Geof Cox's Blog

Why social enterprise needs its own approach to intellectual property rights

Solomon Linda (left) with the Original Evening Birds, 1941Solomon Linda (left) with the Original Evening Birds, 1941

The young man on the left of this picture is Soloman Linda.   You may have heard of him sometime over the last few years, though in his own lifetime, in his own century, you certainly wouldn't have.

Sometime in the late 1920s Soloman Linda wrote a song called 'Mbube' (um-boo-bay – Zulu for 'The Lion').  Although a talented musician, Soloman Linda couldn't read or write.   He and his wife lived on maize porridge and slept on a dirt floor,   They had 8 children, 2 of whom died as babies, one from malnutrition.

In the 1930s Linda got a job as a cleaner for the Gallo Record Company, where in 1939 he first recorded the song Mbube – and where in 1952 he signed over the copyright for 10 shillings – that would be about £1 now. When Soloman Linda died in 1962, at 53, his family couldn't afford a gravestone.

Does the social enterprise movement lack leadership?

A new survey commissioned by UnLtd has found that if they had access to the right support about 1 in 3 people would like to be social entrepreneurs.

This is yet another confirmation of Dr Rebecca Harding's research on the numbers social entrepreneurs.  Her figures suggested some time ago that there are over 230,000 'hidden social enterprises' in the UK, and that over a third of all new entrepreneurs would like to be social entrepreneurs.

It is also another confirmation of the staggering scale of the opportunity we have - and this to me is the area where we really lack leadership (not, as Liam Black recently thought, in defending existing social enterprises).

Our focus on a few kinds of social enterprise - those that happen to fit an official definition, or can be used to forward a government agenda - is blinding us to a much bigger picture.

I've also previously mentioned in my blogs here and in the Guardian Online the Third Sector Research Centre papers on measuring the scale of UK social enterprise (September 2010) and on the construction of the 'social enterprise' concept (forthcoming).  These should have exploded once and for all the myth that there are only 62,000 social enterprises in the UK - yet I still hear this discredited figure trotted out by people who are supposed to be promoting social enterprise!

Business models based on greed and exploitation

I talk a lot about Business Models in my training workshops.  I reject the Business Plan fetishism indulged so myopically by the likes of Business Link.  Business Plans have their place in some trades – but usually way down the list of ingredients for success.   Getting your Business Model right, however, is near the top.

Business Modeling is something you do in your imagination, and using few words.  A Business Model is a working mental model of the key relationships you have inside and outside the business.  It's the fundamental story you tell yourself about what you do – and tell others if you only have a few sentences.

Slide Rule

I usually illustrate this with the story of the British slide-rule manufacturer who thought they were in the business of making slide rules.  They weren't – and when the electronic pocket calculator came along it wiped out the slide-rule business almost overnight (because, people below a certain age need to know, a slide-rule is, in fact, a pocket calculator).   At about the same time an unremarkable American manufacturer of office calculating machines and typewriters lit on the understanding that they were actually in the business of processing information.   That company was IBM, and they went on to become the biggest computer company in the world.

Not many jokes...

I asked a colleague recently if they liked my website - they thought for a bit before replying simply "Not many jokes" - so I thought I'd post this slide from my presentation at The Big Jump Conference yesterday, which some other colleagues found amusing...


NHS Social Enterprise Spin-outs - the real story

NHS Joke

I've posed the question elsewhere of whether the NHS Right to Request process actually led to ANY increase in the number of spin-outs to social enterprise – and not received a satisfactory answer.

Of course I know of a few cases claimed by the Right to Request process – my question is whether these, and possibly others, would have gone ahead, and maybe even been EASIER, without this 'support' intervention.  I certainly managed to keep one NHS externalisation last year out of the official process – which was completed very smoothly in just a few months thankyou very much.

Now I've just read the latest Third Sector Research Centre Working Paper on Social enterprise spin-outs from the English health service: a Right to Request but was anyone listening? by Robin Miller and Dr Ross Millar.   This should make uncomfortable reading for the NHS, and all those responsible for promoting the Right to Request.

Will tendering ever work for social enterprise?

I've been mulling over the stream of research findings over the last year or so around the way excessive public sector bureaucracy hampers the effective delivery of services – for example Professor Eileen Munro's recent finding that the safety of children is being compromised because social workers spend too much time on paperwork and targets.

I don't want to repeat here any of those Daily Mail kind of stories about the absurdity of some health and safety bureaucracy – though it is perhaps worth drawing attention to the government's recent attempt to get a sensible grip on all this through the Common Sense Common Safety report.

We all know about the inherent tendency of the public sector to get bogged down in bureaucracy.   It's hard to find anything new to say about it.  But one area in which social enterprise must keep on raising this issue is public sector tendering.

I know of course that there is a lot of on-going work around gearing social enterprise up to tender, simplifying tender procedures, and building in added-social-value criteria.  But this work may prove to be more than a little self-contradictory, and I still don't think we are strong enough in questioning whether bureaucratic tendering is usually the right kind of selection process at all.

