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Social innovation is political 17 February 2020

Posted by cooperatoby in social economy, Social enterprise, social innovation.
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At the DIESIS strategy day on 11 February, I chaired the world café tables on social innovation, and wanted to go beyond the standard discourse.
The social innovation project is a worthy attempt to transfer the glamour traditionally attached to technical innovation to the social policy field. And the transfer of innovative methods is what gives the EU the competence to intervene. But what underlies it?
The usual definition is phrased in rather technical terms:
• social innovations are new (in their context) social practices that aim to meet social needs in a better way than existing solutions. They are innovative in method as well as results – i.e. they create new relationships;
• They tend to be hybrids of existing elements, rather than completely new, and to cut across organisational or disciplinary boundaries;
• They can be launched by anyone – government, research institutions, companies, professionals, NGOs, the social economy…
• Their crucial feature is that they let new actors in. They empower and strengthen civil society, and therefore increase the effectiveness of change.
Some examples are open universities, social co-operatives, microcredit, fair trade, Wikipedia, community planning and architecture, carbon trading and socially responsible public procurement.
But it’s also important to remember that there are also what might be termed ‘antisocial innovations’ such as the privatisation of public housing: this certainly changes social relations and empowers tenants – but it correspondingly disempowers the homeless who will never get a council house.
Therefore we should remember that social innovation is essentially political – it aims to make everyone winners, but it may also have losers. This is especially the case for so-called ‘disruptive’ social innovations. Disruption sounds grand, but Uber’s gamble that it can dismantle public transport and replace it with its own monopoly is scarcely a progressive step.

Social enterprises are how we sustain social innovation

A second political angle is the suspicion that social innovation is a cloak for public service cuts, a way for governments to shuck off their responsibilities and force citizens to solve social problems themselves. I don’t really buy this – people have a natural desire to improve their societies, and public policy should give them ways to do this. The crucial role of the social economy is that it is the only way of making social innovations economically sustainable. If they don’t have a ‘business model’ then they will forever be controlled from the top down. Social enterprises are the vehicles through which citizens can directly control their living and working environments.

Thirdly, we should avoid digital capture. Not all social innovation is digital. One can certainly use digital methods to bring people closer to power – see the example of Simba’s Comme à la Maison (CALM), which links up migrants with offers of accommodation. By the essential point is power, not technology.

Finally, the pot of gold at the end of the social innovation rainbow is ‘transformative’ social innovation, which not only introduces new approaches to seemingly intractable (‘wicked‘) problems, but also changes the social institutions that created the problem in the first place. It’s slow and requires capacity for multiple partnerships and engaging policy, legal and economic institutions.

We need EQUAL+ 22 February 2018

Posted by cooperatoby in social innovation.
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At the Investing in People – the Way Forward conference in Sofia last week, it fell to me to revive our memories of the EQUAL programme, which from 2002-2008 engaged 20,000 organisations in innovation through transnational cooperation. It was cleverly designed to build partnerships within countries – e.g. between local authorities, research institutions and cooperatives – which then carried out projects with partners abroad, to test new solutions to employment and social problems. There was also an obligatory ‘mainstreaming’ phase to embed the results in policy and practice.

Here’s my presentation.

Asked whether EQUAL was too complicated, I said the ESF is not about spending money, it is about spending money intelligently. It is precisely the methodological support, analysis and dissemination that made the difference. And it did make a difference: many of the partnerships built during EQUAL are still alive today. One key outcome was the invention of a policy on inclusive entrepreneurship (see COPIE), which simply did not exist before.

There is grassroots demand for transnational cooperation, as is shown by the over 100 people who have registered for the ESF-TP’s Partner Search Forum in Warsaw next month.

Simplification – the answer to everything

It should not be beyond the wit of ESF policy-makers to use our new simplified rules to recreate an ‘EQUAL+‘ programme for the 2020-17 period. Using lump sums and standard costs cuts out so much of the paperwork and allows managers to concentrate on results. Flanders does this, preserving the spirit of EQUAL.

Aside from work, I remember Sofia for Wilkinson & Pickett’s presentation on The Spirit Level, the snow-capped massif of the Vitosha overlooking the city, the ruins of roman Serdica under the town centre streets, and the ornate art nouveau Balkan Hotel where we dined as ecologists demonstrated outside.

