Bah humbug! Hot tips for IDAs to help you enjoy Xmas
By Alistair McIntosh, CEO, HQN
‘The approach of Christmas brings harassment and dread to many excellent people.’ So says Mark Twain. And thanks to the RSH, he’s right. They’ve just rung up a bunch of folks to tell them to get ready for an IDA in the new year. Is it time for a hard candy Xmas? Not at all. Let’s see what you have to do…
We’ve run a couple of sessions with the RSH and people that have done well at IDAs to help you get ready. What are the hot tips?
Guess how the RSH started their talk? They put up a picture of Mark Twain. That was to make a couple of big points.
First, the RSH expect you to tell your story as clearly as one of Twain’s stories. You will be sending them thousands of pages about what you do. If they printed it all off it would be like the Andrex puppy advert. So you need to be able to explain yourself. They will ask lots of questions.
Their other point is that Twain lost all his money on business deals that went wrong. Can you put their minds at rest about the deals you are doing?
Let me roll you through some of the rest of the points we heard on the day:
The RSH teams are good. That’s what everyone who has been through an IDA says. They’re not out to get you. But they do their homework. You have to prove you know your business better than they do.
Make sure you are on top of all the data on spending patterns and costs that you send to them. Those returns are the starting point.
Face up to things. Don’t try to hide the elephant in the room. If a big deal is going wrong, tell them. But do explain why you did it in the first place and what you are doing to get back on track.
If you took sound advice on the way in and did a proper option review, you ought to be OK. On the other hand, if it’s just a blunder you need to show that you have mended your ways. It won’t happen again.
Don’t fall asleep at the wheel. The RSH questions should not come as a surprise. The board should have been asking them anyway. Go through the papers and make sure the board did this. If they have been given Hobson’s Choice by the executives, this will stick out like a sore thumb.
The board CVs are just for decoration. It’s what you do when you turn up that counts. Maybe it’s best to ask someone with fresh eyes to go through the papers.
Sort out the basics. Have you enough money to meet your plans? Do you know enough about what you need to do to your homes? Has this been checked by experts? Are the homes safe? How do you know? Are you stamping out fraud? That’s on the rise. How do your costs compare to peers?
Does your governance help you get to the bottom of things? Or is it too complex? We do see structures drawn up by genius lawyers where the mere mortals that sit on the boards just don’t know who is meant to be watching what.
That’s when things slip through the net. You do get boards who nod through actions they have no powers to make. Get those lines of defence and controls in place and test them.
Are you fit for the future? Are you stress testing? Is it tough enough? You can spot those stress tests that are crafted to fall a smidgen short of disaster a mile off. And are your get out of jail cards at all likely to work in real life?
Can you really stop doing this? Can you really sell that? And can you make the changes quickly enough? You’re bound to be asked about Brexit. What will it do to your plans? And expect raised eyebrows if you want to cut back on front line services. The Green Paper will be raising the bar here. Labour could set it higher still.
And one final point: the RSH says it’s OK to practice for an IDA. We’d be happy to help. In the meantime, we are updating our toolkit. It’s free for our members to use. Here’s to a G1 V1 new year!