If societies want to evolve in a way that maximizes opportunity for its citizens. it wants to ensure that its public policies and public institutions reflect the changing needs of its small and medium-sized enterprises. Why? Because they are the major source of employment and healthy small firms contribute to healthy families and healthy communities. Small business advocates are needed.
Advocacy organizations take many forms that reflect the culture, history and structure of the broader society. In societies that are underdeveloped and up to half of the enterprises are operating in the black economy, the only advocate may be a public institution. Before the creation of the CFIB, the former Federal Business Development Bank (FBDC) was a small business advocate because they provided a range of financial and consulting services to the SME community in Canada. The FBDB became the Business Development Corporation or BDC.
The most difficult form of advocacy involves federal states like Canada, the US, Germany or Brazil. The challenge is staying abreast of both Federal and Provincial issues. In Germany and Brazil, the advocacy organizations are those with mandatory memberships that governments collect as a form of taxation and forward to the organization. These organizations are not just advocates, but promoters of government policy. Bob Rae, when he was Premier of Ontario, offered to pass a law that all small businesses in Ontario would have to pay a membership fee to CFIB.
In unitary states like Finland, Sweden and Holland, the advocates are actively involved in municipal and national issues. This makes it very difficult to have a sales force that can handle new business sales and renewals. The new business sales presentation is so different in each community depending on the local issue. This explains why in unitary states, renewals are always by invoice. They all have associate memberships which are a form of group sales from associations. The associations pay a minimal fee and cooperate on legislative matters, but associate members do not receive value-added member services. The associate members are warmed up leads for their sales force.
The founding of CFIB was based on principles and an advocacy model that exists today. Policy direction comes from the members and the bulk of our financing comes from the same members. The CFIB model was based on calling personally on each renewal, although telemarketing is providing part of this function today. Value-added services which began in the mid-90s are an essential part of the package, and now give us renewal rates in Quebec equal to what we enjoy across the country.
It is natural for the basic operating model of an advocacy organization to evolve, and the application of Internet technologies today provide huge opportunities to reduce costs and improve services. But the fundamental principal of funding CFIB through membership fees makes it possible for CFIB to be 100% member directed. This doesn’t mean corporate partnerships can’t play a role in the future when upgrading value-added services, as long as the member direction principle is protected.