Some initial thoughts on entrepreneurship, business, wealth and innovation.

Recently, I’ve been teaching a subject at AFTRS on Entrepreneurial Finance. This has been a useful exercise in exploring ideas about what an entrepreneur is and who identifies as an entrepreneur. Before I outline a few ideas which have sprung from that class, I must thank my seven students who have been willing to be dragged in a new direction, as I moved the subject from being purely accounting based, to include looking at stories of entrepreneurship, to thinking about types of finance available and to pitching for finance.  Their contributions have been insightful and informative.

In this subject, we have talked about entrepreneurship, but we’ve also been lucky enough to talk to four creative industries entrepreneurs about their careers and about what they do. This has resulted in an ongoing discussion about the personal attributes of entrepreneurs, such as risk-taking, passion, vision and perseverance. We have been hearing about the relationships between entrepreneurship and other social constructs, which seem to share the same space, like overlapping segments of a Venn diagram.

So, this post is a quick summary of a few thoughts about the interdependent relationships which entrepreneurship has with business, wealth and innovation. The blog equivalent of scribbled reminders on post-it notes.

Entrepreneurship and business

As part of Entrepreneurial Finance, I interviewed a film producer with a string of prominent feature credits to her name. Parallel to a successful producing career, she has also established, grew and sold a film related company. But when asked if she identified as an entrepreneur, she said no because in her view, to be an entrepreneur, you have to be in business.

The job of a film producer seems to me to be all business. It involves a range of tasks which are inherently entrepreneurial: raising finance, negotiating with talent, striking distribution deals and so on. Yet for my interviewee, this storm of production duties required to get a film made doesn’t feel like being in business. Business is not just busy-ness, but doing and something that looks and feels like a permanent, ongoing profit-making activity.

Are entrepreneurship and running a business essential companions? For me, the answer is no. I see entrepreneurship, and the ability to be entrepreneurial, active in a whole range of fields: in the arts, in not-for-profit organisations, in social enterprise. These are fields which may or may not be “in business.” Fields in which the participants (like this film producer) may not identify as being “in business.”

It seems to me like “entrepreneur” and “business person” are different roles. Like the person who has run a service station for thirty years, you can run a business without being an entrepreneur. Like someone who renovates and sells houses for profit, you can be an entrepreneur but not have a business. But there’s a set of implications about being in business – being self-directed, generating profit, financial risk taking, growing a company over time – which seems to sit comfortably alongside business as complementary ideas. They just seem like they go together, but they can and do exist separately.

(I’m grateful to my supervisor Kate Bowles for finding that term entrepreneur has its origins in 19th century France as “the manager or promoter of a theatre production.” Who’d have thought we’d have the creative industries to thank for the term?)

Entrepreneurship and wealth

Over on Radio National’s Big Ideas program, the Class Act podcast has detailed issues about Australia’s class system – insisting on its existence, detailing its complexity and talking about its effect on people and on. In its second episode, ANU’s Frank Bongiorno talks about the image of Australian entrepreneurs that developed in the 1980s. (Relevant section starts at 19 min 26 sec)

Australia became more unequal in the 1980s. Indeed, it was becoming more unequal from the 1970s, with the end of the long post war boom. And many of the long standing economic opportunities that existed within Australia, within industry and manufacturing, within the farm sector were closing off. During the 1980s, as Australia de-industrialised, as farm incomes and the farm economy came under increasing pressure, unemployment was very high, persistently high, much higher than today right through to the 1980s. Home ownership was declining and so, in many ways, that old image of Australia as a workers’ paradise or a working man’s paradise which goes right back to the 19th century… seems to be belied by the ways Australia was being transformed in the 1980s.

And so, you have the emergence of the figure of the entrepreneur, a term which was used in a non-pejorative way for most of the 1980s and then became more pejorative with the corporate collapses of the late 80s/early 90s and the recession. But you had this image really of the entrepreneur as a kind of public benefactor a public hero. Figures such as Alan Bond, for instance, or Robert Holmes à Court, Christopher Skase and they were held up as people to be emulated. The great irony of this, of course, is that it was a period of Labor government and, in many ways, the Hawke government and Paul Keating as treasurer held up these entrepreneurs as models to be emulated. They were new money as distinct from old money. They had a bit of “get up and go” about them. And, in many ways, a different kind of mass in popular culture where such figures, for the first time really in Australian history, I think, are being held up as real heroes. Their conspicuous consumption, their lavish lifestyles, were seen as admirable, because somehow or other we were able to share in them.

