Summer Academy 2017 to focus on meso organizations

In July 2017 we (mesopartner) will host the next annual Summer Academy. This year is special for me, because the theme of the event is about meso-organisations in the economy. Meso organizations are often taken for granted. And it is often assumed that leading or growing a meso organization is like managing a business or a project.

We believe these organizations, and especially their leaders, need some special attention.

For those that wonder what is meant with “meso”, it refers to a specific kind of organization or program that is created with the intent to overcome a whole range of market failures in an economy. Meso-organisations are known by their specificity, for instance to assist specific industries to modernize, or to support start-ups, or to promote investment in particular new technologies or a specific sub-national region. The reality is that while we describe their role in terms of market failure, competitiveness and growth, very often these organizations, their funders and even their clients have very little interest in theoretical concepts like market failure, systemic competitiveness, innovation systems or even modernization. They have a mandate, a limited budget, and many competing demands.

Most of my work is about helping leadership teams of meso organizations to make better sense of their context, to design better programs and services so that they can have a bigger effect on the industries they serve, or to become more resilient.

Increasingly our focus is on helping these organizations to become more innovative, not only in their product/service offerings, but in the way they unleash the creativity of their staff, their networks and how they all learn and discover what is possible in their given social and economic context. It is about stretching the capability, the influence and the adaptiveness of the meso.

More_Meso

To manage a meso organization takes a special kind of person.

  • Firstly, the leader must meet the demands of their funders or stakeholders. They must be able to handle a huge bureaucracy and lots of reporting on the often seemingly senseless of indicators and targets that funders require. Spare a thought for those that depend on several sources of funding.
  • Secondly, the leader must meet the demands of industries, clients, wanna-be entrepreneurs and dreamers that come knocking on their door. While we can collectively call these businesses “clients”, they are in fact a very diverse group with a mind numbing diversity of requirements, demands, capabilities and competencies. While in an industrialized country it is sufficient to work with those enterprises that shows the right kind of curiosity and willingness to pay for top notch external support, in developing countries these meso organizations are often under pressure to work with lagging enterprises that are struggling to master the basics, marginalized groups and must also contribute to all kinds of social objectives. It is not simply about being at the cutting edge and competitiveness, but also about creating pathways for others to follow. This is very hard to do when there are huge shortages of professional management in companies, poor schooling and a whole host of interconnected market failures that seems to hold everyone from reaching their full potential.
  • Thirdly, these leaders must contend with their organizational context. For instance, many meso organizations I work with are associated with research institutions or universities. That means there is a demand on these centers to contribute to the academic objectives of their host. This includes creating opportunities for students to gain work experience, providing post graduate support, procuring raw material and components and running a business through an administration designed for another purpose.

My list could go on. But perhaps at another time.

We’ve been developing tools, instruments and concepts targeted at meso organizations for more than 10 years. This year we will focus on these, without losing focus on promoting the healthy economies of territories and industries.

I am looking forward to the Summer Academy where we can explore these and other issues. Every year we attract a range of experts and practitioners from around the world where we learn together and get to explore issues that we face in the field with a combination of theory and practical simulations. I hope to see you there!

For more information, visit the Mesopartner Summer Academy page.

Entrepreneurs and markets

While most entrepreneurs depend on functioning and competitive markets to survive, there are those entrepreneurs that actually thrive in imperfect markets. These are the entrepreneurs that creates a business around something like an information failure, high costs of finding suppliers or customers (brokering), or overcoming economies of scale (for instance by leasing expensive equipment on a pay-per-use basis).  Their services or products are valuable to the societies that they create their businesses in, as they overcome barriers to entry and barriers to upgrading. However, there are long term consequences to an economy that is riddled with market failures especially when these failures become very profitable for some. But more about that later.

