How to Depress an Enterprise Culture

Enterprise is a dangerous thing.

In the wrong hands it can re-distribute wealth from the wealthy and put it in the hands of the poor.  If this happens of course vast swathes of public services could be cut back.  Job Centres could be closed down, demand for health services might plummet and swathes of middle class ‘helping’ professionals could be laid off.  So, ensuring that enterprise culture remains depressed and marginalised  in some of our poorer communities is essential to social progress and economic recovery.

Here is your quick guide on how to do it…

  • Build a Public/Private Sector Partnership with the Mission of ‘Promoting Enterprise’

Counter intuitive I know.  But if it just looks like a government/council/housing association led initiative it may lack credibility.  Getting a few (even one) local business person on board will really increase credibility and increase the chances of winning investment.  Be very careful though.  Private sector people will actually want to see enterprise encouraged.  As soon as they see the real effects of the programme they are likely to flee like proverbial rats on a sinking ship.

  • Get your hands on a large sum of money

People are inherently enterprising.  They show all sorts of creative and innovative ways to make life better or at least more bearable.  Fortunately for us many of these (in fact the vast majority) don’t show up in our measures of enterprise so we simply deny them and state that communities with low start-up and VAT registration rates are ‘lacking in enterprise’. However, the point remains, people are inherently enterprising and if we wish to discourage enterprise it can be expensive.  A few million should do it to sustain a 2 or 3 year campaign.

  • Invest substantial sums in prolonged marketing campaigns encouraging enterprise and claiming that anyone can do it

I know this seems counter-intuitive.  If we want to discourage enterprise, then surely we shouldn’t be promoting it?  But bear with me – this works.  If we can get a message out there that says

‘You can be your own boss, running your dream business: All it takes is a bright idea and the determination to succeed’

…our battle is practically won.  Leaflets, posters, websites, adverts on commercial radio stations and buses.  Just flood the target areas of deprivation with marketing collateral.  Ideally also recruit some enterprise champions to attend local community centres and summer fairs handing out leaflets and letting everyone know just how much support is available to the would be entrepreneur.  And if you want to blow a few tens of thousands on a website too – well it will do no harm.

People will come forward in reasonable numbers especially if we help them out with bus fares, offer free lunches, crèches and hint at the possibility of funding to listen to our messages.  Enterprise for all, Anyone can do it, All it takes is hard work, You don’t even need a bright idea – we can give you one of those…

  • Procure Your Own MBA Enterprise (Lite)

Now all we need to do is feed them into an Enterprise MBA (anorexically) Lite.  Perhaps three half day workshops with a decent consultant who can make it all seem so very simple.  Half a day to work up the idea, half a day to develop a marketing plan and half a day to look at financials should do it.  Perhaps supported by a week-end Enterprise Show that offers ‘All you need to know about business in one day’.

Whatever you do please do not encourage team based start ups.  These are far too likely to succeed.  Encourage the myth of the ‘lone entrepreneur’ at every opportunity.

Now we can just sit back and wait.

If we work really hard at this within a year or two we can have perhaps 1000 bright shiny new businesses – most of them run by the gullible who really believe that with all the support available this should be easy.  And the magic starts.  They suddenly find that this is hard work, and it is relentless.  The business becomes like a cuckoo, requiring constant attention, dragging them away from family and friends, requiring time, money and lots of hard work.

NB be very careful not to provide any form of ‘relationship’ with your wannabe entrepreneurs other than the poorly transactional/technical.  You must never employ competent coaches who might help them to balance these tensions and maintain their motivation to succeed.  Instead employ people who have never run a business nor have been trained as coaches and use them as recruitment sergeants for the MBA Lite.  You can call them Enterprise Coaches.  Just make sure that their enterprise experience is limited and their room to coach negligible.  As our wannabe entrepreneurs start to feel and show the strain of running their own businesses we can start to blame their struggles on them.  ‘Perhaps you are just not cut out to be an entrepreneur’. Again avoid telling them the true stories of many successful entrepreneurs who often cut their teeth in failing businesses before finally finding a recipe for success.  Luckily there is a whole industry of motivational speakers and ex Apprentices who will help you to re-tell and re-enforce the Enterprise Fairy tale.  (NB don’t underestimate the budget you will need to procure their services.  This seems to be one area where the vast supply available has not resulted in driving down prices…)

  • Run a ‘Modest’ Grants and Loans Programme

Lending people money or even giving small grants to get their businesses started provides a wonderful mechanism to ensure that painful lessons about enterprise have a long-lasting and practical impact.  It also helps us to short-cut the most commonly raised objection to starting a business which is ‘I don’t have the cash’.  This is a vital step.  In its absence they may go and speak to lenders who will explain to them that their business is unlikely to work and that they will not be able to pay for any investment they seek.  THIS IS DISASTER!  We should do all we can to avoid exposing our wannabe entrepreneurs to such doses of reality.

