Training is the first to go ...

Once upon a time we used to hold training courses based on our book. Sometimes we'd do it for a single company, who'd provide enough people and a venue, and sometimes they were open to anyone. It was a fairly modest affair but even that stopped when the recession hit. So we don't offer it any more although we now have an online course providing an introduction to managing a digital interactive project.

With this in mind I was pleased to hear about the initiative by BIMA and TIGA, trade bodies for the digital creative industries, asking for the government to introduce tax breaks for small companies to invest in their talent by training it. To quote the BIMA blog:

We believe the launch of a pilot SME Training Tax Relief (TTR) scheme to promote skills, training, and productivity is vital to support the future of the creative industries, a sector worth £71.4 billion a year to the UK economy.

How might such a thing work? After all, what your company spends on its business can be offset against tax already can't it?

There have been tax initiatives to help research and development for a while now, and they presumably provide a model. The basic idea is that for every pound you spend on whatever the scheme applies to, you can claim more than that amount against tax. For example, to quote HM Revenue and Customs ...

The tax relief on allowable R&D costs incurred on or after 1 April 2012 is 225% - that is, for each £100 of qualifying costs, your company or organisation could have its Corporation Tax profits reduced by an additional £125 on top of the £100 spent.

There is a similar arrangement should you be making an accounting loss during that particular financial year.

This makes such a scheme attractive financially to a company. Clearly there will be strings attached. For example, in R&D, any intellectual property from the R&D has to belong to the company. With training you might find that it is a condition that anyone trained remains employed with the company for a certain time, so that both the employee and the company benefit from the training. As a slight aside, it has been suggested that training costs should be treated as a capital cost rather than expenditure, since the benefit can be seen to last well beyond the immediate period. At the moment, since as a small company you can offset 100% of capital costs (up to a limit) that wouldn't necessarily be a problem, but the revenue have said that such an interpretation would be 'difficult to imagine'. (See the document linked below.)

For the company, any tax relief will ameliorate the double whammy that (superficially) training staff has: you lose productive staff time and you have to pay for it. But training, especially if the courses include people from outside the immediate working environment, has additional benefits; bringing people together. It's the same with conferences: the time spent socialising is as important as the time spent in sessions.

A final hope, from me for obvious reasons, would be that online training would be eligible for tax relief as well as face-to-face training. This would be by no means a given, based on past experience, but for many activities such as programming, online training can be particularly productive.

As a final note, you should read this document from the revenue:

Sometimes, the government gets suggestions that employers should be given tax relief for the costs of training their employees. That surprises us, since except in cases where the employee has some link with the employer outside the employment itself, the disallowance of expenditure by an employer on staff training and development will be extremely unusual indeed.

See ... even the tax man says you should go for it!

[PS: Full disclosure ... I used to be Chair of BIMA]

Digital marketing and user understanding getting together

Apart from the blurring of digital roles like programmer, designer, and project manager, the blurring of digital marketing and usability specialists occurs but has not been recognised. The overlap comes from the interest in the users’ reactions to products and services that are offered electronically. Traditionally both professionals have employed concept testing to assess the reactions of potential users to an idea, new product or service. However, the market researchers keep a strong eye on the market conditions while the usability experts are biased towards the immediate user experience with the technology process. Both have merit, of course. Imagine a new product that the market seemed to want but it returns a poor result because of technology difficulties in users trying to buy it.

It comes back to the emphasis on which concept is being tested: the type of product or service, or how the user gets information and access to the product and service. We can see that the traditional approach to marketing and concept testing has a rounded approach covering the product, the packaging, the branding and the proposed advertising. [www.decisionanalyst.com]

More than this, the concept testing needs to take account of: the users’ needs for particular solutions, the clarity of the presentation of the item, whether the users are prepared to pay for the proposed new solution, how to move past the hypothetical to real responses. [www.circle-research.com]

So, concept testing covers far more than you imagined? Quite right. But companies are expecting a blend of skills and experience in the job descriptions they are drawing up, such as a Senior Digital User Researcher.

You know these skills are in demand when a technological solution is offered to cover them; see the description of various online tools that are designed to test concepts at Decisionanalyst.com.

The user perspective is noted much more strongly than it used to be. They are more vocal after all, and technology provides a means for them to voice opinions. How is your company dealing with this shift? Do you partner with a marketing/usability company that offers complimentary skillsets to yourselves that will serve your client-base? Are you conscious of the blending of usability and marketing insights? If you have a partnership, is there a bias towards the core skillset that might be limiting the research?

Searching questions for many iMedia development companies, I’d imagine.

What’s in a name? Are you missing out on recognition and funding?

We often come back to the thorny problem of what this whole industry (is it even defined as an industry?) is called. Multimedia, Interactive Media, Digital, Digital Media, Mobile Communications and so on. Then the pieces of whatever it is – digital marketing, games, animation, digital effects, digital data, social media, e-learning, front-end, back-end, digital graphics, ?????. Where do they fit?

You may well react with a, ‘what the hell does it matter?’ attitude because there’s so much to try to keep up with that this seems nit-picking. But, if the government doesn’t recognise you and keep statistics on you, they won’t apportion any of their money to you. That’s the fundamental problem. Government makes decisions on where to place investment as a result of stats collected according to definitions of ‘industries’ and their contribution to the economy: data that is gathered adhering to data codes of standards. Now, if their definition of an industry sector is non-inclusive, businesses not defined in their definitions don’t get a look in.

Do you define yourself within the ‘creative industries’? Do you know what they are? Finally people are recognising that we in digital are contributing significantly to the UK’s economy. In fact, the DCMS (Department for Media, Culture and Sport) cited some key figures in January where the creative industries value added growth of 15.6% between 2008-2012 was almost three times the 5.4% of the economy as a whole. More encouraging, employment rose far faster in our sector – almost 8:1 ahead of the general employment growth.

The traditional definition of ‘creative industries’ included film, television, writers, artists, musicians, theatre and even antiques, but with the rise of cgi, digital effects, animation, digital games and so on, exactly what constitutes ‘creative industries’ has been under scrutiny (hurray!). The DCMS gave some credence to the wider ‘creative economy’ where the official figures state that 1 in 12 jobs in 2012 were in it and that IT, software and computer services account for 31% of employment within this.

Oliver and Ohlbaum Associates did some research for Google in December 2013 where they used a redefined stance on ‘creative industries’: The Internet and the Creative Industries: measuring growth within a changing sector ecology. Here the wider digital value chain is recognised as ‘enabling industries’ that serve the digital creative chain. Their research recognises variances of definition of ‘creative industries’ across Europe as well as realising that the contribution to a country’s economy might be from global recognition of worth as well as a country’s GDP. They give a strong recommendation on behalf of SMEs and sole traders so that their contribution is recognised in future as they have been poorly represented so far. They warn that if the influence of the internet on the traditional creative industries is ignored then the measurement indicators for these industries might well report a decline while the opposite is true. There are some great graphics used in this report and it’s worth scanning if you have the interest.

It’ll come as no surprise then that, with such a rapid growth of employment, a skills shortage is recognised: don’t we know that. The Landing organised an interesting panel event in Greater Manchester to look at this specifically.

But there are several initiatives that it’d be good to know about – namely, thecreativeindustries.co.uk, and NESTA - an innovation charity that has funding opportunities for ‘creative’ businesses, among others. Things are finally moving in a positive direction. Keep shouting!