It is often observed that there are three sorts of businesses. Those who make it happen, those who watch what happens and those who wonder what happened. The same is true of Governments.
There is an excellent report that has just been produced on SME by Goldman Sachs and others. It is well researched, with excellent observations. It is however a report written for observers.
It is written from the perspective of a focus on what is wanted by the Government for economic growth, rather than what is needed by SME to grow on their own terms.
It makes passing reference to issues of SME motivation and mindset, and the importance of growth mindsets, rather than neutral or resistant mindsets, although it is interesting that it does not reference the excellent original work done by Carol Dweck in this area – and vitally what the necessary preconditions are for stimulating growth mindsets. It seems that as with other vital areas, such as healthcare and education, it is written by those who want to observe and collect, but would rather others did the doing. It is the very stuff of fixed mindset.
It makes good points on enablers, both internal and external, from leadership and training to regulation and finance. However, growth mindsets are all about relationships, trust and common purpose, not logic.
Hands up any out there in SME who will trust the providers of finance the moment things get difficult, or who feel the warmth and benefit of the revised regulations on SME dividend tax.Driven by observers, not doers.
Observers can watch what happens from a distance, but they cannot understand what it feels like.
The reality is much more positive, if less visible. All of those I encounter in SME do not fall into these neat observer categorisations – they believe in what they do, in those they work with, in in what they can achieve. They are also very careful about those in whom they place their trust. This is giving rise to interesting initiatives, from peer groups, to crowdfunding.
Just as Uber has disrupted the taxi market by making better use of existing vehicle capacity, so SME are beginning to access the “surplus expertise” of others in variety of places, in different ways, rather than rely on the conventional “taxis” of banks, advisers and others whose expertise in in observing, not doing, in the world of SME.
The report is timely and welcome, but insufficient. If we want SME to grow, we need to get involved. We need people to come down from their observation towers, and get involved. We need them to share the risk, not just arbitrage it.
In the end however, changes in the ways we work, in the power we have to choose who to work with, and what we work for means that increasingly SME can do it for themselves. If we look after them, the economy will take care of itself, not the other way round.
SME will increasingly do it for themselves.
Doers, not observers.