It is interesting to consider how our image of the entrepreneur in early 21st century Australia has changed since the time Bongiorno describes. Certainly, I think they are still held up as figures for emulation. We still think they have that bit of “get up and go” and that’s to be admired. But I think the connection to ostentatious displays of wealth is not so strong. The pervading image of an entrepreneur is much more likely to be of startup owners, app developers and hipsters in incubators. Their values seem to be presented as hard work, self-direction and innovation. Their wealth is mostly invisible and mostly presented, I’d suggest, as existing only as a future possibility.

We seem to have extended the definition of entrepreneur beyond the stratified giants of the AFR Rich List. But we’ve retained the idea of heroism and of an entrepreneur’s story being the highs, lows and ultimate triumph of the classic hero’s narrative.

One further thought: linking entrepreneurship and the drive to grow personal wealth is a challenge to the use of the term in the creative industries, where many activities are pursued without the desire to create wealth (in some cases, without the potential to create wealth). As noted previously, there’s a profit/not-for-profit divide within the creative industries and personal wealth creation sits on one side of it. Further, in the field of social entrepreneurship, I suspect it is absent entirely. It’s another example of how the concepts of wealth and entrepreneurship are drifting further apart from each other, through our wider definition of who an entrepreneur is.

Entrepreneurship and innovation

An ongoing conversation in Entrepreneurial Finance was around the role of innovation in entrepreneurship. One of my students, Daniel Punton, works in the startup space and saw innovation as fundamental; to be an entrepreneur, you must be creating something new. My discussion with Daniel and the rest of the class followed the stories told by our guest speakers, but also sprang from this definition of entrepreneurship from Howard Stephenson of Harvard Business School: “entrepreneurship is the pursuit of opportunity beyond resources controlled.” This definition, which doesn’t mention innovation, business or wealth, allows a wide range of activities to be classified as entrepreneurship.

But here’s another definition from Scott Shane and S. Venkataraman: “Entrepreneurship, as a field of business, seeks to understand how opportunities to create something new (e.g., new products or services, new markets, new production processes or raw materials, new ways of organizing existing technologies) arise and are discovered or created by specific individuals, who then use various means to exploit or develop them, thus producing a wide range of effects.” It mentions the word new five times, so they must really mean it.

For these researchers, newness can be explored in lots of different ways (it need not, for example, be a new product) but it is essential to entrepreneurship as a process. But how new is new? To take our aforementioned service station owner as an example, his business is not, a new idea. But the personal challenge of starting a business, the need to raise resources and to execute a strategy, may be a new opportunity for him/her. And if a service station in a new (geographic) market, for instance, could fit within Shane and Venkataraman’s definition, and certainly within Stephenson’s.

If we’re looking for a set formula for entrepreneurship, I don’t think we’ll find one. And, to speculate for a moment, the lack of a clear-cut definition seems to allow personal bias to influence perceptions of what entrepreneurship is. Viewed in this way, the extent to which any one aspect of entrepreneurship (newness, risk-taking, profit-making) is seen as essential, would be subjective, depending on each individual’s personal values. You might think of innovation as being essential to entrepreneurship, if you value innovation highly, and so forth. This allows Stephenson, Shane, Venkataraman and Punton to all be correct – but signals (another) a difficult definitional journey ahead.

Australian Broadcasting Corporation (2018). Part 2: How we got here. [podcast] Class Act. Available at: http://www.abc.net.au/radionational/projects/class-act/ [Accessed 20 May 2018].
Baron, R. and S. Shane (2007). Entrepreneurship: A Process Perspective, Cengage Learning.
Eisenmann, T. (2013). Entrepreneurship: A Working Definition, HBR.org, available at: https://hbr.org/2013/01/what-is-entrepreneurship [Accessed 20 May 2018].
Shane, S., & Venkataraman, S. (2000). The Promise of Entrepreneurship as a Field of Research. The Academy of Management Review, 25(1), 217-226. Retrieved from http://www.jstor.org/stable/259271

 

Advertisements

The pitch as storytelling and the storyteller’s shifting position

keith-johnston-221964Recently, I’ve had the pleasure of running a two-day clinic for artists seeking to improve their skills in attracting financial support from donors and sponsors. It’s the second time I’ve done this and both times it has been an engaging and rewarding experience.

Much time is spent at the clinic talking about the “ask” – how challenging and daunting it is for artists, and how asking positions the artist and their work. Each time I’ve run this event, discussing the ask has morphed into discussing the value of art, as perceived by consumers, donors, the general public and so on. In general terms, there’s uncertainty about what price to put on a piece of art but despite that uncertainty, there’s indignation when someone wants to access that art for a low or non-existent price.

So, the value placed on a piece of creative work is an ill-defined and touchy subject. It’s also one which is brought into sharp focus by the “ask”, which is ultimately about why anyone should hand over money for an artist’s work and if so, how much. These can be confronting questions for artists and I’ve seen firsthand the distress answering them can cause. Having to put a price on something you created, that has profound personal meaning for you and then justifying that price to a wary buyer? That’s tough.

