Students will learn about some of the key management challenges involved in running a social enterprise. Concepts to be covered include goal-setting and target-setting, identifying and measuring key metrics (both financial and social) and leading and inspiring a team. This class will also feature a “live case” with a guest social entrepreneur.

1. APS 1015: Social Entrepreneurship
Class 10: Managing for Social Impact
Monday November 11th, 2013
Instructor:
Norm Tasevski (norm@socialentrepreneurship.ca)
Assaf Weisz (assaf@socialentrepreneurship.ca)
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2. © Norm Tasevski & Karim Harji
Agenda
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Assignment review
Managing for Social Impact
Preparing your enterprise presentations
Next Week
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3. Managing for Social Impact…
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4. © Norm Tasevski & Karim Harji
Two Main Responsibilities as a Manager of a
Social Enterprise…
Achieving financial goals
Achieving social goals
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5. © Norm Tasevski & Karim Harji
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6. © Norm Tasevski & Karim Harji
Achieving Financial Goals
Key Concepts
• Focus on your mission
• Know when to say “no”
• Build a business independent of yourself
• Test (prototype) often, and fail fast
The Market or the Mission? (Brinckenhoff)
• The market is always right
• The market is not always right for you
• The mission should be your organization’s ultimate
goal
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7. Achieving Social Goals…
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8. © Norm Tasevski & Karim Harji
Exercise: From Intentions to Impact
When did you
volunteer?
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9. © Norm Tasevski & Karim Harji
Exercise: From Intentions to Impact
How do you know you made an impact?
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10. © Norm Tasevski & Karim Harji
Impact vs Net Impact
Is your effort better than what would have happened
anyways?
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11. © Norm Tasevski & Karim Harji
Impact vs Net Impact
Is your effort better than what would have happened
anyways?
NET IMPACT is what matters
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12. © Norm Tasevski & Karim Harji
Achieving Social Goals
1. Identify your social goals
– Theory of Change (defining your social value)
– Embed them within/across your operations
1. Measure the social value created
– How do you measure your goals?
– Address the common challenges in measurement
1. Communicate your impact
– Know what to say and who your audience is
– Be creative around your message
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13. © Norm Tasevski & Karim Harji
Step 1: ID Your Social Goals
• What Social Benefit are you creating?
• How do you decide?
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14. © Norm Tasevski & Karim Harji
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15. © Norm Tasevski & Karim Harji
Embedding “Social” across the Business
Model
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16. © Norm Tasevski & Karim Harji
Exercise:
Balancing social & financial value
$
+
+
-
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17. © Norm Tasevski & Karim Harji
Step 2: Measure the Social Value
Created
Why Measure, and for Whom?
• Management
– Performance management (meeting
needs/objectives)
– Organizational sustainability, attract new investment
– Demonstrate the value created by organization
• Social Investors (inc. funders)
– Impact of grants, mission alignment
– Accountability measures
– Assess organization value, relate to risk/return (of
investment)
• Government Programs/Policy
– Make the case for investment in
organization/approach
– Accountability measures
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18. © Norm Tasevski & Karim Harji
Why is Measurement Important?
“Not everything that can be counted
counts, and not everything that counts
can be counted”
“You can’t manage what you can’t
measure”
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19. © Norm Tasevski & Karim Harji
Challenges in Measurement
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Outputs vs. Outcomes
Attribution vs. Contribution
Qualitative vs. Quantitative
Prove vs. Improve
Rigour vs. feasibility
“Metrics and evaluation are to development
programs as autopsies are to health care: too late
to help, intrusive, and often inconclusive.” (Trelsad)
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20. © Norm Tasevski & Karim Harji
A Note on SROI
• Discounted, monetized value of the
social value that has been
created, relative to the value of the
investment.
• Pioneered by Roberts Enterprise
Development Fund (REDF) and Jed
Emerson
• Various uses for, and approaches to, SROI
• Despite “hype” around SROI, it can be
resource-intensive, and issues around
feasibility, replication, reporting still
remain.
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21. © Norm Tasevski & Karim Harji
SROI Snapshot:
TurnAround Couriers
Overview of Target Population (sample)
•38% recruited directly from shelters
•23% female
•Average age: 21
•100% unemployed at time of hire
•54% receiving social assistance at hire
•54% been involved with justice system
•54% did not complete high school
Sustainable Livelihood Outcomes (sample)
•89 youth in total have been hired over 5
years
•100% target population recruited from
shelters able to get out of shelter system
and secure independent housing within 6
months of employment at TAC
Avg Change in Societal Contribution
(Target Employees):
$9,391
Average Number of Target Employees:
10
Current Year Cost Savings to Society:
$93,910
Cumulative Cost Savings (prior to Y5):
$191,170
Total Cost Savings to Date:
$285,080
Cumulative Societal Payback Period:
1.8 years
Cumulative SROI:
285%
Note: initial SCP investment = $100,000
Employment Outcomes (sample)
•Increased target/non-target staff ratio to 83%
•69% continue to work at TAC (9)
•15% moved onto mainstream employment in
•85% who relied on income support through
window cleaning industry (2)
social assistance at time of hire able to get
•8% went on to post secondary education (1)
off and stay off
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22. © Norm Tasevski & Karim Harji
Acumen Fund: social performance
measurement in the investment process
• Due Diligence
– Literature review: state of practice
– Estimate # of people served over the life of the investment
– Assess how delivery of those “outputs” compare (more or less
favorably) to the “best alternative charitable option”
• During Deal Structuring
– Conversations on how to think about performance management
over the life of the investment, not just “mandatory reports”
• Post-Investment
– Quarterly reporting – performance, capacity, strengths/weaknesses
– Semi-annual “forced ranking” across portfolio against investment
criteria - financial sustainability, social impact at scale, breakthrough
insights, and high-quality leadership - as well as actual performance
to date and the investment’s potential for impact in the future
• Closed Investments
– Short “exit memo” looking at results generated, financial return, and
lessons learned
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23. Simple Measures for Social
Enterprise:
Lessons from the Acumen Fund
© Norm Tasevski & Karim Harji
• Culture matters far more than systems
– Tolerance for / learning from failure
• If you build systems, start with a pencil and paper
– Start simple; technology is an enabler not the solution
• Think on the margin
– Performance is always relative to what you had been doing
before (past), to what your competition did over the same
time period (peers), and to what you should have done
(projections)
• Count outputs and then worry about outcomes
– “the conclusions you can draw from these outputs may not
be made with scientific rigor, but they can inform businesslike
decisions and raise important policy questions”
• Don’t confuse information with judgment
– Balance qualitative and quantitative
– Use informed judgment, hold oneself accountable (to them) 23

24. © Norm Tasevski & Karim Harji
Step 3: Communicating Your
Social Impact
How?
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25. © Norm Tasevski & Karim Harji
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26. Break
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27. Your Investment Pitches…
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28. © Norm Tasevski & Karim Harji
Elements Important to the “Social Investor”
• Overview and mission
• Management and
Advisors
• Problem
– social issue being
addressed
• Size of the problem
– how big is the social issue
• Business model
• Competitive advantage
• Collaboration/
partnerships
• Marketing and Sales
• Financial projections
• Financial requirements
• Solution
– Here’s how it works…
• Value proposition
– Inc. social benefit
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29. © Norm Tasevski & Karim Harji
An Example…
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