David Bowie as a tool of social innovation 29 September 2016

Posted by cooperatoby in social innovation.
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The Social Innovation Community (SIC) launched itself with élan this week. At 9:30 on Monday morning I was surprised to find myself singing along to Bowie and Bon Jovi under the guidance of Sanderson Jones, founder of the Sunday Assemblies. Sanderson turned his experience as a stand-up comedian to good account as he told us the story of how the (so far) 70 Sunday Assemblies – a sort of secular replacement for church congregations – are rebuilding communities and combating mental illness: Congregation – spirituality + science (mindfulness) + pop songs = Sunday Assemblies!

It was cheering to see the Britons who were there being so keen on European collaboration. It was inspiring to hear Fabrizio Sestini from DG CONNECT say that innovation is inherently social, and that economic innovation should be seen as a subset of social innovation: “Whenever there is a social change, eventually someone will make money from it. But that’s not the point.” I met lots of new people, and wrote all over tables covered with white paper. The two main ideas I put forward were that the 8 SIC networks (public sector, corporate social innovation, collaborative economy, social economy etc.) should formulate demands which the work packages (research, education, experimentation etc.) can then satisfy. Secondly, one key set of stakeholders that should be more involved is the funders of social innovation such as ESF Managing Authorities and foundations. But it’s still early days.

I noted two very disparate underlying models of what social innovation is: on the one hand an essentially political movement that has to challenge the financial system – and on the other hand the less disruptive idea that digital media can empower people to solve their own problems (‘tech push’). Social innovation is a broad church. In between, there is a lot of serious work to be done to measure what welfare benefits result and what return on investment social innovations produce.

It was interesting that in our final exercise, when we considered what governance model SIC should aim for, out of the three choices offered – organisation, collaboration and market – a surprisingly large number stayed on the ‘organisation’ table, rather than migrating, as the facilitator expected, to the ‘collaboration’ table. So there seems to be a long-term confidence in the value of what we are doing, and a will to establish SIC as a permanent entity.

Social innovation is more than start-up support 8 March 2016

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The BENISI project aimed to identify 300 social innovations and help them to scale up. But faced with the enormity of this task it seems to have fallen back on promoting start-ups, without assessing whether they are either social or innovative.

I’ve just come back from the BENISI final conference and I have to say I am disappointed. I encountered at least two circular arguments, and ended up quite unsure whether the project was promoting social innovation, social enterprises or just start-ups.

A circular notion of growth

Firstly, the presentation of the project’s outcomes was couched in purely economic terms. It measured whether a business had scaled up by whether its revenue hadP1000111 BENISI grown – and then reported that one of the requirements for growth was financial investment. An unsurprising deduction. Even less surprising is that innovations that generate revenue are easier to scale. The only social outcome reported was employment growth, which is a by-product of revenue growth rather than a social outcome in itself. Social impact can grow even without revenue growth – for instance if a better method of delivering social services was replicated. If it was more efficient, revenue might even fall. In fact many ‘social innovations’ rely on using IT to cut the cost of service provision, and along with it cut the jobs they provide.

A circular notion of impact

Then there was the workshop on impact measurement, in which I was astounded to be told that the three factors making for impact are the values of its workers, the corporate culture and the management methods. That’s all very well, but these are not indicators of impact. They are drivers of impact, or as another participant contributed, indicators of a capacity to achieve impact. Impact is what happens in the outside world, and is about improved quality of life for the enterprise’s intended beneficiaries. Intention should not be confused with success.
Regrettably values, culture and management are not enough – witness how many social enterprises run by the best-intentioned value-led people you could possibly imagine nevertheless go bust and fail to achieve any impact.

Where’s the evidence?

Maybe BENISI could not have been expected to prove scaling in a 3-year timeframe. Maybe the project has served its purpose in making social innovation visible to a larger number of people – reportedly 14,000 have been reached.
But there is deep confusion over what the object of the exercise was. The discourse was about social enterprise, but no one is measuring these enterprises’ social impact – or at least the summary report did not attempt to make any sense of what social impacts the 300 projects did report. Surely one must at least one of them must have got some clients into jobs, or taken x tons of poisonous heavy metals out the waste stream, or housed some poor people, or cut its energy consumption, or even just got some letters of appreciation from its clients?
Unless an enterprise has a notion of what it is trying to change, and measures and reports on whether it is achieving that, then it is not a social enterprise. Having an explicit social goal is one of the principles of social enterprise the European Commission set out in the Social Business Initiative.
Social enterprises reportedly measure impact mostly as an internal management tool (“you can’t manage what you can’t measure”), but it’s also useful in building customer loyalty and essential in getting impact investors on board. Also see EVPA guide.
Public funders like the ESF are also keen to fund social innovation – but taxpayers’ money has to been seen to be benefitting somebody. Otherwise the fascination will fade.