The ask is part of a wider exercise we train these artists to undertake: the pitch. Pitching feels like something we’ve borrowed from the world of entrepreneurs, and specifically baseball loving American ones (pitch an idea to me, see if I take a swing at it or not). Pitching, which I think of as the act of presenting a potential supporter with an idea, challenges artists greatly and fundamentally. There are language barriers to break down (mainly, the tendency to hide behind incomprehensible jargon) and the need to build up the personal confidence to speak in front of people. The most crucial part though is simmering the artists’ projects down to its simplest and most compelling elements, that can make a potential supporter comfortable enough to say, “I get this and I want to help.”

The experience of talking these artists through this process got me thinking about the pitch as a form of story told by entrepreneurs. That story told well unlocks support, money, experience and advice. Told poorly it elicits indifference and/or distrust. It is in the storytelling nature of the pitch that artists have a natural advantage; they are all inherent storytellers, be they painters, filmmakers, dancers etc. If the pitch has been foisted upon artists by advocates of business practice, it is at least something which they can adapt and excel at.

*****

In 2001, researcher Ellen O’Connor spent months trailing the founder of a technology start-up and observed when and how he engaged in narrative practice. She used this experience to develop a typology of entrepreneurs’ narratives: personal, generic and situational. She observed that the founder in question moved between the types of story he was telling frequently, depending on his needs at the time and his audience.

She also noticed that depending on the type of story being told, the founder re-positioned himself in the narrative. Personal and generic stories had him positioned as the hero: a visionary, a creator, a person who made things happen. But situational stories, about the environment surrounding the founder and his nascent company, positioned him as a supporting character; only one of many players impacted by forces outside his control.

O’Connor’s Typology of Entrepreneurs’ Narratives

Type Type Description Subtype Subtype description Storyteller as character
Personal stories Authored by the company’s founder Founding stories Autobiographical in nature (“why I founded…”) May refer to a specific incident in founder’s life. Entrepreneur as the stories’ hero
Vision stories Focus on technological innovation and breakthrough as envisioned by the founder.
Generic stories Templates, required by conventional documents, such as a business plan. Marketing stories Plots the company against its competition and shows its superiority. Entrepreneur as the stories’ hero
Strategy stories Concretely plots the trajectory of the company from launch to success.
Situational stories Contextual storylines that the founder can do nothing about. Historical stories The longer and recent historical events of the industry in which the company is just one of many players. Entrepreneur as a minor player with little or no control
Conventional stories The “common sense” or widely held beliefs by industry insiders as well as the general public as to what companies in that industry and their founders do, should do and what they are like.

 

O’Connor’s story types correlate to the experience of creative industries practitioners in interesting and problematic ways. For creatives, telling personal stories is challenging; positioning themselves as the hero does not come naturally. It’s clear in how difficult they find the pitching process; generally, they have a natural tendency to deflect, to defer to a team’s contribution rather than their own and to downplay their achievements.

This is not just because of the stereotype of the introverted artist, but because it can be difficult to accept the credit for creative work, even if it’s entirely yours. Often acclaimed creative work depends on inspiration, luck, collaboration and strokes of genius that somehow just happen. It can be hard to take credit for this, because often an artist simply can’t explain how they made something great. Thus, a disconnection between the self and the work is always present which makes it difficult to replicate an entrepreneurs’ story of “this is how I made this.”

Generic stories are also challenging because often creatives aren’t trained to think about strategy or competition. There can be very little strategy employed in making a new creative work; there’s always a process but it doesn’t always have the clear objective which necessitates a strategy. If each piece is unique and a really good piece has an indefinable element to that uniqueness, then how could strategy to create it be devised? In this sense, artistic creation is almost antithetical to strategic thinking.

Competition (and in O’Connor’s sense, the ability to market your product’s advantages compared to that of your competitors) is equally challenging. Some of the more profit focused sectors in the creative industries (architecture, marketing and comms, etc) would be acutely aware of their competition. But artists tend to work in collaboration and to share information with their competitors in a way which other industries wouldn’t sanction. Artists in my clinics bristled at the thought of their peers as competitors, even though they often do compete for funding, opportunities etc.

It’s in the situational stories where creatives can flourish. My experience is that they are generally unworried by repositioning themselves as powerless sub characters within a narrative because the world around them is the inspiration for their work. They are more comfortable talking about the forces around them that shape their work, than how they created it. Perhaps it’s because the spotlight’s glare isn’t as bright, but I think it’s also a space they inhabit all the time. Entrepreneurs can use these situation stories to demonstrate a market opportunity; to show how the times we live in have created a chance to make some money. Artists use them to describe their muse.

