The Business Development Approach of Ernesto Sirolli

The Business Development Approach of Ernesto Sirolli


 


Reflections on: Ripples from the Zambezi: Passion, Entrepreneurship, and the Rebirth of Local Economies (151pp. New Society Publishers:1999. ISBN: 0865713979) by Ernesto Sirolli.


 



by Rodney Stares


15.01.05


 


 


I read Sirolli’s book with considerable interest not least because his personal journey parallels my own. Like him I had an initial training in economics and started my professional career in what used to be called the ‘third world’. I too worked in Africa, among other places, and witnessed the grotesque results of the top down technocratic development model then – and largely still – prevalent. In the late 1970’s I became heavily involved in small business development and economic re-generation.  In the early ‘80’s I co-founded a consultancy to work on such issues in both Britain and the US.  Like Sirolli over time my interest widened into an exploration of the role of personal development in change processes and this culminated in establishing a community leadership development organisation based on the principles of individual self-realisation. Latterly, as with Sirolli in his final chapter, I have become more interested and involved in issues of civil society and social capital.


 


The first impression, therefore, on reading the first two thirds of the book is a strong sense of déjà vu.  The model for supporting the emergence of small scale entrepreneurship he describes is far from new; indeed for most of his case-studies I could cite from personal experience or close familiarity an equivalent example ten or more years earlier from the UK and earlier still in the US.  For example, the ‘Local Enterprise Trust ‘movement’ starting in the UK in the late 1970’s was built on ‘Sirolli principles’.  It, in its turn, had been strongly influenced by US experience of both community economic development – the CEC’s – and more mainstream small business development thinking.  Early promulgators of the approach in Britain were people like John Davis (ex Shell) and Stan Windass of the Foundation for Alternatives.  Leading practitioners on the ground included the St Helen’s Enterprise Trust in England.   By 1984 there were sufficient examples of this then new approach to encourage a consortium of public/private and foundations funders to commission an evaluation of the impact of a sample of such enterprise trusts.  I had the pleasure of managing this study that was undertaken by the Centre for Employment Initiatives (CEI) in London.


 


In recounting these antecedents I in no way wish to down-play the validity of what he espouses or the necessity for this sort of material to be given new currency, but rather to underscore two prevalent and unfortunate tendencies.  First, how currents of ‘new’ thinking and good practice can easily over time be diluted and co-opted by the dominant paradigm and the institutions that rely on it.  Today little seems to remain of the voluntarist network of local enterprise trusts or their approach; they have been subsumed into TECS, LECS and other appendages or local delivery vehicles of the state.  Second, in most cases the current generation of economic development professionals seems blissfully unaware of this alternative vision and approach – the modern disease of ‘social amnesia’ has taken care of that.


 


My second impression is that its lack of novelty notwithstanding this ‘second coming’ has advantages over the first.  It is far more self-aware and reflective.  Sirolli writes well; he has a simple, clear style and marshals his material expertly. His explanation of the currents of thinking and the conceptual framework underlying his approach is excellent.  He makes explicit – perhaps for the first time – much that was implicit or only dimly grasped by earlier practitioners of this approach.  Of particular interest to me was his itemisation of the pre-requisites for entrepreneurial success; a vision of what you want to create, the passion to do it, the practical skills to give it expression and the persistence to carry the effort through to full realisation.  All that was missing for me was what is often called ‘third person orientation’; the ability to see current reality or the present situation as it really is rather than how one would wish it to be. To me this is the essential complement to vision, without which there can be no strong creative tension to drive towards resolution.  Sirolli clearly sees the importance of this component for it appears later as one of the attributes that facilitators bring to their role.


 


As with much strong advocacy it can be partial and one-sided – Sirolli’s implicit if not explicit message is that his  is ‘the right way’ to do economic development and by extension that it will be effective and sustainable in any context.  While I fully support his approach I feel that any viable ecology needs balance and diversity.  Either complementary strategies are needed at one point in time or balance is achieved by shifting emphasis and approach over time as the situation on the ground evolves. For example, the polar opposite ‘strategic approach’ of working to relax the structural constraints on local small business development – as illustrated by the work of, for example, MACED in rural southern Kentucky in the 1980’s – can be equally powerful, cost-effective and sustainable. As ever context is all.


