Oncourse issue 19

The market for tax knowledge

Business secretary speaks at Management School conference

Why are older people becoming entrepreneurs?

Southampton welcomes global marketing experts

OnCourse Issue 19

Will entrepreneurs clean up and lead us out of recession?

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In this issueHow many beans make five? Company accountants hopefully have the answer but research by the Management School’s Professor Kevin Holland discovered many non-finance executives shy away from getting involved in their organisation’s tax affairs. Is this wise? Kevin explains more in a thought-provoking article in this edition of On Course.

Business Secretary Dr Vince Cable MP said we were ahead of the game in educating young people about banking when he spoke at a conference earlier in the year. An audience of money market professionals and academics at Winchester heard my colleague Professor Richard Werner and invited speakers describe the German model of savings banks and outline how other countries could learn from their example.

We have welcomed many visitors from around the world in the last few months. It was fascinating to talk to senior leaders from the government of Vietnam who spent a fortnight with us to learn more about western styles of leadership and management. Outside the seminars, we showed them the delights of the English countryside; they also enjoyed a trip to London.

We always enjoy finding out what our alumni are doing now. Phil Boyle, one of our Management graduates from 1987, is now president of the Royal Aeronautical Society. But I must explain he was an RAF pilot earlier in his career as well as a manager.

We hope you enjoy learning more about what is happening at the Southampton Management School, to discover more, see www.southampton.ac.uk/management

You can keep in touch with us through our Facebook alumni page www.facebook.com/SMSAlumni or our LinkedIn account SMSAlumni Southampton

Professor Malcolm Higgs Director of the Southampton Management School

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We are keen to receive any feedback you have about On Course. If you have any comments or suggestions, please do send them to [email protected]

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More highlightsPractical tips to apply psychological insights in the workplacePage 18

Vietnamese leaders discuss change management Page 23

1 Will entrepreneurs clean up and lead us out of recession?

Innovation may be the answer to the economic downturn

Page 6

2 The market for tax knowledge How much do companies really

know about tax? Page 8

3 Marketing: catching the technology wave

Leading experts debate at Southampton

Page 12

4 Older entrepreneurs: The rise of the work-retirement balance?

New ways to make your pension go further

Page 16

Latest developments

4 OnCourse | Southampton Management School

Third year Management with Entrepreneurship student Charlotte Pearce is President of Enactus Southampton, student society that aims to use the power of entrepreneurial action to transform lives and shape a better, more sustainable, world.

She leads 151 undergraduates and postgraduates who are committed to working on projects at home and abroad to make a difference and has taken over from Chris Coates who has graduated with a masters in Business Analytics and Management Science (BAMS).

Formally known as SIFE (Students in Free Enterprise), Enactus is a global non-for-profit organisation involving hundreds of universities around the world. Southampton represented the UK at the Enactus World Cup in Washington DC in September 2012 after winning

the national final for the second year running, defeating 47 other universities.

Charlotte started volunteering with Enactus by fund-raising for the society’s projects then got more involved with its activities. “We work with charities and non-governmental organisations around the world on innovative projects,” she says. “It is very rewarding and gives us invaluable skills needed in all walks of life, I am a completely different and more confident person now.

Southampton projects include providing solar lights to people in Madagascar Kenya and Uganda, supporting disabled people in the city who want to set up their own businesses, and improving sanitationin Kenya by designing and building toilets out of recycled materials.

News

Students tackling innovative projects to make a difference

Understanding decision-making in financial marketsSpecialists from the Southampton Management School are contributing their expertise in real time risk modelling to a leading financial company.

Professors Ming-Chien Sung and Johnnie Johnson and Dr Tiejun Ma from the Centre for Risk Research have secured £148,000 funding from the Economic and Social Research Council (ESRC) and Technology Strategy Board (TSB) for a two year Knowledge Transfer Partnership research project with London Capital Group Holdings plc (LCG). They will engage an Associate to work with the company to develop a real time risk model of financial trading performance.

Nick Lewis, Director of Trading at LCG comments: “We were keen to sponsor this KTP research project because the Centre for Risk Research has expertise in complex database management, advanced statistical modelling and decision-making and risk analysis”

KTPs bring together academic expertise in higher education with UK companies and organisations who want to improve their competitiveness through tapping into advanced knowledge, innovation and skills.

Latest developments

5OnCourse | Southampton Management School

Committed to responsible management educationThe Southampton Management School has re-confirmed its commitment to the United Nations Principles for Responsible Management Education (UNPRME).

We originally signed up to the framework in 2009 and have worked to integrate ethics into our curriculum and research ever since.

Director of the Management School Professor Malcolm Higgs says: “Although it is assumed that many students choose business and management degrees for primarily economic objectives, we believe that education can play a key role in helping our society to make the changes necessary for sustainable development in the longer term.”

New modules in management ethics, corporate social responsibility (CSR) and social entrepreneurship have been introduced into the curriculum; our MBA programme has been redesigned to allow three themes ‘responsible management’, ‘environmental sustainability’ and ‘globalisation’ to run across all units.

Helping students settle into SouthamptonHundreds of students from all around the world started their degree programmes in 2012 at the Management School. This academic year, they received a special welcome from three friendly young people who knew what it was like to travel thousands of miles to study.