*****

I hesitate now, because I seem to have fallen into a false binary: that artists and entrepreneurs are mutually exclusive. Of course, they are not. The cohort of artists I met in 2017 have proven that by harnessing the financial support they needed to create their work.

As I surveyed the 2017 group in preparation for meeting our 2018 clinic attendees, time and again they reported an increased confidence in making the ask. This confidence came from the responses they garnered from the donors and sponsors they approached. The consistent message was that they found people who wanted to feel involved with the work and wanted to help financially. They didn’t mind being asked and, in some cases, encouraged it. This, in turn, created a renewed confidence in the artists about the value of their art, because they found people who valued it as much or more than they did.

One of the 2017 mob said this: “I stopped thinking of it as an ask and started to think of it as an invitation. Because who doesn’t like to be invited to stuff?” In that remark, there is a repositioning, or a narrative sensemaking, as O’Connor would say. That artist repositioned himself from a beggar to the host of a fabulous party; from someone at the mercy of their situation to a hero, controlling the narrative. That’s the narrative transition that O’Connor spoke of entrepreneurs making, articulated proudly.

Storied Business: Typology, Intertextuality, and Traffic in Entrepreneurial Narrative” The Journal of Business Communication (1973), vol. 39, 1: pp. 36-54. First Published Jan 1, 2002

Are the arts central to defining the creative industries?

There’s more to talk about in the article by Julian Meyrick which I discussed last post. As I mentioned then, Meyrick is highly critical of measures used by successive governments to assess the arts on a “value for money” basis. As he writes:

The replacement of policy debate over the all-important question “what kind of culture do we want?” by reticulated, quantified, assessment procedures stems from a moment in time when governments became fixated on getting “value for money” for taxpayer spend.

The monocular vapidity of this reduction belies its administrative adhesion and political use. If you are forever demanding someone “demonstrate” the benefits they provide, you never have to describe or defend the world you want them to be of benefit to. In the 1980s and 1990s, artists and cultural organisations disappeared under a tsunami of Byzantine evaluative and audit tasks that disguised the heavily partisan beliefs that produced them.

The financial and statistical measurement of arts organisations for use in funding decisions and government policy is a world I inhabit and have done since the mid 2000s, a time, I note, significantly after the tsunami swept through. Still, I think that I’m familiar with the “evaluative and audit tasks” that Meyrick alludes to, and the type of arts organisations which are asked to complete them. I think it’s fair to say there are pros and cons to that regime, but some more from Meyrick first.

Meyrick notes that arts funding was one provided as part of “quality of life” legislation, as part of nation-building aspirations. To me, this sounds like what I know of as the “public good” argument for arts funding, and indeed, I have always thought of this as a thing of the past. Certainly, by the time I was running an arts organisation in the early 2000s, an organisation simply existing as a way of providing cultural benefits alone, was not an argument funding bodies supported.

(There is a notable anecdote which illustrates this shift in my paper about the rise and fall of professional regional theatre company Theatre South. When that company’s relationship with one of its key funders, the Australia Council, was floundering, the General Manager was called to a meeting there. In the face of criticism about the company’s performance, the General Manager responded with the argument that the most important aspect of Theatre South was that it existed, only to be flatly told that that was not enough. It’s worth mentioning that a key text for me in preparing that paper was Meyrick’s rigourous account of the Nimrod Theatre Company, See how it Runs: Nimrod and the New Wave.)

“In the last 40 years,” Meyrick writes, “arts and culture have found themselves weighed against criteria and targets not of their choosing.” I think Meyrick’s right that the arts industry has not been immune from the wider movement in management thinking which might be summarised in that old maxim, “you can’t manage what you can’t measure.” And if organisations and their boards have been encouraged to professionalise in order to, at least in part, comply with the measurement regimes imposed on them, that only underlines Meyrick’s point.

Meyrick seeks a more meaningful way to measure culture. “Australian culture is more than series of market preferences,” he argues, “It is more than a list of its impacts on well being, social cohesion, education levels, and the interstate sale of hotel beds.” And in the article co-written with Phiddian, Barnett and Maltby: “We argue that metrics systems for artistic quality imply a spurious homogeneity of purpose in the arts, invite political manipulation and sequester time, money and attention from arts organisations without proven benefit.”

Having seen this system in practice, I find much in Meyrick’s and his colleagues’ concerns to nod along to and to shake my head at, at various times. This is, I suppose, the difficulty of knowing about the nuance of a subject; there’s much to quibble with. So I won’t, certainly not on an open channel.

