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Nic Jones

    Developing Social Enterprise


@NavigatorNic
navigatornic.co.uk
Developing Social Enterprise
Aim:
• To increase awareness and understanding of social enterprise business models and to
  enable the design + implementation of new socially-minded project ideas.


You will learn:
•   The 6 stages of project cycle management
•   How to begin to use 2 tools of business model design
•   How to practically apply these ideas
•   How to communicate your business model

Assessment:
Based on 1 page business model for the assessment
Introduction

     Identify              Design               Communicate

• Group Discussion:    • Business Model       • Pitching
  Global & Local         Definitions
  Problems                                    • Voting
                       • Structure (canvas)
• Problem Tree ideas                          • Communicating
  generation           • Prototyping /
                         Modelling
• Theory of Change

• Case studies
Definition
“A social enterprise is a business with primarily social objectives whose surpluses
are principally reinvested for that purpose in the business or in the
community, rather than being driven by the need to maximise profit for
shareholders and owners.”                          (Social Enterprise: Strategy for
Success, DTI, July 2002)


“Social enterprises are businesses set up to tackle a social or environmental need.”
                                                                       (SCEDU – 2009)

“Social enterprises are businesses which exist to address social or environmental
need.

Rather than maximising profit for shareholders or owners, profits are reinvested
into the community or back into the business. It’s this which makes social enterprise
the most exciting and inspiring business movement in the world.”

                                                                           (SEL- 2009)
Profit
                         +
Traditional business
                                Social Enterprise




-                                       + Impact




                                Traditional charity
                         -
Characteristics
• Can be distinguished from private businesses in the way they use their profits for social
  gain

• Merge mission and money

• Operate across all employment sectors

• Are diverse – include local, mutual organisations (co-operatives) and large-scale
  organisations

• Entrepreneurial, calculated risk-taking

• Bring excluded groups into the labour market

• Contribute to socially inclusive wealth creation (e.g. by retaining wealth)

• Enable individuals and communities to work towards regenerating their local
  neighbourhoods

• Help to develop active citizenship
Sector merging


                               PUBLIC
       PRIVATE
                              Becoming
       Becoming
                                 more
         more
                           independent
        social




                  VOLUNTARY
                 Becoming more
                  enterprising
http://www.youtube.com/watch?v=dMOxfW5bLK8&feature=related
Venturesome (https://www.cafonline.org/charity-finance--fundraising/banking-and-
investments/loans-and-capital.aspx)
The spectrum of SE


Charity owned    Community    Owned by         Owned by            Owned by
                 owned        public sector    Entrepreneur(s) private business
                                               (as not for profit)


Trading arm of   Co-ops      Public services                   Actis Acts
Charity          Development                                   (foundations)
                 Trusts
http://www.youtube.com/watch?v=ikCrx1K7Weg&feature=youtube_gdata
Policy and importance
• Big Society
    • Recent rapid emergence due to social and environmental need (50% growth since
      2000) . Now over 62,000 in the UK.
    • Combined turnover (£27bn). 5% of all businesses. 8.4 billion to economy. 1% GDP

 • Most recent sector-led survey:
 2011 Social Enterprise UK “Fightback Britain – A report on the State of
 Social Enterprise Survey ” showed
 • 14% of all social enterprises are start-ups, less than two years old –
    more than three times the proportion of start ups among
    mainstream small businesses
 • Median annual turnover of social enterprises has grown from
    £175,000 in the 2009 survey to £240,000
 • 39% of all social enterprises work in the 20% of most deprived
    communities in the UK compared to 13% of standard businesses
 • 74% of social enterprises actively involve their beneficiaries in
    decisions about their business
 • 86% of leadership teams boast at least one female director, 27% of
    leadership teams have directors from BME communities and 7%
    have directors under the age of 24
Policy and further reading
       • Social enterprise action plan Scaling new heights 2006

       • Voluntary Action in the 21st Century 2008

       • Financing Civil Society (Venturesome 2009)

