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Enterprise Development Needs a Very Different Response

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If we are serious about developing more enterprising individuals and communities, rather than managing the outputs that most enterprise funders are looking for (start ups and VAT registrations), we need to concern ourselves with the development of self-interest and the accrual of power through organisation, association, collaboration and the acquisition of ‘knowhow’.   We are in the realms of person centred facilitation, community development and education.  Not business planning.  This requires an enormous shift both in what we do, and how we do it.

Helping people to clarify their self-interest and find the power to pursue it requires very different structures and processes to those that we currently use to develop enterprise. It is not about setting up a business.  It is not about experiencing ‘Industry Days’ at school or attending ‘Enterprise’ Conferences with (not so) secret millionaires, dragons and ministers.  It is not about Catalyst Centres and managed workspaces (although these might be useful for the small percentage of people who choose entrepreneurship as the most appropriate way to express their enterprising souls).

It is about engaging in a dynamic and continuous reflection on who we are and what we want to become, and managing processes that will help us move in that direction in a complex and rapidly changing world.

The Davies Review defined enterprise as  the capacity to:

  1. handle uncertainty and respond positively to change – Resilience
  2. create and implement new ideas and ways of doing things – Creativity and change
  3. make reasonable risk/reward assessments and act upon them in one’s personal and working life – The Pursuit of Progress

No mention of employment, entrepreneurship or business. Instead it is about resilience, change making and progress.  Enterprise development needs to find a new home where this broader conception can flourish without the distorting, primarily economic calculus of entrepreneurs and The Treasury.  They will have much to offer to the development of entrepreneurship – but that is only ever likely to be relevant to a minority.  Enterprise needs to escape, what for many is, the deadening hand of business.

The art and science of enterprise is relevant to all and we need to build communities and relationships that understand how to nurture it.

One of my big regrets is that so little LEGI funding has been used to drive this sort of innovation.  Instead it has been used, often wastefully, in the short term pursuit of business startups and in placing cuckoos in the heart of some of our poorest communities.

Anyone up for some innovation in Local Enterprise?

Enterprise, Community and Complexity

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Enterprise, community and complexity.  Slippery words.  So slippery that I wonder what can be meaningfully written about them.  But I will have a go.

Having worked on these ideas for many years I hold my beliefs tentatively.  But they offer the possibility of a very different direction for both promoting enterprise and building ‘harmonious and cohesive’ communities.  And few would argue that we don’t need a fresh approach.  That more of the same will get the job done.

It won’t.  We need to innovate and experiment.

Lets start with ‘enterprise’.  First, empty your mind of all those misconceptions that I must be talking about ‘business start’s, ‘cash flow forecasts’, ‘profits’ and ‘Dragons’.

I am not.

I am talking about enterprise as a measure of ‘agency’ in one’s own life.  The extent to which an individual is able to recognise what ‘progress’ (another slippery word) means and to take action its pursuit.  This is what I mean by enterprise.  It is the product of clear self-interest (I know what I want) and power (I have the confidence, skills and knowledge to take organised action in its pursuit).  An enterprising person is one who is clear on what they want from their life and actively pursues it.  An enterprising community is one which has many such people – because they are valued and supported.

If self-interest is ‘enlightened’ then it is likely that the product of enterprise will be a positive contribution to society.  If on the other hand self-interest is poorly understood then the product of enterprise may be damaging.  Enterprise in itself is not an inherently good thing. If we are going to pursue this route then we need to have faith in the essential positive nature of human beings.

If we are serious about developing ‘enterprise’, rather than managing the outputs that most enterprise funders are looking for, we need to concern ourselves with the development of self-interest and the accrual of power.   We are in the realms of person centred facilitation and education.  Not business planning.  This is an enormous shift both in what we do, and how we do it.   Helping people to clarify their self-interest and find the power to pursue it requires very different structures and processes.

It is worth noting that if you have money, there is a fair chance that at some time you will have hired a coach to help you with the difficult and personal work of clarifying self-interest and gaining the power you need to pursue it. And if they were a good coach they would not have manipulated you towards their preferred outputs – but would let you work on your own personal agenda.  If you have little or no money the chances of you ever having access to such a potentially transformational relationship are slim to none.  The relationship that you have with various ‘helpers’ is likely to be one where they try to manipulate you ‘back to work’, towards a ‘healthy diet’  or some such policy goal of funded output.