I was talking to a colleague very eminent in her field last week, who had taken the decision not to pursue any more tenders.   She was turning away customers without any costly tendering, so why bother?

In the subsequent discussion we isolated 7 clear negative results of tendering - for both sides of the tender:

  1. Any business that is really good at what it does will build a loyal customer base – who will recommend others - so those that respond to tenders are likely to be those with least work on, or those most motivated by ambition, rather than those that are really best at what they do
  2. Social enterprise is more likely than conventional business to lose out in this situation, since it is likely to focus more on delivering social value, or on a work-life balance that is not financially driven, than on growth
  3. Tendering – and especially the kind of excessively bureaucratic tendering procedures often favoured in the public sector – tends to select those that are good at tendering, rather than those that are good at actually delivering
  4. And again, precisely because of its focus on delivery, social enterprise will suffer disproportionately from this
  5. Building in additional criteria meant to favour social enterprise might actually compound this problem - more criteria often means more forms
  6. Sometimes it all really is a costly paper exercise anyway (most of us have been to selection panels both for tenders and indeed for jobs where the winning candidate was always obvious to everyone, and we were all just going through the motions)
  7. And last but certainly not least, large organisations will generally have more capacity to engage in these tendering procedures – and most social enterprises are small.

In this perspective, tendering begins to look like a way of weeding out the best candidates, rather than selecting them!

Of course in many areas, for large contracts, public bodies are tied by EU and other regulatory frameworks – so there's a rather larger lobbying job to be done – but in many areas, such as health and social care, there are only limited legal requirements for excessively complicated tendering procedures, and the fondness of the public sector for them is underpinned not by regulation, but by habit - and the misguided belief that they actually work.

It might be objected that there is no other way of avoiding discrimination, or the old 'deal done on the golf course' mentality.   But is discrimination in areas such as this really best dealt with through excessive regulation? – or is it more a question of 'hearts and minds'?

I've also recently been involved in developing a project team for a new social enterprise. It was done entirely by 'head hunting' – no advertising costs, no forms, no interviews, no equal opportunities paraphernalia - a process common in the commercial world, but one that many in the public and voluntary sectors would frown on. Yet it is hard to find any good evidence that the bureaucracy surrounding equal ops in the public sector has made any difference. If it had, we should be able to point not only to higher proportions of women employed in the public sector (which we can - in fact disproportionately high) but also of disabled people - which we can't.   In fact the proportion of disabled people employed in the third sector – about 18% - is much better than either the public or private sectors - which do no better than each other at about 13% each (according to Jenny Clark, NCVO, September 2006).

I wonder if what really made the difference for women in the public sector, and disabled people in the third sector, was nothing to do with legislation or formality, but everything to do with cultural transformation.  And conversely, the fact that the formalities don't seem to have addressed the exclusion of disabled people in the public sector may demonstrate the cultural distance some public bodies still have to go to see what abilities people with disabilities can, in fact, offer.

Learning from the Open Source Movement

A Guardian sub-editor garbled the final paragraphs of my latest guest blog there - but here's a corrected version...

I argued recently that a focus on a few kinds of social enterprise - those that happen to fit an official definition, or can be used to forward a government agenda - is blinding us to a much bigger picture.

Perhaps the most striking example of this is the surprising indifference of social enterprise to another great movement of our times: the open source software movement. Now I'm sure that many people reading the last sentence will be utterly bewildered. Open source software? that's just a specialist thing for computer geeks, isn't it? What has it got to do with our enterprise, or the social issues we're trying to address?

Well – lots!

I think of open source as the 'intellectual property wing' of social enterprise – and nobody should be under any illusion about the leading position that intellectual property - the knowledge and creative industries - now occupy in developed economies. Moreover, this particular 'wing' is probably globally the most successful aspect of social enterprise. About three quarters of the internet runs on open source software. But let me pick out just three inspirational areas:

The focus on a few kinds of social enterprise is blinding us to a bigger picture

I was recently invited to contribute a number of 'guest blogs' by The Guardian - this is the text of my first...

I was at a 'woman entrepreneur of the year' awards do the other night as a guest of the North East Social Enterprise Partnership. NESEP had sponsored the woman social entrepreneur category. Half-way through the presentations of the businesses short-listed for the other awards, the NESEP Chief Executive turned to me and said “It's amazing how many of these are really social enterprises.” It was true: many of these leading women entrepreneurs were talking about the social problems they had set out to address through their business, or the artistic quest that really motivated them, or the ethical values they placed at the heart of their work. In fact, although the contenders for the social entrepreneur award were all doing great things, it was quite hard sometimes to see the difference.

It seems to me there are quite a few such straws in the wind around social enterprise nowadays.

Such as Jonathan Jenkins' plea here in the Guardian Social Enterprise Network 'not to let the purists hold us back'.

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