In his article “The Competitive Advantage of the Inner City,” Michael Porter argues for an economic-development approach that emphasizes the creation of wealth in inner-city economies. Government agencies, nonprofit organizations, and smaller firms are the employers in these economies; small businesses are the only wealth creators. The more these businesses have the capacity to compete and succeed on a regional, national, or global scale, the more they become engines of local economic growth: creating wealth, generating net new job growth, increasing wages, and upgrading skills and infrastructure.
Interise was established in 2004 to support the growth and development of established, inner-city small businesses. Since 2008, we have rapidly scaled our mission of economic revitalization in lower-income communities, while ensuring consistent quality and impact, by ignoring conventional wisdom. Rather than build our brand, we are building a network—a network of proven results.
The introduction to this series mentioned Interise’s StreetWise ‘MBA’, a nine-month, capacity-building curriculum that provides growth-orientated small business owners with the business knowledge, management know-how, and networks they need to successfully scale their established smaller firms.
During the Great Recession, established small businesses that had completed the program created net new job growth at 10 times the rate of the private sector as a whole, based on US Bureau of Labor Statistics. Since the recovery began, they have done so at five to seven times the rate, and since 2008, these businesses have secured almost $3 billion in government, corporate, and institutional contracts. Additionally, 93 percent of these businesses are either owned by women, minorities, immigrants, or Native Americans, or located in a lower-income community. Fourteen partners now deliver our program in more than 60 communities, and the network increases by an average of 8 new partners a year—drawn from government agencies, universities, hospitals, business associations, and larger community organizations.
President and CEO of Cleveland-based CGB Tech Solutions—a “graduate” of University Circle’s NextStep program, an Interise partner—said, "CGB Tech Solutions hires from the Cerebral Palsy Association vocational training program. Since graduating in 2014, we have seen revenues grow by 57 percent, a 30 percent increase in employees, secured two new contracts, and become certified as a Female Business Enterprise, Cleveland Small Business, and Local Producer Enterprise business.”
So how does all of this happen? Two organizing principles that reflect our organizational values of respect and integrity, and continuous learning and improvement, underpin the rapid scaling of our mission:
1. Subsidiarity. This principle has its roots in Catholic social teaching and basically means that what is best done locally is done locally. Our local partners design their own programs, appoint their own staff, recruit their own businesses, raise their own funds, set and keep their tuition fees, and build a local network of referral and business expertise partners. If Interise tried to do any of this, we would shoot ourselves in the foot and make way too many messes. We may have an award-winning program, but our partners have the relationships, local know-how, and commitment needed for our program to have impact. Locally, it is their lead—we learn with them and follow that lead.
In turn, we provide what is best done across the network as a whole. Besides the curriculum, we provide to partners to help power their local programs—think Intel Inside, powering laptop computers—we provide processes that ensure local success, including training and support for instructors and program managers, quality-assurance evaluation, and impact assessment.
We also facilitate collaboration across the network, initially through the sales and site visits our staff made annually. With network growth, facilitation has diversified. Now it also occurs through the annual group trainings attended by the 60+ instructors and on-going instructor support groups, both of which focus on relationship building as well as the exchange of knowledge and know-how. Group trainings are also provided for program managers. Experienced instructors, as well as Interise staff, now undertake site visits. A technology platform enables learning between the partners as well as between what will be 4200 alumni businesses at the end of 2015.
2. The “Harry Truman theory of social innovation.” Truman said, “It is amazing what you can accomplish if you don’t care who gets the credit.” Our partners brand their own programs; we ensure that their brand has strong value by preparing them to be as successful as possible and undertaking the impact assessment they need to prove it. Making it about our partners—not us—shows respect for their local leadership and experience. And let’s face it: They will invest more in ensuring quality and success when building their own brand. Our willingness to forego recognition means our commitment to their mission serves our mission.
These two organizing principles are based on trust. It takes time to build trust, but once established, trust is resilient. Unlike a transactional model, where money can come and go, trusted relationships stay put. That’s why our network runs on time, not money. It may take longer to build, but it won’t go the way of Roman Empire.
From program to network—it’s all about trust. The StreetWise program uses a cohort model that results in a three-year growth plan and the trusted peers needed to help a business owner achieve it. Interise businesses entrust their businesses to each other, their instructor, and their peers. We do the same; we entrust our program, reputation, and mission to our partners. In turn, our partners trust us to help them make a difference and to ensure their success.
While we have a license agreement with each of our partners, the agreement is not what ensures trust; it is the capstone for the trust we build during the process of developing our partnership, and solidify through the impact and results of their program.
Where do we go from here? What’s next? More partners, more resilient communities, more thriving small businesses … history portends more recessions, and we want as many employers as possible prepared to weather it.