Ivan Melendez, from Mexico, Anastasia Delchanidou from Greece and Emma (Zhenqiong) You from China helped the newcomers to settle in. All three had studied masters degrees at Southampton then went on to work as ‘peer advisors’ with the new postgraduate students. They were on hand to help with everyday problems that students might encounter during their time at Southampton.

Learning and Teaching Co-ordinator Dr Mary Morrison says: “We have students here from more than 30 countries in the world and we want all of them to have the best-possible experience of education at Southampton.”

National honour for Professor Michelle LoweMichelle Lowe, Professor of Strategy and Innovation and Associate Dean, Faculty of Business and Law has been elected an Academician of the Academy of Social Sciences (AcSS), in recognition of her various contributions to the social sciences over the last 25 years.

In research funded by the Economic and Social Research Council (ESRC) and Engineering and Physical Sciences Research Council (EPSRC), Michelle completed a unique in-depth three-year study of the innovatory dimensions of the high-risk market entry of Tesco into the USA. Her current work centres on the future of the UK high street (sponsored by ESRC and Tesco plc) as well as innovation in the boutique hotel sector.

Earlier in her career, Michelle explored waged domestic labour, dual career households, and the domestic division of labour in contemporary Britain. This high-profile research with Nicky Gregson produced the 1994 book Servicing the Middle Classes as well as well-cited papers in leading sociology and geography journals.

Michelle is interested in the wider role of services, particularly retail, in local economic development and in the evolving urban landscape. With Neil Wrigley, she produced two highly influential books - Retailing, Consumption & Capital (1996) and Reading Retail: A Geographical Perspective on Retailing & Consumption Spaces (2002).

Latest news

To stay up-to-date with the latest news please visit www.southampton.ac.uk/managementnews



Image courtesy of Dyson


Professor Jeremy Howells, Dean of the Faculty of Business and Law at the University of Southampton, has researched entrepreneurship for many years, during his career as a management academic. He admits the UK is facing a challenge but remains optimistic.

“Entrepreneurs in the UK have a good track record in setting up companies but we have been less successful in turning them into long-term ventures,” he explains. “For every Branson or Dyson who have set up prosperous companies, thousands have fallen at the wayside. But look at the so-called ‘gazelle companies’; they may be small at present but they are growing by 20 per cent a year. We need to identify the factors behind their success. It could be down to how much money they spend on R&D, it could be the influence of human factors and training. This is rich ground for research.”

The Southampton Management School has always worked closely with businesses large and small. Academic staff combine their duties in education with research with a wide range of companies in the public and private sectors. Their findings are then used directly in their teaching so professional managers can benefit from the latest thinking in their profession. Effective and innovative change management will be explored in the next series of short courses this spring to be run by Southampton’s specialist academics with the aid of skilled professionals who work in human resources and organisational behaviour.

A cross-channel collaboration with the Ecole de Management de Normandie in Caen brings a French flavour to Southampton’s work on entrepreneurship and innovation. Two international conferences have

now been held, one in Normandy, one in Southampton, to explore these issues; the 2012 event focused on socially responsible and sustainable entrepreneurship and innovation. Co-chair Dr Mine Karatas-Ozkan from Southampton and her colleagues introduced a wide range of papers from academics from Europe and elsewhere in the world, many discussing the subject from their own country’s perspective. Keynote speaker Professor Sibel Yamak from Galatasaray University in Turkey addressed delegates on corporate social responsibility (CSR) and its influence on entrepreneurship. Research in areas including shipping, mining, tourism and health care were also covered at the two day conference.

“Our aim was to demonstrate our internationally recognised research activities in entrepreneurship, CSR and sustainability,” says Mine. “We want to advance research into these areas with a focus on emerging markets and we believed that this conference would allow us to strengthen our international links and exchange ideas for future work with new and established colleagues, creating further synergy.”

Dr Lorraine Warren, Director of Southampton’s Centre for Strategic Innovation, is already involved in a joint research project with EMN. She is looking at how management schools in the UK and France work with their communities, assessing potential for academics to support local businesses. “Researchers from both Southampton and EMN are talking to people in universities such as outreach and marketing staff who work directly with companies and organisations, representatives of business organisations such as Chambers of Commerce and the UK’s

Federation of Small Businesses and clients of management schools including companies like B&Q in Hampshire,” she outlines. “We are learning from each other and will share results when the project is over.”

The University of Southampton and EMN are working together as part of the EU Interreg project, which is aimed at strengthening cross-border links as well as promoting exchange visits by students and staff.

The Southampton Management School offers many opportunities to students to develop their entrepreneurial skills. An undergraduate degree in Management with Entrepreneurship covers theoretical approaches and encourages students to try their hand at practical projects to test their business acumen. One example of a real-life challenge is an annual competition for groups of second year students from several disciplines who are studying an entrepreneurship module. In 2012, they were asked to research a successful local manufacturing company, Benham Manufacturing, and suggest growth strategies for the precision engineering business. As well as writing a group essay, the undergraduates presented their work to their tutors and the Managing Director of the company, Paul Benham. Many academics are interested in the subject and work directly with companies and organisations ranging from major multinationals to SMEs in their research.

New for 2013 is a masters degree in Global Enterprise and Entrepreneurship which will cover the fundamentals of strategies and business processes, promote innovation and creativity and develop the student’s knowledge of worldwide issues and opportunities.


