Stephen Bayley says New Labour's product, not its brand, is at fault

An old story maybe, but still worthy of a mention. As reported by the London Evening Standard on July 27 last year. Read it in full using this link or reproduction here;

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It isn't the New Labour 'brand' that's 'contaminated', it's the product, says branding consultant Stephen Bayley, who quit as consultant creative director of the Dome at Greenwich because Peter Mandelson, then in charge of the project, insisted on filling it with trendy junk. 'Blair needs to get tough on crap and tough on the causes of crap, starting with his advisers,' Bayley says. 'Of course image is important but an attractive image only emerges after the long-term development of a successful product.' The assumption that the image is something that can be manipulated is 'wince-makingly wrong and a poor role model for real businesses', he continues.

Perhaps with Byers in mind, Bayley chooses BMW as an object lesson. 'Those guys in Munich didn't sit down all those years ago and say 'Hey, let's create a great brand'. They sat down and said 'Let's create the best aero engines and cars we can'. BMW's superb image is a consequence of its superb product, a result of unfluctuating commitment to a certain set of standards. It doesn't work the other way around, but I dare say Blair suspects this already.'

The Prime Minister fancies being associated with 'something tough', say to do with muggers or young offenders. There are, it seems, plenty of business votes in getting tough on one or two youngish, forty-something offenders in particular. They are a couple of polytechnic lecturers gone wrong, who are said to be behind muggings in workplaces and reports and accounts up and down the land. Gordon Brown and Stephen Byers are accused of deeds that go beyond the usual red tape and tricky taxes that are to politicians as fleas and slobber to a dog.

One man who would drink to Blair getting tough with his Chancellor and Secretary of State for Trade and Industry is George Wortley. He is the managing director of the newish St Peter's Brewery in Bungay, Suffolk, owner of The Jerusalem Tavern pub in Britton Street, Clerkenwell.

'St Peter's produced its first bottled beer in February 1997, since when we have seen the near-destruction of the home market by cheap imports, plus the near-impossibility of exporting to the euro-zone,' Wortley says. 'Fortunately for us, we're selling well due to our own branding skills, mainly to Japan, the US and Canada.'

Wortley's other gripe is 'job creation'. He explains: 'The big boys - Toyota, Samsung, Nissan and so on - get a £1000 subsidy for every job they create, even if we believe the Government's spurious 'jobs created' figures. We have invested our own money, and created 53 jobs in a thoroughly deprived area, and been given nowt. How does that work?

'It works this way,' he continues. 'There are few grants outside designated areas, even though parts of East Anglia are very high unemployment/low wage. Big companies, who are often not needy at all, get huge subsidies as the Government wants the 'spin' of saying 'X thousand jobs created under New Labour' at Hartlepool, Swindon or Derby, or wherever, but smaller companies, however needy or deserving, get nowt.'

It is not as if you can believe 'jobs created' figures, Wortley maintains. 'Tens of thousands of jobs have been lost in retailing all over the country, yet the big five supermarkets constantly proclaim the 'new' jobs they've created,' he says. Another businessman, a City type whose name cannot be used, pointed to 'unfair competition to established businesses through start-up grants' before going on to reel off a list which includes 'higher excise duty on lorries than in France, higher fuel costs, and putting low inflation before the interests of manufacturing'.

His trendiness-detector also picked up 'unnatural obsession with fashionable new sectors without regard to sustainability of growth - for example, 100% capital allowances for technology businesses'.

As for technologists, Rick Nevinson is a director of Brookson, an accountancy and business services firm that looks after 3000 contractors in IT and engineering. Nevinson says all of them face unfair, Government-sponsored, competition. 'Contractors are up against the combined might of the Home Office, which is providing fast-track visas for overseas competitors, and of the Inland Revenue, which allows the foreigners coming in to work here tax-free,' he says.

Andy White, a contractor who edits IT contractors' interactive website UKTECH, chips in: 'We asked UKTECH readers 'Has the Government's policy towards small business changed how you will vote?' and more than 50% said they are switching to the Tories or Liberal Democrats.'

Gordon Brown has been caught on camera at a pre-election binge during which he was flashing a £43 billion wad. Paul Marson-Smith, managing director of venture capitalist Gresham Trust, says he is pleased that at last there is to be some grass-roots spending on education and training, because shortage of skilled people is the one big thing that makes go-go firms stay-stay. But, he says, Gresham Trust research also shows 'nearly two-thirds of firms feel that Government does not understand them, and would trade off Government grants and incentives for less regulation'.

Meanwhile, the advice from consulting actuary Paul Haines is 'don't look to pensions providers for venture capital'. The Government wants pension funds to invest more in venture capital start-ups, but the trend towards Defined Contribution pension schemes makes it highly likely that assets will be invested even more conservatively than before, says Haines, an investment partner in Lane Clark & Peacock. Someone with a Defined Contribution scheme will move into cash and gilts as he or she approaches retirement even more readily than those in a Defined Benefit scheme, and such schemes are already steering investment away from equities and into safer vehicles such as bonds.

The reason? 'Investment return from development and start-up opportunities other than management buy-ins or outs has been lower than from conventional quoted UK equities for over 10 years,' Haines says.

'In these circumstances, I simply cannot see how the Government's desire to increase the long-term percentage of UK institutional investment in venture capital opportunities has any reasonable chance of succeeding.'

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David Hopkins

Webtastic Ltd