NATIONAL CENTRE FOR WOMEN S ENTERPRISE FEASIBILITY STUDY FINAL RESEARCH REPORT

Transcription

1 NATIONAL CENTRE FOR WOMEN S ENTERPRISE FEASIBILITY STUDY FINAL RESEARCH REPORT FOR DEPARTMENT OF ENTERPRISE AND LIFELONG LEARNING, SCOTTISH EXECUTIVE David Deakins, Laura Wilson and Geoff Whittam Paisley Enterprise Research Centre University of Paisley

2 National Centre for Women s Enterprise Acknowledgements We are grateful for the time and assistance given to this study by all the individuals and organisations involved in the consultation and mapping exercise. We are also grateful for the constructive comments and assistance given by the Scottish Executive s Steering Group. We value and express thanks to additional researchers at PERC: Sally Berrisford, Mark Chapman and Margaret Fletcher who assisted with consultation interviews. For telephone survey interviews, our thanks to Paul Maden and James Findlay. James Findlay also assisted research into comparative evidence from Germany. Constructive comments were made and incorporated in the study by Maggie Anderson, Margaret Fletcher and Laura Galloway. David Martin, Director of Scottish Property Network, a research and commercial unit located at the University of Paisley, completed the costing of the property side of the NCWE. The findings of this study, its recommendations and conclusions reflect the views of the authors. i

3 National Centre for Women s Enterprise Contents Acknowledgements Abbreviations Used in The Study Executive Summary i iv vi 1. Introduction Coverage of the Study and Aims of a National Centre Women and Enterprise Research Enterprise Support Policy: Key Issues Women and Enterprise Support: Key Themes Stakeholders in Women s Enterprise Support Summary Methods Comparative Evidence Introduction UK Comparative Experience Continental Europe Comparative Experience Enterprise Support in the USA The Role and Views of Private Sector Stakeholders Introduction Women s Business Associations Banks and other Providers of Finance Additional Views Other Business Associations Summary Comments The Views of Business Women Public Sector Support for Women s Enterprise Introduction Mainstream Enterprise Support: National Provision and Delivery Explicit National Enterprise Support Programmes Mainstream Local Enterprise Support Initiatives Context Explicit Local Enterprise Support Programmes Summary Comments Review and Summary of Support Provision in Scotland Introduction Summary Review of Support Provision Benchmarking Criteria for Stakeholders and Enterprise Support 67 Programmes 6.4 SWOT Analysis Conclusion: Current Gaps in the Pattern of Women s Enterprise Support 74 ii

4 National Centre for Women s Enterprise Contents Contd. 7. Models of Women s Enterprise Support Introduction Alternative Models for an NCWE Costing and Evaluation of the Alternative Models Summary of Costs Summary of Criteria Affecting NCWE Model Selection Conclusions Conclusions 93 References and Sources 98 Appendix 1 Consultation Guide 103 Appendix 2 Business Profiles for Established Women Business Owners 105 Appendix 3 Demand-side Survey Questionnaires 106 iii

5 National Centre for Women s Enterprise Abbreviations Used in the Study AABW ASBW AWISE BAWE BBRS BIG CDFI CPD DTI EMB EO ESF EU FAST FCEM FSB GEM HIE HR ILO LEC LINC MD NCWE NGO OECD OED OWBO PSYBT RDA SBA SBDC SBG SBS SE SEED SEN SEP SET SIP SME SWOT UKBI UN UN/ECE UNCTAD UNDP Association of Ayrshire Businesswomen Association of Scottish Businesswomen Association of Women in Science and Engineering British Association of Women Entrepreneurs Business Birth Rate Strategy Business Investment for Growth Community Development Finance Initiative(s) Continuing Professional Development Department for Trade and Industry Ethnic minority business Equal Opportunities European Social Fund European Union Federal and State Technology Programme Femmes Chefs D Entreprise Mondiale Federation of Small Businesses Global Entrepreneurship Monitor Highlands and Islands Enterprise Human resources International Labour Organisation Local Enterprise Company Local Investment Networking Company Managing diversity National Centre for Women s Enterprise Non-governmental organisation Organisation for Economic Development and Co-operation Office for Entrepreneurial Development Office for Women s Business Ownership Prince s Scottish Youth Business Trust Regional Development Agency Small Business Administration (USA) Small Business Development Center Small Business Gateway Small Business Service (England) Scottish Enterprise Small Enterprise and Economic Development Scottish Enterprise Network Strathclyde European Partnership Science, Engineering and Technology Social Inclusion Partnership Small and medium-sized enterprise Strengths, weaknesses, opportunities and threats UK Business Incubation Service United Nations United Nations Economic Commission for Europe United Nations Conference on Trade and Development United Nations Development Programme iv

