PC1 final [Compatibility Mode]
Supporting Older People Conference
PC1: So, what have you done for me lately? S:\Dept\Conferences\2010-11\Finance Speaker: 2011\Marketing\Handbook Nick Horne Chief Executive Arcadia Housing Group
Chair:
Rob Griffiths Executive Director, Group Financial Services Longhurst Group
People & Culture – PC1 So what have you done for me lately? 23 March 2011 Nick Horne Chief Executive Arcadia Housing Group [email protected]
To cover 4 Background & context 4 Three steps to heaven – a scene setter 4 CEO expectations – exploring the priorities AND what they look like in practice 4 Cultural observations 4 Summary comments 4 Questions & discussion
Background & context 4 About NH CEO Arcadia Housing Group since 1998 Arcadia & Knightstone Board Member Vice Chair NHF South West Exec Committee Vice Chair SHPS 4 About Arcadia A classic organic growth HA South West focus 11,100 homes in management, 24,000 residents, c450 staff. 24.6 in the finance team. Diversified portfolio – general; supported; LCHO; leaseholder; open market developer AC SNI Jan 2010 “excellent prospects”…but that’s all ancient history now Can do organisation, delivers on promises, delivers results
Background & context 4 True confessions – I am a Chartered Accountant 4 I understand how tough your job is (1996-98 Group FD @ Knightstone) & I’ve led finance teams through recessionary times (1989-96 @ Norwest Holst Group) 4 We all know times are tough & they’ll get tougher as the cumulative spending cuts bite. (Especially for our residents) 4 These are my views. I hope to provoke comment. Disagreement is fine. So is an invite for dinner.
Three steps to heaven – a scene setter Question;- what three things does any business need to succeed (especially through challenging times)? Nice people? Attractive offices? Great brands & marketing? Good products? Good Board? Good website? Insurance? Good risk management systems? Well developed supply chain? Strong order book? Good distribution network? Good IT? Lots of contracts & new work? Good reputation? Green / eco policies? A funky CEO who’s always in the news?
Three steps to heaven – My answer as follows… One - a passion for delivering Great Customer Service (listening to customer demand, involving customers; acting on what customers say, getting the basic service right first time, going the extra mile; great recovery systems when things go wrong) Two - the people, attitudes & systems to enable GCS to be delivered (efficient / lean; cultural focus on VfM; customer & solution focussed culture) Three - Positive cashflow & sound finances (underpinned by satisfied & loyal customers)
Three steps to heaven 4 Only continuously delivering and improving all three will ensure long term success (Woolies, MFI v TK Maxx, IKEA v John Lewis) 4 For your business - No. 3 - ensuring a positive cashflow and sound finances - is 100% the finance team’s responsibility. And in today’s higher risk climate it is (arguably) THE number one business priority 4 The Finance Director & Senior Finance Team must lead. Much more than keeping score & passive management. 4 As a divisional service centre – finance team must also evidence how it supports delivery of no. 1 & 2. 4 More later. But first – let’s look close up at my big four expectations of finance staff
Priority 1 – Get the basics right 4 Make sure the numbers add up – taken as read that there are sound systems of internal financial control (Ujima). Basic arithmetic and strategic / tactical. Medium & LT view. 4 Cash is king, queen and the jack of hearts – how much have we got? How much can we get? Is it safe? Is it enough? What’s it needed for? When will we run out and what next? What is our contingency? Is there a Black Swan? What is Plan B? (Connaught & Rok). PS cash includes available undrawn loans. 4 No surprises – We want to know it could happen before it does happen. Time to react, develop tactics & manage the governance, resident, partner & other issues.
P1 - What does this look like? – some practical issues 4 Evidence to your CEO, SMT, Board that the internal financial controls are sound & financial risks managed. IA? Evidence that business strategy is deliverable and LT implications manageable from a financial perspective 4 Evidence your cash position – daily, weekly, rolling 3m,12m,36m etc. Access to new money v cash demands - all the usual treasury bits. A time of capital structure transition. 4 Anticipation – YEM11 is upon you. Auditors. Funders. TSA. Asset values. Funders ratios. Budget / forecast variations. EBITDA’s? No Y/E panics or big late adjustments please. They cause Board’s and CEOs to freak out (nothing chic about that).
