The Social Business

The People Versus

I was back in Liverpool at the weekend to watch the Cup Final with the Blue half of my family.  Sadly the Chelsea Blue triumphed over the Everton Blue.  There were a few sore heads on Sunday morning.

Everton - the so-called People's Club - versus Chelsea - the club bankrolled by a Russian billionaire.  The game came a few days after Man United - owned by billionaire Americans - played Barcelona - a club owned by its fans.  

Barcelona's triumph made some wonder whether this was the start of a new world order - both in football and the wider economy.  Here's a letter from saturday's Guardian from Sheffield Hallam University academic Dr Rory Ridley-Duff:

Much as I am saddened by the sporting loss of Manchester United to Barcelona, I am heartened by another victory for co-operative ownership and social enterprise over private sector capitalism.  Will historians record this as a turning point in our economic history?  Will Francis Fukuyama be forced to revise his thesis on the "end of history"?  Barcelona's supporter-owned football club stands as an inspiration to co-operative entrepreneurs and social enterprises around the world. 

I'd like to believe as much as Rory does in the victory for co-operative values,  but sadly, as is usually case, I think the reality is a bit more complicated.   

Barcelona is owned by its members, and there's a strong democratic structure which elects the club's President.  Their link-up with Unicef is admirable - given that they could make a fortune out of shirt sponsorship.

But Barcelona aren't quite as virtuous as they might seem on the surface.  As David Conn points out here Barcelona (and Real Madrid) dominate in Spain partly because each club sells its TV rights exclusively.  So Barcelona make an absolute fortune, whilst the likes of Getafe will make hardly anything at all.  The Premier League is far from perfect (it was set up partly to stop sharing money with the lower leagues) but at least collective selling of rights means that the TV money is shared a bit more equally between the 20 clubs.  Co-operative values seemed to get forgotten when Barcelona decided how to negotiate TV rights.

Barcelona's choice not to have a shirt sponsor is also, of course, a great piece of marketing.  It allows them to develop the mythology of a club unsullied by corporate greed - whilst it exploits the Barcelona brand with 26 corporate sponsors who pump millions into the club - but who don't get their name on the shirt.   

My point is that I'm as pleased as anyone that Barcelona won on Wednesday, partly because I buy into the mystique of the club and its history as a symbol of Catalan pride - and I do like the fact that they have a different type of ownership.  Yet whilst Barcelona certainly show a better way to run a football club, it's far from perfect.  If we're looking for inspiration, we should perhaps take what we can from Barcelona, but continue to search for better ways to run football clubs.  

The times they are @ changing

When I do a talk or run a workshop, I introduce myself by talking about my journey from activist to entrepreneur.

It's a neat little phrase which communicates a few important points.  I wasn't born on a market stall selling nearly-out-of-date bananas.  In fact I didn't think I'd get involved in business at all until my mid 20's.  I thought I'd be a campaigner, and spent my early 20's trying to work out how I could work for Oxfam.  That's how I got involved as a volunteer at a fair trade shop, and, not intentionally, my life in social business took off from there.

I never made a particularly good campaigner.  For all that I like to stir things up a bit on the blog, I'm not very good at confrontation.  Demonstrating, shouting, confronting, challenging, they don't come that naturally to me.  I'm much more comfortable trying to work out ways to make good ideas work.  

If I'm honest I was a bit sniffy about campaigning for a few years after my move into the entrepreneur camp.  I think it was partly because, with others, I was desperately trying to hold together a social business which was immensely popular but which showed no sign of making any money.  I felt like I was caught up in the real world of paying  bills to keep the shelves stocked, whilst others walked round town with banners and had photo opportunities with the Lord Mayor.  

I think I had a point, but clearly not a particularly good one.  Activism/entrepreneurship doesn't need to be an either/or.  And if you're an entrepreneur who really understands why you do what you do, then you will probably stick with what you do for longer.  

Personally, I've made sense of the activist/entrepreneur thing by being more explicit (some would say naive) in how I describe what I do - and what I do it for.  So, for example, my business card has a few words on the back, starting with the phrase:  We need to change the world.  I always hand my cards out with that side showing.  I like the response that it gets.

It feels like we're entering an age of protest. I'm sure many seasoned campaigners will say we've been in an age of protest for years, but to me at least it feels like we're all moving up a gear.  I'm interested in how technology - web 2.0, fund managers with camera phones, blogs and twitter - are fuelling more effective and massive protest.  Without ordinary citizens taking pictures of the police - part of what's been termed inverse surveillance or sousveillance - we wouldn't be challenging the police about their handling of demonstrations in the way that we are now.

I watched the Hillsborough memorial service on Sky Sports News yesterday and found it very moving.  I feel proud to be from a city which expressed itself as it did yesterday.   I also felt proud of the way Andy Burnham was challenged with chants of Justice for the 96.  