6 National Centre for Women s Enterprise Abbreviations Used Contd. UNIDO VC WBC WEETU WIN WMB United Nations Industrial Development Organisation Venture Capital Women s Business Center Women s Employment, Enterprise and Training Unit Women into the Network Women Mean Business v

7 National Centre for Women s Enterprise EXECUTIVE SUMMARY This study examines the feasibility of a National Centre for Women s Enterprise (NCWE) in Scotland. It represents the culmination of an extensive research process undertaken to meet the terms of a research brief set by the Department of Enterprise and Lifelong Learning at the Scottish Executive. The research brief required the examination of a number of roles, or aims, for an NCWE. The research undertaken for this report has included: The mapping of existing activities concerning support for women s enterprise in Scotland, taking a broad view of stakeholder activity; Comparative experience and initiatives in support for women s enterprise; The identification of gaps in current provision; The evaluation of different structural arrangements for a national centre, including different models for an NCWE that incorporate separate physical and nonphysical forms. An NCWE was considered, under the terms of the study, to have a broad range of aims and cover a broad range of activities. These included: Advocacy and raising the profile of women s enterprise; Education of key stakeholders and support providers; Development of new initiatives and training programmes; Development of diversity approaches to enterprise support; Provision of information on women in enterprise, including expert advice and guidance; Identification of research needs concerning women in enterprise, including undertaking such research; Development and piloting of new initiatives concerned with support or funding with women s enterprise; the development of strong networks for women in business; Promotion of women in enterprise through events, marketing and the media; Development of linkages in women s enterprise beyond Scotland. The authors have taken into account that there are a number of separate audiences who will be interested in the findings including policy-makers, business advisers, women in business, members of the enterprise community and other interested parties and stakeholders. Therefore, although the report is written primarily for policymakers, attention has been given to setting out key themes and issues in women s enterprise. The study reviews recent evidence and research concerning women s enterprise. There is evidence that the participation of women in enterprise has been (historically) under-reported. Although stereotypical perceptions of women in business exist, issues in the literature, on the nature and characteristics of women in business, focus on the nature of their performance and whether women face greater constraints in developing their business than do men. vi

8 National Centre for Women s Enterprise The study considered support for women in enterprise within the context of key policy categories. These included business start-ups, business growth and development, innovation, access to funding and social inclusion. However, separate from the identification of categories, are a number of important themes in the development of support for women s enterprise. These include whether enterprise support for women should be explicit or mainstreamed; whether it should be delivered directly or indirectly; whether support should be integrated with UK developments and whether diversity management needed to be enhanced. The report has adopted these themes for the presentation of findings under the sections and chapters of the report. These chapters include the following review of evidence and support practice. An examination of comparative experience from the rest of the UK, Europe and the USA. Of interest were a number of initiatives in the rest of the UK, but also in Europe, the report found that demonstrator projects and networks that could all inform the development of an NCWE and the future development of women in enterprise support in Scotland. An examination of the role of the private sector. The study took a broad approach to private sector stakeholders. Views of private stakeholders included business associations, chambers of commerce, banks and other funders. In addition, startup and existing women entrepreneurs were asked for their views of an NCWE in an indicative demand-side survey. This chapter reports the current role and activities of women s business associations, the banks and other funders and other business associations. In summary, the report finds that the stakeholders consider that there are gaps in enterprise support for women, with the most commonly mentioned area being the lack of support for women-led growth businesses. A mapping of the provision of public sector support for women s enterprise. Included in this chapter, is coverage of public sector supported mainstream and explicit programmes in both the SEN and HIE network areas. In the SEN network, target categories of business start-ups, including womenowned business start-ups have been introduced. As a consequence, all the LECs now have a target for the number of women-owned business start-ups. Overall, for the Scottish Enterprise network, this target is set to increase from 35% to 41% over 3 years within an increasing overall number of start-ups. The report comments that a greater emphasis on segmentation has also resulted from the review of the Business Birth Rate Strategy. Comments for the SE Network area included that target increases in enterprise support for women appear to vary little from LEC to LEC or from one agency to another, although there is some variation in whether agencies are achieving targets. In the HIE network, targets for women s participation do exist in six business support programme areas, including start up and entrepreneurship training, tourism activities and businesses as well as in waste and efficiency schemes. HIE expects to maintain the same levels of activity and support in the future in vii

