looked at specifically, so I would have to get back to
you on that. One of the programmes that we have looked at with
the LSCs and the national LSC is the employer training pilots
which look at ways of funding training generally and those seem
to have been, at the pilot stage anyway, very well received and
there is no reason why they cannot be used to deliver IT training
specifically. That seems to be quite a good way of doing it, but
I do not know enough about what kinds of training get to be delivered
through those to be able to give you a proper answer.
Q304 Richard Burden: My question is pursuing
much of the same area about what Government can do to move from
the low-tech equilibrium to a high-tech equilibrium. Earlier on
you mentioned that there maybe needs to be greater integration
between different initiatives, e-Envoys and various other things.
What you have said since then has been more to do with, in a sense,
whether the Government is doing the right things rather than whether
they are integrated properly. What do you think we need to be
doing on the integration issue?
Mr Nathan: The key thing is having
a single voice which is speaking across all these issues. It is
not entirely clear to the employers that we have talked to that
that is what is going on at the moment. If you were an employer
and you go on the net and type various words into Google and go
to various bits of the DTI website you will find all the bits
and pieces that you need eventually but there does not seem to
be any strong sense of connection between them and there is not
any obvious way in. If you go to the Office of the e-Envoy you
will find more of what you want but it is not the obvious place
that you would look. Cosmetically it may be a question of organising
the information and making it available in a different way. Underpinning
that there may also be some questions about how those agencies
work together. I know there are some discussions going on with
the e-Envoy at the moment about how that is going to be operating
in the future, so again, we are moving in the right direction.
Q305 Richard Burden: Do you think the
performance of Government in the way it manages its information
and promotes things like that is an example that Government is
in a similar kind of governmental low-tech equilibrium to industry?
Mr Nathan: Gwen should talk a
little about some of the public sector organisations that we looked
at. Two of the eight firms that we spent time in were in the public
sector. One was a local government agency and one was a central
government agency. Generally speaking the public sector has got
a lot on its hands because it has these public sector delivery
targets which are coming up very quickly and it is investing from
a much lower stock base than private sector firms. A lot of money
is going to be spent over the next few years on IT and this is
where the growth in the IT sector is going to come from—the
public sector in the UK. That is going to happen very quickly.
If the private sector firms are having these difficulties with
implementation then there is a worst case scenario for the public
sector where it all goes terribly wrong, a sort of train crash
scenario. On the other hand the public sector and managers in
the public sector are able to look around them and see how the
private sector has done this in the past and has a lot to draw
on in terms of what the implementation challenges are, so it is
in a good position to do it better, to do it more smartly. On
the third hand, it does not have much time to take that on board.
Ms Carpenter: We went into a central
government department and a local government office as part of
our research. The purpose at the outset of the research was not
to come out with comparative findings as such, but essentially
what the research suggests is that, apart from being an institution
that talks about non-delivery of targets or failed innovative
case studies which are picked up by the media and is one of the
major themes discussed around e-government systems, it should
switch the discourse to the best practice that it employs and
offers and work with industry around issues such as skills and
training. If I could pick up a point that Max made earlier, one
of our striking findings is this balance between informal and
formal learning. Balance equally means that organisations in the
private sector and in the public sector need to address how those
two can be merged into formal strategic packages inside their
organisations. This is where there is a great opening to work
together for the private and public sectors to form alliances
around addressing what is going on inside their firms and how
this fits with where the Government is in reviewing its 2005 targets.
Do we make it look good on paper or do we look at adoption and
how it works? This is where, given this crucial stage in terms
of 2005 coming up, the Government can push very strongly in showcasing
solutions. The central government case study that we did was very
strong in being very self-reflective about its programmes on innovation.
It was very strong in realising that communication and information
will be the issue and that bottom-up innovation needs to be addressed.
That is where there is scope for publicity and for practical solutions
in terms of best practice.
Q306 Sir Robert Smith: Given the number
of large scale disasters the Government have had in introducing
ICT, why should they be in any position to provide advice to the
private sector on how to handle ICT?
