Category Archives for "Mutuality"

2 What is Not the Local Economy?

The two case studies, the Grocer’s Shop and the Charitable Business, illustrate some of the issues we face working in the local economy. So, what do I mean by the local economy?  There is no agreed definition. There is no right or wrong answer. Here are a few things I believe are not the local economy, even though they are legitimate uses of the term.

International Development Projects

For example, international developmental projects for the local economy in disadvantaged countries. The aim of international aid is to develop local economies.

It is something I know very little about. I’m interested in UK neighbourhoods, advantaged or  disadvantaged. Clearly disadvantaged neighbourhoods present a greater challenge but we cannot ignore more advantaged neighbourhoods.  They may be where we can find helpful examples of local economic development.

Maybe my experience and  ideas that have a wider application than UK neighbourhoods but I must write about what I know.  However, it is possible lessons from international development projects apply in the UK too.  For example, participatory appraisal and micro-credit are both approaches developed in disadvantaged countries to build local economies.  Groups in the UK use the with some success in the UK, whilst despite a few attempts micro-credit is a tougher proposition, primarily because of the economic environment in the UK.

Government Schemes

Some people associate the local economy with large-scale government-funded regeneration projects. My experience is developmentally these, for example New Deal for Communities, do not necessarily impact upon the local economy. The money passes through the local economy but leaves no lasting change.  Jobs created too often become dependent upon the grants.  After grants run out, these projects rarely obtain mainstream or any other ongoing funding.

An imposed or top-down scheme without local support and centrally planned, works on a one size fits all principle. It’s possible, where there is a thriving local economy, there might be scope for an effective government scheme. But where there is no thriving local economy I doubt large-scale schemes can be effective. It would be interesting to find research into the nature of neighbourhoods where schemes have been successful but I suspect if there are any they will be neighbourhoods where there is already a thriving local economy.

Social Enterprise

Social enterprises may be an integral element in a local economy but they are neither necessary nor sufficient for the success of a local economy. They cannot be the local economy in and of themselves. They are not essential to a thriving local economy.

Social enterprises and other creative local projects may be a sign of a thriving local economy. They’re not necessary because many neighbourhoods have a thriving local economy and no such projects and next time I shall describe a couple of examples that do not include social enterprise.  Whether any have successfully revived a local economy is an interesting question.  I shall share any I find out about.

Social enterprise can be an exciting part of a local economy and can catalyse economic growth. Social enterprise and other innovative economic projects can be a sign of a thriving economy but they cannot thrive without grants in a local economy that is not itself thriving.

Before I go on to define what I mean by a local economy, I shall next time offer a couple of examples.

0 Third Sector Economic Projects: A Charitable Business

This is a second case study illustrating how third sector organisations function in the local economy. I’ve based these case studies on real projects and as far as I know all of them still exist and have moved on since I knew them. Any case study is necessarily a snapshot in time. So, if anyone thinks they can identify the projects please remember first, my intention is to describe the issues and not to criticise the project. Second, these issues do not necessarily apply to this organisations today; they probably struggle with entirely different issues!

Social Enterprise or Charitable Business?

I believe the business I’m going to write about today is doing well. My concerns about it relate to an early stage in its development and its genesis raises some important questions.

It started as an attractive idea using the teaching of particular skills to support a group of disadvantaged people. Their business plan for a social enterprise won awards and some grants and loans to get started.

Whilst funding bodies recognised them as a social enterprise, they looked like a small business. They were in effect one person investing a lot of money in a risky enterprise. Whilst their values were positive, they lacked business acumen and their success depended upon the support of statutory sector funding bodies.

They were successful because they marketed themselves as a social enterprise.  Whether or not you are a social enterprise should not depend solely on your beneficiaries.  The beneficiaries for this project had particular disadvantages and so that made the offer perhaps charitable.  It did not make it a social enterprise.  It is a social enterprise where a group of beneficiaries form the business or maybe a neighbourhood organisation identifies this group of beneficiaries.

A Business Without a Market

What we have here is a sole trader business whose market notionally includes its beneficiaries.  In terms of where its funding comes from, its market was its funding bodies.

This business had no market.  Whether the market was their beneficiaries or others who might purchase services from the enterprise, they simply did not have a list of contacts.  They had run no trials to prove they had a market and had not a shred of evidence that it existed.   They were in effect dependent upon grants and loans. It was touch and go, but they did eventually land a large grant and so may be able to establish their business.