Social what?

It seems to me that the Impact Hubs are hard at work promoting start-ups, and that many of these will be innovative in some way, but that doesn’t make it social innovation and it doesn’t make the start-ups social enterprises.
I also missed any explanation of what the different methods for scaling are – are they social franchising or organic growth or new products or new markets or acquisition or what? And then I’d like to have known which of them were tried, and which worked best in the sample of 300 enterprises. I was left wondering whether scaling is any different from good old growth. Maybe it is just that ‘growth’ is a taboo word which is too reminiscent of capitalist economics.
I left when a speaker pronounced that it was a problem that no social enterprise had yet done an IPO. That’s a key feature of a social enterprise – it can’t be floated on the stock market as a financial investment!
So that’s the trouble: social innovation is everything to everybody, and the name of social enterprise is being taken in vain.
To protect the guilty, this report is made under Chatham House rules.

3 factors in mainstreaming social innovations: needs, social policy-makers and financers 24 February 2016

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I’ve just been at the kick-off meeting of the Social Innovation Community (SIC) project, which involves many of the big names in social innovation and is co-ordinated by AEIDL. Its job is to establish a Europe-wide community of social innovators, comprised of 8 or more networks on issues such as public sector innovation, corporate innovation, digital innovation and the social economy.
I was struck by the debate on which part of the phrase ‘social innovation’ is more important. For ZSI in Vienna, the more important point is that innovation policy should become more social. For me, the point is that social policy-makers should become more innovative.
It seems to me to be misleading to model social innovation too closely on the model of technological innovation. New products are often invented out of love for the product itself – a desire to improve the way something works. Inventions become innovations once they have successfully made it to the market – i.e. they are economically successful. The main beneficiaries are the producer and the purveyors of the new thing.
Social innovation on the other hand has to start with the apprehension of a human need, and the people who benefit will typically not be the inventor or the purveyor, but the clients. Ideally, as in the case of a co-operative, both producers and customers will benefit, and altruism and self-interest will both be satisfied.
In mainstreaming social innovations, it seems vital that the theoreticians of innovation as a process take a back seat and prioritise three things:
– the identification of need, through stakeholder participation and mapping
– the engagement of social policy-makers who are the people who can close the implementation gap
– the bringing on board of the institutions which can provide finance for social innovations – including public authorities, funds likes the European Social Fund and corporate philanthropists as well as crowdfunding platforms.

Social innovation & migration 5 February 2016

Posted by cooperatoby in Social enterprise.
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I’ve been thinking briefly about the relevance of social innovation to migration. Many social innovations rely on one of two mechanisms: user involvement and new technologies.

On the first point, the people who facilitate migration are typically portrayed as exploiters – people traffickers – but they are clearly fulling a market niche. They are providing services that migrants want to buy. The principal problems are price and quality – i.e. a high profit is being made through providing unreliable and dangerous transport and accommodation. If the public sector is unwilling or unable to find solutions, and the private sector exploitative, is there a third way?

Could one look at addressing the problem from the users’ point of view? Before the Second World War, migrant services like the famous ”Kindertransport” were laid on by philanthropists. Today, those looking to emigrate for whatever reason could form co-operatives to manage good value, safe means of transport.

On the second point, migrants already apply new technologies to this social problem, even if only by using Google Maps. But surely some Uber-like matching of supply and demand could also be useful.

Objecting that all this is illegal is not only inaccurate but beside the point: just as in treating drug addiction as a medical rather than a criminal issue, this is all on the principle of harm reduction.

