From 10 Years Ago Today – this column was first published in June 2001, when the Business Birthrate Strategy was criticised for failing to deliver. Re-reading this article just highlighted how little has changed since then.

What do you think needs to be done to support the entrepreneurial spirit in Scotland?

WOULD you credit it? An independent report has revealed that Scottish Enterprise’s infamous Business Birthrate Strategy is a flop. Apparently the initiative isn’t meaningful, it focuses on quantity rather than quality, and it causes much confusion and duplication in business support. Oh, and a higher quality of business advisor is needed. Like we didn’t know already?

I would argue the necessity of carrying out such a time-wasting, cash-consuming review into the initiative – this very newspaper reported back in February that Crawford Beveridge, the former SE chief executive responsible for launching the initiative, knew they got it all wrong. Indeed Mr Beveridge admitted that he knew the strategy wasn’t working half way through his time at Scottish Enterprise. I would suggest that this, and the subsequent waste of millions of pounds, should actually be the basis of a report but hey, that’s never going to happen.

Anyway, the report reveals that the seven year initiative – which aimed to create 25,000 businesses a year by 2000 – resulted only in a miserable 3% increase in business creation, which apparently is statistically too small to be significant. I think even those of us who aren’t statisticians worked that one out.

Brian McVey of Scottish Enterprise’s New Ventures team says that what is clear from this report is that there is no easy answer. Duh! Six months for that?

So now this six month independent review will turn into a further three month consultation (“to have a full and constructive debate on the situation,” according to SE) before we get to hear the prognosis.

I doubt it will be good. In my view, it’s probably terminal, but SE won’t admit to that, will they? They’ll carry on as before covering up the sores with sticking plaster, propping the initiative up with crutches, and squeezing the last vestiges of life out of it. It’s inhumane. If your pet budgie were in a similar state you would put it out of its misery. And that’s exactly what the Scottish Executive should do.

Instead of wasting valuable time and money on consultants, it would make far more sense to ask the customer what should be done. I have, (gleaned over lunch and few post-conference drinks at the Entrepreneurial Exchange Conference) and this is what we have come up with so far:

  • Better use of existing entrepreneurs as mentors and role models. Nothing is more inspirational or educational than listening to the stories of a been it, seen it, done it, invented the T-shirt and sold it for millions entrepreneur.
  • More focus on indigenous businesses – at whatever stage of their growth – to provide advice, encouragement and financial support where required.
  • More focus on businesses and their founders as individual entities, with targeted support to meet their needs at a specific point in time, rather than the current broad-brush range of support programmes available just now.
  • Better support for businesses with real growth potential, with job creation and skills development opportunities – real world class businesses – and less focus on lifestyle businesses.
  • Less marketing spend on people who might or might not want to start their own business; people already know where to go for advice if they want to launch a company. Don’t get me wrong, the Personal Enterprise Shows are great fun. I’ve been to several. But they cost a huge amount of money to stage and haven’t yet returned on that investment. So can them.
  • Put the money to better use in the existing business community. And spend a huge wodge on increasing entrepreneurship programmes in schools.

At the end of the day, a successful entrepreneur is one who hatches an idea and is totally driven to turn that idea into a successful business. That sort of person doesn’t need to be mollycoddled by a business advisor with no real business experience and encouraged to start his or her own company.

The LEC network needs to learn how to read and understand people, to get a feel for who’s got it and who hasn’t, and then put the money they have into businesses in which they believe, run by entrepreneurs or potential entrepreneurs who have a passion for what they do.

It didn’t take me nine months to work that one out, and I bet it would deliver a better return on SE’s £14m investment in the Birthrate strategy!