This story raises a number of issues:

2 Third Sector Economic Projects: A Grocers’ Shop

This, the first of two case studies, illustrates some of the issues third sector economic projects encounter when organising projects in the local economy. Both case studies are snapshots of real projects.  Any case study is necessarily a snapshot in time. So, if anyone thinks they can identify these projects please remember my purpose is to describe the issues these projects faced at a certain time in their development. I do not intend to evaluate their response to the issues they faced.  These issues do not necessarily apply to these organisations today; they probably struggle with entirely different problems!

Fairly Traded Grocers’ Shop

Today’s example is a shop selling fairly traded goods, mostly groceries. It is still going and as far as I know it is doing well. In its early days it struggled with the contradictions of straddling two sectors. Its values are pro-fair trade, organic food, against animal cruelty, etc. They use window displays for example to get their message across.

Volunteers ran the shop. Its profits were for charitable purposes. This sets up some interesting contradictions. First, it means the shop is competing with other shops who pay their staff. This must mean it has an unfair advantage in the marketplace.  No-ones livelihood depended on this shop.  So, the balance is between its charitable aims and the likely impact it might have on its competitors who may be dependent upon the success of their businesses.

There is a more subtle issue. At one time, the shop was under-performing, unable to generate the income you might expect given its location. The reason seemed to be, not having the overheads of similar businesses, there was no incentive to exploit its advantage.

At the same time, it set up a second shop in a disadvantaged area. It was unable to support it financially and so the second project closed. The second shop did not attract volunteers from the first and had to find its own in a community that questioned the idea of working for nothing. But the first shop was not at the time generating sufficient income to support the second.   The second shop arguably supported the charitable aims of the shops’ parent charity.

Leadership

This highlights some of the issues when taking a third sector approach to private sector activity. This project brought its own bureaucracy not so much from the statutory sector, it was never grant aided, but from the church.

Its leadership was ideological, not practical and used bureaucracy for control. This is a common problem in any organisation but is less of an issue where there are clear lines of ownership and/or leadership. If you don’t have to do well financially, it opens up the path to management by whim.

Because it could survive without staffing overheads, it had no incentive to exploit its advantage in the marketplace.  Consequently it found it was unable to grow naturally and so contribute to the second shop.

The charity could have used the first shop to fund the second but it was unable to manage effectively a shop with significant advantages in the marketplace, namely reduced overheads, so it could support the charity’s other activities.  This undermined the fairness of its activities competing in the local economy.

The problem was in part lack of experience and an over-complicated management structure.  Most small shops are managed by their owners and rarely by a committee of people with little day-to-day involvement in the enterprise.  The focus of the organisation was on its charitable activities and not on the local economy.

However, nothing is ever achieved without trying new things.  The shop is still going and seems to be doing well.  Maybe they are finding a place in the local economy and a role that makes sense.  Their low overheads provides them with the time they need to experiment and make mistakes.  This is a luxury not always available to small businesses.

2 Why the Local Economy?

It’s good to be back! Over my break I’ve taken this site in new directions. You will see major changes over the coming weeks and this blog will keep you up to date with them.

Today I’m starting a major new strand – the local economy. On Mondays I explore topics under the heading “Mutuality”. This strand focuses on the third sector. My particular interest is community development although I’ve explored a range of topics you can find here:

I reviewed:

• relationships between the third, private and statutory sectors
• the types of third sector organisation
• approaches to working participatively, and
• partnership theory.

(These links will take you to my new cornerstone pages, where you can see these posts laid out in an accessible format. See this Friday’s post for more detail!)

The Local Economy and the Third Sector

The third sector, understood as everything neither private nor statutory, needlessly drives a wedge between the local economy and community organisations.  Misapplied grant aid separates community-based initiatives from the local economy.  Once the money runs out, community activities die back and the local economy remains unchanged.  Whilst I’m sure there are examples of good practice, I believe this happens too often.

Why?  It’s largely to do with values. Business people work for their own benefit in contrast to the altruistic values of the third sector. Reality is more complex. I have several times argued the two sectors complement each other more than many realise.

