Monday, October 20, 2014

is the honeymoon for CICs over?

I’ll begin by outing myself (again) on the subject of Community Interest Companies (CICs) – I’ve personally never been a big fan of them for all sorts of reasons that include:
  • their not offering any features that are truly unique,
  • are generally not advantageous in securing income,
  • usually allow very weak governance to emerge,
  • offer little security for their Members and Directors in light of their regulators’ powers to overrule them...
(all of which are detailed in previous blog posts), BUT I have supported some clients to gain this ‘hallowed status’ and am always pleased (really!) when an enterprise proves me wrong on why it’s the best form for them to adopt.
However, I’m wondering of the wider world may be catching up with me now in light of trending data published by the CIC Regulator themselves that suggests CICs may be increasingly seen as a ‘bad apple’ by those who set them up, and those they engage with...
You see, I’m a geek in oh, so many things, but particularly in the governance of organisations of all types, and as a result, find the annual reports from regulatory bodies fascinating reading. And despite my personal misgivings about the CIC form, I’ve always said that the CIC Regulator published perhaps the best designed and most accessible annual report of all the regulators. And this year I decided to dig into some of the stats they publish in a little more detail –
I looked at the period 2011/12 to 2013/14 (3 years) to see what trends there might be amongst CICs that are emerging and it’s not an encouraging picture:
  • as context, over the last 3 years, the total numbers of CICs have increased by 44%;
  • but last year, over 10% of all CICs on the register were wound up – a figure that’s also growing year on year (and has floated around the 9% mark in previous years);
  • and the biggest reason (70%) for CICs being wound up is that they’ve been struck off the public register by Companies House for failing to meet their associated statutory legal duties! - which amongst other things means that the Directors of them may subsequently face difficulties with being able to act as Directors or Trustees of other organisations as well as against their own personal credit ratings;
  • and the number of formal complaints being made about CICs to the CIC regulator has also been doubling year on year as a proportion of all CICs on the register
 
So – is all well in the land of CICs? More are currently registered every year than are being wound up, but the trends in each suggest that most CICs currently don’t make it past 5 years. And with a growing trend of CICs failing to fulfil their basic statutory legal responsibilities, it’s perhaps illustrative that many are adopting this legal form on the basis of poorly informed advice and guidance. It also perhaps suggests that CICs are approaching a plateau in terms of their prevalence, and are not in fact the ‘magic bullet’ to solving the sectors’ woes and concerns that many have presented them as being? (but as with all things, I’m open to being proved wrong of this...) 

 

Thursday, October 9, 2014

whatever happened to the Conservative Coops?

So, its party season again, and with a general election looming, every sector seems to be vying for attention with all the separate parties to become the solution that they’re each hoping to find that’ll help them to deliver on all their aspirations but won’t bankrupt the economy in the process...
One such sector which every party (at least in recently history) has embraced and talked up are co-ops: marrying social justice with economic independence and free market economies, they seem too good to be true and have often been cited in many a politician’s speech as to their ‘fab-ness’. Recently, co-op sector bodies such as Co-operativesUK have also started to more explicitly publish the ways in which co-ops can help each party deliver on their conference promises too.
But how far can we really hold faith in these political parties’ interest? Historically, government and political parties were so anti-coops that the movement formed its own political party to ensure that the sector wasn’t discriminated against in parliament! In more recent history, the Conservative party launched its own co-ops initiative. “The Conservative Co-operative Movement” (CCM) to capitalise on politicians’ interest in co-ops and to help keep this sector at the heart of parliament and to their policy and thinking. And they even set it up as a co-op society! (Intrigued, I even became a Member of this society, despite my father being a Labour councillor and a Co-op party Chair...)
But fast forward 4 years. In that time as a Member, I’ve had 3 general emails; 1 item of post (with postage underpaid on it); no notifications of Members’ meetings (or minutes from them); and I also spotted that they’ve been identifying themselves by another co-op society’s registration number in their stationary. Their website seems to have disappeared and I’ve not been able to get any response to messages I’ve sent to contact details I have.
What can I conclude from this?
In the absence of any response that may suggest otherwise, it seems like the CCM were an opportunistic political attempt to cash-in on the integrity and hard work of the co-op sector over the last few centuries. It’s obviously not understood what it means to be a co-operative by not acting as one. And it doesn’t seem to notice when it stops being able to deliver what it was set up to do.
Some might say the above analysis and conclusions are reflective of this wider political parties approach in general, but I couldn’t possibly comment...

Monday, September 22, 2014

why not all coops should live to be 100

There are any milestones in the life of any business: the first (and 1,000th?) customer, the opening of new sites, and the length of time that the venture has continued to trade (this is no mean feat given that most fail within the first 3 years...)
 