Entrepreneurship is always in the headlines. The High Street may be in the doldrums and traditional industries may be struggling to survive, but pundits predict people who can put their innovative business ideas into practice could restore long-awaited growth to the UK economy. How can Management Schools help?

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The market for tax knowledgeBy Kevin Holland, Professor of Accounting and Taxation


While the focus has been on the amount of tax paid, or, depending on your perspective, not paid, it overlooks the other roles of a corporate tax system. While the most obvious and important is the raising of revenue, increasingly tax systems are used to influence behaviours. In the UK, corporate tax relief is available for a range of deemed socially desirable activities including investment in research and development and energy saving technologies.

Paradoxically, while access to tax knowledge is an important determinate of successful corporate tax planning, and therefore can facilitate loss of tax revenue, governments desire and even take steps to ensure companies are tax informed or tax sensitive. If behavioural changes are to be brought about, decision makers within companies must be aware of the relevant tax knowledge. Having informed tax payers can also help lower the costs associated with administrating a tax system by bringing about a higher level of voluntary compliance. Of course, compliance with the ‘letter of the law’ may not necessarily be the same as complying with the ‘spirit of the law’.

Tax avoidance has traditionally referred to tax planning that complied with the letter of the law and was therefore ‘legal’. Evasion, in contrast, describes illegal tax planning. More recently, tax administrations have attempted to draw a distinction between ‘acceptable’ tax avoidance and ‘unacceptable”’avoidance, both by definition legal. In its latest estimates of the UK Tax Gap, HM Revenue and Customs (HMRC) introduces a third concept, ‘legitimate tax planning’ which describes compliance with the intention or purpose of the legislation which it distinguishes from tax avoidance which it describes as ‘bending the rules’.

Where ever one thinks the line between acceptable and unacceptable tax avoidance, or legitimate tax planning and tax avoidance is drawn, an important dimension of an efficient corporate tax system is the process by which companies become aware of tax legislation and other tax related information or what is collectively termed ‘tax knowledge’.

Research by Professor Kevin Holland from the Southampton Management School along with colleagues from University of Nottingham examined companies’ interactions with the UK tax administration, HMRC, and their tax advisers. Collectively these interactions can be viewed as a tax knowledge market. Within this market, HMRC can be seen as a knowledge producer and companies as knowledge buyers, while tax advisers perform the function of knowledge brokers. At various stages the parties’ roles may change. Companies may act as knowledge suppliers to tax advisers who in turn act as knowledge sellers to HMRC.

A distinctive feature of the market for tax knowledge is that it is relatively non-competitive when compared with other business-related knowledge markets. In management consultancy markets, for example, a far greater proportion of traded knowledge is proprietary. In the tax knowledge market, as a starting point, all participants have equal access to the legislation and details of administrative procedures. Of course comparative advantages may exist in how the knowledge by companies and advisers is used.

As primary consumers of tax knowledge, an understanding of how and why companies acquire tax knowledge is important in assessing whether the market is operating efficiently and effectively. Simultaneously,

to the external tax knowledge market comprising HRRC, tax advisers and companies, markets exist within companies and tax advisers. How these internal markets are structured, and the various parties motivated to become involved eg tax expert and non-tax expert, say, a remuneration expert or scientist is of importance if companies are to meet their legal compliance responsibilities while identifying and managing tax risk. Similarly, if companies are to respond to tax legislation in the desired manner, whether one looks at it from the perspective of shareholders or HMRC, then adequate knowledge of tax legislation is a prerequisite.

The ability of tax advisers to meet the tax knowledge needs of both companies and HMRC is critical to their performance. Without any comparative advantage, companies and HMRC would benefit from having direct contact with each other. Both in the UK and internationally, there is evidence of such a trend emerging. Advisers’ status is dependent on how they generate, maintain and retrieve their tax knowledge. HMRC itself uses advisers to assist in disseminating HMRC policy and practice. This dual role can be likened to the bumble bee; pollinating by disseminating and “stinging” by facilitating tax planning.

In the research 26 interviews were conducted with companies (13), tax advisers (eight) and HMRC (five). Company interviewees were primarily staff from the accounting or finance function, though other functions were represented, such as human resources. Attempts were made to interview people from other functions but only a small number of such interviews took place. Although this reluctance could simply be an unwillingness to participate, as discussed subsequently a

These are heady days for anyone with an interest in corporate tax systems. Tax has made the front pages with press and television reports of parliamentary committee proceedings, protestors’ direct action and companies’ responses.


Tax avoidance has traditionally referred to tax planning that complied with the letter of the law and was therefore ‘legal’.

better explanation is not recognising tax as a significant factor. The tax advisers were employed by accountancy firms across the full size spectrum, ranging from a sole principal to ‘Big Four’ partners. The majority of advisers were tax specialists, although knowledge management specialists and general partners were also interviewed. Within HMRC, the interviewees came from a range of responsibilities including staff with direct tax payer responsibilities, knowledge management specialists and policy and practice directors.

Two Internet-administered surveys were used to broaden the response base. They produced 218 responses from companies and 223 tax advisers. Revealingly, two other mail surveys targeting human resource managers and engineers attracted an insufficient response despite the assistance and support of their associated professional institutes. This suggests a lack of awareness or engagement with taxation responsibilities.

