A Business Paradigm for Social Impact

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Under the pressure of mounting demand and shrinking resources, nonprofit organizations are struggling more than ever. Whether a start-up, growing or turn-around enterprise the expectations of most nonprofit Boards has moved toward “running like a business”
Although a strong nonprofit must employee sound business practices, it is critical that both the management and Board understand the differences between a business enterprise and a nonprofit enterprise.
Based upon the framework of Jim Collins’ Good To Great and the Social Sectors –Why Business Thinking is not the answer, this webinar will focus on the 4 stages of building a great nonprofit organization and how they are similar and different than the 4 stages of building a great business.

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A Business Paradigm for Social Impact

  1. 1. A Business Paradigm for Social Impact Jon Firger April 4, 2012A Service Of: Sponsored by:
  2. 2. INTEGRATED PLANNING Advising nonprofits in: www.synthesispartnership.com • Strategy • Planning (617) 969-1881 • Organizational Development info@synthesispartnership.comA Service Of: Sponsored by:
  3. 3. Affordable collaborative data management in the cloud.A Service Of: Sponsored by:
  4. 4. Today’s Speaker Jon Firger Executive Director Newton Community Service CenterAssisting with chat questions: Hosting:April Hunt, Nonprofit Webinars Sam Frank, Synthesis PartnershipA Service Of: Sponsored by:
  5. 5. This Isn’t Your BusinessA BUSINESS PARADIGM FORSOCIAL IMPACT
  6. 6. Today’s Presentation Content Comparison of business and the social sector. Jim Collins methodology and model Defining great performance in the social sector Comparative leadership – challenges Getting and keeping the right people Application of the “hedgehog concept” in the social sector. Creating your brand Summary of the 5 keys to success Jon Firger, MBA, MSW jfirger@NCSCweb.org 6
  7. 7. How Do You DefineOrganizational Greatness? Organizational Growth Number Served Social Impact Percent of expenses for Administration vs. service Jon Firger, MBA, MSW jfirger@NCSCweb.org 7
  8. 8. Defining Great – CalibratingSuccess without Business Metrics• A Great organization is one that delivers superior performance and makes a distinctive impact over a long period of time.• In business, money is both an input and output. In the Social Sector it is only an input, not a measure of greatness.• Measurable Social Impact is the defining output in the Social Sector – All indicators are flawed, whether qualitative or quantitative. – What matters most is not finding the perfect indicator, but settling upon a consistent and intelligent method of assessing your output results. Jon Firger, MBA, MSW jfirger@NCSCweb.org 8
  9. 9. Our Board Members Believe That We ShouldOperate “Just Like a Business” Strongly Agree Agree Disagree Strongly Disagree Jon Firger, MBA, MSW jfirger@NCSCweb.org 9
  10. 10. A great social enterprise ismore like a great business,then it is to a mediocresocial enterprise Very different access to resources, structure, functions and outputs. Similar focus upon people, organizational discipline, strengthening capacity and measuring results. Jon Firger, MBA, MSW jfirger@NCSCweb.org 10
  11. 11. Good To Great And The SocialSectors - Why Business ThinkingIs Not The Answer – Jim Collins1. Defining “Great”2. Level 5 Leadership3. First Who?4. The Hedgehog Concept5. Turning the Flywheel Jon Firger, MBA, MSW jfirger@NCSCweb.org 11
  12. 12. Defining Great Social SectorPerformance The Philanthropic definition confuses input with outputs. Develop a “mental model” Shift focus from inputs to outputs Measure outputs the best you can Establish a baseline and track improvement with rigor Jon Firger, MBA, MSW jfirger@NCSCweb.org 12
  13. 13. It is much more difficult tolead a nonprofitorganization than to lead abusiness. Strongly Agree Agree Disagree Strongly Disagree Jon Firger, MBA, MSW jfirger@NCSCweb.org 13
  14. 14. Level 5 Leadership-GettingThings Done Within A DiffusePower structure Jon Firger, MBA, MSW jfirger@NCSCweb.org 14
  15. 15. Jon Firger, MBA, MSW jfirger@NCSCweb.org 15The View from The TopThe Realities of the Nonprofit CEO Board Community CEO Staff Funders
  16. 16. The Level 5 LeaderPower is rarely “raw”but rather foundmore subtly: powerof language, powerof inclusion, power ofshared interests.Level 5’s compellingcombination ofpersonal humility andprofessional will is akey factor in creatinglegitimacy andinfluence. Jon Firger, MBA, MSW jfirger@NCSCweb.org 16
  17. 17. “Social Sector leaders arenot less decisive thanbusiness leaders as ageneral rule; they onlyappear that way to those whofail to grasp the complexgovernance and diffuse powerstructure common to socialsectors” – Jim Collins Jon Firger, MBA, MSW jfirger@NCSCweb.org 17
  18. 18. Getting The Right People On Jon Firger, MBA, MSW jfirger@NCSCweb.org 18The BusWithin social sector constraints
  19. 19. We have all of the skillsand talents on our Board andstaff to be a successfulorganization. Strongly agree Agree Disagree Strongly Disagree Jon Firger, MBA, MSW jfirger@NCSCweb.org 19
  20. 20.  Sometimes it is more difficult to get the wrong people off the bus. Focus on early-assessment and a strong system. Don’t focus on motivating the unmotivated. Selectivity can lead to increased interest and therefore better applicants. Social sectors have a distinct advantage over business sector: people are desperately craving meaning in their lives. Jon Firger, MBA, MSW jfirger@NCSCweb.org 20
  21. 21. The Hedgehog Concept – Rethinkingthe Economic Engine without a ProfitMotive Passion Economic What we Engine do best Driver Jon Firger, MBA, MSW jfirger@NCSCweb.org 21
  22. 22. The Hedgehog Concept To attain piercing clarity about how to produce the best long-term results. Exercise relentless discipline to say “no” to opportunities that fail the hedgehog test Jon Firger, MBA, MSW jfirger@NCSCweb.org 22
  23. 23. The Fundamental Differencein the Social Sectors Passion Resource What we Engine do best Driver Jon Firger, MBA, MSW jfirger@NCSCweb.org 23
  24. 24. The Implications of aresource engine The evaluation of the contribution made by any given service extends beyond earned revenue to its success in attracting other resources.  volunteers  In-kind  Contributions of funds Jon Firger, MBA, MSW jfirger@NCSCweb.org 24
  25. 25. The members of our communitycan describe what we do bestin a couple simplesentences. Strongly Agree Agree Disagree Strongly Disagree Jon Firger, MBA, MSW jfirger@NCSCweb.org 25
  26. 26. Jon Firger, MBA, MSW jfirger@NCSCweb.org 26Turning The FlywheelBuilding momentum by building brand
  27. 27. Turning the Flywheel –Building Momentum byBuilding Brand Hedgehog discipline creates a steady momentum that leads to unstoppable momentum. More emphasis on “clock building” and less on “time telling” The key link in the social sector is between brand reputation and attracting resources. Jon Firger, MBA, MSW jfirger@NCSCweb.org 27
  28. 28. The 5 keys to a great socialenterprise.1. Define greatness for your organization.2. Develop level 5 leaders throughout the organization.3. Get the right people on the bus4. Clarify your hedgehog concept – have the discipline to say no.5. Turn your flywheel by persistently building your brand. Jon Firger, MBA, MSW jfirger@NCSCweb.org 28
  29. 29. Find listings for our current season of webinars and register at: NonprofitWebinars.comA Service Of: Sponsored by:

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