However, it’s worth revisiting the posited link between the desire to measure the arts along neo-liberal lines and the emergence of the term, “creative industries.” As I said last post, I think that relationship is of two separate but related things happening at the same time. But it might be useful to consider the conception of the creative industries that may have led to making this connection – a conception which places the arts as central to the creative industries. (Other models are available, as noted here)

Part of the issue is that any perception of the creative industries is influenced by the view from where you stand. The arts may only be central to the creative industries if that’s what our starting point is. I’m sure there are, for instance, marketing & communications professionals bemoaning the same rebadging of their industry and giving no thought at all to the arts.

But another factor is the high level of government involvement in the arts and that the fortunes of the arts rise and fall with decisions made by government. In this environment, no change of nomenclature is without motive, no change exists without an agenda to drive it. In this context, I can see how the link is made: government wants the arts to be economically viable and a reimagining of them as an industry (a term infused with economic and bureaucratic meaning) fits that agenda.

For me, the arts is a component of, not central to, the creative industries. It makes more sense to me as a categorisation of commercial sectors which have, within their business models, the exploitation of the creative process. And although my conception of it includes the arts, there’s an argument, I think, for excluding them from that definition, because they lack the commercial intent to make them truly industry-like.

And if that makes sense, then it might even lead us back to the public good argument. Because isn’t doing something for its inherent cultural or community benefit, with no need to measure its costs and returns, antithetical to what an industry is?

References: see last post.

Is “creative industries” just the new, economically justifiable version of “the arts”?

This article, by Julian Meyrick on the Conversation, has sparked so many thoughts that they have to marshaled into an orderly queue and forced to wait patiently. Its primary focus is the evaluation of the arts and its unquantifiable benefits in a policy environment which demands quantification. That issue is enormous, so I’ll put that aside for a moment and talk about discomfort over the term “creative industries”.

Simplifying the measurement of the arts to statistical and financial data and over-reliance on such measures in policy making around the arts concerns Meyrick. His piece in the Conversation contains this paragraph:

In the last 40 years, arts and culture have found themselves weighed against criteria and targets not of their choosing, while the sophisticated calculative practices constructed to do this have sometimes exacerbated the alienated character of the situation.

The hyperlink leads to a journal article by Meyrick and colleagues Robert Phiddian, Tully Barnett & Richard Maltby, critiquing a measurement regime called Culture Counts, then being considered for use within Australian government funding bodies for the arts. In it, further reservations are expressed about quantifying the arts as economic justification, but there is also a link to the emergence of the term, “creative industries”. Meyrick et al see it as linked to an increasing desire to measure the value of the arts; in fact, that it’s a reaction to it.

They talk about the work of academics such as Hawkins, Cunningham, Bennett and Stevenson who, they say, led “the pursuit for the biggest plausible GDP number” to attribute to the cultural sector.

These authors facilitated a shift in government understanding from a traditional concept of “the arts” to a contemporary concept of “the creative industries”, and a concomitant switch from an arts policy to a cultural policy. Quantification was key to this change, as was the alliance between left-of-centre cultural democracy advocates and right-wing free-market proponents.

There are a couple of things to note here. Firstly, that the term “creative industries” is seen as a successor to “the arts” – and not so much a natural evolutionary step, but part of a wider agenda to quantify the arts (which was “key to this change”). More than that, it was a kind of merging of points of view from the left and right. So here, the adoption of the term “creative industries” is seen, at least in part, as having a political dimension. They go on:

These parties found common ground in an instrumentalist cultural materialism with little interest in nuanced critical distinction making. Someone working in advertising or software design was a “creative” in much the same way as a violinist in a symphony orchestra.

Here they express a familiar criticism of creative industry definitions. They place wildly different professions next to each other – actors and architects, musicians and marketers – within in the same category. This discontinuity is even more palpable within those subcategories themselves. Not only, I’d suggest, does an architect not think of herself as in the creative industries with actors, she probably doesn’t even consider herself to be in the creative industries. It’s far more likely, she’d see herself as being in the architecture industry.

There is a problem here, well recognised by people (like me) who work across these boundaries. It’s that the inability of the individual sectors which fill up the grab bag of industries labelled the “creative industries” to coalesce into a unified group, has prevented effective lobbying to government to support those creative industries. That problem can be seen as an inevitable result of imposing a definition of creative industries on those sectors; the term didn’t come from them so no wonder they have trouble adopting it.

The political element is then expanded upon:

The Creative Industries in Australia was a “third way” rapprochement similar to Cool Britannia under Blair. From the historical moment that we are in now, it looks like a hubristic miscalculation of the stability of a liberal democratic centre and its capacity to constrain neoliberalism through neoliberalism’s own mechanisms.

Which, I think, is fascinating. They’re saying, “you tried to play the bean counters at their own game, but you got it wrong.” And what was wrong was, again, their measurement of value.