Key findings

A full discussion of the research findings is available in the publications listed at the end of this article. Some of the key findings are as follows. Beyond the obvious motivation to simply minimise their tax liability, companies employ external tax advisers for a number of other reasons. Risk identification by tax advisers is highly valued, as is their risk-shifting or insurance protection role. Although, tax advisers recognised the importance of this insurance function, the level of awareness was lower suggesting that some advisers may be unwitting insurance providers. Who benefits from the provision of tax related insurance is an open question, the answer depends on your view as to the social desirability of an increase in demand for tax planning.

Insurance considerations can drive the decision by companies on where to obtain tax knowledge. The options include external advisers, in-house advisers or a combination of both. However, it is unclear what fully drives that decision. Although the use of in-house advisers was positively associated with company size, it was not associated with either companies’ perceived demand for tax knowledge or the level of tax complexity facing companies.

The perceptions of both in-house and external tax advisers are that the level of tax awareness in companies outside of the tax and finance functions is low among operational decision makers. This is despite the fact that a significant proportion of these individuals are formally required to consider the tax effects of their decisions. Operational decision makers within companies are not seen as reliable sources of knowledge relevant to tax decisions, both in terms of its timeliness and level of detail. As one might expect, the level of tax awareness among operational decision makers was higher among companies with in-house tax experts. A challenge for all parties is how to raise awareness of taxation issues among such individuals without overburdening them with detail and complexity. A low level of awareness can lead to companies missing an intended tax planning opportunity eg R&D tax credit and the unconscious generation of tax risks. Transactions can be entered into without the tax affects being appropriately considered.

While the majority of companies describe their relation with HMRC as being ‘good’, only around a quarter consider they have sufficient opportunities to share knowledge with HMRC. Consequently HMRC may be missing opportunities to learn directly from

companies about their experiences with the administration of the tax system.

Companies’ attitudes to capturing tax knowledge are ambivalent, only a small majority agree that capturing internally generated tax knowledge is important. In part, this lack of effort is driven by an attitude that knowledge resides within the individual and attempts to capture and store it externally will fail. The dynamic nature of tax law means captured knowledge is vulnerable to becoming dated quickly within a formal knowledge management system.

As companies grow in size and geographical spread and become more complex the volume and complexity of tax legislation increases. Against this background the benefits of well functioning external and internal markets for tax knowledge increase. Risks are better identified, tax incentives more effective and, when appropriate, taxation can be administered on the basis of trust and co-operation compared to the more traditional ‘adversarial’ approach. These are very interesting tax times. Heady and dynamic, adjectives not usually associated with tax.

Publications:

Hasseldine, J., Holland, K. M., and Van der Rijt, P. G. A. (2010). Management of Tax Knowledge. Research monograph published by Certified Accountants Educational Trust (London), pp 1-60 ISBN: 978-1-85908-455-7.

Hasseldine, J., Holland, K. M., and Van der Rijt, P. G. A. (2011). The Market for tax knowledge, Critical Perspectives on Accounting. Vol.22 (1), pp. 39-52.

Hasseldine, J., Holland, K. M., and Van der Rijt, P. G. A, (2012). The Management of Tax Knowledge, Taxation: A Fieldwork Research Handbook ed. Lynne Oats Routledge.


Programmes in 2013 start with a practical short course on managing and implementing change in companies and organisations.

The Southampton Management School welcomes Paul Bennett from the Henley Business School as its new Director – Executive Education. He has a comprehensive knowledge of the current business environment and its management challenges and is known for establishing partnerships at senior level with major regional and national companies

Following a successful naval career and before joining Henley, Paul was Managing Director of an international leadership development consultancy working across a number of key business sectors.

“I am delighted to join Southampton, one of the UK’s leading universities, which is renowned for its world-leading research,” he says. “Our aim is to develop a vibrant learning community for senior managers, which is relevant, impactful and grounded in reality.”

The Management School offers executive education designed to keep managers on track with the latest thinking, delivered by experienced professionals. Programmes

in 2013 start with a practical short course on managing and implementing change in companies and organisations.

“Senior managers in the public and private sectors will learn how to achieve successful change through our interactive sessions,” explains Nicholas Clarke, Professor of Organisational Behaviour and HR Management. “We will be presenting new tools from new theories of change developed through our own research into change management.”

Six half-day sessions will cover how to lead and manage large system change using effective project planning techniques. Skilled academic and professional tutors will explore participation and engagement, team building/ leading and change/conflict management.

For more information on management short courses email [email protected] Or visit www.southampton.ac.uk/management

All change for Change Management.

Executive education at Southampton


Marketing: catching the technology wave

“We were pleased to secure Facebook’s UK Commercial Director Stephen Haines as our keynote speaker...”


Southampton hosted the Academy of Marketing conference in 2012. It broughttogether 400 experts from across the world to discuss the discipline of marketing from fashion brands to ‘silver surfers’. Director of Marketing Education at the Management School Dr Bev Hulbert explains what happened at the international event:

Four hundred leading marketing specialists from the UK and around the world descended on the University of Southampton to discuss and debate the latest developments in the discipline at the 2012 Academy of Marketing conference (AM2012). Its theme was Marketing: catching the technology wave.

Q What was discussed?

An academic conference brings together experts to talk about their research and bounce ideas off their peers. As our theme was designed to consider how marketing as a discipline was responding to the new challenges and opportunities given by developments in digital technology, most of the 300+ papers submitted by delegates covered this aspect of the discipline. We don’t have room to mention all the subjects covered but I can mention a few.