P1 - What does this look like? – some practical issues
4 Judgements – what will they be? Who will have to make them (FD / CEO / Board)? Are the right delegated powers in place? What are the choices? What will the implications be? What evidence will we need? How quickly will they need to be made?
4 Relationships based on trust & confidence are 100% key. Board – FD; CEO – FD; FD – SFT & key managers etc. Reliability of your key people? No dramatics – but red card risks if trust and confidence fails.
Priority 2 – The finance team = a business support team 4 Right information at right time. Report by exception? What’s key? Get it out to people, quickly and make sure they understand its implications in the new world order. 4 Cash flow, working capital, work in progress – THE key information. Ensure CEO is on message. Cash v reserves. Available loan facilities >capital commitments? 4 Pay particular attention to development team. Manage aspirations & understanding but don’t snuff out enthusiasm. 4 Tell us what we need to know, not what we want to hear. It’s OK to say no. (But be diplomatic how you say it). Is this a culture change?
More P2 – The finance team = a business support team 4 (Risks yes). But also highlight & support opportunities to gain advantage, reduce risk, take advantage of market conditions etc. Active not passive management. 4 Provide solutions not problems – An issue or opportunity has arisen? What is your cunning plan? What help is needed to deliver? The Rok / Knightstone DLO example. 4 Dot to dot not Da Vinci Code – map out the golden thread cash in - cash out (asset management, development etc) and your current business plan / LTF. Spell it out for all to see. E.g. Is the core business paying its way? (Essential) Are contracts profitable? (E.g. the Connaught scenario). 4 Enlist support – Get CEO, SMT Board & other key people “on message” so they understand the new world order & your expectations of them.
How do you achieve Priority 2 in practice? 4 Review decision makers information needs in light of changing market – e.g. what don’t they get but now need to get & know? Especially impt. given new development climate. 4 Seize the day & spread the word –Understanding finance is the new black. Boards, SMT, managers, staff, resident groups, key partners all need & want to know the impact of current market on your business & how they can help. 4 Become coach, mentor, trainer - free your finance people to get out & about. Roadshows / team / web briefings etc. Spread the word. Think Robert Peston or Henk Potts. Remember that we’re all in this together…allegedly. 4 Honest communication – reassurance with realism. Managing expectations. Messages endorsed by CEO.
Priority 3 – Finance Teams leading by example Back office maybe. But back woods? No way! So what do your customers see in the finance team? 4 A zest & passion for delivering Great Customer Service? (“Dear Sophie, Thank you for your prompt and helpful letter which really helped me understand my arrears position. The cheque’s in the post…”) 4 Responsive, accessible, innovative, fit for purpose service delivery culture? (“I just love those guys. They always return my calls & are always coming up with ideas to help me out. They totally rock”)
Priority 3 – Finance Teams leading by example
4 Efficient, lean cost & staffing structures – real VfM? (“Wow – the year on year finance costs have kept the same but their work volumes are up. How do they do that?) 4 Or do your customers see something else? 4 Or maybe you don’t know what your customers think of your service? (Comment - you may also hold portfolios for VfM / procurement / IT&IS etc. But do you / your division walk the talk?)
Priority 3 - How can the finance team lead by example? 4 Know what your internal & external customers think of finance services and show you are taking action to respond 4 Benchmark finance & back office costs and learn 4 Listen to service demand coming through the door, email, phone, meetings, web etc. 4 Intervene to redesign service streams using “Lean Systems” or (you chose…) to cut out waste, cut cost and yes cut headcount. 4 Address any team / staff culture & attitudes. 4 Show you want to lead change & not just talk about it. Show you & your finance team are “up for it”.
