The Co-operative Group has plunged to a £559m first-half loss as bad debts in its banking arm wiped out profits from its supermarkets.
The group said there would be no quick fixes as it embarked on a four-year turnaround plan, after reporting pre-tax losses of £709.4m in the Co-operative Bank in the six months to the end of June.
As Ritchie has said something must change:
The farce that the Coop was told recently that its board was not suitable to run a bank because it was not made up of bankers has to go: it’s precisely because people are not bankes that they may be suited to their new roles of making sure banks are clean, although competence will also be important too, of course.
Clearly we need many more of these oh so competent not bankers running the banks.
I’m completely ignorant about the management structure of large companies but isn’t there a case for some non-expert input, at least commentary, on board-level decisions? For the same reason they put vicars on clinical trial ethics committees. The experts tend to get bogged down in their narrow area of expertise and can lose oversight, or miss common-sense things that are obvious because they are so busy trying to cover their ass by sticking to the letter of the SOP.
After all, it’s the same companies that spend vast amounts on that cadre of naive fresh graduates entirely devoid of expertise or real-world experience known as “management consultants” to tell the actual experts what decisions to make at lower levels.
I’m sure a board made up of trade union activists, “third way” troughers and various political apparatchiks will turn the Co-op around in no time.
@Rob.. Good idea, I’m surprised that RM didn’t explain it more clearly. After all, it worked so well for all the Spanish Cajas. 🙂
“@Rob.. Good idea, I’m surprised that RM didn’t explain it more clearly. After all, it worked so well for all the Spanish Cajas.”
Pogo–is it pronounce as Cadgers?.
RM wants *exactly* the same arrangement as the Cajas:
JamesS says:
My feeling is that a courageous state should split RBS into various regional entities, with local politicians (possibly even also local union reps) sitting on the board of each entity.
Richard Murphy says:
Yes
http://www.taxresearch.org.uk/Blog/2013/07/25/why-does-rbs-need-to-pay-the-going-rate-for-the-job-when-no-one-wants-it/comment-page-1/#comment-656758
JamesV –
Having a certain percentage of “non-experts” on a board of directors can be beneficial, but remember that the duty of a board is provide oversight of management… not actually be management. Put “non-experts” in critical management positions and you get exactly what has transpired.
RM, dilettante that he is, has never understood the value of expertise in anything. For him, ideological purity trumps all. But then, it always does for the bigot and the crank.
As you to your depiction of management consultants and the services they provide, you’re as cynical as you are misinformed. Most often what management consultants do is provide a level of expertise (directed towards solving a specific problem) that is otherwise lacking within the organization. And if you think firms like Turning Point are staffed by inexperienced youngsters fresh out of college, you need to think again.
My experience of management consultants is them telling top management that something we do – something that takes 12 weeks to do the simplest variant of under ideal conditions – should be benchmarked at 6 weeks. By benchmarking, they mean getting the most complicated version under distinctly non-ideal conditions with a team of 60 people that all hate each other done in 6 weeks and 1 day would count as failure. This was said by a person who had no experience of the industry or the process concerned. Even discounting the effect on quality of this insanity in a quality-driven industry, a “degree” in “management” “science” does not count, in my opinion, as imprimatur to pronounce on things you know nothing of.
If the last 2 years of my experience as a contractor are anything to go on, the same fuckwit has been going around the entire pharma industry saying the same claptrap, and offering an army of Indians to do a one-off to prove it’s, under certain circumstances, possible. Because we now see exactly zero projects that are not of “A1 top priority, must be done ultra-fast, benchmark to 12 weeks (compromise after pushback from HoDs risking their neck by disagreeing with the snotty 23-year-old with a gold frequent flyer card).
So yes, I think management consultants should all be mutilated, shot and buried in unmarked graves. Alternatively, I’d expect them to put in an actual day’s work but that would be considered cruel and unusual punishment.
JamesV:
I am a mgmt consultant and while I agree that lots of consultants work more or less as you describe it there are also actually some consultants out there who know what they are talking about and son’t just spout nonsense.
Forgive me. I concede that using “all” in my penultimate sentence wasn’t called for. “lots of” will do instead.
Well, anecdotal evidence trumps all, doesn’t it?