9 National Centre for Women s Enterprise the area of women s enterprise support. The report comments that routine disaggregating of statistical data for women s participation in enterprise and the establishment of targets for women s participation in mainstream programmes is in the early stages of development. National programmes reviewed included Business Mentoring Scotland. The report notes that the reduction in the entry criteria for this programme has resulted in a significant increase in the number of women applicants. However, the report considers that the low participation rates of women in Scotland s flagship business mentoring programme indicates that high levels of proactive marketing and development work should be undertaken to raise the awareness and profile of the programme with women entrepreneurs. National funding schemes were also examined. In Scotland, financial assistance is available via the SMART, SPUR and SPUR PLUS programmes for high growth firms, the Small Firms Loan Guarantee Scheme, the Invest for Growth programme and via Regional Selective Assistance. However, the study was unable to determine the degree to which women are participating in the mainstream funding programmes, because disaggregated statistics were not available. The national Micro-credit Scheme is perceived to be targeted at women, although it is not gender specific. It provides business support and access to finance for people who face difficulties in starting and developing new businesses. It also aims to raise awareness and understanding of the wider sources of financial support available. It adopts a peer mentoring/ group lending model and provides access to loan funds of 500-5,000. It also links into the existing business support services provided through the Small Business Gateway. At the time of writing, 18 micro-credit groups have been established across the Scottish Enterprise Network. The authors consider that it is important that the approach to the delivery of enterprise support should reflect the diversity of all business clients in social and cultural terms. Therefore, a potential issue with the delivery of enterprise support for women is the distinctiveness of the approach of advisers and trainers. This is an issue that was recognised by a small number of agencies only, although measures had been taken in a number of LECs regarding the distinctiveness and diversity of approach. The Premier Adviser training programme is now a required training programme for all business advisers in the Scottish Enterprise network. This programme may begin to address the issue of diversity, although it does not apply to the HIE area. Explicit programmes for women s enterprise provided by the SE network included Women into the Network (WIN). WIN is designed to attract and encourage women in business, or women considering starting a business, to utilise mainstream business development support provided by Small Business Gateway (SBG). In each LEC area, a series of events and seminars is held. WIN has a common framework and principles but allows for local flexibility. Each LEC can tailor the seminar themes in relation to local perceived client requirements with some LECs integrating SBG business adviser support viii

10 National Centre for Women s Enterprise within the seminar events. There is a heavy reliance by most of the LECs on the WIN initiative to meet the needs of businesswomen and nascent women business owners for networking and initial support. WIN networking events appear to be universally well attended and are regarded positively by the LECs. However, although WIN is a uniform programme, the nature of attendance and the perception of WIN did vary in terms of whether it is seen as primarily for start-ups or whether it is meant to meet the needs of both established women business owners and start-ups/early stage. WIN does not operate in the HIE Network area. This was partly because the networking associated with WIN becomes more difficult. Explicit on-line support included the scottishbusinesswomen.com web site. This was generally seen as a positive means of promoting women s enterprise and providing additional contacts for women in business. In the course of this study, scottishbusinesswomen.com and sbgateway.com have been restructured and re-aligned to achieve greater integration and greater complementarity. The report welcomes a new explicit funding initiative introduced by Scottish Enterprise, the Business Investment for Growth (BIG) initiative. It is a programme designed to raise investment awareness and is targeted at women in business with potential for growth. BIG is designed to improve access by women in business to mainstream sources of funding rather than offering a direct funding route. The BIG initiative is considered by Scottish Enterprise to have a number of benefits that have emerged from the evaluation of a pilot programme, including increased knowledge and understanding by women in business of sources of investment funding, increased ability of women in business to make an informed decision on investment funding and increased utilisation of mainstream business adviser support through SBG and the LECs. A small number of local support programmes for women s enterprise are reported. These include, Women into Enterprise and Enterprising Women, both in Glasgow, Women Mean Business in Edinburgh and Lothian and mentoring programmes in Lanarkshire. There is, therefore, limited local provision of specific programmes for start-up and established women-owned businesses. However, the report finds relative integration in the signposting of services at a local level, with strong evidence of the local delivery of many of the national schemes, such as the Micro-credit Scheme. This local delivery is further reflected by local authorities initiating developments were they feel they have particular problems such as a high dependency on a declining sector. The report reviews the role of Wellpark Enterprise Centre, which was established in 1996 as part of a targeted women s enterprise programme in Glasgow. The managed workspace offers commercial short-lease office space with car-parking, reception facilities, additional office and secretarial support (at commercial rates) and the hiring of meeting facilities. Wellpark, as it operated from 1996 to 2001, assumed a strong advocacy role, organising seminars and events for women in enterprise. The attempt to combine a multiplicity of roles including running and expanding the managed workspace, ix