Priority 4 – Personal development – promote change Winston Churchill. Jason Bourne. My grandmother. Some people thrive in a crisis. So when you’ve gotten the finance house in order… 4 There’s a paradigm shift in our housing model & 2011 is an opportunity to lead & promote wider or more radical change (v the three business success factors). 4 So what do you think needs doing? Improve VfM? Procurement? Overhaul risk mgt? Streamline IT/IS systems? Greater service centralisation? Restructuring? Change in asset management / development strategy? Change in business culture needed or in the business model? 4 Yes – not without risks. But with radical changes happening throughout the economy, the status quo looks increasingly unlikely & untenable. So seize the day.
Reflections on some cultural issues 4 Robustness – now is not a time for shrinking violets. You & your people must be 100% on your game & prepared (e.g.) to deliver tough messages & a change agenda. 4 Adaptability & flexibility. Remember what Darwin said? 4 Step out of your comfort zone – support/promote/lead change 4 Communication skills – ensuring customers & stakeholders understand the issues, the implications and what you can do to help 4 Diplomacy & negotiation skills – balancing a positive & can-do attitude v saying no v renegotiating the finance offering. (Especially with CEOs wedded to growth). Gearing is not just for bikes.
Summary & closing comments 4 LT success is underpinned by (1) a passion for delivering GCS, supported by (2) people, attitudes, systems & (3) positive cashflow 4 Finance must lead on 3 and must support 1 & 2 4 Finance leaders - your No 1 priority is to make sure the numbers add up, be obsessed by cashflow and deliver a “no surprises” service 4 Then focus on business support – information (esp. cash), communication, opportunities, solutions, mapping the GT 4 Finance can lead by example – striving for great customer service, a lean / VfM service, a great staff culture & attitude. Win respect across whole organisation.
Summary & closing comments 4 The world is changing quickly. So why not promote, embrace & support positive change? Be the catalyst in your business. 4 Look at your own & your team’s culture & be prepared to adapt, adopt & improve in response to new challenges & to get out of your comfort zone 4 We are living through historic times – a genuine paradigm shift in the housing sector. The personal challenge is great. But the opportunity is also great. With the right attitude we can all become better leaders, managers, role models, partners and individuals.
And very nearly finally Many excellent CEOs in this sector started their careers as part of the finance team. What enabled them to make the jump to Finance Director and then CEO is not that they knew where the credits and debits went. It is their ability to do the things I’ve spoken about this morning. To challenge themselves and others. To adapt and improve. To take personal risks and reject the comfort zone. To think like a leader and put themselves forward. To deliver results with a passion for great customer service; and all that goes with it.
What do our staff like about Arcadia & Knightstone? “I like the positive culture open & honest forward thinking”….“Professional, friendly always willing to help”…“No blame culture & freedom to manage own workload with support”…“Professional approach. Ability/confidence to say no when appropriate”…”Traditional values but at the same time can be innovative”…“There is a basic friendliness”… “Everyone has a voice. I like the way that everyone is treated equal and people's views are listened to”… “Commitment to customer service”…”Good
front line staff Open to change. Looking forward”…”We are thorough, we don't take unnecessary risks & staff are treated fairly” …. “We try to build communities rather than just housing” ….”Free tea, coffee & heating!”
What do our LA partners like about working with us? “Professional & reliable. We know they will do the job”…“Committed to achieving results for service users and commissioners”…“Reliable and creative. The people are so professional and so very helpful. I see them as my colleagues”…“Quite entrepreneurial”…“Very good housing
management organisation”…“Always prepared to listen”…“Flexible and take into account our agenda”…“Definitely open to change”…“They come forward with ideas”… “One of the very best”… “A self aware organisation that can demonstrate effective leadership in its willingness to take difficult decisions” Audit Commission
Group Director of Resources £100,000 package
GROUP DIRECTOR of RESOURCES Package £100,000 plus final salary pension and attractive benefits Worle, North Somerset Help shape our future [email protected] 01934 524338 / 077 181 55350
Thank you for listening. Q & A?
