Unsurprisingly, due to our austere times, I seem to have had a strangely high number of conversations recently about the provision of all manner of “core” services (banking services, mobile coverage, broadband access, TV coverage, energy provision and post office services, to name but a few) to the far flung reaches of our sceptred isle.
At the heart of the conversation is the basic economic reality that the providers of these services can only provide them at a loss. Now, when times are good and big businesses can afford to be seen as champions of Corporate Social Responsibility, putting in some loss making services to win PR brownie points and to appease the regulators seems to make sense. However, when times are tough it puts real pressure on the providers to look again at the manner in which they provide the services. To date there are a number of alternative models that are in place and it would appear that this is a rich area for potential innovation for “core” service providers.
1. Community Purchase Schemes: This is where the community raises funds to purchase a specific service for an area e.g. Broadband. What’s interesting is that there is potentially quite a lot of scope for extending this kind of thinking to the maintenance of existing services too e.g. banking services and post office services. The concept is simple – you want us to provide you a service – you pay. Now the plus side of this is that the raising of funds and maintenance of a service can galvanise a community and improve community spirit, making it a popular option in the affluent countryside areas that are keen to use/keep a service. However, there are many communities who will find the fundraising beyond their reach. This type of scheme will just not work for them. It’s therefore not a socially inclusive option but it does make economic sense.
2. Service Sharing Schemes: For some services e.g. those requiring physical buildings (banks, post offices, shops etc) it is the provision of the staff and fuel that make them uneconomic to run, and whilst some communities could fund these overheads most couldn’t. So what’s the alternative? Well interestingly businesses could learn a lot from one of the other central pillars of the community – the church. Faced with declining attendances, reduced incomes and increasing costs the church has been creating new “sharing” models that could potentially be replicated in business. In some rural areas several churches from the same denomination will “share a vicar”. The vicar will cover multiple churches. In other areas different denominations “share a church”. In this case “competing” denominations bury their differences and share a common building and associated costs. Now imagine these models extended to banks, post offices, retailers. It’s not going to feel comfortable to the service providers but by thinking a little laterally they can keep the regulators happy, maintain their CSR kudos and deliver a socially inclusive service.
To my mind this and other new models of service provision are definitely worth exploring in these austere times. An area for real innovation.
I wonder whether there is a market opportunity for someone to become that "shared provider" - providing, for example, banking services on behalf of all of the Big Five banks in a given location. Or perhaps that's what village post offices should do now they have far fewer things to do on behalf of the Post Office??
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