It seemed that he wasn't due to be there  - I can only assume that Gordon gave orders - in order to show how his Government is in touch with the people.  I don't blame Andy Burnham himself - by all accounts he's a decent man who, as an Evertonian, understands Liverpool.  But I can't remember seeing a politician look so uncomfortable, and so out of touch with people's concerns.  To turn up, with a speech full of platitudes and empty words, but without the words which people really wanted to hear - that the Inquiry into what happened at Hillsborough will be re-opened - demonstrates how far removed the political classes are from the real concerns of the people.   

The relationships between the police and the people, and politicians and the people - are shifting.  That in some ways is worrying, but in others, it promises real, positive change.  

Hillsborough - one day the truth must be told

My Hillsborough story is far less dramatic than that of thousands of other people who were affected by what happened twenty years ago.  But, like so many people, what happened that day has stayed with me ever since, and, probably more than any other event in my life, has shaped me for good and for bad.

I was 16 at the time, and the trip to the semi-final - my first - was welcome relief from the hard slog of GCSE revision.  I travelled to Sheffield with my friends John, Chris and Bernard.  Our other friend, Bob, had rung the night before to say that he wouldn't be coming, as his sister, who'd been ill for some time, had died earlier that day.  

On the way up we debated what to do with Bob's ticket.  He was due to be in the Main Stand with John, whilst the rest of us had tickets for the Leppings Lane end.  In the end we decided that I'd go in the Main Stand, and we'd sell my ticket outside the ground.  We arrived at around 2pm and had no trouble selling my ticket.

So much has been written elsewhere about what happened, so I won't write about it here.  But I remember that my brain seemed to respond to what was happening by blocking it out.  I think that was partly because I was with John, who was only 12, and I knew that his dad and uncle were in that pen.   As it happens, Chris and Bernard were both OK.  At 215 they realised that there wasn't much room, so moved towards the back of the pen where there was a bit less pressure.  

It's hard to know what to write about.  I suppose I just want to add my voice to the thousands of others who are saying that Hillsborough is still something that affects them to this day.  There are people outside of Liverpool who think that we should just all move on.  I think they fail to understand the enormity of what happened that day - and the impact that the subsequent lack of justice has on people whose relatives and friends died at a football match.

In terms of its impact on me, there are the primary impacts like never feeling comfortable in a crowd.  But the secondary impacts are more important.  As has been well documented elsewhere, I cannot begin to imagine how families must feel about the fact that no-one has been held truly responsible for what happened that day.  As so often happens in this country, the Establishment - in this case the Police and the Justice system - closed ranks in order to protect its own.   I learnt a lesson early on about the reality of life in Britain.

All is not lost.  You can bet that the families of those who died won't rest until some key questions are answered.  If you're interested in the detail, I'd encourage you to read this excellent piece by David Conn in yesterday's Guardian.  His piece ends with this list of questions, which one day surely must get answered:

1 What, in detail, happened after 3:15pm on the day of the disaster?

2 Could more people have been saved if the response to the disaster had been better co-ordinated?

3 Who removed two CCTV video tapes from the locked control room at Hillsborough on the night of the disaster?

4 Why was nobody identified to have removed them, and what investigation was mounted?

5 Which South Yorkshire police officers worked in the unit that vetted police statements before they went to Taylor and the inquest?

6 Who gave the orders for them to do so and what was the stated intention of those orders?

7 Are the documents lodged by order of the government in the House of Lords library a complete archive of South Yorkshire police's Hillsborough documents?

8 What was Det Supt Stanley Beechey, a former head of the West Midlands serious crime squad, doing on the Hillsborough investigation while he had been placed on "non-operational duties"?

As Margaret Aspinall, whose son, James, died at Hillsborough, said in David Conn's article, "I don't like to use the word justice.  I prefer to say that we want the full truth, and accountability. Even now, it would make a difference, alleviate some of the hurt and betrayal we have suffered for 20 years."

What's wrong with being disturbed and angry?

I sometimes wonder what journalists get paid for.  I know football is all about opinions but the shallow analysis of the Benitez-Ferguson saga does make me despair a little.  The story seems to be:  Benitez has a go at Ferguson.  Liverpool draw a match.  United win a match.  Therefore Benitez lost and Ferguson won.  I think it's a bit more complex than that.

Anyone who studies Benitez will understand that he is a highly political man.  He understands that strategies matter as well as tactics.  He also appreciates the importance of power and influence.  This is a man who managed Valencia in a league dominated by Real and Barcelona - he knows about power relationships.    He has made a considered judgement that Ferguson, Gill and United have too much power in football.  He has decided that that needs challenging.  So that's what he's doing.