Supporting Older People Conference
PC1: So, what have you done for me lately? S:\Dept\Conferences\2010-11\Finance Speaker: 2011\Marketing\Handbook Nick Horne Chief Executive Arcadia Housing Group
Chair:
Rob Griffiths Executive Director, Group Financial Services Longhurst Group
PC1: So, what have you done for me lately? S:\Dept\Conferences\2010-11\Finance Speaker: 2011\Marketing\Handbook Nick Horne Chief Executive Arcadia Housing Group
Chair:
Rob Griffiths Executive Director, Group Financial Services Longhurst Group
People & Culture – PC1 So what have you done for me lately? 23 March 2011 Nick Horne Chief Executive Arcadia Housing Group [email protected]
To cover 4 Background & context 4 Three steps to heaven – a scene setter 4 CEO expectations – exploring the priorities AND what they look like in practice 4 Cultural observations 4 Summary comments 4 Questions & discussion
Background & context 4 About NH CEO Arcadia Housing Group since 1998 Arcadia & Knightstone Board Member Vice Chair NHF South West Exec Committee Vice Chair SHPS 4 About Arcadia A classic organic growth HA South West focus 11,100 homes in management, 24,000 residents, c450 staff. 24.6 in the finance team. Diversified portfolio – general; supported; LCHO; leaseholder; open market developer AC SNI Jan 2010 “excellent prospects”…but that’s all ancient history now Can do organisation, delivers on promises, delivers results
Background & context 4 True confessions – I am a Chartered Accountant 4 I understand how tough your job is (1996-98 Group FD @ Knightstone) & I’ve led finance teams through recessionary times (1989-96 @ Norwest Holst Group) 4 We all know times are tough & they’ll get tougher as the cumulative spending cuts bite. (Especially for our residents) 4 These are my views. I hope to provoke comment. Disagreement is fine. So is an invite for dinner.
Three steps to heaven – a scene setter Question;- what three things does any business need to succeed (especially through challenging times)? Nice people? Attractive offices? Great brands & marketing? Good products? Good Board? Good website? Insurance? Good risk management systems? Well developed supply chain? Strong order book? Good distribution network? Good IT? Lots of contracts & new work? Good reputation? Green / eco policies? A funky CEO who’s always in the news?
Three steps to heaven – My answer as follows… One - a passion for delivering Great Customer Service (listening to customer demand, involving customers; acting on what customers say, getting the basic service right first time, going the extra mile; great recovery systems when things go wrong) Two - the people, attitudes & systems to enable GCS to be delivered (efficient / lean; cultural focus on VfM; customer & solution focussed culture) Three - Positive cashflow & sound finances (underpinned by satisfied & loyal customers)
Three steps to heaven 4 Only continuously delivering and improving all three will ensure long term success (Woolies, MFI v TK Maxx, IKEA v John Lewis) 4 For your business - No. 3 - ensuring a positive cashflow and sound finances - is 100% the finance team’s responsibility. And in today’s higher risk climate it is (arguably) THE number one business priority 4 The Finance Director & Senior Finance Team must lead. Much more than keeping score & passive management. 4 As a divisional service centre – finance team must also evidence how it supports delivery of no. 1 & 2. 4 More later. But first – let’s look close up at my big four expectations of finance staff
Priority 1 – Get the basics right 4 Make sure the numbers add up – taken as read that there are sound systems of internal financial control (Ujima). Basic arithmetic and strategic / tactical. Medium & LT view. 4 Cash is king, queen and the jack of hearts – how much have we got? How much can we get? Is it safe? Is it enough? What’s it needed for? When will we run out and what next? What is our contingency? Is there a Black Swan? What is Plan B? (Connaught & Rok). PS cash includes available undrawn loans. 4 No surprises – We want to know it could happen before it does happen. Time to react, develop tactics & manage the governance, resident, partner & other issues.
P1 - What does this look like? – some practical issues 4 Evidence to your CEO, SMT, Board that the internal financial controls are sound & financial risks managed. IA? Evidence that business strategy is deliverable and LT implications manageable from a financial perspective 4 Evidence your cash position – daily, weekly, rolling 3m,12m,36m etc. Access to new money v cash demands - all the usual treasury bits. A time of capital structure transition. 4 Anticipation – YEM11 is upon you. Auditors. Funders. TSA. Asset values. Funders ratios. Budget / forecast variations. EBITDA’s? No Y/E panics or big late adjustments please. They cause Board’s and CEOs to freak out (nothing chic about that).
