Wednesday, 6 February 2013

Chain Consuming or Systems Thinking

The biggest news story in recent weeks seems to have been the collapse of high street chains HMV, Jessops and Blockbuster. Apart from the news reports, there are various comments and opinion pieces, with various different attitudes. It’s a really big issue, and for so many reasons!

What I want to talk about here specifically is why the attitude of both big business and government in tackling this issue are wrong, and how we should be looking at our high street economies to help them thrive and be resilient through hard economic times.

So what’s the problem?

Some of the comments relating to this news story seem to point the finger at the businesses. “They simply haven’t moved forward; they are stuck in the past hoping what worked several years ago will carry on working, but we all know, it doesn’t”, John N says on Streetlife. I agree that there’s no point in a businesses that provides services that no one really wants, or can get much easier and cheaper elsewhere.

Other comments blame the government for high business rates or failing to provide the services which help businesses (like good public transport, for example).

The truth is though, that what is lacking is systems thinking. Each organisation is just looking at their little corner of the pie.

The businesses are looking at how much money they can extract from an area whilst keeping their costs as low as possible. Capital costs are only justified when their future value can have a firm price tag associated with it, even if that capital cost is only arbitrary and only really there to keep banks and accountants happy. It’s different in the oil industry, or in manufacturing, but in high street retail, value is created through experience and service. Why are we willing to buy a coffee for £2.50 when we could get something of equal quality for less than a pound at home? We are paying for the experience, service and environment of city centre shopping! I buy my books from high street shops, knowing full well that I could get the same book cheaper on the internet, because I want to be able to flick through it before I buy it, I want to be able to ask the employees whether there are other books by the same author that I might enjoy, and want to be able to take the book straight across to the nearest coffee shop and start reading it! All of this value is not recognised by national chains, and unless they start to recognise it, and invest their money in it, high street chains will die, and the companies will be to blame.

But businesses don’t only have themselves to blame. The entire system creates this rather sterile environment, and it must be a team effort to combat it. It’s lovely that individual shops strive against the odds and offer something unique, but to solve it more permanently, and for local communities to become resilient for the future, we need to work together. And we already have a system for working together in local communities. It’s called local government.

But the local government is riddled with red-tape, ego trips and hangovers from previous governments. It looks for ways to cut its spending, without any regard, seemingly, of the wider effects on the local economy, for which they are partially responsible. They take political lines based on what their national parties decided in Westminster, rather than what they, as elected representatives, think is best for local people. And they uphold the status quo for no more reason, really, than because it would take too much effort to no something new and ambitious. In the same way as businesses, the return from investing in the capital costs of better systems is not recognised.

So what if businesses and local government truly started to look at the big picture, the whole system? Rather than basing value on arbitrary figures in pounds and sterling, what if it was valued in the ability to provide for human need, in a sustainable and resilient way?

Systems Thinking

When I look at Norwich, I see a massive resource, with so much potential, but that, under its current, very conservative Labour group, is being mismanaged. Some of the many resources which Norwich city centre has are:
  • A historic market, which some see as being “sterile” since its latest transformation.
  • A wealth of city centre buildings, picturesque streets, heritage assets and spaces that people enjoy being in, as long as they are kept clean and well-maintained.
  • An expansive pedestrianised zone, with plenty of space for events and pop-up markets.
  • A potential workforce in its unemployed people (Over a quarter (26.48%) of residents in Mancroft Ward, which covers most of the City Centre area, are on state benefit, unemployed or lowest grade workers, according to 2001 census data – that’s a lot of potential work that could be mobilised!)
But there are reasons why they are failing, and they’re not that hard to solve, either, if the council only took on a systems thinking approach:

Most generally, all decision-makers should look at the effect of their decisions on the local economy as a whole, not just themselves. Where does the money they spend go? Who benefits and who loses out? This means that when the local authority or any decision-maker is choosing a supplier for their major services, they should be asking themselves how much of the money they give that company will be staying in the local area. Does the company employ local staff? Is the company locally owned? Will profits be reinvested in the local area, or taken straight to London or abroad? Does the company pay its employees fairly, pay its tax and contribute to the community? Does the company care about sustainability and is willing to invest in local energy efficiency measures (which will benefit the local tradesmen who supply them too), rather than just fork out more and more for gas or electricity (which will only benefit multi-national energy companies and their greedy investors)? How much money that is spent will return to us by way of it circulating in the local economy?