… its imprecise use of language reduced terms of policy capture like “excellence”, “access” and “innovation” to abstractions evacuated of precise critical meaning. At the same time, it presented numbers as a tool for demystification that stripped away the obfuscating rhetoric of public value to reveal its privileging of high art in comparison with popular culture. In this way, cultural studies researchers – those who should have been most alert to the inculcation of neoliberal techniques – condoned quantification as the price for a non-exclusivist conception of culture.

All of which leaves me pondering three (ish) questions.

  1. Is “creative industries” just a rebadged version of “the arts” designed to be more economically justifiable?

Personally, I have never seen it like this. My own experience is from working with the film and TV industry to then working within “the arts” sector, which existed, at least in a policy context, separately from film and TV. So that gave me the sense that there existed creative industries outside the arts. From there I moved to working in a quasi government role with creative industries businesses/organisations of which the arts was a subset, and the measurement of those organisations in that context was not about intrinsic value, but about performance improvement and sustainability. I’ve never felt that the Creative Industries was the Arts made more palatable to neoliberals, but it can clearly be read like that.

  1. Was adopting the term “creative industries” part of an agenda to measure the arts to death? Or were the two things just happening at the same time? (Is it correlation, not causation?)

To which I think it’s probably just both happening at the same time, but nothing ever exists in a vacuum. It seems plausible that both these developments – both seemingly motivated by a desire to change how those industries are viewed externally – fed off each other.

  1. Does the creation of the term “creative industries” have a political element?

And clearly for some people it does. This is a reminder that definitions themselves – what we list, what we include, what we leave out – create meaning. Definitions are therefore inherently political; you can’t create or adopt one in an ideological vacuum.

I have been thinking about how to talk about definitions of the creative industries without resorting to simply comparing and choosing between various lists of industry sectors. And here, I think, is an indication that definitions are never just that. They are designed for a purpose, informed by ideologies and infused with motives. They are, in themselves, narrative processes and the stories they tell are contested.

Meyrick, J (2017) “A new approach to culture”, The Conversation, viewed 30 Sep 17. https://theconversation.com/a-new-approach-to-culture-82448
Robert Phiddian, Julian Meyrick, Tully Barnett & Richard Maltby (2017), Counting culture to death: an Australian perspective on culture counts and quality metrics, Cultural Trends, 26:2, 174-180, DOI: 10.1080/09548963.2017.1324014

The Dimensions of Worth

Everyone loves a good list. Lists of things, if complete, give us a definitive account of the contents of a category. They let us put things into easily understood groups and help us make sense of what those groups are. Colours of the rainbow. Planets in the solar system. Quantifiable and legitimised, tick ‘em off at your pleasure.

Lists also provide great fodder for debates, because who’s to say that a list is truly definitive? It’s not just that everyone loves a list, but that everyone loves the list they love, and loves to contest the lists other people love. Seven colours of the rainbow? What about the myriad hues between those seven colours? There are lots of people still insisting on putting Pluto on their list of planets.

Defining the creative industries seems to me to be a similar debate about what to include on a list. It seems to have started, by nearly all accounts, in 1998, when the UK’s Department of Culture, Media and Sport (those three happy bedfellows) described the creative industries as “those industries which have their origin in individual creativity, skill and talent and which have a potential for wealth and job creation through the generation and exploitation of intellectual property” and provided a handy list of 13 sectors. And it seems people have been arguing about that list ever since.

I’ve written about that debate before and the variations proposed and rejected. It is a crucial debate for policy makers and researchers, as boundaries need to be set in order to effectively map, measure and learn about the creative industries (how can we analyse the solar system if we don’t know where it starts and finishes?). At the same time, it’s a pointless debate for many creative industry practitioners, with no day to day impact on their activities (call it what you like, Pluto is still a big ball of rock and ice orbiting the sun).

Having sampled this debate, I’ve been considering a couple of questions. One, how to add to this discussion, in a way which isn’t simply arguing about other people’s lists. And two, what do we mean by the term ‘industry’ anyway? What is one and how do we recognise it?

This article, by Mukti Khaire, offers an interesting perspective on these questions. In it, she talks about the identification of a new industry, not by its vital statistics (is it in orbit around the sun, does its self-gravity make it a globe, has it cleared its orbit of smaller objects) but by a series of socio-cognitive actions.

An industry is self-defined by a process she calls “distributed sanctification”, whereby a variety of participants in an activity take a series of self-directed actions which legitimise that activity as an industry. It is a gradual and unplanned process, the start and end points of which are undefined. In essence, no-one says, “this is now an industry,” in an ABS sort of way. Instead, people start behaving like they’re in an industry and sooner or later, everyone else agrees with them.