Over the last few years I have spoken with many enterprise educators, bureaucrats and practitioners and they have all accepted that this conception of enterprise has merit.  Not only will it help us to get more business start ups, but it will also help us to get large numbers of people acting in pursuit of their own wellbeing – however they define it.  It will also help us to make significant and real progress towards PSA 21 – Building More Cohesive, Active and Empowered Communities.

Which brings us to the question of how does this conception of enterprise  fit with ‘community’?

Community is a property that emerges when individuals and groups learn to negotiate their self-interest with the self-interests of others.  Community is an emergent property.  If this contention is right then it raises serious questions about approaches which attempt to provide short cuts to community (building community centres and one stop shops for example) without addressing the preconditions necessary in a complex adaptive system (such as society) for its emergence.

Community emerges when individuals learn how to associate and collaborate in pursuit of mutual self-interest.  When they recognise that the best way to achieve their own self-interest is to help others to achieve theirs.   When they understand the nature of reciprocity.  Or to borrow the words a well known Business Networking group that ‘givers gain’.

A beautiful by product of this is a raised awareness of the importance of difference.

If I learn how to associate and collaborate with someone who has different skills and knowledge, or a different cultural heritage to my own I am likely to gain more opportunities than if I associate with people who are pretty much the same as me.  Association across race, gender, age and so on provides the key to opportunity and provides a precondition that will allow harmonious communities to emerge.

With difference comes both opportunity and resilience.

Social Participation and Enterprise

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One of the key themes explored at the recent Future Gov Work Better Together event was the promise that ‘social participation gives people the power to self-actualise’.

I am sure it does.

However ‘social participation’ has also been the technology of choice for us human beings to make progress at all stages of Maslow’s Hierarchy – not just at the ‘self-actualising’ peak. Competence in social participation (or what de Tocqueville called ‘association’) and the ability to negotiate self interest through effective collaboration is one of the critical enablers in community and personal development.

Whether it is learning to share a cave (or a housing estate) to meet needs for shelter and warmth, putting together a team to start a new business venture, or pursuing self actualisation, effective ‘social participation’ is the key.

The challenge facing us here is promoting social participation, collaboration, association. Not technology. In very few of the communities where I work is the REAL barrier to progress access to a networking site or high speed internet access (although these are cited usually after lack of money and skills).

It is often a lack of understanding about how collective self interests can best be met through negotiation and association.  About the need to see what can be contributed rather than taken.  About the need to build real trust rather than uncomfortable bureaucratic ‘compacts’.

The other barrier to social participation in the real world is an almost complete loss of belief that progress IS possible – manifesting itself in apathy and resignation. A belief that perhaps this is as good as it gets – and, if it is going to get any better, those bloody politicians had better get their fingers out, because I AM POWERLESS.

So IF we are serious about trying to shift the enterprise culture of a community we need to be in the game of building social capital, self belief and personal responsibility for making things happen.

Tackling Enterprise Head On Is Wrong-Headed

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Most projects designed to promote enterprise tackle the problem head on.

When we say that a community ‘lacks’ enterprise we are saying that we believe fewer businesses are starting per head of population than is ‘normal’.  Typically in a community that ‘lacks’ enterprise you might get 4 new starts per hundred adults per year.  In an ‘enterprising’ community this is closer to 6 per hundred.  This might not sound much of a difference – but this 2% increase could in theory be worth millions in a local economy.  We are usually also saying that fewer businesses are registering for VAT than we would like.  We want more business start-ups and we want more VAT registrations and all of our attempts to promote enterprise are geared pretty directly to these ends.

‘Never mind how you percieve your self interest.  Just start a business.  We will even make it easy for you’.

The assumption is that if we encourage more people to ‘be enterprising’, if we give them access to knowledge, skills and money then surely we will get more enterprise as a result.

In my view this is wrong headed.

