From Understanding to Action: New strategies to reach out to, and support, small enterprises

1. From Understanding to Action: New strategies to reach out to, and support, small enterprises Keynote at USE 2013 Peter Hasle, professor Centre for Industrial production Department of business and management Aalborg University Copenhagen

2. Whycareabout small enterprises • Provide the daily bread for most of the global population • More than 150 mill. small enterprises • Their share of jobs are growing • Limited ressources (money, time and personnel) • Pressured by complex markets, competition from bigger firms, government red tape, limited credit access and much more The working environment: • Higher risk of accidents and occupational diseases • Limited capacity to control (management attention and knowledge as well as time and money) • More self-employed and informal sector under stressful conditions

3. The trouble with small enterprises Slip between our fingers: • Many birth and deaths (10% yearly) • No uniform voice • Limited interest in anything but business • Difficult and expensive to get in touch • Huge heterogeneity

4. The EU definition of SME and employment Peter Hasle, Centre for Industrial Production 4

5. Organization and management The large enterprise • Distant ownership • Professional management • Severallayers of management • Formal employment relations • Professional stafffunctions The small enterprise • Personal ownership • Owner-manager • Direct management • Personalized employment relations • No professionals outside core business function • Limited management resources

6. Employment relations based on social relations • Close personal relations dominate • Both parties occupied with the maintenance of endurable relations • The owner-manager seeks to be the first among equals • Part of the employer responsibility handed over to employees • The employees accept the extended responsibility • A personal relationship for good and for bad

7. Small enterprises evade the traditional business understanding • Profit and growth not decisive motives • Primary concern is survival and control of business • Provide a living • Integrate family life The main priority is maintenance of an identity as owner-manager

8. Creating an identity as an owner-manager • The identity is tied to • - a desired self-portrait • - discourses about entrepreneurship, the craftmanship and the family business • The identity mirrors the expectations expressed through social relations to employees, customers, authorities and other stakeholders • The identity is expressed through narratives and dependent on the context • - Often incoherent, contradictory, and varies over time

9. The identity as an owner manager and the work environment • Work environment is a peripheral issue with a potential for ethical and economic trouble • Important to create a self-portrait as a decent person • Work environment attitudes: • Generally positive • Search for a common discourse on an acceptable work environment • Downgrade risk • Evade personal employer responsibility • Learning from serious accidents: • Unpredictable events • Personal blunders • No prevention Hasle et al., 2012

10. Downgrading risk • Owner-manager, manufacturing squeegees: “It is not risky here. There are a few cuts but not serious ones, and people rarely go to the emergency room. It happened once when a guy broke his thumb not because a problem with the safety guard, but simply because people they make blunders.” • Owner-manager, manufacturing components to food industry: “We have only had one accident in five year, I believe. Well, it is not that we are rolling in accidents. There was one who cut his finger in a saw but that was just a blunder.”

11. Avoiding personal employer responsibility • Partner, spring factory: “Really, they have the possibility, haven’t they? And I do know as an employer you ought to be a bogeyman…….. but people damned well have to think by themselves, don’t they?” • Owner-manager, carpenter-joiner: “I am fond of the people who work her, we are a family and if one of them is injured, it would make me feel very bad about myself. So they have to know that they should take care of themselves.”

12. The need to differentiate

13. A conclusion on the understanding of small enterprises • Dominated by owner-managers • The owner-managers takes personal identity from the business • Employer-employee relations personalized • The owner-managers protect the self from personal guilt for accidents and diseases • Risk is downgraded and responsibility attributed to employees • Work environment is a peripheral issue • Scarce management resources is the most important limiting factor

14. Challenges for preventive strategies • Necessary to relate to business strategy • Negative reactions to requirements which distract the attention from the core business • Criticism of business is taken personally • Information is only used if it arrives exactly as it is needed • Owner-managers want to know what to do – not how to find out • And to do things without paperwork and meetings

15. How do preventive actions work? External: Market, stakeholders Internally: Management and organisation Assumption about how the action will work Context Programme theory Outcome Mechanism Changes in the working environment The causal relations which create changes Pawson, 1997 & 2006

16. A typology of policy instruments Sermon Stick Carrot Sausages Vedung, 1998 Peter Hasle, Centre for Industrial Production