How to support innovation using the ESF 11 November 2015

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Social innovation is one of the buzziest words of the last few years – but once it is mentioned the almost inevitable follow-up is – “whatever it means…” Everyone knows that social innovation is a good thing, and they want more of it, from more people. But how do they know whether they have it or not? Even more problematically, how can they encourage its emergence?
In some senses this dilemma is a long-standing one: the European Commission has habitually refused to answer the question “what is innovation?”, retorting that “if we knew what it was, it wouldn’t be innovation”. Sometimes I have suspected that European programmes place such a premium on innovation purely because that is the institutional space left for them – the day-to-day stuff is left to the Member State level.
The popularisation of the social innovation meme by President Barroso and others has raised the stakes. In transnational work in the ESF, for example, social innovation is supposed to be mainstreamed. And innovation has to be more than creativity – it implies rigorous management in making change happen.

Flanders institutionalises innovation

Flanders is a region that has got ahead through innovation, and the Flemish ESF Agency is one of the few to take a serious and structured approach to encouraging innovation. It devotes 8.5% of its ESF budget – €32m – to innovation and transnationality. On 26-27 October it held a seminar in Brussels to selflessly transfer to other ESF managers the results of an 18-month project to improve the way the ESF supports innovation: Meer werk maken van innovatie voor werkgelegenheid en arbeidsmarkt. The project involved partners from the Czech Republic, Sweden and Poland. 70 people from the ESF all over the EU community attended the event.
Project activities included a literature review, study visits and exchange events, and its results are presented in a comprehensive 396-page toolkit. This focuses on service development but also says something about systems innovation.

Theoretical framework

The first thing to say is that the seminar was hard work – and I mean that in a good way. The content was challenging – even the bits when the participants were supposed to have the luxury of sitting back and absorbing presentations. When it came to doing exercises the effort demanded was even more. But it was well worth the effort, and Benedict Wauters is to be thanked and congratulated for sharing his results.
The content was unique in my experience in that it combined the most abstruse of theory with the most hands-on of practice – and took in some illuminating practical examples along the way.
The theoretical framework Flanders has adopted is based on Theory U which emphasises interactions between people, works upwards to transition theory and has the final goal of improving human welfare and development.
The theoretical underpinning came in the form of presentations from two EU-funded research projects on what social innovation is.

• Theory 1: A multilevel theory of transition

The first is TRANSIT (Transformative Social Innovation Theory), presented by Flor Avelino from Erasmus University in Rotterdam.
In her vocabulary, a transition is the sort of high-level innovation that takes between 20 and 50 years to occur, and is further-reaching than the three lower levels, a systems innovation, a process innovation or a product or service innovation. Transitions evolve over time: the challenge of peak oil became that of climate change and is now all about the economic crisis.
She defined 3 levels of socio-economic processes:
• The highest level is the landscape or underlying process such as climate change and population ageing
• In the middle comes the socio-economic regime, or set of dominant practices – such as an oil-based economy
• At the lowest level come niches – spaces for innovation that are opened up by technological developments – such as wind power or car-sharing
The theory holds that the regime will defend the status quo, so one of these transitions will happen only when it gets caught in a pincer movement from both sides at once: caught between a shock in the landscape – such as climate change – and the opening up of a technological niche like a new form of energy generation. To my simple mind this is a more developed way of saying there has to be both a supply and a demand for innovations, and no barriers in the process of matching them. But the theory puts it in dialectical rather than market terms.
Flanders SI -  the bigger picture of innovation.
A multilevel strategy for transition management therefore involves playing into landscape developments, challenging regimes and empowering niches to scale up.
Social innovation involves a change in the social relations through which we know, frame, organise and do things. This brings to the fore the concept of agency – what can people do? It is expressed in a set of new social movements which challenge the status quo. The project is studying 20 of these, focusing on Europe and Latin America, and including Impact Hubs, Ecovillages, Fab Labs and RIPESS.
The project is looking at how different narratives of change interact, including, in the field of ‘new economy’, the green economy, the collaborative economy, social entrepreneurship and the social economy, and the solidarity economy – i.e. changing the whole economic system including the private and public sectors. What they have in common is that they are hybrid – they challenge the boundaries between public and private, formal and informal, and for- profit and non-profit. Above all, they involve a shift in power relations. However it is unclear how power is shifting – in the case, for example of Airbnb. What seems like a transformation may in fact be a capture by the existing regime.