Dr Julia Wolny from our Southampton Marketing team and colleague Claudia Mueller of the London College of Fashion explored consumers’ interactions with fashion brands on social networking sites, focusing on how this affects electronic word of mouth recommendation. Jan Breitsohl from Bangor University looked at how ‘silver surfers’ aged over 50 use the Internet, in particular how they express negative opinions about goods and services. Twitter was the focus of research for Ana Canhoto from Oxford Brookes University. She wanted to examine how companies and organisations ought to handle customer comments posted on social media.

Q Why did the conference organisers choose to come to Southampton?

It all goes back five or six years. I had been a delegate at past AM conferences and talked to people at the Academy about the possibility of bringing it to Southampton. At the same time, we had been working to transform the curriculum of university-level marketing

education to reflect the growing importance of data and digital technology to marketing professionals. It was the right time to talk about this subject with academics and practitioners.

Q How much organisation was involved?

Running such a major conference is a challenging task; I would say we started planning a couple of years in advance. Deciding on a theme, working with the Faculty’s events team to book venues and accommodation were all important, but we began by issuing a call for papers and making arrangements to review the 500+ submissions a year before. We were pleased to secure Facebook’s UK Commercial Director Stephen Haines as our keynote speaker and he was joined by Professor Charles Hofacker from Florida State University, who also addressed a plenary session.

Q How did it go?

You ought to ask the delegates! We had plenty of encouraging feedback from people who came and I thought our sessions were thought-provoking and well attended. Even ‘though the event took place in the summer, we were thankful we arranged to buy specially branded conference umbrellas as it started with a rainstorm. These exclusive items turned out to be very popular and I suspect many of the umbrellas have now found their way to universities around the world.

During the conference, there was no time to relax, there was always something to sort out and sadly there was little time to chat. My colleagues were also busy; Dr Paul Harrigan was co-chair and Professor Nina Reynolds chaired our Doctoral Colloquium for PhD students the day before the main event.

Nine special sessions were scheduled throughout the conference. They included the life and times of George Gershwin and his impact on modern marketing and

communications, technology and publishing, other sessions included faith-based marketing, virtual worlds, green marketing, best practice in curriculum design and marketing in the neural age.

Q How does the University of Southampton benefit from staging such a conference?

Hosting a successful conference has certainly put us on the map as a centre for innovation in marketing education. Our emphasis on digital marketing sets us apart from more traditional management schools and this is becoming recognised by organisations such as the Academy of Marketing and the Institute of Practitioners in Advertising (IPA), which represents a community of more than 240 UK-based advertising and marketing agencies serving more than 5,000 businesses and 10,000 brands.

Q How do you see Marketing at Southampton developing over the next few years?

We continue to work with our partners, which include the Chartered Institute of Marketing as well as the IPA and the British Interactive Marketing Association to research hot topics in marketing. Our degree courses at both undergraduate and postgraduate level continue to attract talented students from home and abroad and many of our graduates are getting good jobs in industry or stay on for further research with us.

The University now has a strategic partnership with the IPA. Its Future Talent programme aims to recruit high flying students from Southampton and senior people from the agency world are contributing to our programme design and teaching as well as providing internships and summer schools for our graduates.

Our plans are for Southampton to become a Centre of Excellence in the research and education of data-based and digital marketing.


Social media as a business tool Facebook, Twitter, You Tube etc are not just for entertainment. Management School Senior Lecturer Dr Lisa Harris is working with students on ways to turn social media into effective marketing tools.

Lisa runs a popular third year module, which challenges undergraduates to research, raise awareness and promote a local business, charity or society using suitable social media platforms. She also co-chairs the University’s Digital Economy Strategic Research Group, examining how new technologies can transform our world. Tech-savvy students have been recruited as ‘Digital Champions’ to encourage staff and students elsewhere in the University to create a buzz in classes, at conferences and other events by making the most of social media.

“Online technologies are moving fast and the opportunities are endless,” she explains. “We

support our students to discover innovative programs and software and learn how to use them effectively. Guest speakers from cutting-edge companies are frequently on campus to highlight exciting developments.”

Lisa was interviewed on Meridian TV in early 2013 about changing perceptions of social media and the increasing popularity of Facebook and Twitter among older people. She outlined to viewers how social networks are evolving beyond their original role as communication channels for teenagers and students. “The fastest growing demographic for people signing up to social media channels is the over 50s,” she explains. “They use them to send messages and keep in touch with family and friends around the world. But companies of all sizes are waking up to the possibilities of using these networking techniques as marketing tools as well.”

Back in the very early days of social media, Lisa examined how companies were using online marketing and networking in a paper in the Journal of Small Business and Enterprise Development. With co-authors Alan Rae and Ivan Misner, she analysed an online survey of more than 600 firms based in both the USA and Europe, comparing the networking behaviours of small businesses using face-to-face against online methods. They discovered smaller companies could ‘punch above their weight’ if they employed the latest technologies.

Undergraduate and postgraduate marketing programmes at the Southampton Management School focus on digital approaches with an emphasis on analytical techniques. Its graduates are in demand by agencies and companies who want to catch the technology wave.


Business Secretary Dr Vince Cable, MP, praised the Management School for discussing the future of UK banking at a top level conference at Winchester Guildhall.