Mr Nathan: Indeed, but that is
an argument you could apply to any area of policy that the Government
seeks to comment on. One of the key jobs of the DTI is to provide
exactly that type of advice. It is possible to provide some of
the general lessons without seeking to provide detailed solutions
about what the private sector should do. Neither should the DTI
seek to provide detailed feedback because organisations' needs
are very different. As you say, the public sector has not had
a very happy history with big ICT projects. On the other hand,
you would hope—and there is some evidence of this from the
research that we have done—that people in key roles are
learning from that. If you look at the advice that OGC has given
departments about how to purchase, for example, that is changing
and is moving away from telling departments to bring in one-size
solutions forever towards bringing in things which will solve
some problems for the moment, that they can see how things go
and add to them, that they can move to other products and systems
if they do not work out as well. That is an agency that is going
to be influencing the way a whole load of Government departments
use technology in the future and if that is the kind of advice
that is given that is good. In thinking about the two case studies
specifically, neither of the organisations was anywhere near the
worst case scenario that I have outlined. There is some evidence
that the central government department had a very good idea of
what work was done, what the challenges were, what technology
they could use to answer those challenges and was pretty good
at deploying it. The same was true of the local government department.
They had thought long and hard about where they could use ICT
to improve service delivery. They were bringing various functions
together and again they were doing it pretty well. Compared with
some of the private sector organisations we looked at, those two
public sector organisations came out pretty well. On the other
hand, those were only two of X-hundred local authorities and Y
central government departments and agencies, so further research
is required.
Ms Carpenter: That takes me on
to another point, which is criterion success measurements. What
our report shows is that technology has become social and that
the area to address is the cultural change, the adaptation and
measuring that adaptation with productivity in everyday working
lives, so to speak. That is where the Government can take a stand
in terms of addressing its IT investment.
Q307 You made the point that in the short
term there is not much return from IT investment. In the long
term there could be great returns but only if you get all the
other organisational things right, and many do not, so why do
people buy ICT?
Mr Nathan: Because they see that
if they do this other stuff as well they will get the returns
that they are promised. The finding that you played back to us
is a very important one because what it suggests is that you need
to come up with total investment. Technology investment is only
part of that and there is a whole lot of human capital investment
and organisational changes. The Brynjolfsson and Hitt research
from the US shows that we are talking of a five to seven year
timeframe for the productivity gains to kick in. If that is the
message that is put across we should have a more open and honest
discourse about what technology can actually do and move away
from this discourse on solutions and instantaneous change. It
will also give managers a better idea of what they need to be
putting in place to help them plan better. There is no getting
away from the fact that a lot of the people in managerial positions
in UK industry grew up without ICT, do not know that much about
it, are not particularly interested in it and are not taking ownership
of key strategic decisions that they need to make. There is this
presumption that technology is about geeks, server rooms and wiring
and all kinds of the messy stuff that nobody really understands,
but actually technology underpins everything that most firms do.
Managers who do not understand how technology works do not fully
understand how their firm works. They cannot get away from that
because it is used across all the key processes and functions
that most managers are in charge of, so pretending that technology
is not their pot, that it belongs to the geeky person sitting
in the corner of the room, is not an option. That is a government
issue finally, but that needs to be put across as well.
Ms Carpenter: Which suggests accountability
and leadership issues essentially.
Q308 Mr Clapham: Just coming on the back
of that, if we are saying what really is required of businesses
is better leadership skills in order to be able to exploit a technology,
and given that the DTI is responsible for skills training in IT,
if you were asked by the DTI, for example, what are the particular
skills that you feel business requires, what would be your response?
Mr Nathan: In a sense it is less
a case of what the skills are than who has the skills. A lot of
the training and learning that is going on IT-wise is directed
at frontline and shop floor staff. One of the points that came
through from the research was that managers and decision makers
higher up the organisation do not make brilliant decisions unless
they also have some basic knowledge and understanding of technology.
This was something that a lot of managers that we talked to were
echoing back to us, either consciously or unconsciously, through
the answers they were coming out with. If we are thinking about
skills policy we need to be thinking about it from top to bottom
in organisations rather than just deploying it in key functions
of the firm.
Q309 Mr Clapham: So it really is starting
with management down. You referred earlier to the fact that many
people in managerial positions probably have not come through
any technology training, so they need to be taken through that.