• Theory 2: Capability theory

The second research project, CRESSI – Creating Economic Space for Social Innovation, was presented by Nadia von Jacobi of Pavia University. It is applying Amartya Sen’s Capability Theory to social innovation. Basically this holds that social progress is about expanding people’s opportunities; it is not only about the resources people have, but the choices they can make. From a given set of resources (or endowments) – which include the physical environment, institutions, social networks and cognitive frames – people are subject to a set of ‘conversion factors’ – such as their individual traits and the context they find themselves in – which determine the ‘capability set’ of choices they have open to them. Social innovation occurs when the functionings people achieve feeds back and influences the resources available.
If people are to have greater agency, they need to be empowered. They need to have various sorts of power:
• power over – you can resist manipulation by others
• power with – you can act in groups
• power to – you can create new possibilities
• power from within – you can change yourself
Social innovation involves people forming networks and exerting power on three forces in society: institutions, social networks and cognitive frames. This bottom-up approach overcomes the pitfalls of the top-down logic, which treats people, as target groups – patients rather than agents, underestimates complexity and assumes it is neutral with regard to the existing asymmetry of power.

An example of service design

As regards practical tool for social innovation, seminar participants had a choice of two, and I chose service design, presented by Kelly Pollard and Laure Monbrun of PearsonLloyd, a London-based designers. In the A Better A&E project the consultants worked with the UK Department of Health and the Design Council to improve the quality of the waiting experience in accident and emergency depart¬ments of hospitals. The objective was to reduce aggression and violence against A&E staff, of which there are 55,000 cases each year in the UK, which cost the NHS €95m.
Flanders A better A&E resultsThe process they undertook was a little counterintuitive. Instead of tackling head-on the relatively small number of case of direct physical violence, they decided to reduce the frustration patients felt all the way through their visit to A&E, thus improving the quality of life for a great many more people.
The process they went through is known as the ‘double diamond’ (not the beer I used to avoid in the 70s) and comprises 4 stages: discover -> define -> develop -> deliver. It involved talking to the stakeholders to learn about their behaviour and needs, mapping the patient experience, and developing a clear set of charts and signs which would make sure that patients knew what was happening to them at any given moment. They also produced guidance for staff and are developing a mobile phone application. Equipping a hospital costs about €80,000 and typically shows a return on investment of 3:1.

Designing ESF calls for innovation

The seminar’s third section showed us how Flanders organises ESF calls for innovative projects. It holds separate calls for two types of innovation:
• innovation via exploration – for people with a challenge they need to meet
• innovation via adaptation – for people with a service that works well and deserves scaling up

It gives each project a 100% grant of €50,000 for a first phase lasting 6 months, and if the result is validated (by external experts) then it gets a follow-up grant of up to €150,000.
Flanders SI double diamondThe process is rigorous: in the first 6 months, projects have to produce a concept description, an experience map, a high-level business model, a concept test, a report on field results – and plan for phase 2. It is estimated that about half the applicants will go through to phase 2, which lasts 18 months. Nevertheless Flanders has received about 30 applications under each heading, with a lot of universities figuring among the applicants, but also some NGOs.

Further information

Check out the toolkit and a series of presentations!

This nonsense about uncertainty 14 September 2014

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IMG_1714 In de War, Warmoesstraat crVoltaire: Le doute n’est pas un état bien agréable, mais l’assurance est un état ridicule. [letter to Friedrich Wilhelm I of Prussia, 1770]

I’ve been irritated recently by the chorus of business leaders (seemingly organised by the ‘No’ campaign) who have opined that a Scottish vote for independence on Thursday will be bad for the economy because it will create “uncertainty”. It seems to be taken as axiomatic that business dislikes uncertainty. This is at most a half-truth.