“We’ve learned from bitter experience that failure to understand banks and questionable theories about rational markets have done a great deal of harm,” he says. “Southampton is ahead of the curve in encouraging intellectual debate in this area. I would strongly recommend that students understand banking.”

Richard Werner, Professor of International Banking, organised the second European Conference on Banking and the Economy (ECOBATE 2013). Speakers also included Dr Hans-Peter Schackmann-Fallis, member of the executive board of the Sparkassen Association of local banks in Germany. He explained how 422 independent public savings banks across the country with 15,600 branches loan billions of euros to local businesses. Money for the investment comes from the millions of local people who have accounts at Sparkassen banks.

“Local, sound, well-capitalised banks which rely on local savers have served Germany very well,” comments Dr Cable. “I would like to see that model reproduced here.”

A second conference in April, organised by Professor Taufiq Choudry, focused on examining the effect of the financial crisis on European banks and financial institutions. Speakers at Chilworth Manor included Professor Charles Goodhart from the London Business School, a former member of the Bank of England’s Monetary Policy Committee and Professor James Lothian from Fordham University in the USA.

Examining the future of banking and financeThe Southampton Management School hosted two high profile conferences on banking and finance in spring 2013.


One particular outcome of the global financial crisis, which has received less attention by the media, is the impact of the downturn on pensions and retirement. For example, one effect of the UK government’s quantitative easing programme has been the reduction of sovereign bond yields, which in turn has reduced the value of annuities for those seeking to retire. Similarly, the turbulence of equity markets stemming from financial uncertainty has reduced the value of pension funds, on which many diligent saver-investors have tried to build over time to provide them with security in retirement. On the other hand, those who circumvented financial markets and attempted to amass cash savings for retirement have seen their deposits eroded by rising inflation and record low interest rates.

This situation paints a bleak picture for many individuals approaching the state pensionable age (SPA), at which people often retire, as the likelihood of them obtaining the comfortable retirements which they expected or saved for have become less certain. However, even if the current financial challenges created by the credit crunch are placed aside, the increased life expectancy of individuals due to improvements in healthcare still require higher spending by individuals, businesses and the government, to fund the greater demand for healthcare and pension payments over time. A particularly important trend associated with the increased longevity of people, has been the escalating costs needed to fund defined benefit pensions, where businesses and their employees contribute to pension funds which pay a guaranteed, pre-determined income in retirement. These pensions have become more expensive, as they have to fund retired employees for longer, leading many businesses to close these schemes to new members. Instead, most large employers tend to offer defined

By Dr Thomas Wainwright, Lecturer in Strategy and Innovation

Older entrepreneurs: The rise of the work-retirement balance?


contribution pensions, where they contribute to a pension with employees, but where they make a fixed payment, based on a proportion of the employee’s salary. Subsequently, the retirement income of employees is not guaranteed, but is based on the performance of financial markets. This makes them less generous than defined benefit pensions.

However, not all businesses have a pension scheme, which has required some employees to make their own private pension arrangements, but for those on lower incomes, or those who are not financially literate, it has often seemed easier to simply delay contributing to a pension, with the intention of saving at some undetermined time in the future. This has led the UK government to introduce a new scheme in 2012, where employees are automatically enrolled into a business’ existing defined contribution scheme, or the new National Employment Savings Trust (NEST). The aim of the programme is to get all employees to contribute to a pension, although they are able to ‘opt out’ of the system, if they choose. However, some commentators have suggested that the current squeeze of wage freezes against high inflation may lead many employees to opt out. On the other hand, critics have argued that although low paid employees may accumulate a defined contribution style pension under the scheme, the value of the future pension, due to their lower contributions, will still not be sufficient to fund a comfortable retirement.

These issues raise serious questions as to how future retirements can be adequately funded. One potential solution, the uptake of ‘older entrepreneurship’, has been explored in a recent paper by Dr Thomas Wainwright at the University of Southampton’s Management School, and Dr Ewald Kibler of the Turku School of Economics (Finland). Recent research in this area has suggested that many people may choose to work longer, beyond the state retirement age (SPA), to delay drawing on their pensions, and to provide them with the opportunity to save more money for their retirement. However, many people may not want to continue in employment, or to remain in a job which they

no longer feel comfortable or passionate about. In addition, some people like the option of working for longer, to continue to earn an additional income, but would like the flexibility to work when they wish, not when required to by an employer, particularly in what they often view as their ‘retirement years’. These individuals, aged 50 years and above, often develop their business to derive an income in their older age, and are often known as ‘older entrepreneurs’.

Many people have begun to develop their own business in advance of the SPA, so they have a venture developed for their retirement years. Recent data from the Office of National Statistics has shown that people aged higher than the SPA are increasingly working for themselves, rather than an employer, highlighting the prevalence of older entrepreneurship in ‘retirement years’. Older entrepreneurship enables people to enhance their income in ‘retirement’, but is advantageous as they are able to vary their hours, if they need a break from work due to illness, or to increase their hours to earn extra money when needed. Wainwright and Kibler’s paper suggests that people who were unable to save for retirement, or chose not to, viewed older entrepreneurship as an alternative form of pension provision, providing them with a replacement income in older age, while allowing ‘retirement time’ in comparison to being an employee for longer.

