A Small Business Administration for Wales?

Abstract

Objectives: The project is focused on what a US-style Small Business Administration (SBA) might look like in Wales, and thus what might be the best model to provide comprehensive business support in Wales. Prior Work: Supporting SMEs has become an important component of policies to promote sustainable competitive advantage particularly post-2008 crisis. Such support tends to focus (not necessarily evenly) on the 4Cs of Capital (Finance), Counselling (Business Advice, networks and training support), Contracts (Public Procurement) and Championing.

Whilst many of the activities of the US SBA are also currently undertaken in Wales, there are key gaps in the areas of Championing and Contracts. Additionally, an explicit overarching coherent governance structure for SME support policy in Wales is presently lacking.

This suggests Wales could benefit from SBA-type arrangements, but that issues of structure (given bodies already in place), and activity (given existing policies and resource restrictions) need examination. Approach: 26 interviews were carried out from 5 main stakeholder groups (SMEs, Academics, Government, Business Advocates, Business Support). Conducted either face-to-face, telephone / skype, interviews were written up immediately following their conclusion, qualitative analysis conducted using NVIVO (version 10). Results: Small Business Advocacy with Government, particularly in procurement, emerged as a key SBA Policy focus, as did the need for a strong research arm to generate relevant data, support and evaluate activities. Wales SBA Strategy was seen to require a general (research-supported) remit to promote enterprise. More broadly, strategy promoting more unified approaches to business support services is needed.

The SBA could best undertake Delivery, using stronger (contractual) relationships with existing providers, but also additional contractual relationships with local / regional providers (e.g. Local Authorities and FE / HE sectors). A regionally-based delivery structure consistent with the Cardiff Capital Region (10 UAS) and Swansea Bay (4UAs) City Region, and a non-City (8UAS) Region encompassing the remainder of Wales was seen as optimal.

In terms of Governance, the SBA should be arm’s length from Government, be strongly audited on an annual basis and also be Ministerially accountable via a Committee possessing a diverse board membership. The SBA would sit above current business support structures, acting as a bridge between providers, government and SMEs. Implications: The creation of an SBA for Wales has merit, given both additional activities with regard to advocacy, championing, and research, and the overarching business-focused coordinating structure that it could provide. Value: This paper provides an initial evidence base for academics, policymakers, SMEs and business organisations, on which to build policy proposals for an SBA for Wales.