Business opportunities only come about through uncertainty. Someone with both information and imagination spots a need which they can satisfy and for which people are willing to pay. It’s a gap in the market. It’s otherwise known as risk. The entire justification for profit-making is that it involves risk. Financiers demand a “risk premium”. Risk-taking is seen as that grand thing, an entrepreneurial mindset, and tolerance of ambiguity is a political and diplomatic necessity.
Business can’t have it both ways. Either they are not taking risks – in which case the justification for taking profits disappears – or they are taking risks, in which case a bit more uncertainty is a good thing as it opens up entrepreneurial opportunities.
What these business leaders are saying is that they like the cards stacked in their own favour, just like they have always been. They don’t want the apple cart to be upset. They only want to deal with uncertainties that they have already analysed and assessed. They don’t want the bother of having to adjust their spreadsheets, set up new lobbying operations, do new market research or pay attention to new voices of citizen and consumer representation.
Uncertainty shouldn’t induce paralysis, but a search for new paths – the much praised activity of innovation. If people are poorer, that is a market opportunity, as discounters like Aldi have correctly deduced. The media industry thrives on uncertainty – without it there would be no demand for newspapers or television current affairs programmes. Uncertainty is the consultancy industry’s bread and butter. There is enormous growth in online information services that feed on uncertainty by advising us how to avoid bad weather or traffic jams. This market exists because we humans are quite risk-averse ourselves – we all want to know that is likely to happen next. And we all love a good thriller – the hero of Breaking Bad is even nicknamed Heisenberg, presumably after the inventor of the Uncertainty Principle.
So this outbreak of uncertainty-mongering must be code for something else, some other underlying fear. By voicing their fear of uncertainty, business leaders are unmasking their true nature as conservative rent-seekers, seeking to preserve their privileges – and this is hypocritical because their public stance is that they are agile and responsive to changing market demands. In principle, they should welcome change, as it opens up opportunities for innovators to make the system more efficient in meeting consumer needs.
The veiled threat is that business people will refuse to invest unless they can be sure of a predictable return. So what they are saying is that they are not entrepreneurs, just managers. They are not in business to take risks – only to preserve profits.
What’s fascinating and heartening about the Scottish referendum debate is that it has finally let out the pent-up anger at the way the City of London establishment has messed up. Their complaints about uncertainty are not only hypocritical, they are discredited. Anyway, an independent Scotland will be full of entrepreneurial opportunities.

Welfare innovation – making elephants fly 18 February 2014

Posted by cooperatoby in EU, Social enterprise.
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WILCO illoIn studying how best to reform welfare provision, researchers must pay more attention to the sustainability of the structures that are set up. In particular, they must not allow the crucial role of participation to be submerged.

It’s the season for final conferences. Right at the end of January I discovered the limits of academic debate at the final conference of the WILCO project, held in La Tricoterie in St-Gilles. It used to be a sofa factory but has been converted into that socially innovative phenomenon, a ‘link factory’. Coincidentally, it was where Simon & Brigitte held their wedding reception the Saturday before. It’s an interesting regeneration project that is offering the public the chance to become ‘investor-co-operators’.

The €2.4m FP7 WILCO projectUnderstanding innovations in local welfare to strengthen social cohesion and lower social inequalities – involved research institutions in 10 countries as well as the EMES and NISPA networks. It investigated 77 examples of social innovation in 20 cities around Europe, and aimed to work out how local ideas could be better disseminated. It has produced a myriad of outputs, including some very professionally made videos, discursive case studies and a 400-page book, which includes some (rather confusing) network diagrams showing who tackled which issues where. These constitute a valuable resource and are available on its website.

What about the economic underpinnings?

These outputs make clear that social innovations have to spring out of a culture, and cannot be imposed from above as a quick fix for budgetary austerity. But I was confused and disappointed that the project had paid so little attention to the economic sustainability of the initiatives it looked at. This seems to be because it had started out looking at welfare services from the users’ point of view – and that is the strength of the video documents. Taco Brandsen, who led the project on behalf of the Radboud University in Nijmegen, is proud of the in-depth interviews they made with some of the welfare beneficiaries. It concentrated on childcare, housing and employment, focusing on single mothers and young people.
The project focuses on how welfare systems should be reformed to meet the needs of vulnerable people who are affected by the changing way in which public authorities are providing services it notes the rise of a new situation of permanent instability, which consigns people to an unpredictable series of short-term jobs interspersed by periods of unemployment. This is combined with a shortage of affordable housing and increased migration.
The innovations studied nearly always arise from collaborative networking, with or without the active support of the authorities – but at least without their opposition. The project was looking for sustainability, but found that in reality many initiatives remain short-term and local. Evaluations, if they are done at all, are conducted on state/big-business principles, and this may overlook their power as examples of what can be done. These innovations are essentially local, and if they spread at all it is by mysterious means. Transfer is difficult to engineer, and depends on all sorts of intermediaries. What emerges is that the idea is less important than the relationships that are built up during its development. These are what enable the innovation to take place.

