20:20 Vision: Sector Readies itself for Regulators Challenge
We facilitated a successful roundtable event at Midland Hearts offices with leading CEOs from across the social housing sector. We were joined by Fiona MacGregor, CEO of RSH, who shared the regulators perspective and emphasised the need for the sector to tell a more compelling story.
Fiona told the group of the importance of the Golden Thread concept; providers must set clear objectives, link these to measurable targets and provide an honest appraisal of underperformance.
As part of this, the group discussed how a structured benefits planning & realisation framework can support the development of a Golden Thread and how critical it is to ensure transformation plans deliver the intended objectives. For all projects and initiatives, baselining, setting realistic targets for financial savings, resourcing and customer satisfaction underpins delivery of the overall strategic plan.
‘I welcome the encouragement given by the Regulator to tell our story more coherently by ensuring we present clear strategic objectives and are honest about our measures of success as well as, importantly, our explanations for what goes wrong and prevents us from achieving. It’s healthy to share learning from where we get it wrong.’
Sasha Deepwell, Chief Executive, Irwell Valley homes
In advance of the session, we surveyed all delegates on the challenges they currently face: the top three that were identified all require an increase in financial strength; the development of new homes, building safety demands and investment in existing stock. The debate focussed on how efficiencies can be made and how developing a better offer for customers went hand in hand with this. Glenn Harris, CEO at Midland Heart demonstrated how they have delivered additional financial strength by managing their value drivers, not forgetting ‘the elementary areas’ and making tough decisions on key services resulting in financial improvements of £18 million – whist still driving up customer satisfaction.
Ruth Cooke, CEO of GreenSquare Group lead the debate on how to balance the challenges particularly in light of political changes and the impact of Brexit. Ruth set out some of the current sentiment on this, describing it as ‘trying to reconcile the irreconcilable’. We presented back another set of survey results which identified that executive teams score themselves well below average in prioritising change initiatives and managing current overload, so it is easy to understand this sentiment. In this year’s Vantage Financial State of the Sector report, we uncovered that 61 RPs had an operating margin after interest of below 10% in FY (2018/19) up from 45 in FY 2017/18, so its clear things really are tough at the top.
“It was good to hear from the Regulator the increasing focus on value for money. It is important that as a sector, we pick up on this and make sure that our strategic objectives are measurable, reflect what matters to our tenants and are delivered as efficiently as possible.”
Richard Woolley, Chief Executive, Connexus
It was a great opportunity to get around the board table and discuss the sector challenges and potential solutions. Thank you to Glenn Harris, Fiona MacGregor and Ruth Cooke for their contributions in hosting, speaking at and facilitating the event.