2002/12 Research & Review

Further Support for Business Startups: What is a Business Assistance Library?

SUGAYA Akiko
Faculty Fellow, RIETI

Amid the prolonged economic stagnation, various moves to promote new business are being made, ranging from industry-university collaboration and university-initiated venture business to the opening of graduate schools for working people and incubation centers equipped with spearhead information technology. All these activities are certainly important. But it is also necessary to address the needs of people who are not covered by such measures. These are people who are not recognized by the public: those who entered the business world without attending or graduating from universities, those without impressive titles but who nevertheless have a strong will to create something of significance, those who have not led fabulous careers but offer excellent expertise, full-time housewives, or even those seen as "dropouts."

At a time when the rate of creation of new business keeps on falling and the business closure rate continues to rise, it is of growing importance for Japan to bring out and foster the hidden potential of such people. Diverse ideas cannot emerge if we focus solely on those at the top. Rather, providing support in a way to solicit broad-based contributions will lead to the development of new, never-before-seen businesses. In this article, I would like to discuss the potential of business assistance libraries as one means to assist business startups.

Libraries that support business

Many people may find the ideas of a "business" and a "library" an unusual combination. Indeed, a public library is generally thought of as a place where people can borrow books, read newspapers and magazines, and study. However, public libraries in the United States, known for providing extensive services, are functioning as "incubators" for people with inspiration, ideas and curiosity, offering rich resources and unsparing support to help them generate new ventures. Business assistance, to promote individuals' economic independence and activate the local economy, is one of the basic services public libraries - regardless of their scale - provide all over the US. And it is perceived that this function is all the more important when the economy deteriorates. The US is no isolated case as public libraries in many other countries also provide extensive services, including those related to business.

The world-renowned New York Public Library is known for having fostered a number of contemporary global companies. The first Xerox copier was invented by Chester Carlson, a patent attorney, who developed and obtained a patent on xerography after getting a hint from a book he read in the library. Carlson thought that he would not have to check transcribed patent documents for errors if there were a machine capable of copying a number of documents. With that vague idea, he went to the library and poured through a massive volume of material to finally hit upon the idea. Meanwhile, the world's first ever trans-Pacific flight was realized after the founder of Pan American World Airways spotted an island between Hawaii and Guam while looking at a map in the library. The discovery of the island led him to the idea of creating a fuelling station there and thereby enabling flights to Guam. Many others, including the founders of Reader's Digest Association, Inc. and the Polaroid Corp., started up businesses by making good use of the library.

Businesses that take off from libraries

In 1996, the New York Public Library opened the Science, Industry and Business Library (SIBL) as a business library, meeting the needs of the era of digitalization. SIBL offers a vast collection of books and material - information resources that are extremely practical - covering areas such as marketing, advertisement, corporate almanacs on trade statistics, laws and regulations of various countries, trademark registration, patents, applied business science and technology. SIBL is also quite active in providing its resources electronically. It has an electronic information center with 70 computers installed. Needless to say there are Internet services - the center provides visitors with access free-of-charge to what otherwise would be expensive commercial databases, including the Dow Jones. The center also has three Bloomberg terminals, which are familiar to those in financial. The Bloomberg terminals are particularly popular among people who have quit Wall Street companies to set up investment firms, those who want to find a job in the financial sector, and individual investors.

Apart from material, SIBL also offers professional services through the librarians and former businessmen, who are ready to help out with even the remotest questions, such as how to start up a business to produce hats and caps in China. Furthermore, it organizes a range of business startup seminars, including those to provide practical tips, for instance, how to make a business plan, how to account a small business, and how to market one's company. Meanwhile, the Electronic Training Center inside SIBL offers various workshops on the use of electronic information, such as how to search for information concerning trade, patents and trademarks and how to gather job information. Information literacy seminars that provide tips on how to analyze information are offered as well. In addition, an SIBL library card enables the holder to access some of the commercial databases through the SIBL homepage from their personal computers at home or at the office. And all of these services come free of charge.

People use the SIBL in various ways for diverse purposes. Some people visit there on weekends or on the way home from work to do preparatory work for their business startup. The library is also used by those who have lost their jobs and have decided to launch their own business, those working for a small or midsize company that does not have sophisticated information infrastructure, retirees looking for a fresh challenge to start a new business, or women who have come to think about starting up on their own as they find themselves hitting a glass ceiling at their workplace or as a way to better manage their work and family life. Businessmen working for major companies and scholars also come and use the library resources for their research, and committed students gather information in the hope of starting up a business. Because there are modular jacks for Internet access, some people bring in their own personal computers and use the library as their office.

According to an SIBL official in charge of electronic information, the prime purpose of the library is to support small businesses and help increase their competitiveness. Today, it is no exaggeration to say that how to collect and analyze diverse up-to-date information holds the key to business success. But commercial databases are so expensive that many individual proprietors and small enterprises cannot afford them. It is thus a public library's role to provide such information to everybody and eliminate the information handicaps of small and midsize enterprises, which are the very foundation of New York's economy. Elsewhere in the world, similar moves are emerging. The British Library, known as the place where Karl Marx authored "Capital," has substantially increased its business-related practical material, while a newly opened library in Shanghai has launched some business support services.

