Recently we’ve witnessed a fundamental review of nationally branded enterprise support, via the removal of Business Link advice and resources on the ground, at the regional level. Local Enterprise Partnerships are getting established, and one of the key challenges is what to do about enterprise support, information and advice on the ground.
Here’s what I think are 10 lessons for local enterprise strategies and initiatives which LEPs and others might think are worth bearing in mind:
1. Know your market. The better you know your existing business base, and the state of entrepreneurship in your area, the better able you are to design appropriate responses, and to identify the main priorities. Bids for LEGI or European funds will need some decent justification and evidence behind them.
2. Remember your existing business base. They may have needs too – in terms of infrastructure, skills or support. It’s important to retain and develop your existing business base as much as it is to seek to create new entrepreneurs. It was often surprising how many LEGI bids failed to mention existing businesses and their needs. For example many LEGI bids focused on building new workspace and premises, when there were known examples of existing industrial estates and local authority owned business premises that were in need of upgrade and refurbishment.
3. Business-led solutions, not property-led ones. It’s striking how many enterprise strategies start with new workspace and premises as a priority, but with little research or justification behind them. But do you really need expensive new premises? Money may be better spent upgrading or improving existing premises. Plus, many new businesses start out in the home. If the type of housing in your area prevents this – then you might have a good rationale for developing workspace. New premises are very expensive, and there’s little proof they will boost enterprise unless there is a proven gap in the local market. Sometimes new premises, such as innovation and technology parks are too expensive for early stage start ups, even if they are knowledge-based.
4. Go to the businesses; don’t expect them to come to you. Related to the above point – the advantages of incubators are over-sold. Why not deliver advice to businesses on their own premises or in their own neighbourhood, rather than on one site? Be prepared to offer services on the doorsteps of neighbourhoods – you need to do this for hard to reach communities and businesses.
5. Make it relevant to business. Businesses don’t put time into something that they can’t understand or see the benefits from. Consult businesses, but keep what you offer simple and straightforward, with the promise of tangible business benefits.
6. Make your services and provision as good as the market, and involve the market. For businesses, the quality benchmark is always the market. You need to ensure that service standards are in line with this. You also need to involve the market. Most businesses will stop using publicly funded support at some stage and start using private services. Private services will always be more sophisticated and technically advanced, so you need to provide early steps into private business support.
7. Focus on ‘enterprising skills’ rather than purely start ups. Enterprising skills such as soft skills in communication and confidence, as well as technical skills such as book keeping – are transferable into employment or other positive outcomes. When we try to advocate enterprise education and start up programmes as purely for business creation, we’re selling them short. We should design transferable skills for enterprise and working in business into enterprise education and skills programmes.
8. Winners can pick themselves. We don’t necessarily need to pick winning sectors and industries. Winners can pick themselves, if the programmes and service offers are right. Initiatives such as the West Midlands Mustard programme in the early 2000s were set up so that growth businesses ‘self select’ or qualify for support based on credible growth ambitions and development needs. And they provided a suite of support that can be tailored or can be ‘pick and mix’ according to the enterprise’s needs. These services were a mix of Business Link, University, specialist industry association and private sector provision. Businesses had to pay £1,000 to subscribe to the Mustard programme to show they were serious about growth – but with the promise of unlocking up to £30,000 worth of support.
9. Don’t slice up your market too much. Different client groups usually want equal access to services, and not necessarily their own custom-made service. There is a basic cocktail of enterprise support tools and issues – which apply to many businesses across sectors and types of owners. Do we really need a separate loan programme each for women, ethnic minority, young, old and disabled owned-businesses? Probably not. We might support and advice more sensitive to their circumstances though, and tailored schemes for Islamic business owners’ finance for example. What’s important is that enterprise support services and programmes are accessed by hard to reach businesses and communities – it’s far less important to have completely separate services, programmes and institutions for different client groups. An example of using more accessible channels for enterprise support was London’s Faith in Business programme. Faith in Business encouraged, nurtured and sustained entrepreneurship within the African & Caribbean community by reaching them through the Black Majority Churches. It delivered business support from a Christian perspective buying into the faith values and principles of the target community – and it brought mainstream support to these communities too.
10. Build a network, but step back from it. In deprived areas, entrepreneurship can suffer because networks such as friends, family and neighbours aren’t in business, and they don’t know business. Enterprise strategies can help create and develop business networks. However, you can’t control networking and nor should you – you should aim to kick start networks and stand back and let them flourish. We can learn lessons from private sector business networks such as the First Tuesday Network that brings together technology entrepreneurs, financiers and business services providers – all meeting to develop new business ideas, discuss deals and bring new businesses to life. And driven by the maxim of ‘doing business socially.’
