Richard Burge is the Chief Executive of the London Chamber of Commerce and Industry (LCCI), the UK capital's largest independent business advocacy and support organisation. With an insight into the opportunities and challenges businesses face, he spoke to us about the real meaning of city-to-city trade and which key characteristic he thinks will mark out the most successful organisations going forward
First of all, what is city-to-city trade?
City-to-city is characterised by the city itself. These places are not easily defined as a subset of their own country. They're what I would call a global city - they play a role in the economics of another country.
For example, I lived in Nigeria for a long time, and the joke was, 'What's the second business city in Nigeria? London'. It's a clever answer, as they saw London as a resource for Nigeria. Most countries don't have world cities - it occurs when cities have a perspective that's more about them as an entity than the country they're in. That can relate to goods, services, and often where cities work together to facilitate activity far from their own country.
What does the LCCI do, and how do you help businesses grow?
Our job is to represent the businesses of London. We think of it as a big room where businesses come together. Facilitating business is our core purpose, and we do that in a number of ways. We provide opportunities to meet (events) - the idea is to bring people together to find partners, suppliers and clients.
We also provide business services - the key one is trade documentation, which we have been doing for hundreds of years - it's a core part of the reason we exist. For example, we help with ATA Carnet applications, which help with temporary exports. E.g., if you're a cameraman, you will need one to take your camera to another country - you're not creating a product, but creative art (photos, a documentary, etc.).
We do engage in developing ideas for policies and moving the dial, but we do that in an open way as part of a dialogue rather than behind closed doors. We also seek to understand and interpret policy for our members so they know what it means for them. Democracy is driven by government, which is voted for by people, not businesses, but businesses are essential for the country's economic well-being.
Is this business support especially relevant in the current climate?
I think there is a fundamental change going on. We are in the fourth industrial revolution built around data and knowledge, and that plays to cities and their benefits. Yes, people can sit in closets and communicate with the world from their computers, but the hub is taking place in the cities where people can bounce ideas around, form a community and create that critical mass that's needed to make things happen.
As mentioned, one of the big things we do is trade documentation so that you can prove the origin of goods, and that's even more important in a fractured world. Cities are becoming increasingly important because they're the locations for the most innovative thinking and disruptive business modelling. All these things prosper in ecosystems that provide access to support and stimulus to competition.
What are the common challenges businesses come to you with now?
Apart from the immediate problems, like the cost of living and the cost of doing business, I think there are two significant issues that companies face:
1) Policy and regulation
Government policies are intended to positively incentivise work, while regulation is about how it's controlled. However, there's a feeling that policymakers and regulators are behind the curve - they don't really know what's going on. AI is a classic example where the government is flailing around worried about it, but they're not up to date enough to create a policy to incentivise good AI or to regulate it properly to protect against where it might cause issues.
2) A lack of joined-up thinking
You can have government regulators for a particular aspect of business life, but there's no requirement for them to act in a way that facilitates something else. For example, the Bank of England is charged with bringing down the rate of inflation, but there's no requirement to do that in the context of maintaining economic growth. Regulators increasingly operate in siloes. The interesting thing about city governments is that they're much more connected to the intricacies of the ecosystem they look after.
My background is in evolutionary biology, and I find that politicians use the term 'ecosystem' a lot without understanding what it really means. There seems to be thinking that an ecosystem is static, but they're constantly changing - breaking and creating new links. Part of the problem is that politics and regulators think processes are static, but that's not the case - a business ecosystem is a dynamic, interactive social system.
Where do you see the opportunities for businesses going forward?
I think the businesses that will thrive are the ones that focus on productivity rather than growth - where growth is a consequence of productivity. Growth is an outcome, not a goal, and you can't have growth forever.
Politicians will say we've got to have growth. That's fine, but if we keep civilisations going for 10,000 years with growth at around 4%, then you're talking about growth being more than there are atoms in the world.
The thing about productivity is that it can rise and fall - you can get to a high level and maintain it. Then you're producing disposable wealth and placing it in the hands of employees, the government or whoever. It's disposable income that matters - growth is a short-term fix to get yourself elected for another five years.
I think businesses that focus on productivity will be better off and will attract more investment because there will be more money in dividends. For example, I met a baker in the West of London who had expanded his business to three shops and won't develop further. He likes the quality of the bread he produces, he likes being a baker, and he doesn't think he could do that if he had more premises. He's done the maths and believes the business is at the optimum size for maximising his disposable income and giving him time to spend it. With more stores, he might have more income, but he wouldn't have time to enjoy life.
That recognition is also a social need because, in cities, highly productive companies thrive on people who have the time to do other things. London has a highly complex ecosystem that needs to be maintained and allowed to grow in different directions. It's already highly successful in many ways - for example, look at the Shepperton Studios deal, which will make London home to the second-largest film studio in the world. There are also hundreds of small life sciences companies in London coming up with brilliant ideas. They're placed there rather than in some remote business park because their people can go to Soho after work and listen to jazz or go clubbing, etc. - that's an ecosystem.
When would you recommend businesses come to you for support?
They should come to us before they have a problem! Realistically, they can come to us at any stage, but recognise it's not for a quick fix but to be part of a community. They will learn more and more the longer they stay in the LCCI: we provide services that businesses constantly need.
The other thing about chambers of commerce is we can show businesses that no matter what problem they're facing, we can find someone else who's had it and has dealt with it before. People have learned from solving as well as not solving issues.
It's also about being part of a business community - there are so many small businesses with people operating on their own, and that can be pretty lonely. Chambers can give you a community that you can't find on your own, and that's important on many levels because you're only human, and the more you're on your own, the more vulnerable you feel. Of course, businesses are competitive, but they're competitive for individual contracts. I have found that they learn from each other and are willing to do that, too.
Whether you are landing in Lagos or expanding to New York, after you contact LCCI, contact gigCMO to increase the probability of success in your next targeted city.