To illustrate this process, she looks at the rise of the high fashion industry in India. This is useful because she can identify a time period (the 1980s) before which there was no such thing and after which there was. She then examines the actions which participants in the formation of the industry took during this time.

As might be expected, the steps taken by designers, clothes makers and sellers are important, but she argues, so are the actions taken by other more tangential players – educational institutions, the media and so on. The cumulative effect of these actions is the accumulation of social currency in the term “high fashion industry” in India. In her own words, she is mapping “the dimensions of worth.”

This process, she says, is difficult but essential for new industries:

These complexities make the construction of worth of new industries particularly difficult. New industries […] lack definition and coherence—that is, clear boundaries and identities, so they are difficult to understand.

Which seems to be to be exactly the problem faced in describing the creative industries. She goes on to say:

In addition, new industries  […] typically lack norms and conventions of evaluation, so it is difficult to determine their worth. However, the construction of the worth of a new industry is particularly important because worth is a prerequisite for cognitive legitimacy, which is a critical resource that pioneering entrepreneurs in new industries lack. A cognitively legitimate industry—one that is accepted “as a taken-for-granted feature of the environment”—is well defined and understood by both industry actors and audiences and broadly accepted as appropriate. Cognitive legitimacy, or taken-for-grantedness is a condition of complete intersubjective agreement and total absence of dissent regarding the right of an entity to exist.

Which again, seems to aptly describe the creative industries – lack of definition, leads to complexity in evaluation, leading to a lack of legitimacy and “taking-for-grantedness” which in turn is an impediment to entrepreneurship.

It’s tempting to describe Khaire’s approach as the opposite of “definition by list making”. But actually, she does provide a list of actions she says participants take which legitimise an industry:

Curation Customers and outside influencers, like education, media and government orgs, identify what’s high and low quality product.
Certification Educational institutions start offering qualifications for entrants into the nascent industry.
Commentary Educational institutions offer instruction on what’s good and bad practice in the industry.
Critique Media publications offer opinion on what’s good and bad practice in the industry.
Co-presentation Various examples of competing product are displayed together enabling…
Comparison Customers to make judgements about the qualities of those products.
Commensuration The growing number of comparisons allows the development of standard measures of quality.

Khaire’s example (high fashion in India) springs from the creative industries, which she says is appropriate because, “the highly symbolic nature of the products makes collectively understood definitions, shared meanings, and broad agreement on norms and rules crucially important…value construction in creative industries is a complex process because of the relative “singularity” of the products, and involves multiple actors and cognitive processes.”

No argument there. But while her criteria can be applied consistently to fashion, I suspect they could not be as easily applied to the creative industries, as defined as a collection of creative sectors, of which fashion is only one. I think all of her 7 Cs listed above create the “worth” she describes, but only within each creative sub-sector. We can’t measure a fashion designer by the same yardstick as a musician or an architect and so on.

This is leading me to the conclusion that whatever the “creative industries” is, it is not an industry in and of itself – at least not yet. It might be more helpful to see it as a selection of like industries, and that selection as being influenced by a variety of social and political pressures on the entity defining the term.

What makes them “like” is something we can’t quite grasp. Something alchemical, the transformation of imagination into IP. But just because a beautifully designed gown springs from the same creative well as a symphony or a grand old building, doesn’t necessarily mean they together form a cohesive creative industry. Pluto’s a really different place to Jupiter.

Khaire, M. (2014). Fashioning an Industry: Socio-cognitive Processes in the Construction of Worth of a New Industry. Organization Studies, 35(1), 41-74. Available at http://journals.sagepub.com.ezproxy.uow.edu.au/doi/full/10.1177/0170840613502766

Decision making and electing entrepreneurs

In preparation for something else entirely, I have been reading up on decision making. Through that, I’ve come across numerous references to Thinking Fast and Slow by Daniel Kahneman, and the theory discussed within of two cognitive systems employed in decision making.

System 1 is fast, automatic, frequent, emotional, stereotypic, subconscious. It’s the gut feel. System 2 is slow, effortful, infrequent, logical, calculating, conscious. It’s the long hard look. System 1, so the theory goes, is pervasive. Even if you’re deliberately trying to employ System 2 you naturally fall back on System 1.So gut feel governs our decisions far more than we may realise.

I can’t help but consider how this theory applies to the results of the recent US election. Perhaps one of the factors in the Trump campaign’s success was its understanding of the importance of the gut feel and its blitzkrieg communication style, concentrating on emotions, stereotypes and subconscious fears.

Understanding decision making must surely be crucial to understanding entrepreneurship. What is entrepreneurship if not a series of decisions concerning the creation and growth of a business? There are initial decisions to pursue a set of goals, despite the inherent risks. And subsequent decisions about strategies to attain those goals, making smart use of existing resources. Linked together, those decisions form an entrepreneurial chain.