Would you say that the skills that the management require differ
in different sectors, or is training on leadership, for example,
in the context of IT going to be similar right across the sectors?
Mr Nathan: There will be some
clear differences between sectors because of some of the bespoke
stuff that is used. If you looked at a financial services firm
with a large call centre, which was one of the organisations that
we looked at, that call centre had big server systems underpinning
it, and that part of the firm was all about the people sitting
in the call and contact centre being able to pull up all the information
they needed and having these big servers running what they do.
If you look at a solicitors' firm, their IT needs are totally
different but there are some general principles about understanding
strategy and design and implementation which are common across
both and that is where management education needs to focus.
Q310 Linda Perham: We have been told
there is a shortage of intermediate ICT skills in the workforce,
and indeed your report recommends that the Government should intervene
to increase the supply of those skills. We have talked about what
Government can do with earlier questions, but is there a form
of intervention that you are proposing the Government should take
to increase or improve ICT skills?
Mr Nathan: The specific measure
we propose is this driving licence measure that we talked about
earlier. It would be possible to grade that so that you could
have one that corresponded to the minimum level of skills that
you want people to have in the workforce, but also you could have
the equivalent of the advanced driving licence which would provide
intermediate level skills. That would be one way of doing that.
One of the things that we need to do—and this is why I am
sitting on the fence in answering your question—is to think
further about how we plug these technology issues into workforce
development policy more generally. As I said before, there are
a lot of measures in place which could be used to deliver some
of these specific skill needs, but we need to think further and
I can give you some written thoughts afterwards if you like about
how those two agendas come together.
Q311 Linda Perham: When you talk about
the driving licence analogy, and it goes back to something that
Mick Clapham asked as well, are we talking about all employees?
I am thinking of my own experience where I am sure a lot of our
constituents think that Members of Parliament are sitting at their
computer desperately receiving their e-mails and instantly replying,
and if you do not they are on to you two days later. I never actually
do that because my staff do that and so my ICT skills are not
as developed as they might be. Are you saying that it should be
something that everybody from the chief executive downwards should
have a certain level of or that there should be certain employees
or certain groups of employees who would be trained to a higher
level, mainly because of the job they do?
Mr Nathan: There are three things.
Ideally, the first thing we would like to see is everyone with
the basic minimum which is higher than the average at the moment.
Second, if you are going to roll a policy like this out you need
to prioritise certain groups of workers where you need to start
your policy off because their needs are greater. Third, there
are also going to be some specific needs that people have based
on the type of jobs they do. We do not want the Government to
try and master-plan this because it is far too complex a story
for policy to be mapped out completely and solutions devised for
every detail of the picture. There is no straight link between
putting the technology in place and getting the productivity to
get down to it. There is also no single story about how technology
is used in the typical firm because there is not a typical firm
across the economy. One of the things we do say in terms of the
top team use of ICT is that senior staff and managers are in some
cases people who take quite a hands-on approach to their technology.
They have a laptop; they carry it around; they have a PDA and
a number of other gadgets and they enthusiastically use them.
Others are able to outsource this stuff within the organisation
and give it to PAs and other teams to deal with. If people are
very busy, that is fine, but I think it is only acceptable in
a sense if the people doing the outsourcing have some idea of
what the equipment is that their teams are using and what it can
do and are able to set the task but also make the decisions that
affect the rest of that. It is a question of general awareness
at that level rather than forcing people to use their own IT all
the time.
Ms Carpenter: An example from
the research, just to make it visual, is that in the context that
Max used in the beginning, basically all the workplaces we went
to and sat next to looked very similar, which was one of the striking
findings but not surprising. Each had a computer and a telephone
and a mobile phone and lots of papers, suggesting that (a) paper
is not going to go away, and (b) one of the major skills to look
at is typing. Equally, it did not mean that for every person we
sat next to (and we sat next to three times eight workplaces)
that was a skill that was not developed necessarily, so there
is a whole range of skills to look at just from this one example.