P1 - What does this look like? – some practical issues
4 Judgements – what will they be? Who will have to make them (FD / CEO / Board)? Are the right delegated powers in place? What are the choices? What will the implications be? What evidence will we need? How quickly will they need to be made?
4 Relationships based on trust & confidence are 100% key. Board – FD; CEO – FD; FD – SFT & key managers etc. Reliability of your key people? No dramatics – but red card risks if trust and confidence fails.
Priority 2 – The finance team = a business support team 4 Right information at right time. Report by exception? What’s key? Get it out to people, quickly and make sure they understand its implications in the new world order. 4 Cash flow, working capital, work in progress – THE key information. Ensure CEO is on message. Cash v reserves. Available loan facilities >capital commitments? 4 Pay particular attention to development team. Manage aspirations & understanding but don’t snuff out enthusiasm. 4 Tell us what we need to know, not what we want to hear. It’s OK to say no. (But be diplomatic how you say it). Is this a culture change?
More P2 – The finance team = a business support team 4 (Risks yes). But also highlight & support opportunities to gain advantage, reduce risk, take advantage of market conditions etc. Active not passive management. 4 Provide solutions not problems – An issue or opportunity has arisen? What is your cunning plan? What help is needed to deliver? The Rok / Knightstone DLO example. 4 Dot to dot not Da Vinci Code – map out the golden thread cash in - cash out (asset management, development etc) and your current business plan / LTF. Spell it out for all to see. E.g. Is the core business paying its way? (Essential) Are contracts profitable? (E.g. the Connaught scenario). 4 Enlist support – Get CEO, SMT Board & other key people “on message” so they understand the new world order & your expectations of them.
How do you achieve Priority 2 in practice? 4 Review decision makers information needs in light of changing market – e.g. what don’t they get but now need to get & know? Especially impt. given new development climate. 4 Seize the day & spread the word –Understanding finance is the new black. Boards, SMT, managers, staff, resident groups, key partners all need & want to know the impact of current market on your business & how they can help. 4 Become coach, mentor, trainer - free your finance people to get out & about. Roadshows / team / web briefings etc. Spread the word. Think Robert Peston or Henk Potts. Remember that we’re all in this together…allegedly. 4 Honest communication – reassurance with realism. Managing expectations. Messages endorsed by CEO.
Priority 3 – Finance Teams leading by example Back office maybe. But back woods? No way! So what do your customers see in the finance team? 4 A zest & passion for delivering Great Customer Service? (“Dear Sophie, Thank you for your prompt and helpful letter which really helped me understand my arrears position. The cheque’s in the post…”) 4 Responsive, accessible, innovative, fit for purpose service delivery culture? (“I just love those guys. They always return my calls & are always coming up with ideas to help me out. They totally rock”)
Priority 3 – Finance Teams leading by example
4 Efficient, lean cost & staffing structures – real VfM? (“Wow – the year on year finance costs have kept the same but their work volumes are up. How do they do that?) 4 Or do your customers see something else? 4 Or maybe you don’t know what your customers think of your service? (Comment - you may also hold portfolios for VfM / procurement / IT&IS etc. But do you / your division walk the talk?)
Priority 3 - How can the finance team lead by example? 4 Know what your internal & external customers think of finance services and show you are taking action to respond 4 Benchmark finance & back office costs and learn 4 Listen to service demand coming through the door, email, phone, meetings, web etc. 4 Intervene to redesign service streams using “Lean Systems” or (you chose…) to cut out waste, cut cost and yes cut headcount. 4 Address any team / staff culture & attitudes. 4 Show you want to lead change & not just talk about it. Show you & your finance team are “up for it”.
