Supporting Business
What role should Government play in business support?
Today, the Government as a whole spends over £3bn a year on business support. BIS (the department for business, innovation and skills) spends roughly £1.7bn of which £950m funds skills, £226 funds export support and £400m is earmarked for innovation. PWC assert that every £1 spent on business support delivers 7.60 in benefit.
The future of Business Link seems uncertain. If you have spent any time around entrepreneurs in the past few years, you know that this news will almost certainly cause eyes to roll, heads to shake and a muttering of ‘good’. Because knocking Business Link has become cool, just as knocking the ‘Daily Mail’ is also cool.
Are we seriously saying that Government has no role to play in informing or advising businesses in Britain? And even if that ‘advice’ is to come from ‘real business people’ are we really happy to agree that Government has no role to play in funding some of that advice? I’m not convinced.
I’ve been thinking about business support, what Government can or should do, and what part others might have to play.
A few thoughts, and as you’ll see, I’m not presenting solutions, just raising a few things which I find interesting;
1) Seeding the idea of ‘self-employment’, as distinct from ‘entrepreneurship’ and ‘business starting’. I think that this would be a powerful message to take to the million unemployed 18-15 yr olds as they look out into a bleak jobs market. For many, starting a business (high-growth or otherwise) is not right, however working for themselves might be.
2) Working ‘better together’. Brokering valuable introductions between potential partners. For example, between BIS, publishers (for example Channel 4) and brands (for example Apple). Thinking about questions like ‘who has attention?’ ‘who is loved?’. The partnerships and co-sponsorship agreements of the next few years will need to be far more sophisticated than just buying space and ‘badging’. Government can (through its power to convene) promote and enable the fostering of these new relationships.
3) Fostering of networks and mapping of social networks. It remains important to connect the connectors across the UK, especially in deprived areas. By mapping (with consent) who knows who, gaps will emerge, and this is where some of the most powerful opportunities to connect will present themselves
4) Crowd-sourcing ideas and views. The coalition is off to a good start on this in other areas. Ask business owners for VERY specific ideas about how they would reform business support (or cut ‘red tape’ for that matter). Crucially, then represent those ideas to the crowd and invite people to rate and comment on suggestions. Work in partnership with others to promote the consultation. Why not offer a ‘prize’ for any ideas implemented (perhaps offered by a partner?).
5) Rather than thinking about large contracts, why not experiment with small experiments in priming partnerships? Invest (say) 10k in a relationship with an online partner, invite them to present their results (who they have helped and how), then reconsider how to allocate future funding. Given that ‘information’ and ‘advice’ for business might be seen as separate, why now offer the former as ‘free content’ to publishers, and then consider a way of incentivising them to promote that content?
6) Finally, a ‘big idea’ for unlocking national growth is to unlock the personal productivity of our citizens. This idea makes conversations around well-being and health unbelievably relevant. If we can inspire (for example) young people to do what they love, they will be more productive, and the economy will benefit overall. I wonder if this approach might unlock a very different kind of ‘advice’ and ‘information’ to business from Government?
What do you think?
5 Replies to “Supporting Business”
Oli
I have mixed feelings about the role of government to subsidise advice to small businesses. When I set up Prelude I was effectively trying to help start-ups and had to compete with Business link who were effectively free. So in effect anti-competitive! I had to give up working with start-ups (except for the pro bono stuff I do now). The real issue was that the best advisesr generally gave up and only the weakest jumped through all the hoops to become advisesr used by Business Link.
I’m clearly generalising but this was in my experience quite common. The shortcomings of Business Link aside i think you touch on anumber of very interesting areas. I am writing a paper with some similar sentiments. watch this space…
It’s perhaps helpful to separate some of the issues here. There is certainly a role for government to make the information required to run a business easy to find and intelligible in its articulation. But this is very much an information ‘pull’ activity. Make it available and easy, and it will be pulled down and consumed where needed. Businesslink.gov.uk has attempted to do this, and though castigated for its size and cost, we must remember that it also took on the job of deconstructing many of the scattered parts of business-facing content on the web, and rebuilding them in a navigable and coherent form in one place. This is always going to be a messy and expensive task, (but hopefully not one that needs repeating that often).
There is also, from an economic growth perspective, a role to encourage business thinking – and to seed the idea that entrepreneurship or incorporation can offer a wonderful alternative to “just working for someone”. This is necessarily more of a ‘push’ activity, in that it seeks to influence behaviours. One could argue that entrepreneurship comes from within, and telling people to go and do it will be futile, but it wouldn’t seem very sensible to do so. As ever, if you want a major change to happen, you must make the conditions right but also provide some stimulation of thinking.
