Interview

Interview with Gareth Hall

remain, as these are very important for

the Welsh Assembly Government to

pursue its aims and policies in making

Wales a better country. The functions of

the WDA in economic development and

wider regeneration have a direct role to

play in increasing and spreading

prosperity, for creating stronger and

safer communities, for generating better

jobs and skills and getting more people

into work. We will continue to be

instrumental with our partners in these

long term aspirations.

Could you explain the role of the

WDA for our readers’ benefit?

The WDA has been in existence for over

27 years. We are in the business of

providing support to our customers.

These range from new start ups right up

to multinational companies, indigenous

businesses operating in a diverse range

of sectors, companies coming into Wales

through inward investment and

companies operating in Wales that are

run by overseas parents. We recognise

in the Agency that businesses employ

people, and those people and

businesses operate within communities.

The WDA cannot deliver business

support in isolation, so the merger is

very much about true partnerships,

recognising peoples’ strengths and

making sure we deliver a better service

to our customers.

The Welsh Economic Review editorial team recently interviewed Gareth Hall who was How have you measured the appointed as Chief Executive of the Welsh Development Agency (WDA) in July 2004. success of your activities in the Gareth joined the Agency in 1991, working in land reclamation, urban regeneration past, and how may this change? and property development across Wales. In April 2001 he became Executive Director, Traditionally, as with all other Strategy Development responsible for corporate and business planning, performance development agencies, our performance management, European funding and rural policy. Gareth was previously Managing has been judged by hard outputs, for Director South West Division based in Swansea and responsible for developing the example, how many jobs have been Technium concept, Baglan Energy Park and the Llanelli Millennium Coastal Park. He created or how much private sector was educated at the Universities of the West of England, Reading and Cardiff, leverage has been secured. Whilst qualified as a chartered surveyor, and as Defence Land Agent Wales was responsible themes remain valid, I believe that the for the MOD estate in the Principality, covering acquisitions, disposals, nature merged organisation needs to develop a conservation and military training. He is a visiting lecturer in the department of City more appropriate suite of performance and Regional Planning, Cardiff University, a Director of the Wales European Centre, targets. Overall, Wales has almost full and a member of the Welsh Economic Research Advisory Panel. employment, but social exclusion is a

key issue. We are working with partners

There is considerable press Development and Transport Minister – a to help get economically inactive people coverage at the moment regarding political decision which I fully accept). back into the labour pool. These the restructuring of the Welsh The second intention is to create a new activities call for performance measures

Development Agency (WDA)- can public service in Wales. The First which could gauge the outcomes over you provide a brief explanation of Minister wants this new public service to the longer term. these events? deliver better service to the customers;

First of all, this is not a takeover by the the citizens, businesses and We are working daily on the merger, and

Assembly Government. It is, however, a communities across Wales. He wants to there are a number of work streams that merger of the WDA, the Wales Tourist take advantage of best practice within have been set up. For example, we all

Board and the Assembly Government’s the civil service, the WDA and other appreciate that you can’t merge four

Economic Development and Transport sponsored bodies . organisations who have got four

Division. If you go back to the first difference finance systems, different HR principles of the merger announcement, What impact will these changes and IT, so we are deriving synergies and

Rhodri Morgan, the First Minister, said have on WDA activities? economies of scale. We are also looking that he wanted to achieve two things: to The functions of the WDA remain wholly at the processes, everything from make organisations like the WDA valid. Whilst the necessary orders under business planning to financial and directly accountable (that is why we will secondary legislation will seek to abolish output management and performance - be accountable to the Economic the WDA Board, our functions will looking more towards outcomes and

32 Interview

how well we deliver solutions. We need the other, whilst retaining the essential inward investment is not just about to be judged by how we can add value core values but also taking on board the attracting companies from abroad into to our customers’ activities. global reach of HSBC. Wales, but once they have set up in

Wales we treat them as indigenous

Is it going to be less easy to develop This begs the question, how would such businesses embedding them in the longer term targets when you are a brand help in tackling the key issue of Welsh economy and their local part of the Welsh Assembly economic inactivity? I see the communities, with a view to expansion

Government in the sense that your promotion of Wales as an innovative and and reinvestment over the longer term. activities are governed by the inclusive country as part and parcel of prevailing political party? raising our citizens aspirations and self- If demand for large scale foreign

The WDA has always pursued the esteem. Also, whilst the WDA branding direct greenfield investment priorities of the Government of the day. has a high degree of recognition, this recovered, would you still respond?