Many business people start out with altruistic values; they understanding businesses are the most effective way to commit their time to their goals. Others discover, even though they seek personal profit as a priority, they are best positioned when providing something of real value. A good reputation is of massive value to their business. Similarly many in the voluntary sector eventually understand they need income to keep going; they find the constraints in the sector on trading arbitrary and frustrating.

Further, business people can find the third sector judgemental about their values and hopelessly tied into bureaucratic rules and regulations. Often self-employed people leave employment to set up on their own because they’ve had enough bureaucracy from their employers.

Third sector people can find business people distant and not interested in their cause. They’re busy and don’t have time to commit to good causes.

Is this beneficial to anyone? The third sector, working so closely with statutory funding bodies, achieves relatively little in the most disadvantaged communities. Where they set up commercial enterprises for charitable purposes, they are often poorly conceived.

In my next post I shall look at a few examples.  My purpose is to highlight some of the issues, not to deny that a lot of good work is taking place in voluntary organisations and small businesses.  I’m particularly interested in good examples of collaboration across the private and voluntary sectors.  Leave a note about any you know in the comments box.

0 Partnership Online

This is the final post in my sequence about partnership. Partnership Online opens up opportunities that may not be so easy to realise in real life.

Today, four principles of partnership online :

0 Partnership and Innovation

So, what is the alternative to competition?  Look again at natural systems and you will see partnership through innovation, problem-solving and collaboration.

Local marketplaces aim to pool resources and create opportunities so everyone can make a living. The solution to most problems is not so much technology as learning how to work together. No amount of technology can overcome destructive personal relationships. I’ve seen this time and again in community and church groups. Work unravels because we cannot overcome personal conflicts.

Where people successfully share expertise

Partnership does not need to be a full-on. I’m a member of a group of website designers based all over the world. They are a source of support, as we help solve each others problems. Being online is an opportunity to develop these types of partnership and next time I shall explore them further.

Have you experience of working collaboratively or in partnership?

0 Communities of Digital Practice

On Wednesday 16 July 2014 I attended the launch meeting of the Sheffield Digital Media Exchange.  Bizarrely it doesn’t seem to have a website.  It is a partnership to promote access to digital media in the city, building on a network of Digital Media Centres in its  disadvantaged neighbourhoods.

I shall summarise one of the speakers at the event.  Professor Simeon Yates is Director of the Institute of Cultural Capital at the University of Liverpool and Liverpool John Moore University.  The title of his talk was “Building from the Bottom Up!  Using hyperlocal digital media to deliver content and innovation.”  I jotted down a few notes and so can convey the gist of what he was saying.  I thought it resonates with my thinking on this blog.

He talked about Communities of Digital Practice or hyperlocal delivery.  I’ve looked it up and it seems hyperlocal means: “online news or content services pertaining to a town, village, single postcode or other small, geographically defined community”.  That sounds local to me but why use a simple word when a complicated one will do?

Anyway, whatever it is, it has three characteristics:

Together these can

It addresses causes and not consequences.  Government action tends to discuss consequences and so, for example, they address lack of motivation when the problem is really lack of resources.  The focus can be on social and not economic approaches, eg poetry online or journalism in the BME community.

These are thin notes from a rich presentation.  It is significant investment is to be made into neighbourhoods.  My concern is perhaps this approach overlooks the contribution small businesses can make to re-building the local economy.

I have for some time hoped to research asset-based community development (ABCD) and at some time to write about it.  It seems Yates’ approach is asset-based.  Rather than starting with buildings, his focus is on the latent potential of people.  Resources are introduced so that latent potential can become real.

If you enjoyed this post, you can sign up to my email list at the top of the right-hand column. You will receive a weekly summary of my posts, an email sequence about community development and occasional emails about community development online.

3 Consequences of Competition

Last time I wrote about the myth that evolution is about competition. What might seem to be competition is often subtle forms of mutual benefit. It depends upon how we look at it.  What are the consequences of competition?

Belief that competition is the norm has consequences. Here are some consequences based on a New Statesman article, “Fishing with Dynamite” by Margaret Heffernan, in the 20 -26 June 2014 edition:

Questioning Competition

I haven’t proved the point here, my aim is to make the point and suggest we should question the mindset that sets competition above all other approaches. Is it true competition is more natural than collaboration?

Both competition and collaboration are mindsets. They are ways of seeing we project onto the world. The world is no more naturally competitive than it is collaborative. The consequences of which model we project are real though.

