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15 May, 2012

Employing social enterprises is a key, says Professor John Carlisle of Sheffield Business School and Chairman of Cooperation Works Ltd.

He spoke to Anjali Guptara at a Civil Society Forum hosted by Initiatives of Change in its London centre on 19 April 2012.

John Carlisle (Photo: Blair Cummock)
John Carlisle (Photo: Blair Cummock)
David Cameron’s famous ‘Big Society’ is looking for a lot more social enterprise. The Civil Society Forum is a way to ‘put legs’ on this concept. ‘Putting legs’ on David Cameron’s dream means understanding what the dream lacks in order to transform the current situation.

For example, the way that work is commissioned makes it very difficult for social enterprises to get business. Government departments tend to put out large pieces of work for outside contractors to do, which means that smaller enterprises may find it difficult to even fill out the relevant forms as these tend to be so overwhelming and full of baffling irrelevancies.

Moreover, a lot of social enterprises want to avoid relying too heavily on funding from central or local authorities, and would prefer to try to get the end users to pay, in order to be more self-sufficient and sustainable.

Of course that means that social enterprises need to be more business-like in their attitudes and processes–though many social enterprises don’t want to be business-like, because they see being ‘too business-like’ as being equivalent to ‘becoming unethical’, primarily because that is not what they’re there to do. I really respect that.

Further, even if some social enterprises want to be business-like, the question that arises for them is: what model of business are we going to choose? Let’s just think: are they going to use the Tesco model, or are they going to use the John Lewis model? Are they going to use a bonus system at all?

Let me mention the two most important things that social enterprises need to understand about good business. The first is the power of collaboration. Good businesses excel at collaboration. The second thing that social enterprises need to understand is that if you improve quality, you tend to improve the service and bring costs down at the same time. Few social enterprises understand that at present, but it is a fundamental axiom of good business—the continuous quality improvement model having been pioneered by Deming and having been proved by the Japanese as well as others over the last few decades

I want CSF participants to go out feeling confident that they know what they need to do better, as well as what they need to focus on in order to be more efficient and effective with the way they run their current enterprises or the way they’re going to set up new social enterprises. I also hope that, around the Civil Society Forum, there will begin to form a body of learning, of exchange, of the right knowledge. In many ways, the best thing, not just for the individual social enterprises themselves, but also for the economy as a whole, is if all companies could move towards becoming more cooperative—with much greater, if not full, employee ownership.

But I come back to the key point: in order to ‘put legs’ on the notion of the ‘Big Society’ the Prime Minister has to understand, indeed we all have to understand, that unless the people who commission the work—the public sector buyers themselves—change their philosophy, our participants here are going to be hamstrung by the attitude of the people in local government and the civil service. So I hope that the Civil Society Forum can succeed in bringing public sector buyers here for a session so that we can transform their mentality.

I’m working with two government task groups to change the way that public sector procurement happens. We’re beginning to see changes in the way the public sector procurement people themselves work. The way to go forward is through the local government associations, the LGAs. That’s where we should implement change. I think of Wates, an outstanding construction company which has adopted the policy of employing a social enterprise for all their contracts. That kind of mind-set is what we need to cultivate. The Civil Society Forum will help to facilitate that.

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