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Associations, Blog

Michael Webb established the Charities and Associations Exhibition, known thereafter as CHASE in 1991, and kept it going for an astonishing 24 years! Earlier this year Glenda Parker, of Hart Square, gathered a ‘coalition of the willing’ in London to re-launch it for its 25th anniversary. The result – from a standing start in January – was available for all to see a couple of weeks ago. But was it worth all the effort?

Well, if you work for a membership organisation, you don’t need me to tell you that change has been rapid in recent years. Associations, institutes, and charities have developed joined-up systems and active member engagement processes. Their outward appearance has become slicker, their business acumen honed. Much of this is down to the digital revolution.

They are also innovative, adaptable, and increasingly fleet of foot. Because, they’ve had to be. They’re correspondingly independent, task focussed, and frequently small to medium enterprises. They are moreover fundamentally about people. And the best way to engage with people is to bring them together under one roof. Where you can entertain them, enlighten them, challenge and energise them!

And so, while it might have been time to light the 25th candle on its birthday cake, it was also time to take a fresh approach to chase25, bringing it up to date with a new venue, structure, exhibitors, and themes. With a show reflective of change, but without abandoning its heritage.

Nostalgia isn’t what it used to be! But if there was any latent yearning after the past, it was soon dispelled by the new surroundings, and the show’s fresh new format.

Yes, digital loomed large amongst the day’s themes. But then so did innovation, culture, and leadership. All served up as an appetising smorgasbord providing satisfying treats in portions ranging from amuse bouche to belly busting.

Julie Dodd’s reflections on the moral issues exposed by new technology, and its power to do good, during her Michael Webb lecture, was timely. Kevin Cahill, former CEO of Comic Relief, charting the transition from passion driven start-up to charity institution, opportune. And Band Aid, Live Aid and Live 8 co-founder Midge Ure’s juxtaposition of the challenges of promoting a cause in both the analogue and digital universes spanned by his career, revelatory!

But, it was Midge Ure who, for me, came up with the unspoken theme of the day when he attributed Band Aid’s success to “finding like-minded people”. As he put it, “we put all our little soap boxes together to form a world stage”.

Surely – the realisation dawned on me – that is at the very core of what charities and associations do every day; gather like minds in a common cause. But this time chase25 showed us how to do it even better! I, for one, can hardly wait for next year!

The Editor
Association News
Edition 284

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Associations, Blog
Figures revealed by the Financial Conduct Authority’s head of technology, resilience and cyber, Robin Jones, in a speech on 25 January 2018, show that a total of 69 material cyber incidents were declared to the FCA in 2017 – an increase from 38 in 2016 and 24 in 2015. That’s a rise of more than 80% last year alone!

Those numbers may seem insignificant when viewed in the context of ONS statistics that suggest there are about 1.9m incidents of cyber-related fraud each year. And, that the National Cyber Security Centre recorded over 1,100 reported attacks last year. That is until you take into account the requirement to report material cyber incidents to the FCA imposed on regulated financial services.

In these cases ‘material’ means attacks that lead to a significant loss of data, or the availability or control of IT systems; that affect a large number of customers; or result in unauthorised access to, or malicious software present on, the company’s information and communications systems. So, if cyber-attacks are a big deal in the tightly regulated area of financial services – a sector that you might expect to be exceptionally resilient – then how much of a problem are they for SMEs, trade associations, charities, and institutions?

Considering the rewards for cybercrime surpass most other forms of criminal activity. It is low risk, high reward, and it is relatively easy and cheap to be a cybercriminal. And technology is so integrated into our lives that 93% of business is conducted online. Then the problem is probably bigger than we imagine!

In fact the National Cyber Security Centre sees it is a tier one threat, next to terrorism. With sixty-six percent of small businesses having been the victims of cyber-attack or phishing campaigns last year, costing each one an average of £3000, according to some estimates. So, that puts most of us in the frame for a potential attack. But have we anything of value worth stealing?

What could happen? Email inaccessible. Other systems failures, including payroll, accounting, and ordering. Account information lost. Money and goods stolen. Data lost or compromised. Strategic plans and trade secrets stolen. The list goes on!

But what of the impact? Apart from the operational impact, lost earnings, inability to support customers and suppliers, and the need to repair systems? Ransom demands and extortion can lead to the loss of money and goods that are vital to your ability to continue trading. With the potential knock-on effect of lost competitive advantage, and damage to brand image. Plus, with the advent of more stringent GDPR requirements, the potential for regulatory penalties and fines!