Last time I used the example of foxes and rabbits. I suggested that you can read it as either a competitive model or a collaborative model. But which is most helpful in understanding what happens in this admittedly simplified ecosystem?

Whilst we may deplore the violence of foxes and note the callous attitude of those who argue rabbits have to die for the good of the system, we also note the consequences when the system breaks down. The point is there are constraints on the foxes. The consequences for the fox of unrestrained violence are devastating.

What evolves is a system that supports both foxes and rabbits. We can look at it and decide this justifies violence because violence is a necessary part of the system. But how do we avoid that excuse being used to legitimate behaviour that is destructive of the system?

Actually, ecosystems constrain violence. When foxes become too powerful they destroy their own food source. The same applies in economic systems. Unconstrained competition is ultimately destructive.

So, what is the alternative?

1 Partnership and Evolution

In this and the next three posts I shall explore some theoretical arguments about partnership.

In the very earliest written documents and the verbal traditions before them, the powerful have sought to justify their violence. Any argument will do to justify their violence.

Some people blame Darwin for this although I don’t think it was entirely his fault. I understand the term “survival of the fittest” did not appear in the first edition of “On The Origins of the Species”. Whenever it appeared, people misinterpreted these words and used them in two ways that have had unfortunate consequences.

The problem is we understand the word “fittest” in two ways, the healthiest or the one who fits best. Darwin meant the latter, most people seem to think he meant the former. Foxes kill rabbits. The mistake is to think this makes foxes fitter than rabbits. Actually they kill weaker rabbits who can’t run away as fast as stronger rabbits. The mistake would be to think faster rabbits are fitter. Look at this way, if rabbits evolved machine guns and could kill every fox, this would not make them fitter. Indeed the rabbit population would die out as well as the foxes.

The problem is our fixation with conflict or competition blinds us to seeing what is actually going on. Foxes and rabbits are part of a much bigger system. That system also includes grass. Rabbits eat grass. What happens to the grass when the rabbit population increases?

Consequences of Misunderstanding Evolution

This basic misunderstanding has led in two unfortunate directions.

First and obviously: fascism. The idea that the gene pool can be manipulated to breed a better population underlies much far right rhetoric. By being strong, we are told, we can solve all our problems.

One reaction to this on the left was creationism. By thinking Darwinism glorified violence, many Christians reacted by rejecting Darwinism. The 1925 Scopes trial in the States was not conducted by modern fundamentalists. Many had a left perspective and believed Darwinism justified violence.

Creationism evolved during the 1950s into a covert movement called creation science, claiming to be a science and not based upon theology.

When we approach partnership as a topic, we need to understand the entrenched views of many that partnership is somehow not natural. Ultimately human nature will win out and our competitive animal nature will show its real claws.

Obviously this can happen; there are plenty of stories of betrayals but betrayals work because there is trust. In a world without trust it is impossible to betray.

Fitness implies collaboration, innovation and problem solving.  Animals and plants do not evolve in splendid isolation.  It is actually ecosystems that evolve.  Nothing can survive without collaboration.

Next time I will discuss some of the consequences of the competitive world view, and after that I shall look at alternatives to it in real life and online.

4 Non-Directive Consultancy

George Lovell developed Non-directive consultancy, by providing training for church and community workers. He ran his organisation, called AVEC (the French for “with”), at Chelsea Methodist Church in London. (The link takes you to my sequence about non-directive consultancy.)  It ran from the 1970s through to the 1990s. After AVEC closed, George Lovell, with a few others, developed a course about consultancy, mission and ministry. George has retired but the course continues at York St John’s College. Consultancy for Mission and Ministry is an excellent course for anyone interested in non-directive consultancy.

What is Non-directive Consultancy?

Consultancy has something of a bad name primarily because of out-sourcing, where specialist consultancy organisations carry out tasks instead of employees. We all know where that’s led.

Non-directive consultancy does the opposite. It is a mutual method, aiming to empower the people who are doing the work. It starts with the assumption that the consultor knows their job. They may need help in thinking things through. Everyone makes mistakes. Sometimes they need help to see where they went wrong and how to move on from where they’ve ended up!

George Lovell’s two books, “Analysis and Design” and “Consultancy, Ministry and Mission” are the best introduction to the approach, although the course is essential if you want to learn the method.