Getting Japan's business assistance libraries into motion

In Japan, too, there has been growing interest in business assistance libraries. It is not the case that such libraries have never existed in Japan. For instance, since its inception in 1959, Kanagawa Prefectural Kawasaki Library has been providing business-related material and services, initially focusing on industry and then expanding its scope to cover science and other industries. However, it is only in recent years that the importance of libraries' business support functions has come to receive wide recognition. To co-ordinate emerging moves among public libraries to provide business support services and consider how best to organize a business support library, the Japan Business Library Association (JBLA) was launched in December 2000. I serve as Vice Chairman.

In fiscal 2001, the association organized a series of seminars on business support at Urayasu Public Library in Urayasu, Chiba Prefecture. Taking up such themes as "How to collect up-to-date information so as not to miss business chances," "Thinking up business ideas by making good use of the library," and "Basics on patent research," a total of 10 seminar sessions were held, each attended by some 40 participants mainly in their 30s and 40s. Following each session, a consultation counter was set up and lecturers were available to give advice on specific cases. Commercial databases were provided as well.

In fiscal 2002, five seminar sessions were held at Kodaira City Library in western Tokyo under such themes as "Business information organizations and how to use information," "My experience with business startups - housewives wishing to work, come and join me!" and "Making a business plan by making good use of the library." The first session held on Oct. 13 was attended by some 80 people. The Tokyo Metropolitan Government has also taken action, establishing a business support library inside the Tokyo Chamber of Commerce and Industry in the Marunouchi district in central Tokyo in June 2002.

In another move to drive the project forward, the Research Institute of Economy, Trade and Industry (RIETI) and the JBLA jointly organized a symposium entitled "Business Assistance Libraries Getting into Motion" on Sept. 23, 2002 at Hitotsubashi Memorial Hall in Tokyo. Although it was held on the final day of a three-day holiday, some 400 people from across the country gathered for the symposium, in which presenters reported on case examples of progressive initiatives in various areas while entrepreneurs expressed their hopes for libraries.

Midori Sato, who turned from a full-time housewife into Vice President of "Her Story," an Internet-based networking company boasting some 70,000 women contacts nationwide, spoke about her experience of starting a business, explaining how she hit upon the idea for her business while reading a book in a library, and how frequently she used library resources in preparing for the business and continues to do so.

There are many more examples. At a local public library I visited for my research, I met a man in his 40s, who had just quit his job as a salaried worker and was about to open his own "izakaya," a Japanese-style eating and drinking establishment, realizing his long-held dream. He said that the main concept of his izakaya would be to let people know more about the charms of various regions through tasting locally-brewed Japanese sake. He said most preparatory work for the business was done by using library resources. The man referred to cookbooks for menu ideas and recipes, while looking up the types and features of locally-brewed sake as well as the climate of regions in which each kind of sake is brewed. The library also provided him with information about marketing and promotion as well as tips on the design of advertisements and leaflets. "It is unfortunate that many people are not aware of the true value of a library - it is so useful," he said.

Rethinking the role of libraries

Libraries, by their very nature, are information research centers for people. Whatever one wants to do, the first step is to gather and analyze information. Libraries are distinctly different from bookstores, which are commercially operated; libraries offer a comprehensive stock of information in diverse media formats and librarians provide professional information-navigation services. Also, libraries serve as an efficient channel to provide broad-based services because they are used by a diverse population, including those who are not covered by business support services provided by administrative agencies or venture capitalists. By constantly providing information and/or organizing relevant free seminars, libraries may be able to unearth a fresh seam of potential entrepreneurs, those who may not be particularly interested in business at the moment. And most importantly, libraries are open on Saturdays and Sundays, and anyone can freely drop by. Business assistance can be provided effectively in this way.

So, what concrete measures should be taken to provide business support services? Research suggests that the quality of library staff who actually provide services - not library facilities - is the most critical factor in providing business assistance services. A library may have a somewhat restricted budget and its facilities may be poor. But the presence of staff who have ideas, enthusiasm and leadership will compensate for such shortcomings. There are many ways to make a big difference. For instance, libraries can create business corners simply by rearranging existing books and preparing lists of books and useful links. They can also ask officials from relevant business organizations to offer consultation services inside the library, collect and distribute leaflets published by local governments and other entities. And if it can be afforded, libraries can introduce commercial databases and organize seminars on their use to become more "usable" institutions. Of course, efforts by libraries alone are not enough, and support from relevant government organizations is indispensable. Furthermore, local governments, chambers of commerce and industry, promotional bodies for regional development, startup support organizations, nonprofit organization (NPOs), and individual business people should closely cooperate with libraries, clarifying their respective roles and complementary relations. Most importantly, it is necessary to inform people efficiently of the services that they can receive at their local libraries.

As I have described, there seems to be a fairly good chemistry between libraries and business. Given the reality of today's Japan, which is suffocating prolonged stagnation and is unable to present a vision for new business, it is all the more important to redefine libraries as new "incubation centers" to bring out, to the fullest extent, the various ideas and hidden abilities of individuals and, by doing so, to revitalize the economy.

Reference Sites
New York Public Library's Science, Industry and Business Library

>> Original text in Japanese

May 8, 2003