How to apply social enterprise thinking to your business

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This presentation was given in 2013 and explores how businesses can apply social enterprise thinking, and not only help society, but also improve customer and staff loyalty.

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How to apply social enterprise thinking to your business

  1. 1. ASEN|AfricanSocialEntrepreneurshipNetwork 1 Presented by Marcus Coetzee, ASEN www.asenetwork.org www.facebook.com/ASENetwork twitter.com/ASENtweets HOW TO APPLY SOCIAL ENTERPRISE THINKING TO YOUR BUSINESS Prepared for the SAB Foundation: Entrepreneurs’ and Innovators’ Conference (June 2013)
  2. 2. ASEN|AfricanSocialEntrepreneurshipNetworkKEY THEMES TO BE DISCUSSED • What is a Social Enterprise? • Benefits of being a Social Enterprise. • How to apply Social Enterprise thinking to your business.
  3. 3. ASEN|AfricanSocialEntrepreneurshipNetworkA BUSINESS PERSPECTIVE Although this presentation has been pitched primarily for a business audience, there will still be valuable insights for NPOs.
  4. 4. ASEN|AfricanSocialEntrepreneurshipNetworkWHAT IS A SOCIAL ENTERPRISE? 4 SOCIAL MISSION BUSINESS THINKING ENTHUSIASIM Remember that organizations that cannot adopt social enterprise business models can still embrace social enterprise thinking! AMBITION CREATIVITY SOCIAL ENTERPRISE
  5. 5. ASEN|AfricanSocialEntrepreneurshipNetworkEVOLUTION OF ENTERPRISES Another view is that organizations will all evolve into a social enterprise as their social consciousness increases. 5 Social Enterprise Responsible Enterprise Compliance Enterprise ‘Wild West’ Enterprise
  6. 6. ASEN|AfricanSocialEntrepreneurshipNetworkEXAMPLE: TRADE-MARK 6 TRADE-MARK is a social enterprise that connects the best trades-people from the townships with those who require their services. Trademark has a rigorous selection process and a performance-monitoring system that ensures both accountability and the highest quality service.
  7. 7. ASEN|AfricanSocialEntrepreneurshipNetworkEXAMPLE: IYEZA EXPRESS 7 Iyeza Express sends medication couriers on bicycles to collect chronic medication from local clinics for those unable to do so themselves. A nominal service fee is charged to sustain the operation.
  8. 8. ASEN|AfricanSocialEntrepreneurshipNetworkWHY DO SOCIAL ENTERPRISES EXIST? • Massive development needs facing the world. • Shortage of resources (donor funding, government expenditure, CSI funding etc.) to spend on addressing social problems. • Difficult to grow successful social purpose organizations unless you have control over your money. • Current organizational models not working effectively (hence the popularity of hybrid models). • Increasing number of businesses (and business leaders) are getting involved in social issues. 8
  9. 9. ASEN|AfricanSocialEntrepreneurshipNetworkSOCIAL ENTERPRISE CHECKLIST Does the enterprise have a clear social purpose? Does the enterprise sell goods or services to its customers? Does the enterprise use its profits to further its social agenda? Does the enterprise run ethically? 9
  10. 10. ASEN|AfricanSocialEntrepreneurshipNetworkSOCIAL ENTERPRISES ARE YOU AWARE OF? Exercise instructions: • Groups of 4 • Each group to identify potential social enterprises • Apply checklist • Identify three valid social enterprises • Report back to the plenary 10
  11. 11. ASEN|AfricanSocialEntrepreneurshipNetworkIS YOUR BUSINESS A SOCIAL ENTERPRISE? Exercise instructions: • Do the checklist for your business. • How many of these criteria do you meet? 11
  12. 12. ASEN|AfricanSocialEntrepreneurshipNetworkBENEFITS OF BECOMING A SOCIAL ENTERPRISE 12 Customer loyalty More than 88% of consumers think companies should try to achieve their business goals while improving society and the environment. 83% of consumers think companies should support charities and nonprofits with financial donations. Staff loyalty 32% of employees would seriously consider leaving their job if their company gave no / little money to charity. 65% would seriously consider leaving their job if their company harmed the environment. 83% would seriously consider leaving their job if their employer used child labour in sweatshop factories. Make a difference to the world
  13. 13. ASEN|AfricanSocialEntrepreneurshipNetworkSOCIAL ENTERPRISE THINKING &YOUR BUSINESS How do you feel about applying social enterprise thinking to your business? 13 1 This doesn’t work for me at all. 2 It’s interesting, but still doesn’t apply to my business. 3 I am intrigued. Could introduce some elements into my business. 4 I want to be more responsible, but not necessarily a Social Enterprise yet. 5 YES! All of it please.