Many ventures mark their trading histories with parties and such like at 25, 50, and 100 years (although there’s not many of that last group!). And as a supporter of various types of enterprise, it’s always gratifying to see how some business forms seem to survive the ‘test of time’ better than others – I’m not sure the empirical data has been collected to prove it beyond shadow of doubt, but my hunch is that proportionately speaking, co-ops tend to last a lot longer than any other form of business model.
And that’s important, because it shows there’s recognisable value and merit in specific types of business over others that make it easier to argue for them on the groups of sustainability, long-term impact and benefit, etc...
But – that might cause a problem for some co-ops.
Co-ops are created by groups of people to meet common shared aims or addressed shared needs, (rather than the ‘traditional’ motivation of private businesses which is to keep making money for as long as possible...) Once those aims have been achieved, or needs have been met, is there a benefit to it being continued?
Some aims and needs will always be ongoing (creating opportunities for employment, ensuring access to healthcare, or supply of energy), but what of those that can potentially be ‘fixed’ within a given time (supporting each other gain access to financial services through rebuilding credit ratings, or building members’ profiles in their respective marketplaces)?
As well as supporting them to start-up, I’ve also been involved with supporting co-ops wind-up because they were so successful in addressing the needs that they were created to address, that their members agreed there was no point in continuing it for the sake of it.
So while a long-standing business may be a cause to celebrate on the face of it, it might also suggest it’s been very ineffectual in achieving what it was set up to do: let’s therefore start to celebrate the impacts that co-ops create rather than how long they might have been trading for.

Monday, September 8, 2014

is #socialsaturday giving the wrong message about social enterprise?

http://socialsaturday.org.uk/
So – in a few weeks time, #SocialSaturday will be kicking off: one Saturday in September that’s been hijacked to showcase, celebrate, and generally let everyone know how great social enterprises are, and to encourage everyone to do more trade with them.
Good idea? Possibly...
You see, while in theory I like the idea, other sectors have been doing this type of thing for some time already: international charity day, Manufacturing Day, national freelancers day, and so on... heck, some sectors are so expansive in the scope and range of their constituent organisations, they have a whole fortnight!
And all of them tend to take place during a weekday – a day when people are in their places of work; in roles where they can immediately start to influence and reflect on their workplace behaviours and practices, and are in a mind-set of being open to new ideas.
But fast-forward to the weekend: most people tend to want to relax, enjoy time with family, pursue personal interests – not be recipients of campaign activity designed to get them to change their spending and business habits. And by staging this day on a weekend, it sends a message that social enterprises are only really active in those businesses whose main trade is at weekends: retail, consumer goods, tourism – and that makes it harder to showcase those involved in manufacturing and construction, investment and finance, healthcare and education, public services, employment support, public transport, and so on...
 
I’m concerned that by staging the showcasing of social enterprise on a weekend, a lot of the wider sector will miss out on the opportunity to be seen and to show how vibrant and full of potential the sector is in all parts of our economy and society, leading many to assume that the sector is mainly about high street stores that are trying to do things a little differently (rather than enacting what many see to be a revolutionary business model) by not bringing it into everyday workplaces.
 
But as with all things I take a view on, I’m very open to be proved wrong on this (and hope I am...)

Wednesday, August 20, 2014

Making the tea – the most important skill for being part of a co-op?

As some will know, I'm involved in supporting the start up and growth of co-operative enterprises of all types through various programmes, contracts, invitations, (and 'personal accidents'...). And having done do professionally for nearly 20 years at local to international levels, I'm of the view that often, the support offered to co-ops doesn't emphasise enough the importance of “co-op working” skills.
 
On the face of it, co-ops are much like any other business – they buy and sell stuff, keep accounts, pay taxes, employ people, and so on. But at their core is a set of values and principles which set them apart from all other types of organisations. And it’s how the Members and workers in co-ops understand and apply these values and principles in their work and relationships with others that usually determines whether the enterprise will succeed or fail.
 
Now I know of fellow co-op enterprise supporters who have written at length on what these co-op working skills are and what's involved in developing and encouraging them. I know of others who offer detailed training programmes on them (myself included!). There's even been a scientific formula for co-operation developed and endorsed by the national body for Co-operatives in the UK.
But I have an idea that like all great ideas and systems, they can all be summarised in a simple concept – for me, that concept is making a proper 'milky brew' (cup of tea).
 

