Archive for the 'Social Enterprise' category

The Difference We Can Make

Oct 25 2010 Published by under MBA, Social Enterprise

It’s been too long since I’ve last written.

I don’t ever like writing a sentence like that for a couple reasons: First, it’s disappointing to admit that I haven’t been able to attend to this open-ended form of discourse that I enjoy so much. Second, what does “too long” really mean? Should I have neglected other important responsibilities in order to participate here? Am I saying that the opportunity to write has passed by?

No.

I have, however, missed that sort of mental afterglow that I find myself in after having a rewarding experience or intriguing thought. The memory, and the motivation to write it down are still there, but I find that some of the color that would have come with the delivery is lost, and I miss that.

I’d miss not writing it down at all even more.

COURT-SIDE SEATS TO CHANGE

The opportunity to make a difference is available to almost everybody. It’s not there at just any time, but for us in these lands of freedom and prosperity, it shows up regularly and often, and it does so in all sorts of ways. Let me explain what I mean. A day ago, a young man come up to me looking rather the worse for wear, and he asked me for some money to take a bus home after being mugged. I bought myself a train ticket, and I bought him a bus ticket. I got on the train, and he walked to the bus. I hope things work out better for him, and I’m glad I had that opportunity to help.

Sometimes the scope of the opportunity is far greater and arguably more significant.

I’m a member of the board for the Social Venture Competition (SVC) at BYU, and a little more than a week ago I met with the competition director to discuss a presentation I would be making in his place at BYU’s Business Plan Competition (BPC) kickoff event. In our discussion of how to fit all of our excitement for the competition into the two minutes of time each presenter was given, I learned more about the success of previous entrants to the SVC.

I learned that one of the previous entrants Bazari, is having great success with an SMS based data service for microfinance companies. They’ve recently signed Grameen Bank as a beta partner. I’m a bit of a mobile data geek, so I got especially excited about that one, but there are others like Ecoscraps who have gone on to reduce landfill emissions by composting the food waste from major companies like Costco and selling it as fertilizer or like Tipping Bucket who have a very effective platform for funding larger developmental projects from donations as small as one dollar. How exciting!

There is so much possibility to do great business and to make a positive impact.

After presenting at the BPC, I had lots of people approach me about the opportunity and what they could do to participate. One conversation with a friend stuck out to me in particular. He mentioned how interested he was in participating, and that he had some ideas, but he wasn’t really sure how to expand on the idea and make it a business plan. I explained to him that the Ballard Center (BYU’s social enterprise arm) and BYU’s business school had support systems and mentoring programs to help him go through that process, and then we kept talking for a while about how much opportunity there was for ideas and development in our world. He asked me about ideas that I had, and he told me about his excitement for being part of innovative business in the Bottom of the Pyramid space. He was even wearing a pair of TOMS shoes, and that took us off on another good tangent about being creative and doing good. The point is that I don’t know if it will be my friend who creates the next great social venture, but I’m seeing that those ideas are all around me, they can come from anywhere, and the opportunity to do good is ripe for all of us.

When I gave the young man a couple dollars of bus money, I made a difference in a small but significant way. Right now I’m also having the opportunity to help support the development of some grand ideas for innovation. It’s like having court-side seats to a playoff game – something special is about to happen, and I’m right in the middle of it.

It’s exciting, and I wanted to share that excitement with you. And, big or small, I encourage you to take the next opportunity to make a difference that comes your way. The difference you make for somebody else will make a difference for you.

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Breaking Down My Interest For Social Enterprise

Sep 15 2010 Published by under MBA, Social Enterprise

Being an MBA student, I have a lot of opportunities to tell people about my interests for social enterprise. I still have yet to meet even half of the class of students I’m studying amongst here at BYU, so there seems, sometimes many times a day, to be a new face and a new opportunity to introduce myself and my interests. Throw me into a networking mixer, and I’m telling my story 5 or 6 times in a matter of minutes.

I’ve learned there are a lot of people that have heard about social enterprise. I always enjoy that.

I’ve learned that most people think of social enterprise as working with non-profit organizations and providing charity.

They aren’t necessarily wrong about that, but I really want to clarify why I’m interested, because I think the distinction is meaningful. One of the very first people at BYU I told about my interests for social enterprise and making a difference in that space responded to me by asking why I was getting an MBA and not an MPA (Masters of Public Administration – commonly associated with NGO’s and non-profits). I explained that I love the work that those groups are doing, but what I really wanted to do was connect sustainable business methods with the Bottom of the Pyramid.

I explained in my last post that my excitement for the space was really catalyzed by the idea that business could play a role in eliminating world poverty. That resonated with me immediately – this idea that persons primarily interested in developing businesses can grow the most developing parts of our world. It was reading C.K. Prahalad’s book The Fortune at the Bottom of the Pyramid that really wrote that idea onto my heart. I highly recommend the book (it’s worth noting that I read the 2nd edition) for some inspired reading, but the gist the book is Prahalad sharing examples of companies doing profitable business among the Bottom of the Pyramid markets and explaining his theories on how these ideas can be replicated in other companies. He said that we could change the world over and over and over because the force of change was, instead of requiring reoccurring infusions of capital from donors, sustaining and providing for itself.