  14. 14. ASEN|AfricanSocialEntrepreneurshipNetwork8 TACTICS TO APPLY SOCENT THINKING 1. Measure your social impact 2. Employ a marginalized group 3. Sell a social product 4. Change your shareholding 5. Reinvest the majority of profits back into your business's social impact 6. Develop social enterprises in your supply chain 7. Certify your product 8. Do your best to run responsibly 14
  15. 15. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 1: MEASURE SOCIAL IMPACT 15 Pointers: - Determine stakeholders - Determine measurement indicators - Use an existing model (e.g. social accounting, normal impact evaluation, IRIS standards, SROI) - Market your social impact to your stakeholders Shonaquip is a social enterprise that manufactures wheelchairs and provides training and advocacy around disability issues.
  16. 16. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 2: EMPLOY A MARGINALISED GROUP 16 Pointers: - Simply creating jobs does not make a social enterprise - Identify an appropriate marginalized group - Use skills development funding to improve their skills - Use your CSI budget to address their social needs. - Gain B-BBEE points Moyo restaurant not only employs and up-skills disadvantaged groups, but also utilises responsible urban farming for all its produce.
  17. 17. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 3: SELL A SOCIAL PRODUCT 17 Pointers: - Design a product to alleviate a social problem - Collaborate with nonprofits and the targeted customer group to get the design right - Can be an additional product range - Consider producing the product at cost or with minimal markup ePap is a highly nutritious porridge, manufactured by Econocom Foods. It contains all the necessary vitamins and minerals, and is sold to NGOs and Feeding Schemes.
  18. 18. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 4: CHANGE SHAREHOLDER STRUCTURE 18 Pointers: - Sell shareholding to a non- profit organization or social enterprise - Gain ownership, management control and enterprise development points for B-BBEE Cape Town based development NGO, Ikamva Labantu, purchased a 50.1% stake in ITEC Holdings in 2008, benefiting from the dividends paid out.
  19. 19. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 5: REINVEST PROFIT INTO SOCIAL IMPACT 19 Pointers: - Existing social enterprises can simply keep their money in the business, as their social impact will grow as they grow. - Other enterprises could determine a % of product revenue or net profit that gets spent on a social cause. - Engage in cause-related marketing and branding. GreenPop is a Cape Town based social enterprise that sells volunteer tree-planting opportunities online and reinvests its profit into further greening and reforestation projects.
  20. 20. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 6: DEVELOP SE INTO YOUR SUPPLY CHAIN 20 Pointers: - Identify opportunities in your supply chain - Find a suitable social enterprise or set up a new one - Use your CSI budget to address the support the cause of the social enterprise - Gain preferential procurement, ED and socio- economic development points for B-BBEE The Foschini Group used ED funding to set up a clothing factory for the Sean Kelly Centre for the Sensory Disabled, creating employment and sustainable income for the project.
  21. 21. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 7: CERTIFICATION 21 Consider: - Identify an appropriate certification (e.g. FSC, Fair Trade, Fair Trade Tourism, Bean There) - Get certified - Market your certification and use it to distinguish your business from its competitors The WWF SASSI project certifies sustainable seafood outlets and educates consumers about responsible fishing practice and endangered species.
  22. 22. ASEN|AfricanSocialEntrepreneurshipNetworkTACTIC 8: RUN RESPONSIBLY 22 Pointers: - Be mindful of your business's social and environmental impact - Treat your staff, customers and other stakeholders with respect and integrity SAB has various initiatives that make the business run responsibly. From alcohol education to waste reduction, almost all business areas are scrutinised to be sustainably run.
  23. 23. ASEN|AfricanSocialEntrepreneurshipNetworkWHICH OF THESE APPEAL TO YOU? 23 Which of these tactics is most applicable to your business? Which tactics are you already employing? Which tactics excite you the most? Any more questions? Rodin’s ‘The Thinker’
  24. 24. ASEN|AfricanSocialEntrepreneurshipNetwork5 24 THANK YOU www.asenetwork.org www.facebook.com/ASENetwork twitter.com/ASENtweets Please sign up for our newsletter! Marcus Coetzee marcus@asenetwork.org www.marcuscoetzee.co.za

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