Stop. Reflect. Focus.
Knowing what you don’t do well is equally, if not more important than knowing what you do well.
Social business is not immune to this; if anything it is more pronounced in a structure that must carefully balance social objectives with the unforgiving realities of the market. As the son of a small business owner, I can personally attest that running a business is tough. Making one successful is tougher. Doing so with added social costs, inefficiencies, limited capacity/experience, limited access to capital, etc. is tougher yet.
Since I graduated from Notre Dame in 2007, I’ve worked with a variety of start-up social enterprises and development organizations in agriculture, water and sanitation, eco-travel, microfinance, and employability training. In my work, I’ve seen many non-profits rush into privatization or social business with the double aim of resolving funding issues and creating social value. Too few asked themselves “What capacity do we have to make this work? What are we good at and is there another path to accomplish our social mission?”
Sometimes business growth and social value are directly correlated. All too often, however, stakeholders are involved in a rigorous balancing act between the two. In the worst scenarios, leaders might try to maximize both objectives and end up achieving neither.
It all starts with the social mission and an acute understanding of what capacity and social value your organization can add. If your objective is to raise funds to offset non-profit social program costs, your business model will be very different than if your objective is to provide high-quality hospitality training. Starting a restaurant that trains <insert disadvantaged group> is compelling, but perhaps the best way to add value is to raise donations and outsource the training to a professional institution with a certified, structured program. Or maybe you can develop partnerships with successful businesses and create mutually-beneficial training solutions that share the cost (and benefits). The bottom line is not “How can we do this cheaper?” but rather “How do we best invest our funds in the people we work with to create a resilient impact?”
Starting a social business is sexy, but you will need far more resources than you initially think. If you’re truly focused on your social mission, partnerships or other methods of collaboration may be an even better option. At least this way you can focus on fostering excellence in one area instead of a multitude.
~ by responsiblenomad on November 9, 2010.