11 National Centre for Women s Enterprise training, business development, funding and advocacy may have contributed to the some of the problems with Wellpark. This suggests an NCWE should not attempt to combine such a variety of functions. The report considers that direct comparisons between the HIE Network and the SE Network are not valid since the delivery of support is so different. However, the SE Network is currently far more active in offering explicit support programmes. The HIE Network, though, shows a higher ratio of women business start-up assists overall but also shows more variation between LECs. There may also be a particular issue in the HIE area of a lack of explicit funding support programmes for women, but the study could not confirm this. There is an issue across both Network areas of facilitating networking support in rural areas for women and the report recommends that a version of the Women in Rural Enterprise (WiRE) programme from England could be developed for rural areas of Scotland. Additional chapters in the report cover the following analyses and evaluations. A SWOT analysis against benchmarking criteria. For the purposes of the study, the authors suggest criteria that provide a working schematic representation of the process of benchmarking. This approach has the advantage of continuous monitoring of criteria. The criteria included for example the achievement of equality as a goal, the understanding of a gender dimension, defining problems and issues relevant to gender and reviewing the impact on stereotyping. Comparison of the SWOT analysis to the benchmarking criteria allowed the identification of gaps in the current pattern of enterprise support to be identified including; the need for complementary initiatives to WIN linking into mainstream support and existing women s and other business forums, such as Chambers of Commerce; the need for measures that could strengthen the existing women s business forums through help with marketing and recruitment of additional members; the lack of a women s business growth programme, which could possibly be addressed through the development of a mentoring programme or redesigning the existing programme; additional mentors for early stage women in business possibly under the new business buddying programme and additional funding initiatives targeted at women. The study also indicates a need for additional research with women s enterprise including; the need for disaggregated baseline data on women in business; on issues concerning women s entrepreneurship, such as barriers to growth and accessing resources; on longitudinal studies; on the need to examine social inclusion issues affecting women in business and on issues concerning the business support environment. The evaluation of a number of models for an NCWE that were considered to fall into two groups. First those that involved a separate physical centre (an external NCWE) and, second, those that could be incorporated within existing support arrangements (an internal NCWE). Any of the models evaluated could undertake a range of activities associated with the aims and activities of an NCWE. An external NCWE could be incorporated as: x

12 National Centre for Women s Enterprise A centre that incorporates business incubation providing serviced office facilities for start-up businesses. An administrative and contact centre housing a core staff of business advisers and administrative staff. A centre having a primarily advocacy and championing of women s enterprise role. An internal NCWE could be incorporated as: A dedicated women s unit within the Enterprise Networks. This could operate at a number of different levels within the SE national and HIE areas. LEC membership and interface with PROWESS UK with greater coordination of, and participation by, the Enterprise Networks and others in the UK and European dialogue through sharing of best practice. As part of this model, for each LEC, a champion of women s enterprise is included. Improved Enterprise Network support including a review of the present environment for the delivery of business support and the training of business advisers. The SWOT analysis and the evaluation of the different models for the NCWE led to the following main conclusions. A primary conclusion of the feasibility study is that there is a need, and evidence of demand for, further initiatives to support women s enterprise in Scotland. There is evidence of the need for an NCWE in Scotland. Although significant progress has been made in recent years by the Enterprise Networks in the provision of enterprise support for women, there are still gaps in the pattern of women s enterprise support. These gaps included the need to build on existing national and local initiatives such as the Women into the Network (WIN) programme; to strengthen existing mentoring programmes; to develop additional support and pilot new initiatives; to strengthen existing women s business forums; to educate key stakeholders; to carry out research and to link into comparative experience in the rest of UK, Europe and elsewhere. There was no evidence of demand or need for a centre that delivers services directly to women entrepreneurs. This study further concludes that an NCWE should be incorporated within the existing Enterprise Networks as a dedicated women s unit. This unit should be combined with the appointment from existing Enterprise Networks staff of a women in enterprise champion in each LEC or HIE area. The champion should take up membership of PROWESS, a DTI-funded initiative to promote women s enterprise support in the UK. xi

13 National Centre for Women s Enterprise The NCWE will be able to: assist in integrating existing support programmes with mainstream associations, such as Chambers of Commerce and women s business associations; take a lead role in developing and piloting new support initiatives for women in business including on-line support; promote women s enterprise with all stakeholders including banks, business angels, venture capitalists, Chambers of Commerce and all business associations; undertake or commission research on the continuing needs of women in business; ensure that general research projects undertaken or commissioned by the Enterprise Networks are gender sensitive; contribute to the development of gender sensitive mainstream business support programmes; develop and maintain links with comparative experience in the rest of the UK, Europe and elsewhere. promote best practice throughout the LEC and HIE networks. However, it is recognised that the advocacy role of a dedicated women s unit in the Enterprise Networks may not be as effective compared to an external NCWE. Timing may also be more appropriate for an external NCWE, given the newness of PROWESS and recent initiatives detailed in the report. If the dedicated women s unit is not acceptable to the Enterprise Networks, either located in SEN/HIE or with a LEC, then an external NCWE, in primarily an advocacy role, is recommended as an alternative model. It is also concluded that there are specific initiatives that could be undertaken to strengthen current provision of women in enterprise support. These specific initiatives would be largely beyond the scope of an external NCWE. However, tackling the issues below would be an appropriate starting point for the NCWE. Therefore, it is recommended that the Enterprise Networks undertake the following: The development of a business growth mentoring programme for women in business, building on the experience of the SE Lanarkshire mentoring programme. This could be undertaken in collaboration with Chambers of Commerce. The report considers that there are distinctive support needs of women in business that are not fully served by the existing Business Mentoring Scotland programme. xii

