When finance minister Chris Sinckler rises at the despatch box on Tuesday to deliver his Budget statement, it will be the speech that will determine the future of this DLP government and define its vision. The proposals will give Barbadian voters a clear idea of what this government could do if re-elected and, just as important, if Sinckler has the ability to replace Freundel Stuart as leader of his party and a potential prime minister.
Sinckler has to account to parliament, and through members to the people of Barbados, for the near five wasted years in which he and his colleagues failed to do anything meaningful about the badly crippled Barbados economy. Equally, he has to explain why he has failed to make the last government account for the fourteen years in which it failed to put aside enough surplus to see us through a period of economic famine – the fourteen most prosperous years ins the economic history of mankind (I have written a longer essay on this which is available to those who email me).
I will restrict myself to one missed opportunity, one that does not trip easily off the lips of public intellectuals, who often prefer to drift in to tribal party politics.
Obama has rightly reminded Americans that the long-term success of any economy depends very much on successful innovation and entrepreneurship. And, in case it is not common knowledge, some organisational cultures stifle innovation, which is about the structured use of bright ideas, looking for new opportunities in unexpected places, encouraging constant change, renewing and invigorating the way we do things.
Innovation is down to processes, but most of all it is about the organisational culture and leadership. Quite simply, if a project is not important to the CEO then that message goes down to the most junior employee. Further, innovation can only take place outside the usual place of day to day work. So, it is a waste of time and effort to expect the very senior and middle managers responsible for an operational system to be the architects of its destruction.
To overcome this, as I have said in previous Notes, any dynamic leader, including prime ministers, must have a policy delivery unit in his department with the power to intervene in ministries if the government’s programme is being frustrated. There are risks, of course, in research and development in that after spending huge sums on training staff they can often leave for higher paid jobs with rival companies, but that is the gamble a forward-looking company must take. The challenge here is to work out a strategy to hold on to key people. One way of doing this is by allowing key staff time off to work on their own ideas, since innovators are by nature optimists. To succeed you have to compete at every level in which you believe you have a competitive advantage. This applies to individuals, firms and governments. If you retreat or runaway, or become just lazy, time and opportunities will pass you by. More particularly, you allow rivals a free-run to out-perform you. Just look at the Barbados rum industry, our only potential world beater, if you want an example of how an entire industry can wither and die. A cottage industry, run by a few small families who prefer to stifle a potentially lucrative industry rather than bring in bright, young people to drive it forward, the Barbados rum industry has allowed others like Bacardi, and producers such Diageo and the entire Scotch Whisky industry to leave them back in the 17th century.
Even a simple enough suggestion that we must give legal definition to Barbados/Bajan rum, in a political culture dominated by lawyers – to the extent that there is a ratio of one to every 300 people, one of the highest in the world – this simple suggestion has not even come on the radar. So, we have a government and industry, crippled by their stubbornness and arrogance, from even protecting their own long-term future, their intellectual property rights.
As the founder of Sony has said, emphasising a firm’s finances, is to focus on the past; but by emphasising research and development, is to focus on the future. We need forward-looking people.
It is true, there are economic and organisational obstacles to be overcome, but to genuine innovators and good leaders, these are just challenges. In the 1980s, General Motors had a research and development budget of US40bn, while the entire global venture capital budget was only $28bn.
There are different kinds of innovations: departmental versus organisation-wide innovation, renovating existing products and processes versus the disruptive or completely ‘new’ innovation. Some people believe there should always be a new consumer dimension in any innovative product, while others believe there should be a connection between new ideas and commercial viability on the principle no matter how good an idea unless it pays for itself it would not survive. But circumstances may also force change; for example, a food manufacturer producing products with too much salt or sugar in a health-conscious age may be forced to innovate to survive.
Analysis and Conclusion:
Government is about change, not business as usual; and when a people put their futures and their children’s futures in the hands of government, then that responsibility must be taken seriously. Politician are self-selecting, they put themselves forward as capable and able to lead the nation, as the guardians of the nation’s future. The prize is very big; if they fail, it is not only personal, it is a national disgrace. More than that, there is a truth in the saying that a people get the government they deserve. Ability is nothing without opportunity and it is the principal role of government, apart from protecting its citizens, to provide those opportunities for its young. This government has sacrificed the young unemployed on the altar of expediency.
Government is about strategy, not implementation. Prime ministers and Cabinets outsource the periphery to the ministries but keep the core – strategy and brad policy – to themselves. The Cabinet should be about policy implementation, not micro-managing.
It is the role of government to create the fiscal and legislative environment which will encourage local and foreign direct investments in sectors apart from tourism and to identify and encourage suitable talent pools and to provide them with the right competencies. Providing them with the skills training and sound purpose-led education – not generic academic learning – are the key ingredients in preparing a young force for the new global challenges.
We need a business culture in which innovation is seen as problem-solving, rather than shunting individuals out of a job. In addition, we must not forget that most innovative ideas come from people who have been doing the job for a length of time, so creating an ideas culture – and one that tolerates failure since most new ideas are a waste of time – is central to good government.
Start by encouraging customer feed-back, after all they are the people paying the bills.
Remember that so-called market segments are really people, who have ideas about how they are served and the kind of service they want to receive.
Innovation does not only come from Silicon Valley, but from every corner of the world and from all levels of society – even from ordinary Barbadians.
Remember, innovation is about changing the world, about getting up in the morning and looking with fresh eyes at things you do every day.
The workplace is not just the place you pass the time of day to get a wage packet, it is about making a difference.
In Britain, about 1000 new medium enterprises, geographically and industrially distributed, created 50 per cent of new jobs; 25 per cent of all British university dons are from overseas, implying that when looking for staff universities are prepared to look far and wide for the brightest and best. We too can follow that path: identify potentially successful sectors, scenario planning, exploring new frontiers, create a business growth fund to finance innovation, encourage clusters which would become centres of excellence.
Government has failed to introduce enablement technology, which drives down cost, improves efficient and makes overall management more modern. A good example of this failure is having a modern $70m court building with the registry using old-fashioned books and pens to register births, marriages and deaths, in much the same way they did at the end of the 19th century. It is what we used to call icing on ginger bread. The sparkling new building does not an efficient administration make. It will be a big mistake to see innovation only in terms of technology; fundamentally, it is mostly about people, how they are selected, how they are trained and how they communicate with customers/public. It is about competence, putting customers first.
We must allow bright, young staff ownership of innovation, rather than see them leave because of boredom or frustration. In journalism we do that by giving our brightest titles, columns, authority. But we know that Barbados is not an innovative society; all we have to do is check on the number of patents that have been registered over the last year, no make that the last fifty years. Where is out patent court?
Finally, this government has failed because it did not realise the extent of the challenge it faced. However, for an economy to grow there must be a supply of money and credit. Just ask Al Barrack what he thinks.