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Innovation and Enterprise….

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Recently I have been reflecting with Imran Ali about the nature of innovation in the city (of Leeds in this case) and how it might be developed.  The assumption being that more and better innovation will be an unalloyed good in a fast changing, dynamic, complex yet very finite environment.

Most of the discussion has focussed on some obvious innovation levers that we believe could yield some relatively quick and easy wins, such as:

  • encouraging more innovation across traditional boundaries of department or role
  • seeking applications of technology for social innovation
  • thinking as idealists rather than realists – exploring the art of the possible not just the pragmatic
  • providing ‘investment ready’ development programmes
  • engaging non traditional sources of funding in the innovation process and so on.

But the implicit assumption all of these approaches to innovation is of an innovative elite.  A creative class with the brains, the money (or access to it) and the networks to figure out how to make things significantly better for the rest of us.  Scientists, technologists, financiers, policy makers, politicians, environmentalists, campaigners, entrepreneurs (social and not so social) and academics are all encouraged, incentivised and trained to ‘unleash’ their creativity and innovation.

But how many in the city form part of that elite?  The hallowed few from whom progress is expected to emanate or who feel it is their duty to change the workings of the world. A few thousand perhaps in a city of 800 000.  I suspect it is less than 1% of those living in the city.

I believe that innovation, creativity and change in pursuit of progress, are essential human qualities that will find means of expression.  Regardless.

  • How does the potential of ‘innovation’ play out for the rest?
  • How do the processes of creativity and change in search of progress manifest for them?

Well, I suspect there is another slug of the population who are deeply engaged in creativity and change in relation to developing their  practice, in the more or less explicit hope, that they may be able to join the elite.  Training, learning, networking and thinking of ways to get their hands on the innovation levers.  Would-be entrepreneurs, politicians, students, scientists and bureaucrats who are working their way upwards and onwards.  Some, of course will join the elite. But most, by definition, will not.  And they will join another group of potential innovators.

These are the ones who do not wish to change the world/city/community.  Perhaps they have given up on the challenge. Perhaps they never engaged with it.  But the essential creative drive remains and will be expressed.  It may play out through personal lifestyle choices.  Living the environmental life perhaps, gardening,  reducing the golf handicap, pursuing cultural enlightenment, renovating houses/cars etc.  Progress is defined in more or less personal terms.  It is perhaps the pursuit of happiness rather social change.   Work becomes a job rather than a way to make a mark on the world.  Creative courage is reserved primarily for ‘out of hours’ activities.

And then there is another group who never really established a foothold in ‘the system’.  Those for whom a steady salary providing some level of ‘disposable’ income was never really ‘on the cards’.  Vocational and professional routes for creative expression never opened up for them.   From this group I suspect the systems demands not innovation and creativity but just passive compliance.  Do as your told, smarten up tour appearance, brush up your CV and look for a job.  Or at least pretend you are looking for a job.  But the drive to innovation will out.  Creativity will be expressed.

So when we are looking to support innovation in the city where is the great untapped potential?

  • Does it lie in providing more and better support and training to the elite?
  • Or should we try to mobilise middle England, Big Society style, to rally tot he cause?
  • Or should we perhaps change the terms of engagement with those at the margins of the system?  To shift from a coercive approach to a coaching one?

Anyone for ‘Innovation Coaches’ in Leeds?

Arts Funding in a Web 2.0 World

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I tend to agree with JG Ballard when he said:

The funds disbursed by the Arts Council over the decades have created a dependent client class of poets, novelists and weekend publishers whose chief mission in life is to get their grants renewed….

The trouble is the alternatives to pursuing public funding are so damned hard.  They traditionally rely on someone liking your art enough (or believing it to be a decent investment proposition), to want to actually buy it at a price that does not lose the artist money and that values their time and skill reasonably.

But what if we set up a site where artists could pitch their projects at the ‘drawing board’ stage, including the budget necessary to create the work, and then donations were crowd sourced from the web?

It could look a bit like this from the US.

  • Does such a platform exist here in the UK?
  • Could it?
  • Should it?