       • Big Society Not Big Government 2010
Case studies

               International
               Grameen bank




                National
               Worn Again




                  Local
               Jamie’s Farm
Grameen bank




 http://en.wikipedia.org/wiki/Grameen_Bank
Worn Again

      http://www.wornagain.co.uk/
Jamie’s Farm




http://www.jamiesfarm.org.uk/
AL
                                                AL
                                           AIS ysis
                                           AIS llysis
                                                                  N
                                       PR                    SIG          rk
                                       P       a     s
                                                     s                 wo
                                    AP er A a y
                                    AP er An allysi
                                                          DE        me is
                                                                 Fra ys
                                         ld An
                                         ld An                 al Anal
                                       ho al
                                       ho al
                                     ke tu
                                     ke tu                 gic
                                  Sta ntex
                                  Sta ntex
                                                         Lo Risk
                                    Co
                                    Co
                                                Project
IDENTIFICATION
                 Problem Tree &




                                                 Cycle



                                                                                               APPROVAL
                                                                               Business Plan
                   Intelligence




                                               na The
                                                 tio
                                                     n
                                                                     g&
                                                                     g&
                                             mi &                g in g
                                                                 gi    g
                                           se ew               na r n
                                                               na rin          N
                                                            Ma          TIO
                                                                        TIO
                                                             a
                                  N
                                        Dis                         o
                                                                    o
                                             TIO                nt
                                                                nit
                                        vi
                                                             Mo
                                                             Mo       TA
                                                                      TA
                                      Re
                                           UA
                                         AL                         EN
                                                                    EN
                                                                EM
                                                                EM
                                               EV
                                                              PL
                                                              PL
                                                         IM
                                                         IM
Identification
1. Social problem(s)

2. Thematic grouping

3. The Problem Tree

= Your mission
effects




          causes
Theory of change
                           Mission, vision and the social change model

                 Mission                                    Social Change Model                           Vision
                                                                                                      “One day . . .”
                                                                   Theory of
                                                                  the Problem
           “As an
        organisation,
           we . . .”                                Theory of                   Theory of
                                                     Action                      Change




          What the                               The ‘engine of change’ that bridges             The future state the
           organisation intends                    mission and vision                               organization wants
           to do; its reason                      Captures an organisation’s views about           to create
           for being                               the problems it is trying to solve, levers
                                                   necessary to cause desired changes
                                                   and the organisation’s unique model for
                                                   creating these changes
           Note: Social Change Model framework adapted from David Kantor


Social Change Model framework adapted from David Kantor
Theory of change
1. Identify ultimate goal
What problem are we addressing?
Who are the intended beneficiaries?
What can we do to solve this part of the problem for our beneficiaries?
What does success look like?

2. Identify the direct pre-conditions to achieving this
goal? (Context)
What needs to happen in order for this goal to become a reality?


3. Think through assumptions associated with your goal
The pre-conditions – ie the reasons you think your approach will work.

4.Mapping and connecting outcomes
The purpose of the map is to tell a story

5. Indicators
Work in progress - For illustration only


                                                               SI’s leverage the     SI’s derive real
         The Hub Theory of Action Model                            networks               value



                                                                 Alternative




                                                                                                                                           “People and ideas collide and realise imaginative
                                                               viewpoints and
                           The Hub provides                    multiple stimuli
                           access to the right




                                                                                                                                                initiatives for a radically better world”
                            infrastructure for                                        Better testing
                                innovation                                           and prototyping
                                                                Networks are
                        • Space                                  visible and
                        • Talent                                 accessible
                                                                                       More diverse
                        • Knowledge                                                  skill-sets applied
     A diverse          • Investment                                                  to more ideas
   range of Sis
                                                               Resources are                                        Enhanced
    attracted to
                                                                accessible                                          Innovation
      the Hub
                                                                                      Better market
                                                                                       definition /
Note: SI = Social
                                                                                      assessment
   Innovator                                                                                                          (collaborators,
                                                                Specialised skills                                 customers, suppliers)
                                                               and knowledge are
                                                                 made available
                           The Hub cultivates
                          the right culture for                                         Enhanced
                               innovation                                               credibility

