London is the hub of UK tech and experiences the pains of the skills shortage every day. The arrival of Facebook and Google risk making things worse.
The last month saw two of the FANG group of large tech companies announce plans to firmly set up shop in London, with Facebook opening an office currently housing 800 Engineers with a view to increasing that number to 2,300 by the end of the year, and Google announcing plans for a state of the art office in Kings Cross that will house over 7,000 staff. The move by Facebook is a particularly welcome statement for the UK economy, with the new London office quickly becoming its largest engineering hub outside of the US.
However, with competition for talented engineers already being a major problem for Tech SMEs (79% of employers cited a lack of suitable resource as their primary growth challenge) and a highly candidate led market in tech recruitment (61% of people in tech polled stating they were considering a job change in the next 12 months), the arrival of Facebook and Google is potentially bad news for UK born Tech firms, and in particular, SMEs, with more choice for engineers on who they work for.
Large, established tech firms make no secret of their willingness to pay way over the odds for the best people, placing extra pressure on salaries and often pricing SMEs out of the market. And Facebook’s decision to locate in London rather than elsewhere in the UK threatens to create an even stronger magnet for young techies to move to London in pursuit of higher compensation and standard of living, rather than remain in other locations such as the South West, North West and North East. This risks exacerbating existing ‘skills deserts’, isolating non-London tech regions and making recruitment and retention in these areas even more difficult over the coming years. Time for SMEs, particularly those outside of London, to really think innovatively about how they can consistently convince talented people to chose them over larger firms – and it’s not all about funky offices and high salaries.
A deliberate act or an act of naivety? Apple admits slowing down old handsets.
Confirming a long running suspicion that older Apple iPhones were slowed down to drive up sales of newer models, Apple admitted in December that it did indeed slow down older models. But not for the reason a lot of people thought. In fact, they confessed that they slowed down older handsets with the aim of ‘preserving battery life’, a seemingly customer focused action to take.
This wasn’t how the market received it though, with demands for CEO Tim Cook to make a formal apology and explain his company’s actions being called for globally. An apology was forthcoming, together with an offer to provide major discounts on replacement batteries which promised to return handsets to their previous performance. However, one key ingredient was missing – the signature of Tim Cook himself on this apology. Cue calls for his head on a platter and an Apple Exec team forced in to reactive mode as they try to minimise the impact of this admission.
A lot of questions arise from this issue surfacing, notably is it the aim, as is commonly believed, of major tech firms to reduce the life of their products in order to drive up sales of newer models? Though Apple are getting the bad press, this is surely a question facing all major tech hardware manufacturers, and one which could impact brand loyalty going forward, as experienced by VW in the recent emissions scandal.
But surely the bigger question is ‘how’ this was allowed to happen? Some people of a less blood thirsty nature might actually empathise with Apple – weren’t they just trying to preserve the life of older iPhone batteries by slowing phones down, meaning customers could keep them longer? Seems that the motivations for this action may actually have been ethical, and not some ill-fated attempt to dupe customers in to upgrading their handsets. Only those in Apple’s top team will know the true reason.
The latest revelation in the world of Tech, following UBER’s highly publicised battle with worker’s rights, and Google’s ongoing difficulty in managing diversity, show that no firm should underestimate the impact on brand and business performance that can be experienced through neglecting people, and the importance of great leadership and of culture in an organisation. The very people who either made and implemented a decision to force its customers in to upgrades, or the people who neglected to think how the company could be impacted if the rationale for such a decision wasn’t carefully explained up front to its loyal customer base. As companies grow, and particularly when they grow at pace, a wave of success can blind leaders to what is holding their firm together. Once this unravels, the impact can be catastrophic. And markets won’t waste a second in attacking firms when things go wrong.
Is a culture of full transparency the future? Buffer certainly seem to think so
Buffer, the social media management platform that was launched in Birmingham, UK, in 2010, has recently announced the launch of their 100% fully transparent ‘Salary Formula 3.0’.
Buffer are regarded as leaders in transparency, in everything from email communication to workload activity and pay. Don’t believe me? Check out their website where you’ll see the incomes of everyone in their business, starting with CEO Joel who took at salary of $265,315 in 2017.
Value number 2 for Buffer, after ‘Choose Positivity and Happiness’ is ‘Default to Transparency’. Why? Because Buffer recognise that a lack of transparency breeds mistrust. In fact, Buffer first adopted full pay transparency in 2013, recognising that the leadership team needed to demonstrate their commitment to full transparency across the board by offering up full visibility of their income. Wow. Imagine doing that! But in return, they ask the following from their growing team:
- You take pride in opportunities to share our beliefs, failures, strengths and decisions;
- You use transparency as a tool to help others;
- You always state your thoughts immediately and with honesty;
- You share in the decision process to avoid ‘big revelations’.
I’d like to say this article was the product of some award winning investigative journalism, but I’d be lying. In fact, all this, and a load more to boot, is displayed for all to see on their website. Full transparency in action right there.
CEO Joel Gasgoine wrote in 2015, 2 years into their transparency journey, that ‘Sticking to radical transparency was probably both one of the most frightening and exciting things … it has meant to open up and make ourselves extremely vulnerable for ideas, since they were easily accessible for everyone on the team’. So why continue down this road you may ask? Well, he also adds that ‘I believe that it has such a unique potential to empower and inspire a team’ and that ‘one key reason transparency is such a powerful value for a company’s culture is trust: transparency breeds trust, and trust is the foundation of great teamwork’.
Well said Joel. I think a lot of companies and CEOs can learn from Buffer’s example, as scary and stretching as the concept of total transparency can be. As businesses grow, we are more reliant on people doing a great job and working cohesively as a team, with less and less direct dependence on the direction of the founders and/or leadership team. So, what better way is there to breed this than by allowing trust to develop beyond what most of us will have ever experienced in any previous job/company, in a sustainable and continually evolving way?
Take note, because full transparency will be one of the major trends in company culture over the coming years. In an age when a simple Google search will tell an employee how well they’re paid vs. average for their role and experience, avoid discontent and distraction by getting ahead of the curve, making pay and reward a fully transparent, consistent and objective process, and allow people instead to focus on developing levels of trust with you their peers and their teams that will truly drive your businesses’ future success.