Regional Networks for Start-up Promotion
The term "regional network" may be looked upon from two angles. The first relates to the term "regional". Under the perspective of local economic development, regional means going beyond local boundaries and trying to get several locational actors to get together. These may include, for instance, a group of neighbouring municipalities and institutions of provincial and federal level as well as private actors such as banks and savings institutions, universities and research institutes, employers' associations and other interest groups. The points of departure for such a grouping together on a regional level are manifold:
Sometimes central government funding is the reason. Several local areas join hands in order to create a, say, critical mass, that is able to absorb the funding. Otherwise, they would simply stay too small and not become eligible.
In other cases, regions are historically shaped (e.g. coal mining and steel areas) and comprise several municipalities. This results in economic features and problems cutting across administrative boundaries. Thus, as the economic issues are similar, there is no sense in staying alone.
Another motive is to pool resources from different sectors of the economy, such as banks, universities, associations and so forth in order to become more effective. Often, some of these sectors are not organised exactly along the administrative boundaries. Hence, if you want to get them on board, you need to become regional.
Networks try to organise actors outside well established institutional forms. Compared with other types of organization, networks are "light" systems of organisation. Normally, they are not formally or legally institutionalised. Access and exit are easy. They are based on a high degree of informality and voluntarism. In short, their advantages may be enormous in terms of the pooling of resources and information sharing, and their costs are low.
For the reasons mentioned above, regional networks for start-up promotion have become a prominent feature of developing as well as developed countries. The activities realised by these networks include
the organisation of entrepreneurial get-togethers, seminars and workshops covering all aspects of business start-ups, financing and management,
the coordination of the activities of promotion agencies in order to avoid duplication of effort and waste of scarce resources,
the exchange of experience among network members and the collection of best practises as well as
the development of integrated approaches to business and job promotion and their joint implementation.
Two cases, one from Zambia, the other from Germany, may exemplify their functioning.
1. In Zambia, GTZ's "STEP IN"- programme (meaning "Integrated Skills Training for Employment Promotion") became part of a network comprising a total of 16 projects and programmes of bilateral and multilateral donors and NGOs. The creation of this network was based on the experience that interventions in the field of start-up and employment promotion needed to be coordinated it they were to provide gainful jobs. Before, some actors had focused exclusively on microfinance, others were organising fairs and some were conducting training courses, but sustainable jobs were only to be created if the target group had access to a combination of all these services. The network really managed to improve the effectiveness and efficiency of start-up promotion in the informal sector in Zambia, and the "STEP-IN" programme drew a series of valuable lessons as to the factors permitting or hindering the evolution of the network (quoted from Ebba Augustin: Case Study Zambia - Networking for Employment Promotion, p. 142; in: Wolfgang Zehender (Hrsg.) Networking with Partners, Eschborn 2000):
Networks have to be task- and objective-oriented. Networking has to be a means, not an activity in itself, otherwise time and energy is wasted. […..]
Networking is a participatory learning process, where [….] a joint attempt is made to find an answer. Members should therefore learn to pose questions and should not feel under pressure to provide any answers.
Members of the network jointly have to agree on its structure, means of communication and objectives.
Networks can create a conflict of interest if they are not complementary to the daily work of its members. Demands of the network can overburden members, leading to a decline in services to the beneficiaries. [….]
Another aspect that needs to be tackled in a cautious way is that of an assistance structure such as a secretariat to the network. In the case of Zambia, the "STEP-IN"- programme provided such a service. On the one hand, such a secretariat really acts as a facilitator to the network but on the other hand it may undermine its long-term sustainability, if (a) the cost of the secretariat are not shouldered by all or the majority of the network members and (b) if the activities are not incorporated into an appropriate institution, preferably represented by or with the involvement of the democratically elected local government.
Inspired by a perceived lack of entrepreneurial spirit in Germany and by high unemployment due to a structural crisis of the "old industries", the German federal country North Rhine-Westphalia initiated the "GO! Initiative" in 1995. GO! is a joint programme of the provincial government of North Rhine-Westphalia, chambers and employers associations, trade unions, municipal incubators and technology centres, universities at the local and regional levels as well as municipalities. Under the GO! roof, around 30 local and regional networks emerged. The specific structure in terms of membership and concrete tasks of each of the individual network members depends on the local circumstances. Whereas some of the network members provide services related to its specific area of competence, others act as network coordinators. The initiative has become one of the most well known start-up programmes in Germany and contributed to the shaping of a new image of Germany's industrial heartland. You will find more information here.
next chapter: promoting and supporting spin-offs
last chapter: small business estates
the target group
SME
support
SME promo-
tion
investment
promotion
entrepreneur-
ship
promotion