By running our own grants and loan schemes we also help to lay the seeds for decades of resentment in the community.  Firstly we will have the chance to refuse many who apply for loans.  This really ticks them off, wastes their time, puts them off the enterprise process and makes them deeply suspicious of anyone who offers to invest in entrepreneurs.  And for those that we do make loans there is a good chance they will default – but even if they don’t they will see us as money lenders – and no-one really likes their lenders, do they?  And if we give them a grant, because no one else will lend them money – well we are almost certainly setting them up to fail.  If their business idea was inherently profitable they would not need to come to us for a grant.

NB actually setting up a grant or loan service can be hard.  Instead, do a deal with a local credit union and get them to work ‘under your brand’.   This way you get all of the upsides without having to actually do any of the dirty work.  Never signpost people to independent sources of finance and investment.  This risks your client seeing you as the good guys and them, the evil moneylenders, as the bad guys.  Of course if your long-term goal of depressing enterprise culture is to be achieved then you need to be perceived as the bad guys – so bring the finance guys under your brand.

  • Now be patient

That’s it.  Now sit back and watch the results of your labour come to fruition.  You have encouraged perhaps a thousand people to start businesses.  Of course, some of these would have started their businesses anyway.  And some will expect to work all hours to get things working well.  But many, if we are lucky a majority, will be anticipating some sort of cake walk to entrepreneurial success.

And so the magic starts.

The demand for many hours of hard work kicks in.  The money flows out, and our trap is sprung.  We may have had to put up with a short-term spike in the start-up rates (it is unlikely that many VAT registrations will occur as a result of our MBA Lite) but now we can expect the start-up rate to quickly fall away again.

We now have a small army of failed and failing entrepreneurs in our community, with neighbours and friends talking about their latest entrepreneurial failure, trying to service their debts and walk away from their ‘dream business’ turned nightmare.  If you have done your work well perhaps loan default rates could be significantly above 50%.  We do not need to promote these failures.  Indeed we can be portraying them as successes to ensure that we recruit another tranche to our MBA.  The entrepreneurs will collude with us in portraying their success – but the community will recognise and spread the truth.  That enterprise is hard and inherently risky, and that in spite of all the support available the decks are stacked and success often remains elusive.

But what, I hear you say, of those that ‘succeed’.  Aren’t they walking adverts for the entrepreneurial dream?  Well, actually, No.  Most of them will be in the ‘working like a dog for not much money’ phase.  Even those on the road to entrepreneurial success (typically by way of a start-up failure or two) will be like government sponsored health warnings against the dangers of an entrepreneurial life style.

  • Commission a Mid Term Evaluation

It must be glossy and full of warm words and smiling faces.  Don’t worry, even your most miserable and hate filled entrepreneurs will be prepared to smile for your cameras as you explain to them that many potential customers will read this report.  If possible get an evaluator with a double barrelled name and a decent reputation to undertake the evaluation.  They will understand the politics of the situation and can be relied upon to be sympathetic.

  • Avoid producing lists of the entrepreneurs you have helped and the businesses you have started

Such lists can be problematic.  People who are interested in enterprise in their communities might ring up some of your clients and find out whether they are living the dream or not.  If you are wise each of the clients will have been helped by several of your partners and will have been counted more than once.  Such double counting can easily be hidden away in a database.  Indeed we can blame it on the IT system.  A published list is much less forgiving.

  • Get Out Early

Ideally after a 2-4 year campaign such as this you should now withdraw your sources of advice and support.  If you are lucky you will be able to blame this on central government cuts and ‘The Recession’.  Don’t worry the long-standing enterprise support organisations such as the Enterprise Agencies or Business Link won’t be able to pick up the slack – they are already stacked out.

FAQs

Q: We have spent several millions refurbishing old buildings in deprived areas as ‘enterprise centres’ and have helped establish Development Trusts and CICs to run them.  Is there any danger that these might serve to promote enterprise in areas of deprivation?