Making a round of drinks for your fellow co-op Members and workers involves various things that are crucial to establishing and sustaining appropriate working relationships: knowing when the best time of day is to step away from the servicing of customers for a time without risking losing their trade to brew up; knowing that there's enough tea bags, milk and clean mugs to hand; knowing how people like their tea (I'm a “leave the bag in for ages, then lift it out before adding a splash of milk” type myself...); and knowing when they prefer to receive it. All of which can be taken as clear allegories for establishing the basics of the systems, procedures, and knowledge of others that underpins good working relationships in any context (and if you can't see what they are, then I'll explain it to you over a cuppa sometime... ;-)
 
Of course – not everyone likes tea; some prefer coffee, or even gin as their afternoon tipple. But in my experiences so far, it’s usually the things that appear inconsequential, like making the tea, that turn out to be the most important in revealing the state of workplace relationships and corporate culture.
 
 
(Oh yes – and my proper first office job was as a tea boy: within a year I was supporting the firm to gain new business and had discretionary control over budget spends, but always made sure that everyone kept getting their tea on time, just the way they liked it and as a result I became one of their longest-serving and most trusted employees...)

 

Thursday, July 31, 2014

great co-op myths of our time (or why we need more competition and less collaboration...)

Co-ops: they’re great, right? Everybody seems to love them, and they’re often held up as models of enterprise that can fulfil some of the most challenging aspects of our societies: creating sustainable employment, empowering the disenfranchised, addressing poverty, ...
But sadly, there are many myths and mistruths perpetuated about them through ignorance, which are probably part of the reason why co-op enterprises have never really ‘taken off’ in this country like they have in others, and are often treated with trepidation by the wider business community.
There’s plenty of material already out there (if you only look or ask for it) that helps to dispel some of these myths that relate to decision-making needing to involve everyone, all employees needing to be paid the same wage, etc, but I wanted to pick up on one that seems to be creeping in to not just rumours about co-ops, but also has implications for the wider economy too: competition.
Co-ops are defined by a set of universal values and principles, which include ‘co-operation amongst co-operatives’: the sense that the sector grows stronger by actively supporting each itself and each other. But this isn’t the same as not competing with each other as some seem to think (based on a few recent twitter conversations...)
Competition, if open and honest, between co-ops is actually quite important and vital: it forces them to constantly question assumptions about how things should be, what customers want, and if there might be a more effective way of achieving the end goals. That doesn’t mean co-ops have to undercut or metaphorically backstab each other, but as part of co-operating with each other, it should mean that there’s a healthy and open discussion about what each might be able to do that’s different to the others, and which will ultimately also mean more choice and benefit for customers and the wider community and society.
Competition stops us stagnating and being overtaken, and surely better to be in ‘healthy competition’ with people who share our underlying values, than a faceless corporation whose only interest is in making as much money out of people as possible?
And this sense of competition being something we should encourage amongst ourselves shouldn’t be limited to just co-ops - collaboration is being increasingly encouraged between businesses within all sectors and industries, so as with so much else, the co-op movement would seem to have some useful learning for other these other marketplaces and enterprises to draw upon and be inspired by.
 
Competition – it shouldn’t be a dirty word for co-ops, but rather one which should be encouraged and celebrated as a means to make sure we keep upping our game so we can have ever greater impacts on our communities and the wider world.

Thursday, July 17, 2014

'enterprise accelerators' - the blind leading the blind?

I've noticed a growing trend for 'enterprise accelerator' programmes over the last few months, and usually dismissed my curiosity to investigate further as they mostly seem to be based in London (I'm a Northern lad..)
However I recently had the opportunity to attend the opening workshops of one that's being delivered by an "international professional services firm" so thought it'd be a good idea to see what sort of support qualifies being labelled as 'accelerator', and from the private sector (as most of the enterprise support programmes I'm involved in have been publicly funded).
 
Sadly I was very disappointed and even shocked.
The opening workshops of this 'flagship scheme' explored basic marketing principles (understand what your customers are interested in, and be able to present the benefits of your service not just its features), and some initial basic concepts of good meeting skills.
Now, I'll agree that such basics are important for any start-up enterprise, but to form the basis for an 'accelerator' that's targeting aspiring high growth businesses in high value industries?
What made me more concerned was that of the start-up entrepreneurs present, none really had any aspirations to scale the enterprises they were thinking of setting up beyond their immediate community, but the cuts by government to enterprise support meant that they couldn't find any other type of free training or advice.
 
But what really stunned me were the 'expert presenters' of the workshops: a communications officer on temporary contract who introduced their subject using the phrase "I don't really know about these things myself, but I'm led to believe...", and another who closed with "...and these are all a few ideas based on my experience of internal meetings with colleagues."
So in actuality, the content of this flagship enterprise accelerator programme was more 'start-up101' than high-growth, and those leading the sessions had no real understanding or first-hand experience of either start-ups or high-growth ventures.
And yet there were glossy brochures and banner stands which make it appear professional and trustworthy.
 
 
If this is the future of enterprise support, I fear for the future of our economy and business communities.