                                                                  Optimism,
                        • Welcoming, hospitable, convivial      encouragement,
                                                                  confidence
                        • Collaborative design
                        • Choosing right mix of SI’s
                        • Matchmaking
                        • Diversity
                        • Community and belonging
                        • Collective intelligence and memory
AL
                                                AL
                                           AIS ysis
                                           AIS llysis
                                                                  N
                                       PR                    SIG          rk
                                       P       a     s
                                                     s                 wo
                                    AP er A a y
                                    AP er An allysi
                                                          DE        me is
                                                                 Fra ys
                                         ld An
                                         ld An                 al Anal
                                       ho al
                                       ho al
                                     ke tu
                                     ke tu                 gic
                                  Sta ntex
                                  Sta ntex
                                                         Lo Risk
                                    Co
                                    Co
                                                Project
IDENTIFICATION
                 Problem Tree &




                                                 Cycle



                                                                                               APPROVAL
                                                                               Business Plan
                   Intelligence




                                               na The
                                                 tio
                                                     n
                                                                     g&
                                                                     g&
                                             mi &                g in g
                                                                 gi    g
                                           se ew               na r n
                                                               na rin          N
                                                            Ma          TIO
                                                                        TIO
                                                             a
                                  N
                                        Dis                         o
                                                                    o
                                             TIO                nt
                                                                nit
                                        vi
                                                             Mo
                                                             Mo       TA
                                                                      TA
                                      Re
                                           UA
                                         AL                         EN
                                                                    EN
                                                                EM
                                                                EM
                                               EV
                                                              PL
                                                              PL
                                                         IM
                                                         IM
Design
1. Mission – Your ‘value proposition’

2. Your entrepreneurial solution... – The Business Model
Traditional Business plan

• Hierarchy of AIMS
                   Vision
                  Mission
   In             Activities   Outputs
                               Outcomes
                               Impact
Business model discussion
Business model generation




Business model canvas: Alex Osterwalder: http://alexosterwalder.com/
Activities                       Relationship



                                                                   Customer
Partnerships                   Value Proposition                   Segment /
                                                                  Beneficiaries



                 Resources                         Distribution




               Costs                                 Revenue Stream
Partnerships   Key Activities   Core Offer               Customer Relationships   Customer Segment /
                                           (Value Proposition)                               Beneficiaries




                       Key Resources                              Distribution Channels
                                                                      (Route to market)




Costs                                                            Revenue
Grameen Bank



                        Fund
                     management
                                                          1:1
                        Risk
                     Management

   Bangladesh
                                   Affordable Loans                      Entrepreneurs
   Government

                        Brand

                      Reputation                      Peer Lending

                       Platform




               Fund management                              % interest
Worn Again



                     Design process
                                                                 1:1 with
                                                                corporate
                       Manage
                                                                  clients
                     manufacturing
                                                                  Web
                                                                                 1. High profile
                                             1. Corporate
     Virgin                                                                          Corporate
                                                  Waste
                                                                                      Clients
                                             2. Consumer
    Eurostar                                                                       2. Aware
                                                 products
                                                                                     consumer
                      Brand Name                               Uniform
                         People                              manufacturers
                      Web platform                              Web




      Sourcing product line. Manufacturing                  Consultancy     Product Sales
Old Fundraising Model




                         Oversee
                         activities
                                                          1:1
                        Marketing
                                                                           Donor
  Dependant on
  charity – often                          Charity
        CSR
                                                                        Beneficiaries
                           Brand
                                                      Aid Agency /
                                                     Local partners
                          People




         Direct Market. Cost of delivery                    Donations
Activities                       Relationship



                                                                   Customer
Partnerships                   Value Proposition                   Segment /
                                                                  Beneficiaries



                 Resources                         Distribution




               Costs                                 Revenue Stream
Apple
        Partnerships   Key Activities   Core Offer               Customer Relationships   Customer Segment /
                                           (Value Proposition)                               Beneficiaries




                       Key Resources                              Distribution Channels
                                                                      (Route to market)




Costs                                                            Revenue
Credits

 This presentation was based on information gathered from
 organisations across the social enterprise sector including:
 UnLtd, The Social Investment Business, Regen School, The
 Young Foundation and Venturesome.