14 National Centre for Women s Enterprise A policy review of the role of the WIN programme and realignment of the programme to provide networking support exclusively to nascent women entrepreneurs, rather than existing business owners. Provision exists within the private sector for existing women business owners, although the report concedes that there is evidence that some of these organisations could be strengthened. WIN should be further integrated into mainstream organisations such as Chambers of Commerce and other women s business networks and women s business associations in order to provide an appropriate exit route for business owners from the WIN network. An examination of the Premier Adviser programme which accredits business advisers. The review would examine the degree of social and cultural diversity addressed by the programme and the numbers of female business advisers accessing the programme. A review of the environments created for the counselling of women business owners and nascent female entrepreneurs. In some cases environments can still be intimidating for women. Incorporated into this review would be an examination of the gender balance of business advisers in different areas. Additional demonstrator project funding initiatives. As one example, the establishment of a Mutual Guarantee Scheme for women-owned established businesses could be investigated. These should complement existing and new initiatives in this area including the Micro-credit Scheme and the BIG programme. These additional funding initiatives would aim to demonstrate to both the public and private sectors the potential of alternative funding support for women entrepreneurs. Research on the particular needs of women in the science, engineering and technology sectors in establishing new enterprises and the development of appropriate support programmes. Women with this background are more likely to be in a position to establish high growth companies. However, the evidence suggests that women in these areas have lower than average entrepreneurial ambitions. This is a UK-wide phenomenon but is of significance in meeting the targets in Scotland for high growth start-ups. Additional research with women-owned business and nascent female entrepreneurs to monitor needs, attitudes, and business development. This will enable new programmes and initiatives to be properly informed. Further research with women business owners to investigate issues indicated in the demand-side findings. In particular issues concerning growth, business development, support and training needs as well as access to formal and informal finance (related to the nature of the business) should be explored. xiii

15 National Centre for Women s Enterprise A final conclusion is that there is a pressing need for reliable disaggregated information on women-owned start-ups and existing businesses on a national basis in Scotland. In particular, the lack of disaggregated statistical data from the banking sector is hampering the development of appropriate support programmes for women entrepreneurs. A project to review current practices, recommend alternative approaches where appropriate and strongly advocate the gathering of such data is required. xiv

16 1. INTRODUCTION This study represents the culmination of an extensive research and consultation process undertaken by the Paisley Enterprise Research Centre to examine the feasibility of a National Centre for Women s Enterprise (NCWE) in Scotland. Enterprise support for women has received increased attention from recent research and policy statements. For example, helping women get into business has recently been (re)stated as an aim by Scottish Enterprise. 1 The Global Entrepreneurship Monitor (GEM) project, 2 which aims to measure international comparative levels of entrepreneurial activity, claims that a significant factor determining the level of entrepreneurial activity is the (national) relative proportion of women engaged in enterprise. Scotland s entrepreneurial activity was below the average for the GEM surveyed nations, with the rate for women, in all countries, lagging significantly behind that of men. 3 In Scotland, the recent review of the Business Birth Rate Strategy (BBRS), 4 and the subsequent consultation, has argued the need to encourage business start-ups from sections of the population that are underrepresented, including women. In addition, there is a desire to ensure that economic opportunities are provided for all groups in society. As part of the process of developing economic opportunity and a new BBRS for the 21 st Century, the Department for Enterprise and Lifelong Learning at the Scottish Executive commissioned this study on the need for, and role of, a National Centre for Women s Enterprise. The bulk of the research for the study was completed between March and May 2002, with additional research, updating and drafting undertaken at the request of the Scottish Executive from June to October The authors recognised that there are a number of separate audiences who will be interested in the findings, including policy-makers, business advisers, women in business, members of the enterprise community and other interested parties and stakeholders. Therefore, although the study is written primarily for policy-makers, attention has been given to setting out and describing key themes and issues in enterprise support, on the interests of different parties and in placing findings in context. The study is organised into eight chapters. In this introductory chapter, the aims and scope of the study are described and placed in the context of the current body of research knowledge on women and enterprise support. Key issues, themes, categories of support and stakeholders are also identified. Following this introduction, the research methods used are described in chapter 2 and comparative experience from the rest of the UK, Europe and USA is detailed in chapter 3. The role and views of private sector stakeholders, including funders, women s business associations and views of women in business are noted in chapter 4. The provision of public sector support for women s enterprise by the Enterprise Networks and other agencies is reviewed in chapter 5. Chapter 6 includes a separate summary review of the broad pattern of support, a SWOT analysis developed against best practice benchmarking criteria and the authors 1 Scottish Enterprise website (2002) 2 Global Entrepreneurship Monitor (2001) Executive Report, Kauffman Center for Entrepreneurial Leadership, Babson College, Boston, USA. 3 Galloway, L. and Levie, J. (2001) GEM Report Scotland 2001, Hunter Centre for Entrepreneurship, University of Strathclyde. 4 Fraser of Allander Institute (2001) Promoting Business Start-ups: A New Strategic Formula, Stage 1 Final Report, Scottish Enterprise, Glasgow 1