Kurt Cobain and MC Hammer as Enterprise Gurus

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In a week when Dragon’s Den has returned to our screen portraying a particular take on entrepreneurship I htink that we can get fresh inspiration for entrepreneurial good practice from less mainstream reference points.  Here are a couple of examples from the music industry.

Nirvana are not the usual reference point when considering characteristics of the successful entrepreneurial start up, but this post teaches some valuable lessons:

http://lateralaction.com/articles/kurt-cobain-startup-success/

I also love this podcast where rappers and other ‘street’ musicians talk with Stanford University about the impact of the internet on their business models – featuring 80s legend MC Hammer and Quincy Jones III

http://ecorner.stanford.edu/authorMaterialInfo.html?mid=2047

Thanks to Hope&Social’s own @edhombre for pointing me at the Cobain piece. Hope & Social are finding their own ways to build customer loyalty and make a living (and fun lives) from the music industry without having to sell tons of bytes.

Fiddling while Rome Burns…Again?

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As someone who remembers the Small Firms Service, Manpower Services Commission, The Training Agency, TECS, Business Links and the establishment of RDAs, I refuse to be overly exercised by the development of Local Economic Partnerships.

We know that they will have significantly reduced budgets.  We know that they will be led by some concoction of ‘private’ and ‘public’ sector with a seasoning of social enterprise for good measure.

We can be relatively sure that they will have considerable bureaucratic overheads – necessary to ensure openness, accountability and probity and that they will tie themselves up in the same debates about economic development policy that have raged with sterility for decades; picking winners, encouraging start-ups, clusters, sectors, creative classes, beautification, yada, yada, yada.

We know that they will be very heavily influenced by professions allied to construction and engineering. Planners, place-makers, architects, developers who can throw big money at making sure they retain the lion’s share of public spending even as the spending pie shrinks.  One just needs to look at the key ‘Partners’of the current Regeneration and Renewal National Summit to see the evidence.

We can also be sure that they will embrace a strategic, top down approach to economic development that pretends that economic development happens in a bubble that is disconnected from cultural and social development.  No doubt these too will get their own shrivelled strategic bodies.  The paradigm of economic growth as an unmitigated good will hold sway in the strange world of economic development.  Ideas of sustainability and steady state will not be seriously entertained (unless of course they paradoxically provide opportunities for growth).  Visions will be developed by the anointed, and most of us will see the world of economic development at best, ‘through a glass darkly’.

Facilitation is unlikely to get a look in.  Whole person approaches will be ignored (economic development will continue to speak to homo econimicus), co-creation is as close as we will get to responsiveness and bottom-up. And let’s be clear, co-creation as conceived by the state is nowhere near responsive and bottom up.  It still asks ‘how do we engage people in the agenda of the state’ and not ‘how do we engage the state in the agendas of the people’.  For me this is the ultimate deceit that lies at the heart of ‘Big Society’ and that needs to be carefully and thoroughly outed.

We can also be sure that those who actually live in the communities and give their time and skills to help make things better will be expected to do so for free as budgets for community development shrink and are increasingly targeted at problems (obesity, crime, drugs etc) that see humans as essentially degenerate instead of at the development of aspiration, hopes and dreams which see people as essentially good and progressive.

So I refuse to be exercised.  LEPs will evolve.  They will be largely ineffective in spite of the fact that they will be stuffed to the ginnels with good, committed, well meaning people.  And in a decade they will evolve again.  The sign-makers, website developers and letterhead printers will rub their hands with glee.

I will put my energies into supporting bottom up, responsive approaches that honour peoples humanity, that build social capital, that value the contributions of all, regardless of sector, ambition or potential.  And I will keep looking for genuinely innovative approaches to the thorny question of progress?

In practice this means helping others to develop initiatives like Bettkultcha, Cultural Conversations, TEDx Leeds etc (we are blessed with a resurgence of such civic endeavour in Leeds) that holds real promise to nurture something very exciting.

But I will also endeavour to provide some contributions of my own.  For me this means trying to develop Progress School and Innovation Lab as places to foster radical personal and organisational transformation.

And just perhaps we might be able to persuade those in authority to trust us, to support us, to help us.

Who knows?

How to Depress an Enterprise Culture

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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.