This article here details the similarities between entrepreneurship and moral decision making. It argues that the two share a common set of ingredients: imagination, creativity, novelty, and sensitivity.

The entrepreneur creates something new in society, something novel, that meets a need that is latent in consumers. Successful entrepreneurs have to be attuned to the needs and desires of those who constitute potential markets for their products and services. The entrepreneur has to have imagination in abundance to envision a new product or service and bring it to market. The product entrepreneurs introduce into society is new and its impact on humans and the environment is unknown. It takes imagination to envision the possible impacts a new product may make and develop novel and creative solutions to potential problems that may arise. …these same qualities are crucial for moral decision making, and the issue of moral decision making is critical for entrepreneurship.

I think what this description of entrepreneurship lacks is the element of self-interest. Entrepreneurial decisions might be about a lot of things, but at their core, they are surely about improving the lot of the entrepreneur in question (or at the very least, not damaging that position). Moral decision making does not necessarily need this element; in fact self-interest work against a moral decision making framework.

Not that self-interest is bad. It might be a crucial element which counteracts the level of risk involved in being an entrepreneur. So self-interest might be an essential element of entrepreneurship, and perhaps it permeates all entrepreneurial decisions, in the same gut feel way of System 1.

A bit later in the same article, there’s a small section which brings us back, in a funny way, to President-Elect Trump.

In a society that promotes entrepreneurship, change and newness are highly valued and elevated. Such a society will encourage the desire for new things and a willingness to replace old things. Everything in an entrepreneurial society is open to change and modification, to replacement through various entrepreneurial experiments.

In Trump’s rise, and that of Prime Minister Malcolm Turnbull, we see entrepreneurship communicated as a virtue; that an entrepreneur is a well qualified person to assume high political office. They are seen, I suppose, as people who have made personal decisions which have served them well, and presumably as people who can repeat that trick for their respective nations. This is one of the results of the idolisation of business success, that change and newness are highly valued and elevated. In a society where entrepreneurs are hero worshipped, is it surprising that we choose leaders who embody that breed’s particular strain of change and newness?

And if we have prioritised entrepreneurship over an ability to make decisions within a robust moral framework, let’s hope the two really do have some things in common.

Ref: Buchholz, R.A. & Rosenthal, S.B. 2005, “The Spirit of Entrepreneurship and the Qualities of Moral Decision Making: Toward A Unifying Framework”, Journal of Business Ethics, vol. 60, no. 3, pp. 307-315.

Bridging the creative/financial divide.

I’m preparing to deliver a training workshop at the Artlands conference in Dubbo later this month. It’s a workshop I’ve now delivered many times called ‘Making Money Business’ and it covers business skills for Indigenous artists running creative enterprises. It’s a workshop I’ve gained a lot from and have blogged about it before, on what these Indigenous artists can teach other businesses about sales.

I’m in the middle of redesigning the workshop for its next iteration, so was intrigued to come across this journal article which details the results of “a survey of small creative firms … in the south west UK”. The survey indicated:

…the majority of firms are interested in a lifestyle based on fulfilling creative aspirations. Very few respondents exhibit any interest in participating in training schemes aimed at enhancing business performance.

So that was little discouraging.

This is a space I’ve inhabited for many years. I’ve both organised and delivered training activities for creatives covering a variety of topics. Generally, the feedback from those sessions has been very positive. And usually, these activities are well attended, which would indicate some level of interest in participating.

But as I read through the article, I realised the assertion that creatives aren’t so keen on undertaking business skills training is not the guts of the article. It’s a conclusion drawn from the piece’s central analysis about the motivation driving the owners of creative firms. (Interestingly, he uses an established quantitative model for measuring entrepreneurship.)

The author’s survey tested the how strongly the participants leant towards creative satisfaction or financial gain from their work. The results were mapped on the matrix above. He finds that the participants value the creative benefits more highly than monetary ones and so…

… it seems rather unlikely that one could persuade them to dramatically alter their artistic
philosophy to the point where they now wish to participate in business growth support
programmes…

For the creatives I’ve worked with, and for the participants in the Making Money Business workshops, I’d argue that this is not a binary choice. Most creatives I engage with want to be creatively fulfilled and financially successful. Sometimes the dream of making a living out a creative passion is unfeasible – an insurmountable mismatch between an artist’s labour of love and the market demand for that work.

But where there is a market demand to be met (and Indigenous art is a good example here) and an artist can tread the line between making fulfilling art and art that fulfils a customer’s order, then there’s a mutually beneficial transaction to be made. Which can be useful if you want to both make art and pay the rent. For me, it’s not so much about dramatically altering an artistic philosophy, but about seeking to improve the chances of being able to do both those things.