Mr Nathan: Absolutely. While we
were doing the research a colleague in another firm, which will
remain nameless, sent me a picture of their chief executive, which
is the picture he used to describe his mobile working style. He
was in the back of a cab with his secretary with him with a laptop,
giving her dictation and she was tapping away on the laptop. On
the one hand this was a brilliant example of the international
mobile worker who is obviously going to the airport to fly to
some conference or other. On the other hand, he had completely
taken away from himself any need to understand or use the technology
himself because he had somebody who was both PA and some sort
of bag person carrying all the stuff around with him. Given that
that person is also likely to be making decisions about how all
of the people in his organisation use technology, we do not think
it is a particularly good state of affairs just to opt out like
that. It is something that shareholders of the firm at any rate
would expect the CEO, who is ultimately accountable, to be thinking
quite hard about, and it may be something that government policy
has to take into account.
Q312 Linda Perham: What is the balance
of responsibility between government and employers because there
are employer training pilots going on and certainly, talking to
people in the TUC yesterday, I think the general view is that
employers are not really investing in training, not just ICT,
but that is an obvious example. Where is what the Government should
be doing and what should the employer be doing in terms of putting
investment into training their own workforce?
Mr Nathan: The way the Government
works, as I understand it, is that it is a broker between the
supply side and the demand side of the market. It has a role to
provide a basic level of generic training and learning for everyone
through the education system and through continuous learning and
so on, and there are specific training needs that employers have,
which it seems that employers should provide, and there may also
be some failures in the education system and the level of training
and learning that employees come out of school with and have access
to over their lifetime, for which government will need to intervene
and provide. The basic settlement that was expressed in the PIU
paper on workforce development seems to be the right place to
start as far as the workforce is concerned. That means obligations
on employers but also on government, and policies, such as work
training pilots which intervene in the market and provide financial
incentives for employers to get their people trained and try and
get over some of the basic things that they need. This is something
that the Work Foundation is interested in generally but, as you
say, technology skills are one of the key areas where exactly
that type of intervention is required.
Q313 Sir Robert Smith: You mentioned
the importance of e-mailing and communication. How significant
is the growth of spam and inappropriate mailing to undermine the
enthusiasm for ICT?
Mr Nathan: Considerable. There
are various figures floating around about what proportion of e-mail
is spam, and it is anything from 50 to 80%. I hope it is not 80%
but 50% feels about right. We all know the basics of spam. A lot
of it comes from a fairly small number of people, mainly based
outside the UK, and in order to combat that some kind of international
agreement is required and there are a number of solutions on the
table, one of which has been enacted in the States, one of which
has been proposed for Europe. On a day-to-day level one of the
things that we found was that people were generally a bit cynical
and a bit frustrated with technology but getting a lot of spam
every day was one of the things that wound people up. We distinguished
between two types of spam in the research: one of which is bad
spam, which is stuff from Florida about Viagra, and the other
of which is good spam, which is unwanted or unnecessary communication
from colleagues and people you are working with. That is
something which organisations need to get a handle on. One of
the things that we argue is that, because ICT has come into organisations
quite quickly and it has come in quite quietly under the management
radar, a lot of the social routines and etiquettes that are formed
around other types of communication and are accepted by everyone
in the firm intuitively are not in place in the form of ICT, so
people are not always sure whether to e-mail or not, who to e-mail
to, whether to leave a voicemail message or whether to keep ringing
or whether to send a text message. All of these things are very
trivial on their own, but collectively they add up to an important
part of organisational life, and are a very important part of
people's working day. Getting information and communicating information
is something that most of us spend a good deal of time doing,
whether we are an information worker or not. Not having good ground
rules about what to do when and how to do it with what makes for
quite a lot of stress and strain and it is one of the things that
at one end can lead to a lot of frustration but at the other can
hold things up considerably and lead to misunderstandings and
problems and difficulties with systems which cost a lot of money.
Spam is an external thing for the government to think about but
also it is something for organisations and employers to think
about.
Q314 Sir Robert Smith: It may be more
the employees that see the frustration, or are employers getting
frustrated that their employees are not being productive?
