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When Sbane Talks, People Listen

The Smaller Business Association of New England commands more influence, both at home and in Washington, than its modest size suggests.
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Bill Anderson was on the golf course one afternoon last July when Sen. John Chafee (R-R.I.) returned Anderson's morning telephone call. Chafee, a member of the Senate Finance Committee, was smack in the middle of debating the 1981 tax cut, and Anderson, president of a small manufacturing firm in Providence, wanted Chafee's support for a steeper graduation in the corporate income tax rate. "Chafee didn't really want to hear from me," says Anderson, "but he tracked me down anyway."

The incident may reflect something about Chafee, but it also illustrates how a relatively small, regional business association makes itself felt in Washington without being there full-time.

John Chafee and Bill Anderson didn't know each other until Anderson became active in SBANE, the Smaller Business Association of New England. Now when Anderson calls, Chafee gets back to him. "He's developed respect for us," Anderson says.

The oldest of all the regionally based small business associations, SBANE has been something of a model and mentor for newer groups in the West and the South. And although it spent much of 1981 banished to the Reagan Administration's doghouse, SBANE still exercises more influence than its modest size -- 1,750 members -- would suggest.

In 1938, President Roosevelt invited 500 small businesspeople to a Washington conference. Once there, they excoriated Roosevelt, denounced his New Deal, and became fascinated with the then novel notion that small business-people could organize themselves into politically powerful groups.Dozens of regional and national small business associations sprouted from that 1938 conference, but most soon wore themselves out fighting "isms" -- including socialism and communism. They had no energy or partience for dealing with mundane issues like procurement, bank loans, and depreciation rates. But SBANE did, and it alone among the regional business associations has survived.

Today most SBANE members are still not political activists. Many of them join because they are looking for help in running their businesses.

Chuck Crawford, for example, left a teaching job at the Massachusetts Institute of Technology to buy a small company, Kimball Physics, without knowing the first thing about double-entry bookkeeping or balance sheets. Through SBANE, Crawford has attended three annual three-day, live-in sessions at Dartmouth's Amos Tuck School of Business Administration.

About 40 members regularly attend each of the several day-long executive seminars SBANE holds every month, according to Julie Scofield, who runs SBANE's education program. "We do best," she says, "with the things that are sales oriented or that address the sex appeal of running a small company." Topics in January and February, for example, included Advanced Sales Techniques, How to Select the Right Microcomputer, Managing for Results: How to Get Things Done, and Strategic Planning and Short-Term Survival.

Crawford has been to many of these sessions, and he is also an active member of one of the 10 SBANE Executive Dialog groups. Each month one of the dozen or so members of the group hosts a meeting in his plant where he asks other members for advice on some business problem. "The discussions tend to be very frank," says Crawford. "The group tends to become close-knit, and there's a great deal of trust."

There's also an SBANE information exchange. A member calls the SBANE office with a problem and is put in touch with another member who can help. "It's networking at its simplest," says Scofield.

For Crawford, "the whole SBANE system is there for peer support." And that's how it functions for most SBANE members, over half of whom are active participants in the training program or in the monthly meetings of the nearly one dozen SBANE chapters spread around New England. It's the contact with other small businesspeople, say many members, that keeps them interested in the organization.

But the organization has another role besides peer support. SBANE is, and has been, a significant player in the national politics of small business.

The organization was instrumental in the creation of the Office of Advocacy within the Small Business Administration in 1976. It was a key mover in the drive to create within the National Science Foundation a program that would concentrate on seeding research and development in smaller companies. It has been a shaper of export assistance legislation. It is a respected combatant in every major national issue involving the interests of the small business sector. Yet surprisingly, less than 10% of SBANE's members take any active interest in this aspect of the association's work.

SBANE's 30-member board ultimately decides which issues the association will address and what its positions will be, but the real policy-making work halppens in eight committees of 12 to 15 members each. Like New England town meetings, SBANE's committees are an exercise in pure democracy. Anyone can be on any committee. There are no assignments or elections. This open arrangement does not assure, however, that the positions these committees take are the same the majority of SBANE members would take if the majority turned out to vote.

Consider last year's tax debate. SBANE supported the Democratic alternative to President Reagan's personal and business tax-cut proposal. Though in a pre-election poll, 41% of SBANE members supported Reagan, few members complained about this contrary stand. Few members knew of it. When eight randomly selected SBANE members were questioned recently, every one of them said he or she thought that SBANE had supported Reagan in the tax debates.