The research also found that some individuals had carefully saved and planned for retirement, but that the returns from their investments were not sufficient to secure them the lifestyle which they wanted in retirement. In order to make up what the financial markets did not deliver, older entrepreneurial venturing was seen as a way of providing a ‘top up’ to their pension. Subsequently, they often planned their business around their financial needs, experimenting with the venture and business models prior to ‘retirement’. The paper argues that many older entrepreneurs are moving away from a more traditional work-retirement dichotomy, to a more fluid work-retirement balance, where they vary their hours of work and leisure. This flexibility is

particularly valuable for people who care for sick, older relatives, or for grandchildren. In some cases, older entrepreneurs blurred the boundaries between work and retirement further, by developing businesses which are related to their hobbies or interests, generating an income through activities they enjoy, making work in their ‘retirement age’, seem less like work.

As such, many older entrepreneurs tend to operate their business from home to flip between work and leisure, but also because it can be a low cost space for their venture. However, the research revealed that while working at home can facilitate a work-retirement balance, it can also develop tensions within the household. Previously, the home was viewed as a place of relaxation in retirement years, but work within the home can develop stress when work activities cannot be effectively separated from leisure time. Arguably this can be problematic for other members of the household, when work activities occur in spaces and rooms of the home which would normally be considered as spaces of relaxation in retirement.

Although older entrepreneurship may be viewed as a potential solution to some of the pension challenges faced in the UK, it cannot be viewed as a silver bullet. For example, older entrepreneurs whose income is strongly reliant on their ability to work in their business may not be able to use it as a long-term solution, as their ability to continue to work into a later age may be adversely affected by health problems. However, this does not rule out the role that older entrepreneurship could play in boosting incomes in retirement in the future, for those that have pensions, but which are not large enough to meet their needs. We urge more research into this area, to understand how policy-makers may integrate or support older entrepreneurs as a strategy to address pension related challenges in the future. While older entrepreneurship may not prove a useful vehicle for everyone, tailored training, support and education, if provided more widely, could assist people in developing new ventures to support them in an older age.


Feeling under pressure?Practical tips to apply psychological insights in the workplace

Are you facing urgent demands to improve your business or organisational performance? It is not surprising if you find yourself scratching your head for ideas and approaches that will make a difference.

As workforce motivation and performance are always critical issues, turning to business psychology for answers is not a bad idea. The only downside is that it can be a challenge to see past all the psychological jargon and find ideas that you can quickly apply with good effect. A quick scan of the business section of any bookshop reveals plenty of large volumes on the subject, but very little that a busy executive or management consultant can easily access. Yes, of course, we could do an internet search, but again the problem is the huge quantity and variety of material with no clear signposting about what is reliable and how you can apply it.

That is why my co-author Dr Jonathan Passmore and I wrote the book Top Business Psychology Models - 50 transforming ideas for leaders, consultants and coaches. Both of us are practising management consultants

and academics and it bothered us that there is a great deal of wisdom in the business psychology literature but it can be a real challenge to get to grips with it. We ourselves have even met clients, wanting to offer interesting approaches, but have struggled to remember the models or theories sufficiently promptly and accurately enough to sound authoritative.

When planning the book we began by putting together a list of some well-known theories like Maslow’s Hierarchy of Needs and the Hawthorne Effect and added some newer ideas like Flow and Appreciative Inquiry. Our aim was to pick business psychology ideas that have been tried and tested over the years and which work well with a wide range of clients and organisations. We wanted them to be practical and quick to apply. The chapters are deliberately short, a thousand words or so, and give neat summaries of the core idea together with some critique and practical ideas about how to apply it in practice.

Both Jonathan and I have a bias towards encouraging a positive, optimistic and

appreciative outlook on life and so our choice of models in the index of 50 reflects this. Interestingly, and I think unsurprisingly, more and more evidence is emerging which confirms such a positive outlook in an organisation leads to better results.

Researching the book proved to be a very stimulating experience. Having been taught a number of the theories over the years, I certainly had made assumptions about their validity and the reliability of the evidence which supported them. Being compelled to look in detail at some of the original material, it became obvious that things were not always as clear cut as they seemed.

For example, the Hawthorne Effect, with its idea that paying attention to a group is sufficient to increase productivity, has been dissected by critics over the past 60 or so years. The actual dynamics of the context and the research were far more complicated and the reasons for change in productivity certainly not as straightforward as the subsequent publicity around the experiments implied. It was also very interesting to look

“When someone says to you I’ve read this great research that says ‘if we did x, y and z in our company we could really improve performance’ do take a moment to find out the context of the work...”

By Stefan Cantore, Senior Teaching Fellow in Organisational Behaviour and Human Resource Management


at the social context of the work of the Hawthorne researchers, their assumptions and values. The bottom line is that business psychology research is located in a particular time and context and, despite their author’s best intention to conduct ‘pure’ research, it is really important to be aware of that context as we interpret the findings.

Tip: When someone says to you I’ve read this great research that says ‘if we did x, y and z in our company we could really improve performance’ do take a moment to find out the context of the work and the assumptions made by the researchers. It is obvious advice but a little of your own research always pays dividends.

For this reason, we made sure that every chapter of the book included a section where we looked at the perspectives of those who had critiqued the theory. It is a really helpful to be able to get the whole picture and then you can decide what you want to do with the idea - use it or bin it! Interestingly, a number of ideas, which have been torn apart by academics, are much used and appreciated by leaders and consultants.