These are set out in the remit letter would be enhanced significantly We would, where such interest matched from the Minister for Economic amongst target business audiences in the Wales proposition. The inward

Development and Transport. This was the USA, Europe and Far East, through investment market has changed. For also the case in the Welsh Office days. adopting the strap line, ‘Wales: Home of example, there are companies in China

Our overall strategy and key investment the Ryder Cup in 2010’. and India looking to set up operations to decisions are overseen by the Agency’s serve the expanding European market.

Board of non-executive directors drawn Do you see any change in WDA Wales is well placed to respond to their from business, the trade unions and emphasis over the last few years needs. We can offer the opportunity to voluntary sectors. The Board is to be between developing indigenous ‘dip their toe into the water’ whilst abolished from April 2006, but I am very companies and putting effort into building market knowledge and much of the view that from this date the attracting FDI? networks ahead of further investment.

Minister should have access to a panel I believe that this is a facile debate. My of such experienced people to help view, and I know this is also the view of The scale of truly global mobile foreign inform decisions on strategy and policy. the Assembly Government, is that we direct investment has reduced in recent

are in the business of supporting years, whilst at the same time

What is going to happen to the WDA businesses that have the potential for competition has increased. However, name? growth and to become more competitive levels of merger and acquisition activity

There is a whole debate going on at the and therefore contribute to increasing are on the up and Wales continues to moment about branding. My view on and spreading prosperity. These more than punch its weight in this area, this is that branding is about more than businesses can be anything from a new as we do in securing reinvestment by logos. Marketeers quite rightly tell me start up to an inward investment from a overseas owned businesses. that branding is about the values and Fortune 500 company or expansion by the service that the organisation long established Welsh based You have referred to key sectors. delivers to customers. I very much want businesses be they indigenous or Would you refuse companies into what this brand represents, especially in foreign owned. The common Wales if they are not in the right terms of customer service and delivery, denominator is that they are innovative sectors, for example, if they were to be preserved and built upon as part of and have the potential for sustainable engaged in low value-added the merger process. For example, the growth, and our support can help with activities associated with low pay? activities of the Wales Tourist Board and that growth. This is another misunderstanding.

Wales Trade International, demonstrate Businesses are in the business of there is a lot of common ground in the How will you be able to identify this making money and businesses would service that we seek to deliver to potential? only consider Wales if it was a sound customers. Following the merger we We have got to be smarter. As our proposition for their business. I have will deliver it in a more joined up way, customers become more sophisticated, mentioned that we are being much more whilst still espousing these core values. so must we in the support that we can proactive with targeting. In Wales we

offer them. We are therefore becoming have established emerging sectors

What will people call this package? more proactive and targeted. We are including aerospace, automotive, and

I honestly don’t know at this stage. The developing a better understanding of biotechnology and we have propositions

First Minister is rightly very keen to the characteristics of businesses which we are then proactively targeting promote Wales as a brand, promoting through market segmentation, and the to businesses in these sectors both at

Wales as a country. There are development of key sector strategies home and overseas. successful examples of countries being with industry fora. To be competitive in promoted as brands, such as Canada an increasingly global marketplace, If Wales hasn’t got a sound proposition and New Zealand. New Zealand there is a requirement to promote to offer, we wouldn’t get on their promotes an image of the country as a bespoke Welsh propositions which shortlist for mobile investment, from diverse landscape as a tourist differentiate us from our competition, whatever sector. Whilst we are destination, the same brand promoting and presses the right buttons with targeting key sectors this is not our sole