 The Business Model Canvas is inspired by the work of Alex
 Osterwalder. Please see http://alexosterwalder.com/ for
 more details

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Developing Social Enterprise

  • 1. Nic Jones Developing Social Enterprise @NavigatorNic navigatornic.co.uk
  • 2. Developing Social Enterprise Aim: • To increase awareness and understanding of social enterprise business models and to enable the design + implementation of new socially-minded project ideas. You will learn: • The 6 stages of project cycle management • How to begin to use 2 tools of business model design • How to practically apply these ideas • How to communicate your business model Assessment: Based on 1 page business model for the assessment
  • 3. Introduction Identify Design Communicate • Group Discussion: • Business Model • Pitching Global & Local Definitions Problems • Voting • Structure (canvas) • Problem Tree ideas • Communicating generation • Prototyping / Modelling • Theory of Change • Case studies
  • 4.
  • 5. Definition “A social enterprise is a business with primarily social objectives whose surpluses are principally reinvested for that purpose in the business or in the community, rather than being driven by the need to maximise profit for shareholders and owners.” (Social Enterprise: Strategy for Success, DTI, July 2002) “Social enterprises are businesses set up to tackle a social or environmental need.” (SCEDU – 2009) “Social enterprises are businesses which exist to address social or environmental need. Rather than maximising profit for shareholders or owners, profits are reinvested into the community or back into the business. It’s this which makes social enterprise the most exciting and inspiring business movement in the world.” (SEL- 2009)
  • 6. Profit + Traditional business Social Enterprise - + Impact Traditional charity -
  • 7. Characteristics • Can be distinguished from private businesses in the way they use their profits for social gain • Merge mission and money • Operate across all employment sectors • Are diverse – include local, mutual organisations (co-operatives) and large-scale organisations • Entrepreneurial, calculated risk-taking • Bring excluded groups into the labour market • Contribute to socially inclusive wealth creation (e.g. by retaining wealth) • Enable individuals and communities to work towards regenerating their local neighbourhoods • Help to develop active citizenship
  • 8. Sector merging PUBLIC PRIVATE Becoming Becoming more more independent social VOLUNTARY Becoming more enterprising
  • 11. The spectrum of SE Charity owned Community Owned by Owned by Owned by owned public sector Entrepreneur(s) private business (as not for profit) Trading arm of Co-ops Public services Actis Acts Charity Development (foundations) Trusts
  • 13. Policy and importance • Big Society • Recent rapid emergence due to social and environmental need (50% growth since 2000) . Now over 62,000 in the UK. • Combined turnover (£27bn). 5% of all businesses. 8.4 billion to economy. 1% GDP • Most recent sector-led survey: 2011 Social Enterprise UK “Fightback Britain – A report on the State of Social Enterprise Survey ” showed • 14% of all social enterprises are start-ups, less than two years old – more than three times the proportion of start ups among mainstream small businesses • Median annual turnover of social enterprises has grown from £175,000 in the 2009 survey to £240,000 • 39% of all social enterprises work in the 20% of most deprived communities in the UK compared to 13% of standard businesses • 74% of social enterprises actively involve their beneficiaries in decisions about their business • 86% of leadership teams boast at least one female director, 27% of leadership teams have directors from BME communities and 7% have directors under the age of 24
  • 14. Policy and further reading • Social enterprise action plan Scaling new heights 2006 • Voluntary Action in the 21st Century 2008 • Financing Civil Society (Venturesome 2009) • Big Society Not Big Government 2010
  • 15. Case studies International Grameen bank National Worn Again Local Jamie’s Farm
  • 17. Worn Again http://www.wornagain.co.uk/
  • 19. AL AL AIS ysis AIS llysis N PR SIG rk P a s s wo AP er A a y AP er An allysi DE me is Fra ys ld An ld An al Anal ho al ho al ke tu ke tu gic Sta ntex Sta ntex Lo Risk Co Co Project IDENTIFICATION Problem Tree & Cycle APPROVAL Business Plan Intelligence na The tio n g& g& mi & g in g gi g se ew na r n na rin N Ma TIO TIO a N Dis o o TIO nt nit vi Mo Mo TA TA Re UA AL EN EN EM EM EV PL PL IM IM
  • 20. Identification 1. Social problem(s) 2. Thematic grouping 3. The Problem Tree = Your mission
  • 21. effects causes
