We need social business models that aren’t about recycling cans and turning the lights off. – Sir Ronald Cohen, Chairman of the Portland Trust
Not long ago I heard Matthew Taylor of the RSA speak about the success of the UK coalition government’s ‘Big Society‘ concept. I remember clearly one particular point he made that day: The UK’s public services all rely on the government ‘doing things’. The government administer state education, they administer street cleaning and they administer healthcare. The one service that we effectively ‘DIY’ is our recycling/refuse collection. Up and down the country, councils expect everyone to separate their own recycling from their non-recyclable refuse.
He got me thinking: what else can we successfully apply this to, to improve the quality of public life? We probably couldn’t self diagnose or wouldn’t clean our own streets but can we administer parts of state education, big society style? Can we make an impact on youth services or the employment service?
Malcolm Gladwell at the Deutsche Bank WEB Conference in June then added fuel to the fire, with his take on Generational Paradigms. A (slightly weak) comparison between Martin Luther King’s Civil rights movement and the more recent Occupy protests highlighted the difference between how things have historically been done in a hierarchical and centralised fashion. The new generation are used to a more networked approach to organisation with decentralised decisions being made. The benefits of Big Society in it’s current form haven’t been fully realised – ideally we’d want to move towards a ‘Network Society’ approach, as an enhancement of the original concept.
Big Society should become Open, Networked Society – and learn lessons from the technology world, to help the public
In this Open, Networked Society, Social Enteprises would rise to find smart solutions to societal problems in an ‘open source’ way that is sustainable. Arguably Social Enterprises are defined as businesses running a service which has social benefit but also makes money. They normally have a triple bottom line (or double, without regard for the planet) and in some parts of company law get certain concessions for their ‘social aims’.
Making a serious attempt to complement or even replace a public service with such a structure raises more questions than it does answers. What does it take to run a social startup which competes with the behemoth that is the government? How do you successfully run a hackathon with a difference, find a technology cofounder with an overwhelming conscience or a VC looking for social return?
Though not precise answers, there is a lot of good practice that we can look to. Examples include Midtown Inc, a Community Development Corporation in Detroit who have successfully taken over a number of public services in their area and University Circle Inc, whose board is entirely comprised of residents in its Cleveland area of operation. These ‘CDCs’ are showing how Neighbourhood watch groups can develop, whilst coexisting with traditional government. Good for Nothing‘s recent #madeinlambeth project shows examples of something closer to home that emulates the hackathon nature prevalent in tech startup communities – see what they were able to pull together over a weekend at ilovelambeth. Apps4Good is an excellent example of how we can kill two birds with one stone: youth upskill and learn to code an App (yay, STEM!), which potentially solves a problem.
Are we able to make it easier for citizens to help and get involved? Are we able to embrace open data methodology in the healthcare sphere – or allow an ‘App Store’ type set up, where developers are able to build apps using a common framework, which are used based on popularity, usefulness and referrals, rather than spending money on huge contracts with consultancy firms whose mandated solutions are rejected by doctors?
Where’s the money? Is it sustainable?
A second set of questions is that of the form the Business Models take. Public services aren’t inherently ‘for profit’. There would be a need to toy with new business models being presented – and not just the overtly social ‘recycling can and lights’ ones. I’ve seen a lot on the ‘Shareable‘ business model: I keep seeing references to a generation who don’t want to own cars. There is also the Freemium model and a the Subscription model to add to the mix.
Social Investment Bonds (SIBs) invest in projects now, that will save the government money later. At the WEB conference, Sir Ronald Cohen broke it down as follows (paraphrased) : a project that will reduce re-offending rates in prisoners by more than 7% over 6-8 years gets its SIB paid back in the full by the government, as the cost of the SIB is smaller than the cost of those 7% of re-offenders.
Sir Cohen believes that the financial crisis will force us to work out new approaches to deal with those in society who have been left behind and are losing out. Throw in the proven motivation of gamification and pockets of excess Philantrophy from certain corporates and I’m sure there’s a sound business model which matches social supply to social demand and regenerates in a new way.
Some are closer to cracking the puzzle than I currently am. I don’t think there’s one right answer, but I’d like to develop, experiment and roll out one of those approaches. Fingers crossed, I’ll work it out before the predicted influx of Social Investment players.
Gladwell mentioned some small print for the networked organisation. A real challenge appears when change needs to be scaled or taken to the next step….there is a place for hierarchy, but there are also major benefits of the network when beginning the road to change. As an analogy, long journeys require more than one mode of transport – you walk, you may take a train, or a plane and even a car before continuing on foot again to get to where you’re heading – change happens in stages.
So what would help the ‘Open, Network Society’ to really drive some social change?
- Sort out incentives! It should be clear which types of revenue model we want to reward for social success, and the benefits and concessions attached to them. We should also be sure to be wholly committed in our support of business & entrepreneurship. Whilst promoting entrepreneurship and a 21st approach to work and careers should we continue to use unemployment rates as such a trusted, dominant measure?
- Be open about what’s not working, and open about how we’re trying to make it work. You never know who might have the winning idea…or has been working on it for decades. Politicians have a particular role – I think it’s to listen and represent the views of the public – we don’t expect them to have all the answers to everything…just to be mindful of what is being said and ready to empower those saying the right thing. Can we support programmes like Good for Nothing to become nationwide initiatives?
- For public initiatives we all need to have the long game in mind, but work quickly. The public sector is notorious for sitting back. Let’s lean forward on this – the stakes are quite high right now and it would be great to be pioneers.