I'd say that it's part of a social entrepreneur's make up to be disturbed and angry about things.  I certainly am.  I'm disturbed and angry about many aspects of life in Britain.  I'm disturbed and angry about the shocking lack of social mobility in this country.  I'm disturbed and angry about what the bankers have done to the economy.  I'm disturbed and angry about the way we're sleepwalking into environmental catastrophe.

Channelling that sense of anger and disturbance into positive action is what matters.  

Rafa, Mr Ferguson, and being the challenger brand

It's up to you to decide whether you think Rafa lost it, or whether this was a brilliant tactical move to out-manoeuvre the grand master of mind games.  

I think he's been very clever, but then I would.   He's used the kind of tactics that challenger brands the world over use in order to, as Ferguson might put it, knock the dominant player off their ****** perch.  

Here are some classic challenger brand tactics: 

• Point to an injustice.  Imply that the dominant brand has abused its position in the  marketplace.  Suggest that we all lose as a result of the behaviour of the market leader.  
• Stick to the facts.  There's no point  in ranting and raging and making things up.  Make your points - and back them up.  Showing you've done your homework will strengthen your argument.
• Play to your strengths.  Assess your competition.  Don't take them on at something at which they excel.   
• Get your timing right.   If you're going to take on the dominant brand, make sure you're on the front foot.  No point taking them on at squeeky-bum time.  
• Use humour.   Be the first person in the world to make a joke out of zonal marking.  
• Be self-deprecating.  Remember Avis's famous slogan - We're Number 2.  So we try harder.  People will like you for it.   
• Get the crowd on your side. People warm to challenger brands far more than to market leaders.  Showing some emotion will engage your audience.

Only time will tell whether the market leader continues to dominate.  As Rafa suggests, for all Ferguson moans about fixtures they have by far the best run-in - including playing the other top four teams at home. We shall see.     

For sale - large property, enormous garden, generous seating area

If you ran a bank, and had loaned a load of money to a football club, who then couldn't pay it back, what would you do?  

Obviously if you re-possess a house, you can usually find someone else who's in the market for buying a house.  But selling on a stadium - that would challenge the most florally-linguistic estate agent.  

I'm worried about Liverpool.  We've got our best chance of winning the league for years, and it seems that the biggest danger  is that the club might go bust before the all-important title run-in.  

Keith Harris (no, sadly not that Keith Harris) said earlier this week that he's worried about Everton and Liverpool, because, as he puts it, "The demographics of Liverpool as a city are not hugely compelling."  

Liverpool's problem is that Gillett and Hicks, Liverpool's owners, took out a £350 million loan when they bought the club, and that loan is due up in January.  Most of the risk lies with club - even though Gillett and Hicks would stand to benefit most if the club became profitable.    The two banks - RBS and Wachovia (Wachovia - who are they? Exactly) - aren't flush with cash and could well ask for the money back in January.  There doesn't seem to be much spare cash floating round the economy to lend to a business as other-worldly as a Premiership football club - so where's that money going to come from?

There's a fan-led initiative called ShareLiverpoolFC which would like fans to own the club - a bit like they do with Barcelona.  When it was first launched I was enthusiastic but my head told me that they had no chance.  Now I think things are very different.  The days of cheap credit are gone, and with a bit of luck, so will Gillett and Hicks before long.  But the days of small-scale investors - clubbing together to buy football clubs - have arrived.  Supporters Trusts now own a number of football clubs in this country.  

The demographics of Liverpool as a city may not be compelling to Harris, but the case for fan-ownership is more compelling than ever.  

A big own goal

A last minute rush of blood to the head, undone by a crafty right-winger. What was David Moores thinking when he had a last-minute change of heart and decided to sell to Waldorf and Statler instead of DIC? Surely self-styled Mr Liverpool wasn't swayed by the extra millions coming his way?

Whatever his motivation, his poor decision making has proved costly for Liverpool. Hicks cares about Hicks, full stop. Watching him try to sing along to You'll Never Walk Alone last night was a painful reminder that this man has no feel for the club.

The farce at Liverpool is a reminder that ownership matters in business. But how much does it matter in social business? In the olden days it was simple, social enterprise was proudly not-for-profit. Or was it? Co-ops have always offered dividends, which sounds a lot like profit sharing to me (and no bad thing).

And things have become more hazy still with the introduction of the CIC Limited by Shares. Suddenly you can make a pretty decent profit out of owning a social business. Not-for-profit has become not-for-an-over-the-top profit.

Does that matter? On one level I think it does, because when an absolute (not-for-profit) becomes more relative (not as much profit as the other guys) there is scope for continued pushing of the boundaries, and social enterprise could lose something quite important. You only have to look at ownership of football clubs (beginning with Tottenham's holding company ruse in the 1980's) to see that you can't always anticipate the long-term impact of decisions around profit-making in business. Football clubs were once not-for-profit too remember.