  • 22. Theory of change Mission, vision and the social change model Mission Social Change Model Vision “One day . . .” Theory of the Problem “As an organisation, we . . .” Theory of Theory of Action Change  What the  The ‘engine of change’ that bridges  The future state the organisation intends mission and vision organization wants to do; its reason  Captures an organisation’s views about to create for being the problems it is trying to solve, levers necessary to cause desired changes and the organisation’s unique model for creating these changes Note: Social Change Model framework adapted from David Kantor Social Change Model framework adapted from David Kantor
  • 23. Theory of change 1. Identify ultimate goal What problem are we addressing? Who are the intended beneficiaries? What can we do to solve this part of the problem for our beneficiaries? What does success look like? 2. Identify the direct pre-conditions to achieving this goal? (Context) What needs to happen in order for this goal to become a reality? 3. Think through assumptions associated with your goal The pre-conditions – ie the reasons you think your approach will work. 4.Mapping and connecting outcomes The purpose of the map is to tell a story 5. Indicators
  • 24. Work in progress - For illustration only SI’s leverage the SI’s derive real The Hub Theory of Action Model networks value Alternative “People and ideas collide and realise imaginative viewpoints and The Hub provides multiple stimuli access to the right initiatives for a radically better world” infrastructure for Better testing innovation and prototyping Networks are • Space visible and • Talent accessible More diverse • Knowledge skill-sets applied A diverse • Investment to more ideas range of Sis Resources are Enhanced attracted to accessible Innovation the Hub Better market definition / Note: SI = Social assessment Innovator (collaborators, Specialised skills customers, suppliers) and knowledge are made available The Hub cultivates the right culture for Enhanced innovation credibility Optimism, • Welcoming, hospitable, convivial encouragement, confidence • Collaborative design • Choosing right mix of SI’s • Matchmaking • Diversity • Community and belonging • Collective intelligence and memory
  • 25. AL AL AIS ysis AIS llysis N PR SIG rk P a s s wo AP er A a y AP er An allysi DE me is Fra ys ld An ld An al Anal ho al ho al ke tu ke tu gic Sta ntex Sta ntex Lo Risk Co Co Project IDENTIFICATION Problem Tree & Cycle APPROVAL Business Plan Intelligence na The tio n g& g& mi & g in g gi g se ew na r n na rin N Ma TIO TIO a N Dis o o TIO nt nit vi Mo Mo TA TA Re UA AL EN EN EM EM EV PL PL IM IM
  • 26. Design 1. Mission – Your ‘value proposition’ 2. Your entrepreneurial solution... – The Business Model
  • 27. Traditional Business plan • Hierarchy of AIMS Vision Mission In Activities Outputs Outcomes Impact
  • 29. Business model generation Business model canvas: Alex Osterwalder: http://alexosterwalder.com/
  • 30. Activities Relationship Customer Partnerships Value Proposition Segment / Beneficiaries Resources Distribution Costs Revenue Stream
  • 31. Partnerships Key Activities Core Offer Customer Relationships Customer Segment / (Value Proposition) Beneficiaries Key Resources Distribution Channels (Route to market) Costs Revenue
  • 32. Grameen Bank Fund management 1:1 Risk Management Bangladesh Affordable Loans Entrepreneurs Government Brand Reputation Peer Lending Platform Fund management % interest
  • 33. Worn Again Design process 1:1 with corporate Manage clients manufacturing Web 1. High profile 1. Corporate Virgin Corporate Waste Clients 2. Consumer Eurostar 2. Aware products consumer Brand Name Uniform People manufacturers Web platform Web Sourcing product line. Manufacturing Consultancy Product Sales
  • 34. Old Fundraising Model Oversee activities 1:1 Marketing Donor Dependant on charity – often Charity CSR Beneficiaries Brand Aid Agency / Local partners People Direct Market. Cost of delivery Donations
  • 35. Activities Relationship Customer Partnerships Value Proposition Segment / Beneficiaries Resources Distribution Costs Revenue Stream
  • 36. Apple Partnerships Key Activities Core Offer Customer Relationships Customer Segment / (Value Proposition) Beneficiaries Key Resources Distribution Channels (Route to market) Costs Revenue
  • 37.
  • 38. Credits This presentation was based on information gathered from organisations across the social enterprise sector including: UnLtd, The Social Investment Business, Regen School, The Young Foundation and Venturesome. The Business Model Canvas is inspired by the work of Alex Osterwalder. Please see http://alexosterwalder.com/ for more details