So what are the threats to my business, what are my vulnerabilities, and are there any counter measures I can put in place? Phishing attacks, that involve emails claiming to be from reputable companies, try and trick staff into revealing personal or company information, such as passwords and credit card numbers, are some of the most common, and are best detected by training and vigilance.

Ransomware – software designed to block access to a computer system until a sum of money is paid – and malware, specifically designed to disrupt, damage, or gain authorized access to a computer system (which can sit on your system for up to 230 days before activation), along with a distributed denial of service, are the most common threats. Regularly updating anti-virus software and completing patching regimes are the first line of defence. But, outdated operating systems like Windows XP are particularly vulnerable because they are not supported or updated and are therefore liable to attack.

More practical measures to combat insider threats involve awareness training. Disabling USBs and other unnecessary hardware, separating user accounts, removing software, and implementing administration rights, can all be effective in overcoming insider threats and mistakes. Above all, switch on your human firewall and develop a cautious secure mind-set.

But what if I need extra help? That generally comes in two forms. The first line of defence are the expert services of a specialist IT support company that will assess your systems, recommend and install defensive barriers, and devise pro-active company security protocols. They may also test the vulnerability of your system periodically using simulated attacks; suggest and monitor staff training programmes; and use heuristic filters to protect against as yet unknown threats.

The second line of defence – cyber insurance – may seem like shutting the stable door after the horse has bolted. Far from it. Although insurance is no substitute for vigilance it can offer a valuable safety net if the worst happens. From a single point of contact through to restoration and recover services, practical help from insurers will also include legal assistance and forensic services (from specialists like Xenace). And, not forgetting that your finances and reputation will suffer – public relations cover!

But, before we leave the subject of finances, what does insurance cover? Losses could involve simple theft of funds, but might also result from hackers accessing data and demanding a ransom to release it, and income lost when viruses paralyse systems. But the knock on effect could also extend to fines and penalties incurred through data protection non-compliance, legal action by customers following accidental loss of data, and interruptions caused by the paralysis of third party providers.

At first glance Cyber-crime might appear to be a nuisance, and a distraction, from the daily routine of running a membership body. But it can quickly spiral out of control, causing untold damage, not only to finances, but also to brand image, reputation, and member confidence. So prevention in the form of technical expertise is most definitely best. But if you need a cure then insurance is there to help. Or better still, why not belt and braces?
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Blog, Public Affairs, Public Relations

Thirteen years as CEO of the now defunct National Association of Goldsmiths (NAG) and I was beginning to experience a sense of frustration that the debate on transparency and trace-ability in the jewelley supply chain was going around in circles! After more than a decade of work – heroic efforts by Greg Valerio and Fairtrade Gold, and a bucket load of green-wash from other quarters – I was starting to feel that the pool of committed people was almost saturated and that we were now just having a circular debate within a group of devotees to the cause. But the recent FLUX: REDEFINING LUXURY conference has restored my faith!

The True Cost

Now, after three years watching from the side-lines, I’m immensely encouraged to find that the message is again reaching a wider, grass-roots, audience of designer makers. Why is this? Well, persistence is one reason, recognition another! The award of Greg’s MBE contributed new impetus and pushed ethical gold several notches up the awareness ladder. Ethical fashion has helped too.

In 2000 – when I first became involved with retail jewellers – many didn’t really get the connection between themselves and the fashion industry. But brands and diverse materials have broadened their horizons, and cemented the bonds between jewellery and fashion. Interestingly fashion and jewellery have been running on parallel tracks when it comes to ethical supply chain issues too.

Both are concerned with provenance, the elimination of destructive environmental practices, human rights violations, and exploitation of local workers. But their gestation periods have been different. Environmental and exploitation anxieties about gold, precious metals, and diamonds matured over decades, reaching their tipping point with the No Dirty Gold and ‘blood diamond’ revelations early this century.

Similarly, the extraction, and consumption of water during cotton cultivation and subsequent pollution in the processing of fabric has long been an environmental concern for the fashion industry. The universality, accessibility, and relentless rapidity of fashion trends – ‘fast fashion’ – has accelerated that destruction but also propelled the possibility of change in the garment industry. The durability, value, and complexity of jewellery, has driven change more slowly.