Mr Nathan: On the spam issue I
think it depends on whether the senior team are reading their
own e-mails or not. If they are not then maybe the person who
does will tell them about it. If you are self-servicing, which
an increasing proportion of professionals are, at any rate, it
is something that you are going to encounter head on. The other
thing to say is that e-mail is not universal. ICT is, but things
like the internet and e-mail are not used by anything like as
large a proportion of employees. A lot of the debate about e-mail
and spam and information overload is generated by and is about
professionals, journalists and people like us and people in financial
services and people who have access to e-mail all the time. It
is in the corner of the screen and ticking along. Some of the
people in contact centre and call centre environments did have
e-mail but it was not working while they were on shift because
they were supposed to be talking to people, so their experience
of spam and e-mail issues is going to be very different, so keep
that in view.
Q315 Chairman: Do you think more could
be done to filter certainly the bad spam? There are techniques.
Would you get a sense that this time-wasting could have been avoided
had some software been purchased and utilised?
Mr Nathan: I wish we knew of a
product which would get rid of all our spam. We seem to have an
enormous amount of it. That is not a question that I can give
you a proper answer to.
Q316 Chairman: I am not asking you to
adopt the role of an ICT consultant.
Mr Nathan: You need to ask a security
systems person the answer to that question. The sense that I have
is that anti-virus protection is something where more can be done.
To speak from personal experience, the Work Foundation has a number
of screening programmes in place and they screen very effectively
for viruses, which are the worst type of spam of all because they
have such serious consequences. We do not seem to have a programme
that gets rid of spam and can spot various types of spam coming
through. If you do hear about one in the course of the inquiry
please let us know and we will buy it for ourselves. At the moment
it is something that we just delete rather than deal with organisationally.
Ms Carpenter: From the research
numbers we saw a lot less heavy use of e-mail than we had expected
from debates on it and suggested numbers before we went into the
field. There was an interesting difference between people thinking
they were heavily using e-mail and actually counting that they
had 10 to 20 e-mails on their screen when they came in in the
morning. I am not suggesting that there are not spheres out there
that have extremely heavy use of e-mail. What I am suggesting
is that there is the potential to look at workplaces, and what
their balance is would probably bring a different view of the
extent of the problem right now.
Q317 Chairman: I do not know whether
I would qualify for being on the top floor in paragraph 19 of
your evidence, but certainly I am among the "lots of 40 or
50-somethings [that] can't even type". Actually I do not
get many e-mails because I do not send any. When I have to reply,
or my staff reply, the replies tend to be frosty and terse because
I object to them because usually they are thoughtless cretins
writing because they can do it easily rather than thinking first
and then writing, so you get a stream of ill-digested consciousness
from someone. I just wonder if maybe there is a case for a self-denying
ordinance on the part of some of the more garrulous e-mailers
and that might be it.
Mr Nathan: The most extreme response
to this was what Phones4U did last year, which was to ban e-mail
entirely inside the organisation. I am not sure exactly what was
driving that, and obviously they were getting frustrated with
e-mail, but it is also an absolutely fantastic publicity masterstroke
from a mobile phone company to make everyone speak on the phone
more. That is one way of rediscovering the joys of face-to-face
communication, talking on the phone, sending faxes or whatever.
Generally speaking, it is useful to have some ground rules and
some basic assumptions in your company about when to e-mail and
when not to e-mail, and equally when to ring and when not to ring.
If everyone knows that that is the way it is done around here,
then there is a lot less friction, but that sort of social hardware
is not really in place and that should be looked at.
Ms Carpenter: In the context of
technology, companies look at e-mail as part of the issue of information
at work. The issue then is not around the dangers of spam or how
much does it create frustration but more about how do you impact
the usefulness of the information within e-mails, and that is
where most of the organisations began to think about piloting
programmes around their CRM systems and how to use those effectively.
Further to the security issues is the question how e-mail and
knowledge management and the knowledge that knowledge workers
bring can be packaged into a future-looking development of that
workforce.
Q318 Chairman: Obviously we have got
to have a sense of proportion about the e-mail issue, but on the
other matters we thank you very much because you have provided
us with a useful overview which we will pursue with other people.
We are very grateful for that. We may well come back to you; whether
it is by e-mail or letter remains to be seen.
Ms Carpenter: We also have phones.
Q319 Chairman: We will communicate if
necessary and if you have anything else that you think on reflection
you would like to submit, by whatever
mode, we would be very happy to receive it. Thanks
very much.
Ms Carpenter: We will send a pigeon!
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