be argued, solves the uk ’ s productivity problem at source and at a stroke. for economic historians, this could be thought of as an act of schumpeterian creative destruction. for horror film - watchers, it could be thought of as an act of systematic zombie - slaying. i believe such an approach is probably wrong - headed. most tail companies are not zombies, overburdened by an insurmountable mountain of debt or a broken business model. rather they are companies surviving, but not yet thriving. and they account for fully 80 - 90 % of all jobs. they are not the tail ; they are the dog. if you restricted creative destruction to true zombie – those whose productivity was negative – this would make little arithmetic difference to average productivity, raising it by perhaps 1 %. a more creative solution to the long tail problem would be to build a stronger diffusion infrastructure – that is to say, creating some stronger and longer diffusion spokes to attach to the uk ’ s strong innovation hub. let schumpeter ( 1942 ). assumes workers with negative productivity flow into firms with zero productivity. all speeches are available online at www. bankofengland. co. uk / speeches me discuss three approaches for creating those institutional spokes. all three are already underway, to some extent. once in place, they could speed - up the process of technological trickle - down to the long tail. ( a ) supporting supply chains recent years have seen a lengthening and deepening of supply chains, nationally and internationally. the largest uk companies have direct supply chain links with several thousand other companies, large and small, national and international. as well as benefitting efficiency and lowering costs, these supply chains provide a natural infrastructure that could be harnessed to spread good practice across companies. some companies already actively support firms in their supply chain to help improve their productivity, the fruits of which can then be shared. a set of structured projects are underway nationally, co - ordinated by be the business, which aim to use the supply chain infrastructure to disseminate knowledge and best practice across companies in the long tail. as another example, i recently visited a company which had invested in a new technology centre. this enabled them to simulate all of the processes and products in their complex business. they had created, in effect, a “ digital twin ” of their business. this technology allowed them to evaluate the impact of potentially productivity - improving changes to their business model,

and accounting for over half of all private business turnover. 16 and yet smes face a £22bn funding gap. 17 almost half of all smes don ’ t plan to use external finance, citing the hassle or time associated with applying. of those that have approached their bank, two fifths have been rejected. 18 part of the problem is that the assets that smes are seeking to borrow against are increasingly intangible – the value of a brand or user base – rather than physical assets, like building or machinery. smes that have not borrowed lack the historic data required for credit scoring. and legal requirements to prevent money see : https : / / libra. org / en - us /. federation of small business : https : / / www. fsb. org. uk / media - centre / small - business - statistics. nao report ‘ improving access to finance for smes ( nov 2013 ). report by british business bank : small business finance markets ( 2019 ). all speeches are available online at www. bankofengland. co. uk / news / speeches laundering and “ know your customer ” make the process especially burdensome for a small business with limited resources. this should not be the case in a data - rich world. lenders should be able to access a broader set of information on which to base credit decisions. already, search and social media data are supplementing traditional metrics to unlock finance for smaller enterprises whose assets are increasingly intangible. in the uk, iwoca has made over £900mn worth of loans based on trading data, such as sales and customer reviews, to over 25, 000 small businesses over the past five years. even the big banks are getting in on the action. earlier this month, santander announced that it was partnering with ebay to offer small business loans, based on sales, cash flow and customer review data to sellers on the ebay platform. these initiatives are welcome but are still too small to plug the sme funding gap in the uk. to make real inroads, smes must be able to identify the data relevant to their businesses, incorporate it into their individual credit files, and easily share these files with potential providers of finance through a national sme financing platform. this would put into practice the recommendations from professor jason furman ’ s digital competition panel report on how to extract value from data and promote competition. one of the most important recommendations in this regard is