Understand the whole picture before taking action, advice from Stefan Cantore


The Hawthorne Effect is one but others, for example, include the Phases of Change model. This was originally based on the work of Elisabeth Kubler-Ross and her five stages of grief. In a nutshell, she claimed that her research showed that people generally move through a series of stages as they experience the death of a loved one. Over the years, this idea has been adopted and adapted by management consultants who call it the Change Curve or something similar. The original work by Kubler-Ross has long been discarded by most psychologists in the field as unreliable but this has not in any way decreased the popularity of the Change Curve and its derivatives in the world of management consulting.

Tip: Some ideas, even if they end up being found to be false, prove very intuitively attractive to us. They somehow chime in with our experiences and emotions. When we find ourselves drawn to such theories it is worth pausing for a few moments to reflect on what question or issue is really making us respond so positively. I think for example,

that the Hawthorne Effect reminds me that paying attention to the social needs of people in a work context brings benefits not just for others but because it is what I desire myself. The Change Curve reminds me that organisational change brings with it a variety of emotional responses from different people and that this should be expected.

Given the diverse nature of business psychology models available to us Jonathan and I needed to think carefully about how to structure the book. Eventually we decided to split the models up into those which suited individuals, teams and whole organisations. Of course life does not work in such neat categories and there are overlaps but generally there is a good fit.

Tip: Before jumping in to use a particular model, try and think through what the focus is of your intervention? Are you trying to improve team working or help individuals change—or both? Again it is obvious but often I can find myself rushing into a situation with an approach or model in my mind. I need to stop and listen carefully to what is being

asked for and reflect on what might be most helpful and then offer it at the right time. Usually the initial request is to help sort out a symptom rather the deeper issue. It is worth spending time discerning the core concern rather than responding with a knee- jerk reaction.

We found writing the book an educative experience. Some of our pre-conceptions about business psychology were challenged and we also uncovered some less well-known ideas that we think will re-shape the way organisations develop into the future. I’m biased but I think it makes a worthwhile read for anyone under pressure to make big difference in the workplace!

Stefan CantoreSenior Teaching Fellow in Organisational Behaviour and HRM Top Business Psychology Models-50 transforming ideas for leaders, consultants and coaches. Authors: Stefan Cantore and Dr Jonathan PassmoreKogan Page, London.ISBN 978-0-7494-6465-3

“Before jumping in to use a particular model, try and think through what the focus is of your intervention?”


in the futures market. Management masters programmes

A member of the prestigious Russell Group of Universities, the University of Southampton is one of the UK’s top research universities. Our Management School has an excellent international reputation for the analytical study of management and business, providing cutting edge research and education with a global focus. We offer a selection of career enhancing postgraduate programmes in management related disciplines, including masters, MBA, and research programmes DBA and PhD.

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For registration and further information please contact the Postgraduate team on: +44 (0)23 8059 6965/6904 [email protected] www.southampton.ac.uk/management

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A University of Southampton Management Science postgraduate has become President of the Royal Aeronautical Society (RAeS), the world’s oldest and most prestigious aerospace organisation.

RAF pilot Phil Boyle from Portsmouth turned to the Management School near the end of his time in the air force, where he had flown Hercules and Nimrod aircraft before being posted to Boscombe Down, near Salisbury, as a trials pilot. He had seen service in the Falklands War. Although he had taken a masters in Avionics with the RAF, he wanted to study for a qualification that would prepare him for a career in business. The University of Southampton offered the right degree at the right time; Phil describes his choice as ‘serendipitous’.

“In the 1980s, a Management Science MSc was similar to an MBA but with harder maths,” he recalls. “The RAF helped out with a contribution to fees and some study leave. I went to university one day a week for two years and remember being taught by Dr Jonathan Klein. I thoroughly enjoyed the course and definitely got my first job as a civilian directly as a result of the qualification.”

Phil entered management consultancy after graduating from Southampton in 1987 and went on to found executive recruitment consultancy Ramsey Hall Talent Management, which has grown into a global brand.

He has been a member of the RAeS’s governing Council for over 20 years and, as President, now heads the global organisation. He is also Chairman of the Society’s Solent Branch. His continuing interest in aeronautics regularly brings him back to the University of Southampton, often to talk aviation with engineers.

Management Science prepares an RAF pilot for a new career


Senior Teaching Fellow Stefan Cantore devised the two week course which included lectures and seminars from academics in Social Sciences and Management and professional administrators, visits to local authorities and opportunities to spend time in London and the West Country. It highlighted how leaders in local and national government are managing cultural change in their organisations. It also included an overview of current issues in public administration in Britain.

Group leader Pham Hoang Be says delegates enjoyed their two weeks in the UK and found it a valuable experience. “We found the combination of theory and practice

both interesting and useful. The sessions on government policy in public administration were very relevant in a Vietnamese context. We also valued the chance to learn more about British culture, visit London and the English countryside and admire the harmony of your environment and architecture.”

Stefan says it was a successful programme. “Our guests were positive and enthusiastic. It was an excellent opportunity to share with the Vietnamese leaders our research on public administration, policy making and managing culture change. We also learned a great deal from them about the challenges they face.”

Vietnamese leaders learn about changing cultures More than 20 senior leaders from the government of Vietnam have gained new insight into UK policymaking through a tailor-made programme delivered at the Southampton Management School.

www.southampton.ac.uk/management [email protected] +44 (0)23 8059 9340

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