Fashion Revolution was born, in the wake of the Rana Plaza collapse in Dhaka, Bangladesh, that killed 1,134 and injuring 2,500 others.  Its belief that ‘fashion can be made in a safe, clean and beautiful way, where creativity, quality, environment and people are valued equally’ seems to me to be the fundamental linkage between jewellery and fashion! Thanks to Greg, Fairtrade Gold, Lina Villa from ARM, and Orsola de Castro of Fashion Revolution for bringing that fact vividly to life!

Michael Hoare

Bavaria 1

 

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For most of the twenty-first century the jewellery industry has agonised over the moral, ethical, and environmental damage done by the exploitation of diamonds. Be that in terms of child labour, the blighted lives of miners, the spoil left by the extraction process, the financing of civil wars, or the propping up of repressive regimes. The Kimberley Process, and subsequent legislation, attempted to bring forth order out of chaos.  But in 2006, the Hollywood blockbuster movie ‘Blood Diamond’, starring Leonardo Di Caprio, pricked the conscience of the industry and brought the subject back into public focus. The actor’s name has been linked with low-level anti diamond activism to this day.

Disruptive Diamonds V2

Industry insiders don’t need reminding of all the arguments that have ricocheted to and fro ever since. Initiative has piled upon initiative in an attempt to improve the situation – or create a thicker smoke screen – depending on your point of view, and the depth of your cynicism.  At the same time the hunt has been on for verification systems that could guarantee the provenance of natural diamonds, or for diamond substitutes that provided glitz without guilt. Cubic Zirconium was a passable diamond simulant, but lacked the cache of the real thing and, whilst man-made synthetic diamonds were theoretically possible, it wasn’t until the barriers came down across Russia that the technology to manufacture them became readily available.

So, imagine the kudos attaching to a company that not only claims to be able to manufacture quantities of large synthetic diamonds relatively quickly and economically, but also secures an investment and an endorsement from Di Caprio! Not only will his money come in handy, his publicity value is enormous! But Diamond Foundry isn’t actually too short of money, having secured the financial backing of six billionaires in making products that they claim are “ethically and morally pure”, and selling them – already set in jewellery – direct to consumers.

Naturally enough, there has been a backlash, with an open letter to Di Caprio, from Bob Bates of JCK Online, questioning the basis of the company’s environmental claims, highlighting the social and economic impact on mining communities in Botswana, South Africa, Namibia, and Sierra Leone and raising fears about the effect of commodification on prices. So, the argument over who benefits most from diamonds – the miners the middle-men or the financiers – and who will suffer most from the proliferation of synthetics rumbles on.

However, regardless of the arguments or judgements about who is morally or ethically right, the underlying theme of this debate is one that we will return to regularly over the next decade. For here is a classic example of a disruptive innovation. One that has the potential to create a new market and value network – disrupt existing ones – and displace established market leaders and alliances. Think Alibaba, Amazon, and Uber!

As we plunge into Industrial Revolution 4.0 it becomes easier to make money than even twenty-five years ago. Setting up and running a mine is expensive and requires a lot of manual workers. A company that makes its money out of a smart app needs less capital, doesn’t incur the same infrastructure costs, and virtually no extra outlay as the number of users rise. In other words, the marginal costs per unit of output tend towards zero. That’s why tech entrepreneurs get very rich very young!

Oxfam recently highlighted that the sixty-two richest billionaires own as much wealth as the poorer half of the world’s population put together. The world is becoming polarised between the ‘haves’ and ‘have-nots’.  Against this backdrop, regardless of ethical, or environmental concerns, the initial losers will be those at the bottom of the heap.

What if the ‘direct-to-consumer’ model proliferates – undermining established practice and traditions, atomising existing supply chains, shedding jobs, and vaporising careers? As wealth passes from old style mine owning corporations to billionaire technology pioneers and venture capitalists – concentrating it in fewer hands – who will be the winners and losers? Regardless of the short-term disruption, where are innovations like these taking us, and what will be the effect on society in years to come?

Bavaria 1

Michael Hoare FIAM

Reviewing your strategy, communications, or public profile? Can I help? info@michael-hoare.co.uk    
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Getting a buzz from jewellery drones

The jewellery trade press are reporting that a business owner in the U S has completed what is thought to be the first ever drone-delivery undertaken by a jeweller. According to Jewellery Focus:

‘Distinctive Gold Jewelry, of Frankfort in Illinois, delivered a women’s watch to a couple celebrating their anniversary. The business owners say that they have being “dying to do” such a delivery since they first heard of the concept of drones. Drones have become a talking point in retail and consumer circles ever since online shopping giant Amazon said it was trialling the technology….It is not clear whether Distinctive Gold Jewelry intends to roll it out as a standard part of their service offering, but it has nonetheless garnered some attention stateside, with US trade magazine National Jeweler breaking the story.’