The harder area is that of “business support”. That is where I do feel that government’s role should be more limited. Forming a relationship with an ‘adviser’, pushing information on different strategies and approaches, for many businesses may not be an economic way to do it.
Keep it simple: focus on clear, available information, organise small, focused interventions to stimulate business thinking (your ideas above are, as ever, bang on the money in this regard) and leave it at that.
Oli,
think you are right about promoting self employment. One of the best bits of advice I have ever had is to “think like a freelancer” – whether or not you have a “permanent” job. And therein lies the rub. Nothing is permanent, as they say except Death and Taxes. We no longer have vertical loyalty to our employment masters but a horizontal loyalty to our business/creative/specific interest groups. Gov could help by advising and teaching( in schools) that there is another way to finance, fulfilment and flexibility. A portfolio career approach could be the answer.
Hi Oli
A good post, and good comments.
There is so much to say on this topic, and so much to agree on.
I see via Twitter that you were at OneAlfredPlace with Michael Hayman last night, so you will know about Doug Richard’s Entrepreneurs’ Manifesto – a “declaration of rights” for small businesses.
I was involved in the discussion that followed, which we held at the Royal Institute. You may be interested in these three April posts (on http://www.startupdonut.co.uk/blog/2010/04/ ), covering: the recent history of business support in the UK; who ‘the customers’ of business support are, and how they would like to receive help; and then ‘How is this offline help best given, who should be doing it, and what tools/methods can make these delivery methods more cost-effective?
Here is a subsequent, insightful comment from a veteran of this issue, who will remain nameless as I haven’t managed to ask him if I can quote him:
“From a quick look and think about the issues I think I am more with Doug Richards than Rory MccGwire side of the argument.
I certainly identify with Richard’s proposals to
1. sweep clean the entire government funded industry of business support and leave behind solely an institution whose remit is to expedite and simplify the effort of small business to manage the burden that government places upon it.
2. free up the savings of our families, friends and communities so that they may give, invest or lend their own small capital into the nascent businesses of their children, their friends and their communities with credits and exemptions that radically encourage the activity.
Having worked on both sides of the fence – with Business Links and as a recipient of support funding – I cannot help think that the most of the activities are a total waste of money.
The energy and belief that guys like you [he is referring to the 50+ business support organisation PRIME here] have is a zillion times more valuable to supporting business than manufactured support services, be they public or private.”
Some really good points here (including the comments).
I think Oli is right that it’s become fashionable to bash Business Link. That said, if the rush to jump on the bandwagon has had any effect it’s been to cloud the very real reasons why Business Link isn’t a smart spend of government funds not that’s been unfairly tarnished.
For me the decision to scrap the regional Business Links was correct as the service they provided neither made economic sense or was consistently fit for purpose.
A government run business support site (if this is a rehased BusinessLink.gov so be it) should remain as a single point of basic, administrative business information – but it has to be simplified, streamlined and dragged (not by an expensive design agency) into the 21st century.
At the moment it is way too difficult to use, tries to do too much and other sites in the same space have proved you can deliver online business information in far more accessible and engaging formats for a fraction of the budget.
I’d like to see a business support website that provides essential information (how to register, legal and tax essentials etc) in the fewest pages, and most concise way possible and does nothing else but this and signpost services for existing advice services, sites and networks – which could be rated by the users as suggested in the Richard Report.
Based on the feedback I’ve had, I know there remains some demand for a call centre service for the same simple advice (although there are obvious costs to this which could prove it far from viable).
Beyond this, I agree there are a number of interesting ways the government could and should support enterprise and business (and particularly self-employment), but for me this almost certainly lives outside of Business Link – a stale brand which for me doesn’t hold any level of respect to warrant morphing it to fit other forms of government support.
I hope the new government makes further cut backs to Business Link and makes it a swift, clean cut with the past and then unveils a new programme of support based on three factors:
– The essential services pre-startups, start-ups and small business owners tell them they need
– The private sector support those people are using and deriving value from now
– Building an enterprise culture by developing a system by which the government can quickly support, fund and connect individuals and organisations with smart ideas such as those put forward by Oli above.
The government doesn’t need to deliver comprehensive business support for all businesses in all regions (that’s impossible for a start), it needs to empower those who are better skilled, positioned, experienced and motivated to do it for them.