INSPIRE project

The INSPIRE project is a "development partnership" active within the EU's EQUAL Community Initiative against inequality and discrimination in the labour market. Its focus is on developing processes of "replication" or "social franchising", which will make it easier and cheaper to create new social enterprises.

INSPIRE, a broad-based partnership in North-East England, aims to put the development of social enterprises onto a more professional footing, by replicating business models that are already proven successes. It is focusing on three growth sectors – the environment, tourism and care – and it is in the care sector that it has made spectacular progress. From its base in Sunderland, "Care & Share Associates" (CASA) is launching a chain of employee-owned home care companies all over the region. It has aroused a great deal of interest among policy-makers, and has already created 70 new jobs.

A new style of social enterprise support

The INSPIRE partnership set out to apply a new and more strategic approach to the creation and growth of social enterprises. Its founders felt that in Britain it was traditionally the local authorities – county or district councils – that had financed support agencies for social enterprises, as part of their effort to support economic development and counter unemployment and poverty. The result was that most support agencies have been relatively small, with maybe three of four staff, and have served a population of maybe a million people. They have mostly adopted a 'bottom-up' approach – in other words, they have taken their clients' needs and wishes as their starting point. So if a group of people has come through the door with ideas about starting a restaurant, then the agency would help them to do exactly that – by providing training, helping develop the business plan, find finance and so on.

On the one hand this constitutes an excellent service to the population – and it should be mentioned that these local agencies – usually called co-operative development agency or CDAs – were often the only source of help that was prepared to listen to disadvantaged groups such as women or black people.

However on the other hand it suffers from two shortcomings. First, this tailored approach is very labour-intensive: each group needs to be supported through what is essentially the same process, but in parallel. Secondly, it can lead to weak businesses: each group is pursuing its own business model, and each group has to start form scratch. There is no accumulation of business knowledge.

Therefore INSPIRE set out to change this by systematising the business creation process. Its idea was to raise the scientific level of the social enterprise creation ‘industry’, by giving it a research and development function. The partnership set out to identify promising market niches where social enterprises had a high chance of success, and then to develop businesses to occupy these niches. The result would be not just one new business, but a horizontal cluster of businesses, which has two desirable results in that it creates more jobs and also means the new businesses can support each other. The project also aims to avoid creating a support organisation that has no stake in the success of the businesses it supports.

This conception fitted well with the regionalisation of local government that is under way in the UK. The idea needs a certain scale to work well, so the partners approached One North East, the government-appointed regional development agency (RDA) for the North-East of England, for support. In doing this they were building on the work of the first round of EQUAL, as one of the strands of work under the Social Enterprise Partnership (SEP) was to establish regional support bodies. Out of this grew the North East Social Enterprise Partnership (NESEP), which brings together all the important federal bodies in the sector. Along with NESEP, INSPIRE brings on board other key actors such as the regional branches of Social Firms UK and the Development Trusts Association as well as a number of local social enterprise development organisations. It thus works by being a very inclusive partnership, although one family – the voluntary sector – is only peripherally involved.

Replication: 1.. 2... 4...

As part of its EQUAL project, Inspire has worked with SHCA to set up Care & Share Associates (CASA) as a vehicle to replicate the same model in other towns – work which has so far created 70 new jobs. The first success was just up the coast in North Tyneside, following an introduction effected by Sunderland’s Director of Social Services, after he moved to the borough. North Tyneside Home Care Associates was launched in May 2004 and now employs over 30 people. Newcastle-upon-Tyne and Manchester are also in operation, each delivering some 400 hours of care per week. Next, the adjacent borough of South Tyneside awarded CASA a contract, and negotiations are now under way in several other towns and cities across Northern England, including Darlington and Sheffield. A start was made in Middlesbrough, but this has petered out. Contacts have also been made in Scotland.

Given the model’s track record and the inexorably growing market, there is interest across the political spectrum. Ms Elliott has been to meet both Prime Minister Gordon Brown and David Cameron, Leader of the opposition Conservative Party, and has even flown to Hong Kong to explain how it works. CASA is represented on the group advising the government’s Third Sector Commissioning Taskforce, and its experience has been reflected in a white paper issued by the Department of Health. The Royal College of Nursing has adapted the idea in the form of the ‘nurse-led social enterprise’, and a group called "Viva" has been set up as a community interest company to promote employee ownership in the health sector. On the European scale, regulatory differences in the care industry mean that it will be more difficult to replicate the idea, but the partners feel that the employee ownership aspects are very transferable.