So, a PR coupe for Distinctive Gold Jewelry, but what if this neat – even amusing – stunt were to become an everyday occurrence?  The crowded streets of our major cities are a far cry from the comfortable little town of Frankfort with its 17,000 inhabitants.

Scale up the delivery of one watch to the kind of volumes that might attract Amazon, and you have a whole different scenario. Imagine the skies of London or Birmingham buzzing with delivery drones? Or worse still, the peaceful horizons of our market towns? Is that really what we want?  How much fun will it be when our Sunday afternoons – and maybe nights – are shattered by the infernal buzz of drones passing overhead? How much of a laugh will it be when you’re poleaxed by a parcel falling from the sky, or get a swipe across the head from a twenty kilo projectile, as it bounces off the roof, and breaks a few tiles on the way down? And who will pay for the damage?

So, leaving aside the obvious security concerns, the threats to privacy and safety are just two of the reasons we should think very hard before surrendering to this seductive new technology. But if that time ever does come, I think I’ll be investing in a tin hat and a catapult!
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Nobody expects the unexpected, but you can at least try and plan for it!

Opening up the building after the Christmas shut down a few years ago I discovered to my horror that over the holidays a small electrical explosion caused by a power surge had burnt out the main fuse box and deprived us of heat, light, switchboard, and computers. Unbeknown to me the argument that ensued about liability between the electricity board, energy supplier, and contractor, would take days to resolve and result in no power for a week, but even at this stage it felt like a disaster!

RISK REGISTER v2

Packing the staff off for what we thought would be a welcome extra day`s holiday, and thanking our lucky stars the whole place hadn`t burnt down, an intrepid colleague and I settled down in the cold to manage the recovery as best we could; literally and metaphorically fumbling in the dark to resolve the problem.

With year-end accounts to complete and membership renewals in full swing it could hardly have happened at a worse time. But a lucky break came with the discovery of one lone top floor power socket that was unaffected. As – being an old building – it was probably connected to next door`s supply! So, with the aid of a long extension cable, we powered up the servers and key colleagues were able to use remote access connections (the one thing we had planned for) to return us to some semblance of normality – at least to the outside world!

Now, how likely it is that we could have anticipated the catalogue of other people`s errors that led to this incident is a moot point. But it is illustrative of just the kind of risks that lurk around every corner. But, the fact that we avoided a disaster was down to luck, rather than planning.

You could categorise our mini disaster under the heading of a technical failure, or even a service provider failure, but risks come in all shapes and sizes and can include loss of key personnel; reputational risk; regulatory and legal failures; financial losses; poor project management; compromised governance; or environmental factors like flood, gale, snow, or fire.

Risks tend to cascade, trigger a domino effect, or worse still collide to exponentially magnify the consequences. So, formulating a risk register that identifies threats, and puts in place plans to deal with the fall out, has got to be a good idea. Yes?

Of course, risks sometimes revolve around people too. I know of one trade association that suffered severe trauma due to the loss of its CEO and Chairman. Reputational risks ensued from allegations of inappropriate behaviour, leaving a compromised and rudderless Board in charge. Finding scapegoats, apportioning blame, and alienating those who could have mitigated adverse publicity did nothing to help. And, despite loyal staff eventually regaining equilibrium, the long-term damage is impossible to calculate. But much of it could have been avoided had there been a plan in place for the Directors to follow!

Dull as it may seem, a risk register lists all the risks pertaining to a business (or project), their grading in terms of likelihood of occurring and seriousness of impact on the company, initial plans for mitigating each high level risk, and subsequent results. It also usually includes details of who is responsible for managing the risk, and an outline of proposed mitigation actions (preventative and contingency). It must be regularly re-assessed as existing risks are re-graded in the light of the effectiveness of the mitigation strategy, and new risks are identified. So, ‘filing and forgetting’ it isn’t an option!

So, a risk register tells us the what, where, and how of risk management, but it also provides the trustees, management committee, and funders with a documented framework against which risk status can be reported. It also ensures the communication of risk management issues to key stakeholders and compels them to act. Let’s face it, disasters happen! Some are predictable, others preventable! But if they strike while you’re in charge, neither shoving your head in the sand, or running around like a headless chicken are attractive options!!

Bavaria 1

Reviewing your strategy and communications? Can I help? Over twenty years’ association management experience.     Michael Hoare FIAM
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