 


Operationally, the Sirolli approach adds a few wrinkles that were not appreciated or not made explicit in earlier versions of the model.  In particular the removal of the necessity for the entrepreneur to cover or be good at all aspects of the business process. His reference to constructing enterprise teams, whether by formal partnerships or sub-contracting the task to others, is a useful corrective against much of the curricula-driven or MBA type approaches to entrepreneurial development that have become so prevalent.  Hence he shifts the emphasis from the content of the entrepreneurial role to the learning process that structures its manifestation.  Interestingly, towards the end of the sections on business development he opines that of all the characteristics needed by an entrepreneur perhaps the most critical is the ability to build teams.


 


The team building aspect of his approach raises another interesting question that is not really answered by the data he present. Many of his examples involve the development of significantly sized small businesses ultimately involving more than 10 people often by adding value to basic raw materials be it fish or agricultural products.   Experience in the UK has tended to throw up far more ‘one-man band’ types of businesses of a hobbyist or life-style nature where the primary motivation has been to earn a minimal living rather than to create a business.  Consequently interest in employing others has been low.  It would be interesting to know how many of those seeking help fell into this category and how he handled the inevitable need to prioritise ones time as between these clients and those with grander ambitions.


 


For me Ripples On The Zambezi is at its most interesting when Sirolli reviews what he has learnt about enterprise facilitation – and particularly what might be called the ‘metaskills’ of facilitation. He argues for an approach that is more about ‘being’ than ‘doing’; his starting point is an ‘open mind’ willing to be surprised, his ‘tools’ vulnerability, active listening and a sensitivity to what is often referred to as ‘rank’.  His behaviour is one of ‘doing nothing’, eschewing manipulation and basing his contribution on the principle of proportionality. The facilitator provides a mirror to the entrepreneur, gets alongside them and becomes a ‘co-learner’ in his/her enterprise.  This is a very useful antidote to much current practice which tends towards a sort of industrial model of support where prospective entrepreneurs are run through a structured process with steps, tasks and milestones which removes all passion and presumably, it is hoped, all risk from the equation.


 


The last 3 chapters represent a marked change of gears from what goes before as Sirolli takes his facilitation ideas into other domains; first education and subsequently politics and public administration.  Judged by his own criterion of passion, this is now where Sirolli’s heart lies but for this reader it provides a somewhat unsatisfactory experience.  In reviewing the shortcoming of much current educational practice, compared to what his facilitation model might offer, his tone becomes almost angry but he adds little to what has already been said by the likes of Neill, Myers & Briggs and Illich.


 


In the same way he goes on to talk about the need for a new political culture of respect and creativity but then spends most of his time bashing ‘bureaucrats’ and ‘planners’ as if they uniquely set the agenda or are in some sense separate from the society they are paid to serve.  The closing chapter enters some interesting territory by positing the ideal of a new ‘Civic Economy’, defined as “an economy resulting from generalised reciprocity” and goes on to argue that it will be achieved by what is essentially a variant on Adam Smith’s notion of the ‘hidden hand’ linking individual striving to collective advancement.  Instead of the profit motive, the driving force will be individual creative self-realisation that will lead individuals to seek out opportunities for greater mutuality and reciprocity.  This optimistic win/win scenario is further buttressed by a belief that “the tide is turning against authoritarianism in every field”.  Whatever ones optimistic pre-dispositions, and mine are considerable, one is still left feeling that this is another example of his one-sidedness: issues of political power and its distribution are mentioned but not dwelt on.  Perhaps one day Sirolli will have the personal material on which to write a fitting sequel on institutional or political facilitation but then again maybe he is hoping someone else will be inspired to take up the challenge.


 


 


Rodney Stares trained as an economist, initially specialising in accounting and business finance but later switching to economic development policy and practice.  His early work experience was in the Third World but since 1973 he has worked extensively on a wide range of local economic development, community enterprise and corporate social responsibility issues, with clients in Britain and overseas. His caseload management software is the most widely used programme among both community and family mediation services in the UK.


 


He has been the Treasurer of Senscot since its inception.