Flying elephants

My problem is that this analysis underplays the key role of the social economy or social enterprises in making innovations work. It pays too little attention to the ‘economic underpinnings’ of welfare innovation.
Agnès Hubert from BEPA was on hand to situate the study in the context of the Social Business Initiative, and as her finale made the rousing call: “We have the knowledge, we have the people, we have the funds – we have to continue to work together!”
I put the question whether anyone was researching whether social economy structures resulted in better and more sustainable welfare innovations. I was surprised to get the response from Adalbert Evers (Giessen) that they had found very few social enterprises among their case base, and that it was more a case of intrapreneurship in the public sector. His beautiful slide showing an elephant with butterfly wings instead of ears depicts the central problem of ‘making an elephant fly’. This seems to overlook the fact that the vast majority of social innovations take the form of social enterprises.
If you have an elephantine public service, which is expensive to feed and unresponsive to changing needs, there are two main things you can change: technology and customer relationships. Social networking approaches are one tack which enables welfare services to become more responsive. The other is shifting power down from representative democracy to participative or deliberative democracy.
Many social innovations involve one of these two routes: on one hand, the internet can save costs by making infinite amounts of information available for virtually no cost and allowing citizens to do their own research and collaborate to solve their own problems.
On the other hand, shifting power down to users allows them to take charge of defining service delivery to make it more efficient. It shortens the feedback loop between provider and recipient. The very fact of being involved often increases satisfaction with the service. This is the great lesson of social co-operatives – of which Italy has over 7,000.
Co-operatives grasp the nettle of combining social with economic ‘bottom lines’. For 170 years the movement has been refining the way through which consumers and producers can democratically operate a business that meets social needs.
Taco Brandsen observed wisely that social innovation has a normative dimension, in that every change involves a transfer of power, and there are losers. I pointed out that there are sorts of ‘social innovation’ which might – if one took a normative view – be seen to be undesirable: in particular, the ‘spin-outs’ of public services to so-called ‘employee-owned mutuals’ that is the vogue in Britain. In theory public service staff are given the right to ‘privatise’ the service they deliver by setting up a new business which they control and which takes on contracts from its former employer. They are then in theory liberated to develop new service and behave in an entrepreneurial fashion to everybody’s benefit. But in fact many of these are majority controlled by venture capitalists. As the industry will inevitably consolidate through takeovers, competition will enforce a ‘race to the bottom’ in terms of workers’ pay and conditions, and may endanger service quality.
Research seems to be lacking on what sort of structures provide the best outcomes for service users and employees in the long term.

Stealing the social economy’s glory

There is a repeated effort on behalf of level-minded academics and policy-makers to depoliticise this area. Whenever the social economy comes up with a good idea that is based on the tried and tested principles, someone comes along and rebrands it – in this case to ‘social innovation’. But this attempt, which on the face of it seems rational, may be self-defeating. Because it may end up setting up structures which are short-lived. Participation is inherent in the definitions of both the social economy and social innovation, and must be safeguarded.

What progressives should propose is social enterprise 15 November 2013

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Roberto UngerGood to watch Roberto Unger being grilled by Steven Sackur on the BBC’s HARDtalk last night. It was an interesting contrast of style between a deeply-thought-out political philosophy and a journalistic desire to get snappy answers to practical problems. Unger, who is a Harvard law professor and was Brazil’s minister of strategic affairs under Lula, tried his obstinate best not to be dumbed down. His analysis led me to watch his discourse on What progressives should propose.
And hey presto I am delighted to find that little I have come to some of the same conclusions as the great man. He proposes that:

    – our economies need to be based on a combination of self-employment and co-operation (18:00 in the video). He calls it “the reconstitution of free labour”
    – civil society involvement in experimental ways of providing social services (23:00 in the video) – exactly what social so-operatives and social enterprises are doing
    – politics needs to be enriched with participative democracy

It seems that we in Europe are edging towards many of his prescriptions – to find a new synthesis of the North American faith in unfettered markets and the north-east Asian command economy, by for example:

    – spreading the experimental innovative collaborative ways of production which are currently limited to the vanguard of the high-tech industries
    – encouraging localities to conduct social experiments

Michel Barnier’s grounding of the Social Business Initiative in the need to “put finance at the service of society” bears a resemblance too. Maybe social enterprise is capable of “doing the work of crisis, without crisis”.

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