More specifically:

Currently Norwich Market has lots of empty stalls and generally suffers from stagnation of both traders and customers. If I were managing the market, I would hold short-term events to fill all the empty stalls for, say, a week at a time, with a theme. Such a theme might be “collectables”, at which one would invite collectables shops within Norwich and across Norfolk to trade their wares, as well as individuals who can’t commit to running a full-time shop. It would be advertised in city and regional media, and at the market itself, to ensure that plenty of customers who’re interested in collectables would be there, and whilst there, they would also use the food stalls and all the other shops in and around the market. Other themes might be furniture, local groceries, comic books and toys. Successful traders might then consider taking up a full-time stall, increasing the vibrancy of the market in the long term.

If I were local authority planners looking at the city centre, I would immediately try to encourage more of a community there. The city centre seems to be a place for people from outside of Norwich to come to shop and drink coffee. Where is the city centre community? Apart from a fair chunk of housing at Pottergate, much of which is council housing, the city centre doesn’t really have a community. I would want this to change, and would suggest that planning policy should encourage more residential flats above city centre shops. There’s loads of potential for it, and many of them are already empty. You just have to look around the city for signs above shops that say “3500sqm of office/retail space to let”. There are loads of them! Surely they’d be filled much quicker if they were residential. There would be many benefits apart from getting empty buildings into use – there would be more people in the city centre using the shops for their daily items, eating out and enjoying the nightlife without the worry of parking, petrol and drink driving. Crime would reduce because there would be more people keeping an eye on their streets at night.

When I was on job-seekers allowance last year, I got totally frustrated that the Job Centre and the local council were not making efforts to actually encourage the creation of jobs for me and the other unemployed people there. They essentially just tell you to keep looking at the adverts, brush up your CV, broaden your search criteria. As I’ve said before, all of this does nothing to change the number of jobs that are available, so all it really does is makes job searching more competitive, and more stressful for applicants and human resource managers alike. Under a systems thinking approach, the council would look at the job market as a resource, through which they can stimulate the local economy as well as get things done that need doing. They may be able to develop some policy that might actually create new jobs, or bring back jobs that have been sent overseas. The unemployed community probably have a wealth of knowledge and skills that the job centre, let alone potential employers, are even aware of, but just don’t have the resources to actually use and progress those skills. Here’s an idea: a business incubator, which does not pay staff, but offers them accommodation and cheap food on the condition that they spend working hours developing their new business. It would be no more expensive than distributing job-seekers allowance and other benefits, but successful ideas would pay back a proportion of their turnover to keep the scheme going.

Working together

The short phrase above has become a bit of a cliché, particularly in green (and Transition) circles. But I think the vision that I have in my brain when I think about working together is a little different to the quite fluffy idea that phrase might naturally conjure up. Last week I attended a lecture by Karen Armstrong, in which she talked about “Socratic dialogue”. This is the type of working together that we want. In Socratic dialogue, it’s not about winning, defeating and humiliating the opponent, but “it [is] a joint effort to obtain new understanding: you expressed yourself clearly as a gift to your debating partners, whose beautifully expressed arguments would, in turn, touch you at a profound level”, as Karen Armstrong puts it.

1 comment:

  1. I'm less concerned about the decline of the City centre than the lack of local facilities planned for the enlarged communities such as Hethersett which within 10 years will have a population as large as medieval Norwich. Everyday needs should be met by shops that people can walk and cycle to rather than driving into the city or to out of town retail parks. Of course the city will remain the focus for entertainment where a larger catchment is required.