I would argue that all human beings are innately enterprising.  All of the time.  It is a part of the human condition.  We create and pursue a set of habits and behaviours that we believe will work in what we believe to be our self interest.  Behaviours that will maintain our self image and help us to get where think we want to be.  This IS enterprise.  These behaviours and habits are a reflection of what we perceive to be in our ‘self interest’, and what we perceive to be our ‘power’.  There are a massive range of ‘enterprising behaviours’ from claiming benefits and watching day time television through to planning a multi-million pound bio technology start up or a space tourism operator.

If our self interest is ‘to maintain the status quo’ then we will get the power we need and our enterprising behaviours will serve this goal.

Ditto if our self interest is ‘to be a millionaire by the time I am 30’.

A thorough development and negotiation of  self interest is central to the kind, and extent, of enterprise that emerges.  If we want ‘more’, ‘better’ enterprise then we should focus our efforts on helping  more people to clarify their self interest and build their power to pursue it.

Chasing More Enterprise

Often what we call ‘enterprise’ (or more accurately ‘count’ as enterprise) is a set of behaviours generated in order to comply with a system of stick and carrots that we have carefully constructed to pursue our policy goals.  This is not enterprise.  It is compliance.  Manipulation.

Helping individuals to clarify self interest – to work out what they want to spend their time and energies doing – is not a trivial task.  It takes a strong relationship (confidential, compassionate, challenging, person centred rather than policy driven) and sometimes many months of introspection and exploration of options.  Helping people to recognise the difference between self interest and selfishness and to recognise and adopt the principles of ‘sustainable’ enterprise cannot be rushed.

But when we get it right we can bet that much more enterprise will emerge.  Not only will the economy benefit but our community will become much more vibrant too.

Enterprise at its best—decoupled from self-interest?

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Julia Middleton has written an interesting piece for the Institute of Directors.  She argues that we need to decouple ‘enterprise’ from ‘self interest’.

Julia contrasts the motivations of the bankers  – ‘primarily financial‘ with the interests of Narayana Murthy, Chair of Indian IT giants Infosys – primarily about a ‘wider social gain‘.

Julia suggests that ‘Bankers’ are primarily motivated by self interest, while Murthy was motivated by a wider social need that ‘transcended’ personal gain.

“Many people wondered why I wanted to take such a risk, to create, at that time in India, a company that would set a new standard of ethics in business. I had a good job, I was married, I had a small child, and I was brought up middle class. It was no easy decision. But all of us are driven by factors that transcend the hygiene factors: money and position. We all want to do something noble and make a difference to the context.”

Julia argues that this view of enterprise is “glorious and grand and is delivered the world over by people motivated not only by personal gain but also by the needs of their communities and countries. It is enterprise at its best—enterprise decoupled from self-interest.”

But Murthy was acting EXACTLY in his own self interest.  He was driven by factors that ‘transcended the hygiene factors’.  He was driven to do something ‘noble’.  He believes that everyone else is as well.  Presumably even bankers?

In my book, both enterprise and entrepreneurship are all about ‘self interest’ and ‘power’.  About taking decisions and actions that work for a self interest that has been properly understood and negotiated.  Not simply in terms of profit, but in terms of sustainability, and wider societal impact.  Some bankers seem to have managed this ‘proper negotiation  of self interest’ more effectively than others.  As indeed have some IT companies.

Perhaps Julia is arguing that good enterprise is ‘selfless’ rather than ‘selfish’?

I would argue that both of these are equally dangerous foundations on which to build an enterprise.  The middle ground of self interest, where my hopes and aspirations (to get rich, to save the whale, to reverse climate change, to do something noble) are properly and sustainably negotiated with the interests of others provides the only strong foundation for a sustainable, progressive and effective relationship.

I cannot be always giving (selfless) nor can I be always taking (selfish).

The point is not that we should decouple enterprise from self interest – but that we should work with people to ensure that their self interest is both rightly understood and properly negotiated with both the present and the future.  That personal perceptions of self interest remain dynamic and relevant (witness Bill Gates journey from techy to philanthropist – all the time pursuing his self interest).

Instead of urging people to put self interest to one side we should be urging them to put it ‘up front and centre stage’.  We should then help them to explore how their self interest ‘works’ with the self interests of others.  To understand how self interest is served by helping others.  How association, co-operation and mutuality work in pursuit of individual and collective self interests.

Because it is the mutual negotiation of self interests, and access to the power to pursue interests effectively, that provide the basic building blocks of civic society.