A: Relax!  It is true that you have spent millions that you could have held onto – but it is unlikely that you will have done any real harm to our mission of depressing enterprise in deprived areas.   As long as you have built in lots of overheads (Victorian listed buildings that are inherently energy inefficient, combined with generous staffing and ‘architectural’ use of atria and ‘overpriced shared working space’ should suffice).  Unless you make the mistake of offering really competitive prices for decent office space with easy terms you are not going to fill up with local sustainable businesses capable of paying their rents consistently.  This mistake is almost impossible to make as if you should, no doubt unwittingly, provide any meaningful competition to the private sector there will be howls of complaints about anti-competitiveness.

NB leave the buildings with a legacy investment so that they can sustain themselves for a year or two after you have gone.  This way you may avoid some of the blame for commissioning a white elephant.

As the poor CIC or Development Trust pursues ‘break even’ it will have to forget its social mission and, at worst, the car park will fill up with BMWs, Audis and 4x4s as entrepreneurs from  out of town recognise that their are deals to be done on some sexy workspaces.   Or they may shift their focus from ‘enterprise centre’ to ‘conference centre’.  Or the car parks (and bicycle sheds) will remain stubbornly empty and after many months or years of support the centre will die a long and lingering death.  In most of our communities this trajectory can still be seen playing out in versions of ‘enterprise centres’ from the 70s, 80s, and 90s.

You may find that some claim the Enterprise Centre gives local people something to aspire too and that this will somehow lead to an entrepreneurial revolution.  Again Relax.  Go and talk to the operations manager in any of the older incarnations of the enterprise centres.  They, their low occupancy rates, and their key tenants running government programmes, will testify that no such enterprise revolution is likely to occur.

Q: We have executed the plan perfectly.  Does this mean that we can take the foot of the gas?

A: No!  People are inherently enterprising.  As soon as you stop, the recovery starts.  They start to make progress again.  Luckily it tends to be slow and pain staking but it happens.  You must be prepared to re-brand and relaunch the whole project again at least every 10 years.

Q: Hang on a minute!  We have done some or all of the above in the name of encouraging enterprise in deprived communities.  Are you saying that we have got it wrong?

A:…Well of course only time will tell.  But in short, Yes.

Comments

  1. Harry Fortune says:

    Oh so true….

    I’ve been following these programmes a while myself, seeing some success but not seeing a real change in environment, community or local wealth distribution. You see some good numbers for targets coming out of it though. One old wise Enterprise Agency Director once said to me, see that enterprise programme? That won’t be there in 5 years, I’ve seen these come and go over the last 25 years. The programme went without leaving much of a legacy on the very wide community it had to serve.

    If you could succinctly put together a programme that would support and encourage enterprise (I’m talking enterprise of the narrow view not the broad view) in any community what would it look like? (Assuming the opposite of the above!) – have you blogged this already Mike?

    Would a programme really need much funding? Shoestring enterprise support… With the right people I’m sure it could be done. Look forward to the next post from the Chitty Institute, Academy of Enterprise!

    Harry

    PS – Liked your comment on the lone entrepreneur – why encourage people to form teams and bring together several brains? Surely this is better for targets as you can count 3 jobs created, 3 interactions etc for the price of one (business start up – perhaps that is the problem).

  2. Mike,

    One of your best rants yet!

    However, like Harry I totally support your plea to back “team starts” – and like him too, could you refer me to the Mike Model for Modest Micro Business Success

  3. Brilliant provocation. I particularly agree about the dangers of enterprise hype and the need for a more patient and relational approach. Not so sure on your finance points- wouldn’t put so much store on mainstream lenders’ assessment of business feasibility; or knock the value of a small grant or loan.

    And yes, the short-sharp hype approach is more likely to lead to business nightmare misery – but overall, despite more modest incomes, there’s lots of robust research showing that self-employed people are much happier than employed counterparts.

    • Hi Erika glad you liked it. I am absolutely not knocking the value of a grant or loan. I am questioning the way it attracts many of those who are looking for easy cash rather than meaningful coaching support. Where a coaching provider is also a lender/granter they often spend a lot of time shaking off the money chasers and usually have a dodgy reputation as they have to let so many down.

      Let someone else manage the hassle, bureaucracy and reputational challenges that come with being a lender or grant giver.

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