This steady process of growth through multiplication will be sustained through a central structure. Care & Share Associates (CASA) will keep a 10% shareholding in each new care enterprise it spins off. These will then pay an annual licence fee of around £35,000 (€50,000) plus a small percentage of their turnover (around 0.25%). Each federated company will also hold shares in CASA, thus ensuring the coherence of the group.

How the social franchise system works

As the franchisor, CASA offers its franchisees:
*business planning and contract management
*the business manual – covering philosophy, brand and image, personnel systems, financial systems, operations and care management (personal care plans, user focused services, safe working practices, risk assessment)
*quality systems to comply with inspection regime
*recruitment and induction
*early-stage interim management support
*ongoing administrative and training support

Experience teaches that one of the most critical steps in getting a new care business up and running is finding a good manager who has experience of home care, and installing them ahead of time. But before that stage can be reached, the necessary partners have to be brought on board. These include the local social services department, the employment services and whichever body is responsible for regeneration in the area concerned. It is estimated that an investment of about £75,000 (€110,000) is sufficient to create around 20 high-quality jobs.

Three manuals for three promising sectors

Home care is the area where INSPIRE has moved forward fastest, but is not the only string to INSPIRE's bow. The project identified three sectors of the economy (all of which were among the 'new sources of jobs' identified by the European Commission in 1996) where the time is ripe for colonisation by social enterprises:
* care
* the environment
* culture and tourism

INSPIRE is in the process of setting up a project called "Community Renewable Energy" (CoRE) to promote local renewable energy ventures. It believes that renewable energy offers a tremendous opportunity for social enterprises to offer an alternative way of doing things, and to bring a small part of the energy sector under the ownershipof the local community. Community Energy has elicited a lively public interest, with its network meetings attracting 50 or more people. In Berwick upon Tweed, along with the local Development Trust, INSPIRE is investigating opportunities to build wind farms, and companies are being set up to provide biomass heating and combined heat and power (CHP). It is also working with the Forestry Commission, Britain's national forestry organisation, to develop wood chips as an energy source. Other ideas are to produce biodiesel from old chip fat, and to market renewable energy certificates (ROCs).

Sustainable transport is another area of INSPIRE's work, and one where transnational learning is taking place. Having taken a look at the car-sharing scheme in Genoa, it is leading a pilot project to replicate it in North-East England. It started a two-car pilot scheme in Durham in October 2006, and Newcastle and Darlington are also interested. Using the new legal structure for social enterprises that was introduced in the UK in 2005, the project has founded a Community Interest Company called Option C to promote new car-sharing schemes.

Towards the end of the project, the partnership plans to publish a manual for each sector, plus a portfolio of cases.

A transnational dimension

Transnationality is a principle of the EQUAL initiative, and INSPIRE’s transnational partnership is called "Sustainable Business Concepts for the Social Economy", although its acronym, "SIPS", echoes the process of ‘sharing, identifying, promoting and supporting’ new business ideas. It brings together a second British partnership, Realise, as well as organisations in Germany, Finland, Italy, Lithuania and Poland. SIPS’ work was launched, along with that of INSPIRE, at a conference in Newcastle in November 2005, which established a series of working groups. The second major event took place in Berlin in September 2006, and was based on the Open Space Technology, through which participants collaboratively defined their own subject matter and working methods. It also offered a programme of visits to German social enterprises.

Towards the end of 2007 the partners created the European Social Franchising Network (ESFN), which is being constituted as a European Economic Interest Group, to work on the issue of replication at European level.

Particularly with such experienced partners, the single European market means that this transnational collaboration can quickly move from words to deeds. The project intends to contract its Genoese partner WIP (Welfare, Inclusione, Partecipazione) to develop social enterprise in catering, with a view to bidding to supply school meals in Newcastle.

Discussions have also resulted on setting up a ‘recycling village’ in the North-East England, an idea that Germany and Finland are also aiming to transfer from the USA. Such a village acts as a focus for businesses to be created to process various fractions of the waste stream, and to market their products, which might include for instance salvaged architectural elements, pens made from waste paper or furniture made from plastic chips. The village concept aims to overcome the problem of fragmented waste collection, enables a higher-tech process to be used, and identifiable products to be marketed.

References

Website: [http://www.nesep.co.uk]

Source: EQUAL Community Initiative, Employment, Social Affairs and Equal Opportunities DG, European Commission, 2007. See [http://ec.europa.eu/employment_social/equal/practical-examples/entrep-07-inspire_en.cfm]