New perspectives on productivity: scale deep, crowdfunding, and purposeful business

What are the strategies beyond the traditional economic-centric growth metrics which have historically defined productivity? Research Assistant Daniel Williams writes about the Scotland Productivity Forum’s panel discussion on the scale deep, crowdfunding, and purposeful business approaches to productivity as part of National Productivity Week 2023.

The event featured industry experts who discussed various innovative approaches to enhancing Scotland’s productivity, proposing various innovative approaches in a changing economic and environmental landscape. The discussion shed light on the need for a nuanced approach to productivity that embraced societal value and environmental stewardship as well as economic output.

By fostering collaborative efforts across government, businesses and communities, Scotland can embrace a productivity paradigm that balances growth with resilience, inclusivity, and sustainability, paving the way for a robust economy that serves both its people and the planet.

Key themes

1. Scale Deep Businesses should embed themselves into their communities and markets more deeply than traditional surface-level growth strategies allow. This approach fosters resilience, enhances customer relationships, and addresses the complexities of market adaptation in a rapidly changing and increasingly technologically reliant world.
2. Crowdfunding A critical alternative financing model, especially for Small and Medium Enterprises (SMEs). Carolyn Currie, CEO of Women’s Enterprise Scotland and chair of the Scotland Productivity Forum, detailed a pilot project which provided a crowdfunding platform for women-led businesses in Scotland. The benefits in providing alternative routes to finance for SMEs, validating market demand, and fostering innovation were considered – alongside the challenges it presents, including the uncertainty of success and the need for extensive marketing and the resources needed to action crowdfunding campaigns. This project is included in research being undertaken by The University of Glasgow and The Productivity Institute investigating crowdfunding through gender dynamics, with a particular interest in the Scottish context.
3. Purposeful business A shift towards businesses that intentionally create positive societal and environmental impacts. The panel discussed how purposeful business practices could enhance brand loyalty, contribute to long-term sustainability, and address challenges at local, regional, national, and international levels in balancing profits with purpose.

Panellists included:

• John Housego, AquaScot, who provided insights into his business’s transformation into a fully employee-owned company in 2016, showcasing the significant impact such a restructuring can have on company culture, engagement, and resilience. Housego argued that restructuring to an employee-owned structure has enhanced AquaScot’s commitment to both community and sustainability whilst having a positive impact on profits. This highlights how a triple bottom line approach incorporating societal, environmental and profitability aspects to a company’s structure can be beneficial both to the company itself, its local community, and the environment.
• Iain Scott, Be Enterprising, who emphasised the importance of an “enterprising mindset” in revitalising local economies and scaling deep, fostering entrepreneurship, particularly through transforming empty buildings into collaborative workplaces for micro-businesses and self-employed individuals.
• Jo-Anne Chidley, Beauty Kitchen UK, who explained how she founded businesses committing to triple bottom line and purposeful business aims. Her talk on converging entrepreneurship, sustainability, and a focus on ethical business practices gave insight into how these principles can be combined to create a growing, sustainable business with roots deeply entrenched in the promotion of a circular reuse economy.

Policy Recommendations

The event’s discussion brought forward four key potential policy actions:

1. Support for deep market penetration: Encourage businesses to adopt deep market penetration strategies that focus on sustainable growth, resilience, and strong customer relationships by “scaling deep”.
2. Innovative funding mechanisms: Promote crowdfunding and other alternative funding models to support innovation, community engagement, and financial inclusivity for SMEs.
3. Promotion of purposeful business practices: As seen by the success of Beauty Kitchen, Reposit and AquaScot, purposeful businesses can be among the most successful in a national economy. Policies which advocate for businesses that contribute positively to society and the environment offering incentives for their societal and environmental contributions would give incentives to other businesses to follow suit.
4. Frameworks for impact measurement: Develop and implement comprehensive frameworks to measure the societal and environmental impacts of businesses, facilitating accountability and encouraging purpose-driven practices.

The session was held on 30 November 2023, hosted by the University of Glasgow in collaboration with the IRT Digital Society and Economy marking the second of a three-day series of events as part of the UK’s National Productivity Week.

This blog is the second in a series of four on the Scotland Productivity Forum’s events hosted as part of National Productivity Week in 2023.