Tuesday, March 22, 2011


As mentioned yesterday, there are five key reasons, according to the "insiders" who sent me their critique report, as to why DET isn't working. As you will see, most of is to do with the civil service set-up within the department although some will argue that this is due to a lack of political leadership. 

This is what they had to say - judge for yourselves. 

1. The ERP is politically driven.

It is owned by the Deputy First Minister, not by business and certainly not by senior management within the department. It may or may not stick after the next Assembly elections, depending on the election result.

The view from the ground internally is that senior management appears not to care much either way as long as it gets the department to the next election line. What happens after is up for grabs.

Rather than being treated as a real strategic approach to using public sector economic development as a tool in Wales to get alongside business and create robust structure for wealth creation, skills development and business prosperity, when you scratch the surface of the ERP the gloss comes off, leaving it looking weak and lacking in coherence.

Unfortunately,  as far as the Deputy First Minister is concerned and the election only months away, the ERP is now the only game in town and like a Soviet style 5 year plan, the exercise now is to talk it up rather than allow critical questions about its durability. Timing, they say, is everything. The problem for the ERP is that by May, there will be little evidence proving that the plan is working but what political opponents won’t be able to prove is that it isn’t.

2. Top management within the department lack leadership qualities and substance, particularly around vision and strategy.

People understand that opportunity in DET is achieved by loyalty to the person that promoted you, not because of merit.  Consequently, in the last three years of WAG survey, the SCS (Senior Civil Servants) team within DET has scored the lowest across WAG (somewhere in the 35% range) on questions about belief in their leadership quality and the staff’s trust in their ability to lead. Needless to say, nothing of note has occurred in the department to change these perceptions. 

The ‘leadership’ problem is not unique to this department of WAG but appears most pronounced here and the problem for the ERP is that the people who will be most engaged in delivery do not believe that senior management have much of an idea about what they are doing. “Making it up as they go along” is the commonly heard complaint. 

Senior WAG management have said rightly that they are not in post to be liked, but the ability to be believed and respected by staff would be an advantage.

3. There is no ability within the department to understand, lead and manage change.

Since the merger with the WDA there has been constant change within DET. The problem is that this has been imposed and top down with no critical understanding of ‘emotional intelligence’ or the business techniques that can make a large change management process work. 

Consequently, change hasn’t taken effect and people still talk about how things were done ‘better' in the WAG or the WDA. This comes back to the inability to think critically about leadership across the SCS team and also to the ‘cloning’ characteristic across senior management. 

There is little evidence of management’s ability to learn from failure. The leadership and senior management team within DET have been the same team who were charged with getting both the WAG-WDA merger and then the implementation of FS4B (the business support structure) right and they failed on both. Why then should anyone believe them when they say they have learned from the past and will get the ERP right? 

No one thinks that driving change in the public sector is easy but with a bottom up approach and managed with modicums of respect and emotional integrity for existing skills and experience, effective change can be made to happen.

4. DET is supposed to be open for business, it is not.

If we were an actual business we would be bankrupt. There is no vision, no strategy and crucially no viable product range.  If you are an indigenous business looking for help or an inward investor enquiring about good reasons to come to Wales, the majority of staff would probably telly you to come back in a few months when things are clearer. This has been the situation in the department for nine months, will remain so until the new sector team are selected and then go on through and beyond the next assembly election. The reality is that the department, despite protestations and formal lines to take’, will effectively be on hold for 12 months whilst teams bed down, new policies develop and practices rolled out. 

However, the betting is also that in three years or less, the ERP will be gone and some cynics suggest that it will be replaced by a new split between policy and implementation and the revolutionary re-establishment of an agency, charged with driving economic development in Wales. Because policy was better driven when the WAG had charge of it and the WDA had a range of business focused products that they could deliver. Reality check time perhaps but the fault is the leadership’s strategic and intellectual inability to deliver transformation.

5. Staff morale within the department is on the floor. 

Since the merger was mismanaged, there has been a continued  cycle of failed change. The consequence is that people are both demoralised and very unmotivated.  Staff also see poor performance at senior management level rewarded or, when a policy fails, get moved sideways to far less critical roles. The main drop in headcount numbers in the new department are in IBW and relationship management. Here not only will many lose their jobs but hard working staff who have built up years of skills, experience and contacts in relationship management, trade development and inward investment are competing for far fewer customer facing roles in the new structure. 

So, at a stroke, the department will move from having a strong outward facing economic development expertise to one that is driven by inward thinking and by the imperative to make the politically driven ERP work. 

Yes, perhaps a focus on sectors is sensible but at the cost of one sector competing with another for resource and support as opposed to a division dedicated to bringing in inward investment. Staff certainly feel that they are in danger of losing their jobs whilst Wales loses key skills at a time it can least afford to because of the accumulated failure under the senior management team to understand what economic development in Wales should be about.


If the First Minister wants a real economic development strategy that will drive the Welsh economy forward in the next 10 years, rather than the next 10 months, good examples of effective public/private partnership exist. He needs to look at some of the states in the USA or closer at home e.g. in Scotland.

Failing this, he and the Permanent Secretary might commission PWC to develop a strategy for putting the department on the right track. It might be costly but will have a better chance of delivering effective change and economic support to the people and businesses of Wales and would be far better than allowing the current shambles to continue limping from one failure to the next. 

Wales deserves better.