New Zealand as a film location and targeted businesses. You asked me how strategy. The Agency recognises world class centre for multi-media. We things have changed? In the old days, increasing convergence between can do the same thing for Wales through the WDA built speculative factories and technologies providing business a similar brand architecture. went out to Japan and the USA to look opportunities which do not fall within

for companies to occupy them. This was convenient ‘slots’. Also, a key aim of the

A leading case study is the HSBC the way that investment worked then, Assembly Government is to get more takeover of Midland Bank which had a with buildings and labour readily people into jobs through tackling the loyal customer base and reputation for available. Nowadays businesses are pockets of economic activity and social generations. When HSBC took over, they seeking solutions which meet their inclusion in Wales. We are, therefore, didn’t automatically take every sign needs not just through premises and very much aware of the need for down and announce that Midland Bank available skilled labour, but also supply creating appropriate employment is now HSBC. They managed a chain links, networks and relationships opportunities for these members of our successful transition from one ‘brand’ to with the University sector. Therefore, communities, be it through inward

33 Interview

investment, new business start ups or Welsh people and businesses need to these ‘customers’ is very much a the social economy. both move onto and up the value chain partnership approach involving the

in order to counter increased low cost public, private and voluntary sectors,

So what is your perspective on the competition from Eastern Europe, China and above all, the communities

Welsh economy, and the continuing and the Far East. Historically, Wales has themselves in determining their futures. prosperity gap with the UK a higher level of performance in average? manufacturing productivity compared Finally, what do you think the WDA

The economy of Wales is on the up, as with other regions in the UK. will bring to the merger? evidenced by our low unemployment Manufacturing will continue to play an The merger is not just about changing rate. However, there is an ongoing important role in the Welsh economy the name above the door, the merger requirement to pursue the twin becoming more competitive through has got to deliver new and better strategies of increasing productivity and investment in new products, markets, services to our customers. Because the participation. The productivity agenda skills and management training and Agency is a very customer focused is embraced in the notion of the Dragon production techniques. organisation, we have developed what

Economy with Wales as an innovative we believe to be best practice in many country, with innovative people working You refer to customers and talk areas which can be applied across the in and starting up innovative about economic inactivity. Does new organisation. However, we do not businesses. As already mentioned, at this mean that the economically have a monopoly of good ideas and we the same time we need to tackle the inactive are your ‘customers’? will continue to benchmark ourselves long term issues of economic inactivity, They are our customers since there is an with similar organisations in the UK and enabling these people to join the interaction between businesses, abroad, as is the best practice of employment pool, and to contribute to communities and the citizens who live in competitive businesses. This is why I am wealth creation and the wellbeing of these communities. These people need emphasising that this is a merger and their communities. to be given opportunities to play as full not a takeover. Here I refer to Rhodri

as possible role in their communities, Morgan’s vision of a new public service

Recent investment of European funds is through engagement in regeneration, in Wales, which I believe will create a providing a springboard for Wales to the social economy, employment, and new culture based on customer focus build on its many strengths. These setting up their own businesses, hence and delivery, on being innovative, and in range from the research and teaching my earlier reference to both people and anticipating our response to the needs strengths of our academic institutions, businesses moving onto and up the of these customers. the landscape of Wales, to our value chain. However, I am realistic and increasing culture of entrepreneurship. appreciate that in certain communities This is a very modern concept isn’t

This and other investment is also we need to focus on creating suitable it? addressing the skills issues and we are opportunities for people to move out of Well, it’s something we’ve learned from targeting support for businesses to unemployment or long term sickness world class, competitive businesses and invest in R&D and commercialisation, onto this value chain - not everyone can regions. and to exploit new markets, particularly move straight into value added jobs at with the expansion of the EU. the higher end of this chain. Supporting Gareth Hall, thank you.

Welsh Economic Review 16.2 WINTER 2004 34