But on balance, I'm keen on making it easier for people to make some money out of social business. I'm in the social change business, and I'm clear that to stand any chance of making the world a better place, we need to find ways to enable most of us to do good things most of the time. That's as true in business as anywhere else. Some of us, some of the time, are motivated purely by a moral/social incentive. And long may that continue. But most of us need a financial incentive a lot of the time too. So if we can make it easier to set up businesses which are proudly social, but also allow for a fair amount of profit to be taken out too, then I think that is a good thing.

Gary Hirshberg, CE-Yo of Stonyfield Farm has something interesting to say on this topic in his new book:

"As George Bernard Shaw once said, "Virtue is insufficient temptation." Our planet will not be saved by preaching principles and exerting moral suasion. After more than three decades spent working in the environmental movement, I am convinced that economic self-interest - whether it is achieved by saving, earning, or both - is the most powerful, if not the only, force capable of bringing about the future we need in time to make a difference to the well-being of Mother Earth."

I still think we'll beat Chelsea in the second leg by the way.

Share Liverpool FC

A very exciting plan to take over Liverpool Football Club will be launched today.

The model they're looking at is a co-operative one, based on the kind of structure that a number of clubs in Germany and Spain - most notably Barcelona - have adopted.

I've blogged a number of times before about ownership in football and I really hope that this initiative gathers a head of steam. It seems to have good people behind it - Rogan Taylor has been a voice of reason for many years - and I for one would jump at the chance to invest in Liverpool.

Something has to change. David Conn outlined the situation very well in yesterday's Guardian. My heart sank when I saw a banner in the Kop at the Aston Villa game pleading with Dubai International Capital to rescue the club from its current owners grasp.

Share Liverpool FC could offer us a real chance to put ownership of football clubs back into the hands of fans - and for football to be run once again for the social benefit of the many, not the financial gain of the few.

A letter to the Football Association

Dear Brian,

Sometimes you don't get what you want. Instead you get what you need. I was disappointed that England didn't qualify for the European Championships, but there was also part of me that was pleased as it might give your organisation a long overdue kick up the backside.

If you've read my blog before, you'll know that I've written a number of times about the state of English football, so I won't recycle old arguments here. But let me tell you about my ten year old nephew. He lives in Liverpool, your home town and mine, a city which has produced more than its fair share of great footballers over the years. He's mad about football and by my reckoning a pretty good player too. He's been playing for a local under 10's team for a while now.

I saw him on Sunday and asked him how he'd got on the day before. He told me he'd stopped playing for the team because, in his words "I'm not learning anything anymore." The guy who coaches the team coaches four other age groups too, so doesn't have much time for them. And in line with your guidelines, (unlike just about any other decent footballing nation) 10 year olds play on full-size pitches. Given that their legs are too short to run up and down the pitch for 90 minutes, they learn to aimlessly hoof it up the pitch. Just like your lads did last Wednesday. Can you see a pattern emerging?

My nephew told me he's going to try another sport now. Which in lots of ways is great, but what a wasted opportunity. I hope your root and branch review really does get back to the grassroots. Your organisation could be the most dynamic, democratic organisation going. Instead it's stuffy, stuck in the past and carelessly selling the soul of football to the persuasive moneymen at the top of the game.

May I suggest a bit of reading for you? Try David Conn's excellent book, The Beautiful Game - to give you a real insight into where you're going wrong. And have a read of Simon Caulkin's column in this weekend's Observer - in which he highlights how you share poor management systems with plenty of other organisations, including HMRC and the NHS. He quotes systems thinker Russell Ackoff:

"Problems in organisations are almost always the product of interactions of parts, never the action of a single part. Treating a single part destabilises the whole and demands more fruitless management intervention; management becomes a consumer of energy, rather than a creator."

So if you really believe you're sorting things out by getting rid of one manager and bringing in another, please think again, and think of my nephew.

Yours in hope,

Rob

Reason 1 - ownership matters in football

I heard on the news this morning that fans website MyFootballClub has agreed to take over Blue Square Premier Club Ebbsfleet United.

20,000 members have each paid £35 in order to provide the £700,000 needed to take over the club. I don't know the detail, but I'm pretty sure that the website is run as a Supporters Trust, with a not-for-profit (Industrial and Provident Society) structure.

I've blogged a few times before about football and its gradual takeover by people interested in nothing more than making money. Football clubs are too important to local communities to allow that to happen, and it's great to see a number of Supporters Trusts getting their act together and either getting a seat on the Board, or in some cases taking over the club. When Leeds United's troubles started a few years back I got involved (in a vaguely uncomfortable way as I'm a Liverpool supporter) in helping to set up Leeds United Supporters Trust , which has had an important role to play in challenging times for the club.

As the great man Bill Shankly once said

Some people think football is a matter of life and death. I assure you, it's much more serious than that.

In terms of the long term health of a football club, I'd say ownership matters that much too.