17 evaluation of current gaps in the pattern of enterprise support. Selected option models for an NCWE are examined in chapter 7. The main conclusions of the study, incorporating the authors recommendations for an NCWE, are contained in chapter Coverage of the Study and Aims of a National Centre Under the terms of the brief, the research required for the study included: the mapping of existing activities concerning support for women s enterprise in Scotland, taking a broad view of stakeholder activity; an examination of comparative experience and initiatives from the UK, Europe and the USA; the identification of gaps in current provision and the evaluation of different structural arrangements for a national centre, including different models for an NCWE that incorporate separate physical and nonphysical forms. The aims of an NCWE need to be placed within the current Scottish policy context and the broad goals of equal opportunity, social justice and economic development. To assist in the achievement of such goals, an NCWE may take on a range of aims. Potential aims were broadly outlined in the Scottish Executive brief and subsequently expanded by this research, to include: Advocacy of issues with women s enterprise with all stakeholders and policy makers. Educating the stakeholders on women s issues in enterprise including the Enterprise Networks. Training and business development support for women in business. The provision of information on women in enterprise and expert advice and guidance. The identification of research needs and undertaking research. The development of new training materials, including on-line business support. The development and piloting of new initiatives concerned with supporting or funding women s enterprise. The development of strong networks for women in business. The promotion of women in enterprise through events, marketing and the media. The development of linkages in women s enterprise beyond Scotland. The research examined the feasibility of these aims and functions through a number of different models and in the context of current provision, expert opinion, best practice and stakeholders views. 2

18 1.2 Women and Enterprise Research One recurring issue in the research literature and in policy development for small and medium size enterprises (SMEs) is the relatively low participation of women in such businesses compared to men. Statistics on small firms ownership are not generally disaggregated by gender, nor do the new business statistics collected for Scottish Enterprise. Indications for the participation of women in business take self-employment data as a proxy for this measure. In Scotland, the self-employment rate is 5% for women compared to 12% for men. 5 Women account for 25% of the self-employed in Scotland. 6 Scotland is not alone, however, in having lower participation rates for women. For example, a forthcoming paper on gender and entrepreneurship suggests that in most countries women s participation rates are around one-half of that of men. 7 It should be noted that official statistics could be underestimating the participation of women in business; for example, women may participate through involvement as partners, or in family businesses as employees, but remain hidden in official statistics. Recent data suggest that 52% of all SMEs in Scotland have at least one female owner. 8 A recent study for the Federation of Small Businesses (FSB) suggested that mixed gender ownership, amongst their membership in Scotland, is 40%. 9 The same study indicated that the proportion of businesses wholly-owned by women FSB members was only 12% in Scotland, but this was above the national average for the UK of only 10%. This further indicates that one of the information gaps is reliable data on women s participation in business and entrepreneurial activity. 10 A recent policy paper for the Industrial Society 11 claimed that women face particular distinct issues and potential barriers in developing their businesses. 12 An NCWE for the UK was a policy recommendation of this paper. Standard issues in the literature, on the nature and characteristics of women in business, focus on the nature of their performance and whether women face greater constraints in starting and developing a business than do men. In a similar vein to the literature on ethnic minority business (EMBs) ownership, issues include cultural and social barriers that may exist in business start-up and development support. For example, women may be hindered by institutional barriers such as access to formal sources of finance or are reluctant to use mainstream sources of enterprise support, as is the case with EMBs. 5 Labour Force Survey Data (2001) Office for National Statistics. 6 Scottish Executive (2001) A Smart Successful Scotland: Ambitions for the Enterprise Networks, Scottish Executive, Edinburgh. 7 Galloway, L., Brown, W. and Arenius, P. (2002) Gender-based differences in entrepreneurial behaviour: A comparative examination of Scotland and Finland, International Journal of Enterprise and Innovation Management, forthcoming. 8 Scottish Executive Survey of SMEs, Autumn FSB (2002) Lifting the Barriers to Growth in UK Small Businesses: Scotland, FSB, Glasgow. 10 Carter, S., Anderson, S. and Shaw, E. (2001) Women s Business Ownership: A Review of the Academic, Popular and Internet Literature, Small Business Service, London. 11 Shaw, E., Carter, S. and Brierton, J. (2001) Unequal Entrepreneurs: Why female enterprise is an uphill business, The Industrial Society, Policy Paper, London. 12 Notably, pre-start experience, finance and networks see Brush, C. and Hisrich, R. (1999) Women- Owned Businesses: Why do they matter?, in Acs, Z. Are Small Firms Important? Kluwer, Norwell. 3