SBANE critics, like John Motley, a lobbyist for the rival National Federation of Independent Business, cite such anomalies and accuse the organization of elitism. The NFIB, which supported Reagan in the tax fight, claims to rely solely on membership polls to set its association policy. That, says Motley, is much more democratic "than 20 guys sitting around a suburban Boston country club saying they represent the business community of New England."

SBANE committees don't meet at country clubs, but Motley has a point. Regional associations like SBANE have tiny staffs. Members do most of the work, and the positions that emerge from that work will reflect the views of the activist minority.There's some danger that in an organization like SBANE the committee members and board members "may get too distant from the really little guy," says Leo McDonough, executive vice-president of the Smaller Manufacturers Council of Pittsburgh.

The influence SBANE exerts on events in Washington is out of proportion to the size of its membership, especially when you consider that until last year SBANE didn't even have a Washington office. Even now it shares just one Washington lobbyist with more than a dozen other regional associations.

Part of the reason SBANE has this clout is simple geography. Because its members are spread over six states -- instead of just one state or even just one city -- it has a claim on 12 senators and 25 representatives.

More important, however, is how SBANE uses its access to this substantial congressional delegation. Most associations try to influence members of Congress while they're in Washington. SBANE prefers to work at home.

It has successfully encouraged many New England legislators to create small business task forces, liberally laced with SBANE members. The periodic task force meetings with the legislators take place in New England, away from the political pressure and posturing that permeate Washington. "It's the difference," says one SBANE member, "between holding a business meeting on-site and off-site." New England legislators also routinely attend SBANE chapter meetings, and some meet informally with SBANE directors.

These sessions with constitutents who happen to be small businesspeople give legislators ideas and information they wouldn't be likely to get in Washington from a battery of paid lobbyists. The informality of the relationship makes for open doors. "SBANE's a household name around this office," says an aide to Sen. Claiborne Pell (D-R.I.). Rep. Nick Mavroules (D-Mass.), who sits on the Armed Services Subcommittee on Procurement, checks out any procurement-related legislation with SBANE before acting on it, according to a senior aide. A member of Sen. Warren Rudman's (R-N.H.) small business task force says Rudman routinely sends the group ideas and proposals for their comment.

Bear in mind that this is not a one-way exchange. Small business constituents who sit on a lawmaker's task force or meet with him frequently are likely to get friendly with him, and the more friendly they become the more likely they are to contribute, ask their friends and employees to contribute, or even host a fund-raiser at the appropriate time. As an organization SBANE has no political action committee and endorses no candidates, but its activist members do get involved in campaigns.

One other reason SBANE stands out in the crowd of regional business associations is that it has been swimming in Washington's political waters longer than any of the others. And, in the judgment of most of the other groups, SBANE knows best what it's doing. Markus Trice, staff coordinator for the Cincinnati Institute for Small Enterprise, calls SBANE the "godfather group." Indeed, SBANE is parent to an emerging coalition of regional associations, which only last year took a name: Small Business United.

For more than 35 years, SBANE has been holding annual presentations of small business issues in Washington for members of Congress. One by one over the past 10 years, other regional groups teamed up with SBANE, and the formal creation of SBU last year was the next logical step.

Lewis Shattuck, SBANE's executive vice-president, was SBU's first chairman. "Everybody's comfortable with SBANE's position as first among equals in the coalition," says John Polk, executive director of Cleveland's Council of Smaller Enterprises.

Beyond its affiliation with SBU, SBANE is seeking internal growth as well. A projected membership of 2,000 by the end of this year and 5,000 by 1985 will "increase our credibility and help us play the numbers game with the national associations in Washington," says Peter Webster, last year's president. To meet its growth goals, SBANE recently hired its first full-time marketing director and four commissioned sales-people.

Clearly, SBANE will never be able to match numbers with the NFIB (over 500,000 members) or with the U.S. Chamber of Commerce (nearly 220,000). Besides, history suggests that bigness is not always healthy for small business organizations.

"One of the strengths SBANE has," says Jack Rennie, a director, "is that when I go to Washington to testify, the congressmen like the fact that I'm clearly a small businessman from New England, giving my honest, on-the-scene opinion." SBANE doesn't want to grow so big or expand so far that it loses that quality, which is its real strength.

Last updated: Apr 1, 1982




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