Don’t knock the little guy

Rapid expansion and the emphasis on “bigger is better” now seem to be hard-wired into the housing sector. It is the fashion, or even the obsession, of our political masters, even when it makes them contradict themselves.

One has to wonder – what is this fascination with size? Has no one ever heard of Freud?

The quest for efficiency, not to mention the Gershon review of public sector efficiency, drive those who see mergers, acquisitions, alliances and economies of scale as the true path to the Holy Grail 0f high places in league tables. And yet, looking at the Housing Corporation’s operating cost index, only one of the top 20 organisations is a big player. Smaller registered social landlords with, say, 5000 or fewer properties seem to be quite capable of holding their own.

And a review of the past six months’ Audit Commission reports reveals that there are as many small RSLs as large ones receiving “good”, with either “excellent” or “promising” prospects for improvement assessments. All sizes of organisation seem capable of good governance and financial viability. We are a people and a communities business: a strong reason why small may be beautiful for us. That’s how it seemed at last year’s National Housing Federation In Business awards, a celebration of the neighbourhood-focused work of RSLs, where 10 of the 15 prizes were given to smaller organisations.

Staying small can be good for the organisation itself, too.

In a smaller RSL, the chief executive can touch all sides of the business. He or she knows the entire staff – by face if not name – and has a feel for their morale and outlook. We have the same issues and the same level of regulation as large organisations, but do not have the profusion of staff to deal with them.

We have, for instance, one performance manager, not a hierarchy, so partners can deal directly with the key person.

This overcomes bureaucratic inertia, but also demonstrates our commitment to our projects. Smaller organisations, of necessity, put their senior managers where their mouth is. They must focus their attention on the ground beneath their feet and the needs of key stakeholders – the local organisations they work with, such as primary care trusts, social services and the police – because their fate is inexorably bound to that of the stakeholders.

The unique selling point of smaller organisations is how they can contribute to neighbourhood and community needs. Our challenge is how we can effectively measure this to demonstrate our worth.

Here then, is a contradiction in government strategy. On one hand we are told to work in consortia, purchase in bulk and adopt regional targets; on the other we are challenged to work at a neighbourhood level, including neighbourhood decision-making.

The two goals are uneasy bedfellows.

Consortium procurement certainly has its place. But so does local procurement, which invests in the very communities in which we are working. The business case for smaller organisations should be argued for with greater rigour. We have to say why they matter and present evidence to prove it. We have to promote ourselves, and so local strategic partnerships and the NHF must make sure the contribution made by an RSL to its community is on the ODPM’s efficiency agenda.

There is a place for both small and large players in the housing sector, but perhaps we should be hearing a bit more in praise of little brother.