Priority 4 – Personal development – promote change Winston Churchill. Jason Bourne. My grandmother. Some people thrive in a crisis. So when you’ve gotten the finance house in order… 4 There’s a paradigm shift in our housing model & 2011 is an opportunity to lead & promote wider or more radical change (v the three business success factors). 4 So what do you think needs doing? Improve VfM? Procurement? Overhaul risk mgt? Streamline IT/IS systems? Greater service centralisation? Restructuring? Change in asset management / development strategy? Change in business culture needed or in the business model? 4 Yes – not without risks. But with radical changes happening throughout the economy, the status quo looks increasingly unlikely & untenable. So seize the day.
Reflections on some cultural issues 4 Robustness – now is not a time for shrinking violets. You & your people must be 100% on your game & prepared (e.g.) to deliver tough messages & a change agenda. 4 Adaptability & flexibility. Remember what Darwin said? 4 Step out of your comfort zone – support/promote/lead change 4 Communication skills – ensuring customers & stakeholders understand the issues, the implications and what you can do to help 4 Diplomacy & negotiation skills – balancing a positive & can-do attitude v saying no v renegotiating the finance offering. (Especially with CEOs wedded to growth). Gearing is not just for bikes.
Summary & closing comments 4 LT success is underpinned by (1) a passion for delivering GCS, supported by (2) people, attitudes, systems & (3) positive cashflow 4 Finance must lead on 3 and must support 1 & 2 4 Finance leaders - your No 1 priority is to make sure the numbers add up, be obsessed by cashflow and deliver a “no surprises” service 4 Then focus on business support – information (esp. cash), communication, opportunities, solutions, mapping the GT 4 Finance can lead by example – striving for great customer service, a lean / VfM service, a great staff culture & attitude. Win respect across whole organisation.
Summary & closing comments 4 The world is changing quickly. So why not promote, embrace & support positive change? Be the catalyst in your business. 4 Look at your own & your team’s culture & be prepared to adapt, adopt & improve in response to new challenges & to get out of your comfort zone 4 We are living through historic times – a genuine paradigm shift in the housing sector. The personal challenge is great. But the opportunity is also great. With the right attitude we can all become better leaders, managers, role models, partners and individuals.
And very nearly finally Many excellent CEOs in this sector started their careers as part of the finance team. What enabled them to make the jump to Finance Director and then CEO is not that they knew where the credits and debits went. It is their ability to do the things I’ve spoken about this morning. To challenge themselves and others. To adapt and improve. To take personal risks and reject the comfort zone. To think like a leader and put themselves forward. To deliver results with a passion for great customer service; and all that goes with it.
What do our staff like about Arcadia & Knightstone? “I like the positive culture open & honest forward thinking”….“Professional, friendly always willing to help”…“No blame culture & freedom to manage own workload with support”…“Professional approach. Ability/confidence to say no when appropriate”…”Traditional values but at the same time can be innovative”…“There is a basic friendliness”… “Everyone has a voice. I like the way that everyone is treated equal and people's views are listened to”… “Commitment to customer service”…”Good
front line staff Open to change. Looking forward”…”We are thorough, we don't take unnecessary risks & staff are treated fairly” …. “We try to build communities rather than just housing” ….”Free tea, coffee & heating!”
What do our LA partners like about working with us? “Professional & reliable. We know they will do the job”…“Committed to achieving results for service users and commissioners”…“Reliable and creative. The people are so professional and so very helpful. I see them as my colleagues”…“Quite entrepreneurial”…“Very good housing
management organisation”…“Always prepared to listen”…“Flexible and take into account our agenda”…“Definitely open to change”…“They come forward with ideas”… “One of the very best”… “A self aware organisation that can demonstrate effective leadership in its willingness to take difficult decisions” Audit Commission
Group Director of Resources £100,000 package
GROUP DIRECTOR of RESOURCES Package £100,000 plus final salary pension and attractive benefits Worle, North Somerset Help shape our future [email protected] 01934 524338 / 077 181 55350
Thank you for listening. Q & A?
Supporting Older People Conference
PC1: So, what have you done for me lately? S:\Dept\Conferences\2010-11\Finance Speaker: 2011\Marketing\Handbook Nick Horne Chief Executive Arcadia Housing Group
Chair:
Rob Griffiths Executive Director, Group Financial Services Longhurst Group