19 Attention has also focused on the development of business networks and access to finance. 13 Research by Grampian Enterprise Trust in Scotland with women business owners suggested women, in accessing finance and business support, faced barriers. 14 Carter, et al. claim that the majority of studies show that women find it more difficult to access resources than do men 15 ; although a careful study by Read on the treatment of men and women by bank managers found that there were more similarities than differences. 16 In addition, a recent study by a businesswomen s network 17 in England also reports that there is a need to be wary of making simplistic statements about the differences between men and women. One of the problems with the literature is that robust and consistent methodology has not often been adopted and that many of the studies are rather dated, making it difficult to pin down important issues. However, overall, there does seem to be consistent evidence to support a view that women are slower generally than men to realise their entrepreneurial potential, 18 even though they are generally more highly educated. There may be issues arising too from greater concentrations of women owned businesses in some industrial sectors Enterprise Support Policy: Key Issues It is useful, in the context of Scotland, to clarify the main categories and issues in enterprise support policy. Support for women in enterprise needs to be considered in the context of key policy categories. Five categories have been chosen for greater discussion and illustration: business start-ups, business growth and development, innovation, access to funding and social inclusion. These five categories are discussed below. It should be noted also that policy development in Scotland is not static, it has been evolving, partly through experience and partly through changing priorities. Therefore, enterprise policy also needs to be seen in an evolving dynamic context. 1. New start entrepreneurial activity and business start-up support has, over time, been a key policy objective reflected in the Business Birth Rate Strategy of Scottish Enterprise from 1993 to The review of the BBRS 20 in 2001, recommended that greater focus for policy should be on higher growth, innovative start-ups. This reflects a trend that was already in place in the Enterprise Networks, to move from volume provision of start-up support to greater segmentation with different levels of support for volume start-ups, compared to growth start-ups. There is a strong theoretical case for greater selectivity of support, although against this it can difficult to establish criteria for selecting growth firms. 21 Following the review of the BBRS, the revised Scottish Enterprise approach to entrepreneurship and business 13 Hisrich, R.D., and Brush, C.C. (1984) The Women Entrepreneur: Management Skills and Business Problems, Journal of Small Business Management vol 22, no 1 pp Grampian Enterprise Trust (1997) Women in Business:- Encouraging Growth, Grampian Enterprise Trust, Aberdeen. 15 Ibid, Carter, et al. (2001) 16 Read, L. (1995) "Raising Bank Finance: a comparative study of the experiences of male and female business owners", ESRC Seminar Series The Finance of Small Firms paper, University of Paisley. 17 WIN (England) study on women business owners and their banks. 18 Boden and Nici Boden, R.J. Jnr & Nucci, A.R. (2000) On the survival prospects of men s and women s new business ventures, Journal of Business Venturing 15(4) pp Kovalainen, A. (1993) At the margins of economy, Turku School of Economics and Business Administration. 20 Ibid, Fraser of Allander Institute (2001). 21 For a summary see Curran, J. (2000) What is Small Business Policy in the UK For? Evaluating and Assessing Small Business Support Policies, International Small Business Journal, Vol. 18, No. 3, pp

20 start-ups includes targets for a number of selected categories, including growth businesses, women-owned businesses and minority-owned businesses. These targets are discussed, where relevant, in this study. The dynamic nature of the policy agenda should not be underestimated. The move towards greater segmentation requires considerable progress to be made in establishing effective mechanisms and further comment will be made on this later in the study. 2. Established businesses can be seen as part of policy support for small business development. This is delivered now through Small Business Gateway (SBG) in the Scottish Enterprise Network. Like start-up support there has been considerable progress made by the Enterprise Networks in Scotland towards greater consistency and the reduction of duplication since the Scottish Parliament review 22 of economic development services. Reference is made later in this study to the uniformity of provision of business development support through SBG and the advisers employed to deliver SBG. In addition, accreditation of advisers is now being achieved through the Premier Adviser programme in the Scottish Enterprise Network area. 3. Separate programmes of support may be provided to assist innovation, whether with start-ups or established businesses. Innovation is a key theme in policy priorities, including creativity, IT and e-business development, commercialisation and research and development Difficulties experienced by entrepreneurs in accessing funding may prevent the achievement of key policy objectives in entrepreneurial activity and business development. For example, there is some evidence that minority or difficult to reach groups may face greater difficulties than others in accessing formal sources of finance. 24 There is market failure in the provision of certain types of finance (for example, seed capital) that, in theory, would justify policy provision. Public sectorfunded initiatives may also have demonstrator functions for the private sector. 5. Social inclusion has become an important objective of policy development. Although specific programmes and funding exist targeted at, for example Social Inclusion Partnership areas, inclusiveness is embedded in the nature of entrepreneurial and business support programmes. These five categories will recur throughout this study, since they all impinge on the nature and current provision of enterprise support for women. Figure 1 below is the authors modelling of these categories, showing that each of the five areas above can input via policy initiatives at any business stage. The bulk of start-up training, advice and support will be required by pre-start and new start businesses; business development policy will be required more for existing businesses. However, these are not exclusive categories and policies and programmes require flexibility. Funding and innovation issues can also be a factor at any business development stage and enterprise support can be delivered directly to women in these areas. Policy initiatives can be 22 Enterprise and Lifelong Learning Committee (2000) Final Report on the Enquiry into the Delivery of Economic Development Services in Scotland, Scottish Parliament, Edinburgh. 23 Scottish Executive (2001) A Smart Successful Scotland: Ambitions for the Enterprise Networks, Scottish Executive, Edinburgh. 24 Bank of England (2000) Finance for Small Businesses in Deprived Communities, Bank of England, London. 5