17. Policy instruments Regulation (stick): • Government laws, enformcement and punishment Incentives (carrot): • Reduced insurrance fees, certification releases from inspections, branding Information (Sermon): • Training, dissemination of information Most programmes includes elements of all instruments

18. An acceptable work environment standard as a cornerstone • Owner-managers need to maintain an identity as socially legitimate persons • They search for a standard of the working envíronment which stakeholders find acceptable • The standard constitute the licence to operate • They search for signals from employees, colleagues, customers, and authorities in order to identify the acceptable standard • Increasing the level of the standard accepted by small enterprises a key strategy

19. How to increase the acceptable working environment standard Instruments Mechanism Legislative standard Inspection Express societal legitimacy The standard pursued by small firms Recognition by social partners Signals social accept Information dissemination Knowlegde about consequence Context

20. Developing a new standard for bricklaying

21. The road to a new standard for bricklaying New standard widely accepted Enforcement by labour inspectors New solution recommended by social partners Social partners in sector OHS-council accept the need for improvement Enforcement moratorium Development of solutions supported by government fund Involvement of suppliers Technical solutions missing Enforcement by labour inspectors Akward and straineous work in bricklaying

22. The policy instruments and mechanisms in the bricklaying case A combination of policy instruments Regulation (stick): • Improvement notices from labour inspectors • Enforcement moratorium • Improvement notices based on the new solutions Incentive (carrot): • Government fund support develop-ment of new technical solution Knowledge (sermon): • A code of practice with info on technical aids and work methods • Disseminated through several platforms by all involved stakeholders Mechanisms Coercion: • Initial improvement notices • Revnewed enforcement after solution developed Norms: • Joint message from employers and unions signals that the new solution is both ethical responsible and economically viabel Imitation: • Owner-managers and bricklayers observe still more cases with the new solutions being applied and get convinced that it is the way to do bricklaying in the sector

23. Strategies for action Effective support systems A high standard for an acceptable work environment Tools Regulation The social partners Outreach activities • Involvement • Integration in legislation • Responsibility • Intermediaries • Personal • Context • Inspection: • Concrete • Advisory • Dialogue • Concrete • Solutions • Integration • Not Ri. Ass.

24. Developing effective support systems We know the requirements for effective tools: • Practical oriented - What to do – • Not focus on identification of risk • Low cost • Positive forward looking • Linking to management goals and business strategy We lack sufficient knowledge about: • Cost-effective and sustainable outreach activities • Embedment after the first pilot project • Integration in business strategy

25. Developing effective support systems The small enterprise The intermediary organisation Embedment of the support system Change process Interpretation = sensemaking Effects Dissemination to the enterprise Embedment Organization of Support activities Tools for implementation of work environment improvements

26. The process of sensemaking • An external suggestion for improvements needs to make sense for the owner-manager Does is: • Solve a problem experienced as real and urgent? • Make employees happier? • Increase legitimacy among stakeholders (customers, local community, authorities, peers)? • Contribute to business survival?

27. Social relations in support systems Someone wants somebody else to do somethin Initiator Intermediary Small enterprise It is a social exchange with a two-sided relation building on trust and mutual benefits Thanks to inspiration from colleagues from NIOSH, USA

28. Intermediaries • Employers associations • Chambers of commerce • Accountants • Banks • Large firms • Occupational health services • Educational institutions (universities, colleges, vocational training centres) • Small business advisory services • Local community groups: - Environmental groups, safety net (Canada), farmers’ wifes (Denmark)

29. Integration in business strategy – the weak link • The working environment a sidecar as long as integration in business strategy is low • Solving a health and safety problem should also solve a business problem • Working across sectors and intermediaries necessary Example: • Better OHS planning in construction can improve the general planning proces – but the methods should be simple and with few requirements for formalizaton • In Denmark such a method have been developed and are now applied in practice

30. Conclusion • The world needs more jobs so secure the economy and combat poverty • Small enterprises constitute the backbone of job creation • But new jobs need to be sustainable: - Economically - Socially - Healthy Environmentally We need to develop methods, tools and support systems which intergrate business goals with health and safety and environmental concerns In close contact to non-OHS intermediaries

31. Thanks for your attentionPeter Haslehasle@business.aau.dk