Monthly Archives: June 2009

Thoughts on cooperation.

First of all, let me just say that, wow, it’s been a long time since I’ve been in school.

We had two half day sessions today. The first was with Cooperative Economics professor Stefano Zamagni, who lectured on economic theory from Adam Smith to today. The second was with Pier Luigi Sacco, from the IUAV University in Venice. Yesterday we heard from Professor Zamagni’s wife, Vera, who is also an economics professor here.

Professor Zamagni is a world renowned expert on economics, who discussed the distinction between the political economy, which is composed of the exchange of equivalence of value and redistribution, and the civil economy which layers in reciprocity.

What does that mean? It means that beyond the negotiated cost of a product or service, in the civil economy there is the concept of reciprocity. Families often work this way, in that they will give each other money or their time knowing that they might need to call in a favour at another time, but the deal of that exchange is organic and isn’t set out ahead of time. I wouldn’t sell my car where the agreement was that I gave over my car but we’d negotiate the price later. With social capital in place, the value of the exchange can be negotiated informally over a longer period.

Lots of interesting concepts here, but what strikes me is that the history of the region created tight communities who cared about individualism. Social capital is extremely strong. People don’t care about growing singular large companies, but in creating smaller companies, often as coops, which partner and work together to create the goods or services they wish to produce. Because social capital is so strong, deals are done on a handshake, and contracts are avoided most of the time. Seventy percent of companies in Italy have less than 100 employees, and only 10% are large companies, defined as having more than 500 employees. Companies with 500 employees at home would not even be considered large companies, and here they are in the top 10%.

A lot of what seems to work here is not necessarily directly exportable to North America, which is a less trusting and more litigious society. Having said that, I think the search for partnerships and the building of reciprocity has some lessons for us back home. Imagine if, instead of starting a new division in your company, you partnered with another company to achieve what you wanted. What if these partnerships were tight and based on trust, so not everything had to have an SLA and a legal contract? Would that fly?

Another concept I find interesting is the two models of competition. As an employee of a cooperative, we discuss coopetition when I get together with my credit union peers, and that’s what they have here. Traditional companies have positional competition, where companies compete to take the top position, and only one can win. Here they have cooperative competition, where competition helps companies focus and hone their edge to make themselves better, but not to drive their competitors out of business. They need each other to stay lean and innovative. This seems to me like the way credit unions compete back home.

It strikes me that we actually have a lot of cooperative competition at home, but with one key difference. I share lots of ideas with my peers at the banks and credit unions, but only once I meet them and develop some trust. It isn’t the default. Because companies here are very small, they are often family run, and the default is to trust because families know each other. The trust is inherent as opposed to built.

Tomorrow we’re out of the classroom to visit Imola and meet with a couple of cooperatives. Will write more in the next two days.

Also, my first of three guest columns on ChangeEverything.ca was published today.

First impressions of Bologna

It is truly lovely here. The city is dense but seems very livable. Last night three of us went out for a drink after dinner, and the streets were bustling, people were out drinking and socializing. But unlike at home, where at midnight the only people out would be young people, often getting rowdy and obnoxious and drunk, people of all ages were out to enjoy each other’s company. It felt more like community, rather than older people in their homes and the night owned by the young and inexperienced.

My flight over was uneventful, and I stayed up well past the point of exhaustion to make the leap to Italian time. Last I slept 10 hours and feel great today.

I wandered the streets for a bunch, having slept past the informal meeting time this morning. The agenda today doesn’t start until 3pm, when we get a debrief and a walking tour of parts of the city.

I have included some photos below from my first evening and morning.

Putting the BLOG in BoLOGna.

I’m in one of those odd moments where I’m ready to go but have a few hours before I have to leave for the airport. I can’t tell if I’m in a bit of denial, or if I’m good to go, but I feel ready.

It’s hard leaving my wife and son for two weeks. That’s the hardest part. I also feel a sense of obligation and duty to discover something useful and actionable, yet strategic to bring back with me to Vancity. It’s a responsibility to my fellow staff and our members that I appreciate and want, but I know that it’s critical to deliver something.

As I work on our next three years online with my WEB Team (Web Engagement & Banking), we’ve been putting our opportunities into three buckets. The Strategic (this aligns with our vision of Redefining Wealth), the Opportunistic (what will be easy to implement based on other work going on at Vancity, especially in IT and at Central1) and the Fixit (what do we just need to get right). I like this sense of planning, because it creates clarity on what is strategic and what we just need to get done.

I feel the same way about this trip. Meeting with cooperatives in Bologna, learning about cooperative economics, seeing different models of how cooperatives operative, innovate and deliver should give me the same three levels of ideas. There will be a strategic layer that aligns with our vision, where every transaction our members make at Vancity has some positive benefit or impact on the greater region and our citizens. Those things won’t be quick fixes, they will require some effort and planning and likely several steps to get us there. There will be some things we can do opportunistically, those things that are low hanging fruit or tie into other things we’re doing that we can try almost for the sake of trying. And there are those things we just have to do because it would just simply make us better.

I say all that, but I’m not sure what it will look like. Will those ideas come to me? Will it be a lot of philosophy and great discussion that will be a struggle to turn into action? Or can we get some stuff done?

In the meantime, I’ve said goodbye to Ivan for what will be the longest time by far that I’ve ever been away from him, and to Amy, whose support is always so appreciated. I’ve set my out-of-office messaging. I’ve written and submitted my first of three guest columns to ChangeEverything, which Kate will publish during my time in Italy.

There’s nothing to do except open my mind and go experience something.

If you have questions, let me know. If you want to understand something while I’m there, drop me a comment. Part of my obligation is to you, the people who somehow find what I write interesting enough to follow along. I am eager to engage in discussion about what I am discovering.

Assuming I can find wifi…