| You
have underlined that the Small Business Administration
has social goals set down by Congress to govern your
work -- perhaps a surprising thought to many outside the
United States. What is this social responsibility?
Ernie: Businesses are
told more and more to try to define and stick to what is
their core business. The question then is: "what is
their core business?" Usually it is the one where
they have good knowledge, unique specialties to enable
them to be competitive. What then is the core business
of the SBA? The core business of the SBA is to help
small businesses become better at what they do. What we
are concerned with in the SBA is enabling companies to
start up, survive and grow. That is how we measure our
success. If we don't accomplish that we become
irrelevant. And Congress agrees with us. They really
want us to show at the end of the year what good can be
attributed to society, how we have benefited small
businesses and the American taxpayer.
James: One of our
objectives in the way that we work is to level the
playing field in the United States. That is, large
businesses have resources. We seek to lessen the impact
of regulation on small businesses. The country is made
up of an extremely diverse population of all
nationalities and races. We have businesses in rural
areas and inner city areas. Leveling the playing field
is partly an objective because one of the principal
goals of government is helping those who need help most,
looking at what we call "the underserved".
Small businesses, small and medium-sized enterprises,
can be an underserved group compared to the large
companies, and even with the SMEs there are groups that
can need help. So the corollary mission of our goal is
to help small that need help the most to succeed. So
often there is a social good tied to the economic
benefit.
So how do you gauge your
impact?
Ernie: We try to look not
only at the number of startups but also at the number of
startups by Asians, African-Americans and other minority
groups -- we look at the diversity of ownership of the
existing stock of small business. One of the goals is
for more women to own businesses.
To take up the theme of
the Executive Forum, what is a network and how does it
work?
Ernie: A network is very
much like a Flatland in which everything was just in
three dimensions and people could not understand a world
in three dimensions. Sometimes the discussion reminds
you of a Flatland.
In its most basic form a
network is just a combination of nodes and links. It is
quite uninteresting. It becomes more interesting when
you consider the mission and objectives for this network
-- to accomplish a purpose. For instance, in
transportation networks -- a very classic example -- it
is to move goods and people through the network wherever
they want to go safely at low cost and at the requisite
capacity. It then becomes very interesting to see in
defining these missions and objectives what people, what
organizations, what associations you associate with the
network and what are their responsibilities.
Discussing a network of
intermediaries by itself, without a clear statement of
goals and objectives and measurements of performance is
not totally interesting. You should never forget that a
network of intermediaries exists to help clients,
end-users and the local economy. It might be said that
if the export sector grows, that's wonderful,
intermediaries are doing their job. If the export sector
does not grow, the intermediaries can point to the
roadblocks. However that's a bit facetious. We might
instead ask: "what is the true, real cost of
intermediaries -- and do they show that they benefit
society more than their cost?" Otherwise we should
try another network.
James: The assumption of
the network is that there is a common purpose, in this
case improving the export potential, if you will, of a
society. In the United States there are at least three
criteria for the successful operation of a network:
- Is it
customer-focused? Which means serving the demand of
a group of people.
- Is it results driven?
That is, can you measure what it does in a
meaningful, objectively timely sort of way through
milestones?
- Is it market-based? We
are both public sector officials. But market-based
means: Is competition of this and can the private
sector hold us accountable and provide a reality
check? It has to be transparent and accountable, so
that we know who in the network is responsible for
what, as does everybody else, who are they
recipients and that they can hold us accountable.
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