Anecdotal evidence would suggest that entrepreneurs that exploit market failures to create new markets often earn disproportionate returns. They take huge risks as governments could address the market imperfection if it had the will, the competence and the resources to do so. Once these entrepreneurs are established they often have near monopoly market dominance. Unequal income for me is not such a big problem (it basically tells me there are many systemic failures), rather unequal opportunities is a much bigger issue as it is more widespread. For instance, can the cycle of inter-generational poverty be broken in a society? Can a child from a poor rural location one day choose to become a lawyer, engineer, or teacher; or are they trapped with few options? Is the society creating opportunities only for a few entrepreneurs that have connections and that can protect their interests, or are we creating markets where many entrepreneurs can compete in?

In a European country, with layers and layers of competition and market policies, most entrepreneurs compete on a more-or-less even playing field with markets that are carefully designed, or regulated as they emerge. In Africa, many entrepreneurs are competing in markets where government actually introduce imperfections, largely because markets and competition is not trusted (it is called the Law of Unintended Consequences). The situation is also made worse in that our market regulating and shaping institutions are often not resourced sufficiently and over-run with both creating market systems and coping with ongoing change.

How to overcome this situation?

Industrial policy in developing countries cannot be driven only from the perspective of trade and industry, as many other departments (or policy areas) are introducing market failures into the system in for instance health, education, science and agriculture. These conflicting policies then creates market imperfections that if exploited by a few entrepreneurs will lead to huge profits and a firm market footing. Society may benefit in the short term from a particular solution being available, but in the long term society may be stuck with a market that very quickly develops its own interests that may not necessarily be in the interests of the wider society.

Furthermore, market institutions must recognize and identify the patterns that plays out repeatedly in a society, and try to address these. We should not celebrate when one entrepreneur jumps on an opportunity (although this is still better that nothing). We should celebrate when many entrepreneurs are crowded into a market. I don’t know whether it is naive to ask policy makers to also think about the unintended consequences of their decisions. This is the reason why we’ve had to delve into complexity theories to try and curb the damage being done by well-intended policies.

If we do not succeed in building the right market systems that are based on fair competition we will forever be creating opportunities just for a few entrepreneurs. In the meantime, we depend on a few entrepreneurs that combine intelligence about an opportunity with the right resources and the right competences.

What do we mean with systemic?

There are hundreds of ways of describing the word systemic. Yet in development it is important that we at least narrow down the definitions as to not cause confusion.

Richard Hummelbrunner describes three emergent features of methods and approaches from systems thinking:

  • An understanding of interrelationships
  • A commitment to multiple perspectives
  • An awareness of boundaries

Richard then explains that each of these features focused in the development of the systems thinking field in the last fifty years. Up to the 60s, the focus was interrelationships. This was followed by an increasing awareness of the different perspectives as a critical issue. This affected the way people recognized interrelationships. In the 1980s the focus shifted towards the boundaries of the system, as practitioners realized that they system had to be bounded in some way to allow for diagnosis. This raised the ethical question of who decides what is part of the system and what is not, as the shifting of these boundaries has great influence on what is revealed and understood when the system is diagnosed.

Our firm, Mesopartner, is known for the “Systemic Competitiveness” framework that we use in our work. The framework originated within the German Development Institute in the mid 90s. One of the common misunderstandings about Systemic Competitiveness is that people confuse systemic with systematic. The latter in my mind would refer to a very detailed and exact way of understanding and doing things that may be very rigid. This may detract from the fact that to really understand a system we might have to embrace complexity, dilemmas and issues in a more dynamic way, something that a very recipe driven systematic approach may not allow.

Reference:

Williams, B and Hummelbrunner, R. 2010. Systems concepts in action: a practitioners toolkit. Stanford Business Books.

ESSER, K., HILLEBRAND, W., MESSNER, D. & MEYER-STAMER, J. 1995.  Systemic competitiveness. New patterns for industrial development. London: Frank Cas.

MEYER-STAMER, J. 2005.  Systemic competitiveness revisited. Conclusions for technical assistance in private sector development. Mesopartner

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