21 developed not just for enterprise as a whole but also for all the different stages of business development outlined and for the different categories or types of support. Figure 1: Policy Provision and Enterprise Support for Women Business Stage: Business Start Up Advice, Training & Support Business Development Advice, Training & Support Pre Start Start Up Established Funding Innovation Social Inclusion 1.4 Women and Enterprise Support: Key Themes Figure 1 provides one framework against which to describe enterprise support for women. Separate from the identification of these broad categories, described below is a number of important themes. These include whether enterprise support for women should be explicit or mainstreamed, which is linked with the theme of diversity management and equal opportunities. Further themes include whether support should be delivered directly or indirectly, and finally whether support should be integrated with UK developments or focused on Scotland alone. A distinction can also be made between the actual provision of programmes and the nature of delivery, e.g. the distinction between the level and type of support provided and the environment in which it is delivered Explicit Support v Mainstreaming Enterprise support for women could be explicitly provided, for example as separate, gender specific programmes, or mainstreamed and provided as part of standard business programmes. The question that arises is: should programmes, funding schemes or other forms of enterprise support be developed separately for women? This debate is closely linked with the debate on equal opportunities and diversity management, described in more detail in section below. Assuming a case could be made that support programmes require such a separate and distinctive approach, the development of separate provision is quite feasible across start-up, business development, innovation, funding and social inclusion initiatives. Examples of such provision are to be found in chapters 3 and 5 of this study. 6

22 There is a strong argument, however, that it is better to design mainstream programmes that are sufficiently sensitive to women s needs, making explicit women s support provision only where explicit needs have been clearly identified and where a mainstream response, although desirable, is not possible, practical or feasible within a specific timeframe or a timeframe judged reasonable. Explicit provision, therefore, can also be time-limited until the mainstream can develop an appropriate response. The mainstream change required could include culture, attitude and environment as well as infrastructure and delivery mechanisms. Therefore, in some cases, the timeframe for the necessary mainstream change may be measured in decades or years. The mainstreaming approach has the advantages of avoiding duplication and ensuring that enterprise support is more accessible, democratic and sensitive to the needs of all potential client groups. In Scotland, gender issues should be an inclusive part of all programme or policy development by all enterprise stakeholder groups. Developing this integrated theme, a framework and checklist for the development of women s enterprise support has been suggested by a SEED working paper. 25 This informative document provides a service delivery matrix that highlights the gender issues to be accounted for in the design of programmes such as micro-credit, loan guarantee, training, counselling, mentoring, information and networks, incubators, marketing assistance, support activities and advocacy. This illustrates too that Scotland is not the first nation to tackle such issues Direct v Indirect Provision In principle, an NCWE could take a number of direct and/or indirect roles. These are developed and evaluated later in this study. In brief, a direct role would involve an NCWE engaged in providing support, advice and training to female clients. This may include a funding role and specialist assistance. The case for direct support provision of this nature relies upon the identification of deficiencies and gaps in the present provision of support that would allow such a role for an NCWE or for other forms of direct support provision. It also raises issues of proper integration with existing delivery mechanisms. The indirect role would require a body such as an NCWE working alongside existing support providers including the Enterprise Networks and other organisations such as Chambers of Commerce and banks to provide advice and support at institutional level, taking an advocacy and championing role for women s enterprise. An NCWE in this role is recognised as a centre of expertise, of information and possibly takes a direct research role Integration with UK Initiatives v Development of Scottish Provision Scotland has traditionally developed enterprise support provision that has been different from that in the rest of the UK. This has reflected, in the past, different policy priorities and support needs, for example with the development of the Business Birth Rate Strategy. This study discusses initiatives and developments in the rest of the UK. In principle there is a case for integration where initiatives may be able to benefit women 25 Kantor, P. (2001) Promoting Women s Entrepreneurship Development based on Good Practice Programmes: Some Experiences from the North to the South SEED Working Paper 9, ILO 7