Now you’re talking my language. We’re talking about real, lasting change.

A couple quotes from The Fortune at the Bottom of the Pyramid (2nd Ed.):

…there is a growing recognition that the social and environmental challenges facing us in the twenty-first century are so complex and so multi-dimensional that they cannot be solved by governments alone. Industry has to be part of the solution. But perhaps the biggest catalyst for change has been the increasing awareness within business itself that many of the big social and environmental challenges of our age, once seen as obstacles to progress, have become opportunities for innovation and business development. – Patrick Cescau (former CEO of Unilever)

There are two great forces of human nature: self-interest, and caring for others….to provide for the poor we need a system that draws in innovators and businesses in a far better way than we do today. Such as system would have the twin mission: making profits and also improving lives of those who don’t fully benefit from today’s market forces. For sustainability we need to use profit incentives wherever we can. - Bill Gates

That was the hook for me. An immediately sustainable force, although not a simple or easy one, for giving the poorest members of our world life-changing goods and services.

Let me clarify a little bit.

I’m still really excited about the “rest” of social enterprise. For example, have you heard of TOMS Shoes? The idea behind TOMS shoes is fantastic: Buy a pair of shoes, and TOMS Shoes will give a pair of shoes to a child in Africa that doesn’t have them. Simple. Effective. Life changing. I love that type of social enterprise. There is still a huge need for it. Frankly, there will probably always be a need for it.

However, TOMS Shoes is still a charity – sorta. Blake Mycoskie, founder of TOMS Shoes, has been clear about the fact that his shoes cost a little more because there is money built into the price to pay for the donated shoes that are going to Africa. The person buying the shoes is willing to pay a little more because they are buying into the lovely idea that TOMS Shoes represents. However, at the end of the day, that extra money is a donation.

I have absolutely no interest in getting rid of good will. I have every interest in using real market forces to change the lives of the community at the Bottom of the Pyramid in a manner that will endure on its own.

In some ways what I’m really interested in is connecting established companies with emerging markets. However, that’s also too simplified, because I just adore the work that so many of the socially oriented businesses are involved in, and it would be my privilege to make a difference through either venue. However, much of my own road through the social enterprise space will be learning how to connect new sustainable business ideas with the Bottom of the Pyramid as well as learning to help already successful business systems scale themselves to these same developing markets.

I can sum this up with an excerpt of an article by Carl Shramm from the Standford Social Innovation Review called All Entrepreneurship Is Social:

People tend to think that advancements in health care, for example, are the achievements of either government or the social sector. More recently, they note how the work of social entrepreneurs is improving population health, particularly in developing countries.

Yet the experience of the United States demonstrates that business entrepreneurs have done as much—if not more—for American health in the past century and a half as did medicine or public health. In the middle of the 19th century, most of the U.S. population was ridiculously poor by today’s standards. Americans not only had low incomes, but also spent the bulk of their money on life’s basics: food, clothing, and shelter. What they purchased, moreover, was of questionable quality. Because there was no refrigeration or ability to transport foods over long distances, most people subsisted on a kind of stew that, by all accounts, was simple and tasteless. A poor diet meant poor nutrition, which meant poor health.

One innovation that fueled prosperity, well-being, and further innovation was the American railroad system. The spread of railroads in the 19th century permitted something nearly unprecedented in human history: conquest of the weather. Better movement of people and goods reduced the vulnerability of the population (especially in rural areas, which still dominated the country) to cyclical vagaries. Even in the depths of winter, consumers could purchase food from afar.

Railroads also facilitated the rise of large-scale national companies and allowed a geographically disparate country to purchase new and better goods and services. Consider, for example, the contributions to American health and welfare made by just two companies: Sears, Roebuck and Montgomery Ward. Their first catalogs were only single sheets of paper, but in short order they grew to include thousands of items. By making products such as iceboxes and better farm tools widely available, these companies empowered Americans to improve their lives.

I want to make a difference in the social enterprise space, and I’m especially excited about ideas and systems that have the ability to make real and lasting changes in the lives of our neighbors at the Bottom of the Pyramid. I’m still a toddler, so to speak, in this arena, but I’m excited about it, and it’s my privilege to be able to share this force for change with my community.

Now if I can just expand my community a bit.

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“Born Again” Into Social Enterprise

Sep 10 2010 Published by under Social Enterprise

I like social enterprise.

I really like social enterprise.

What is social enterprise?

I guess I don’t really know (that’s part of what this whole blog/road-to-discovery is about), but I would like to share with you why I’m interested.

A SEED WAS PLANTED

I’ve been aware of microbusiness for about 10 years now. My first exposure to the term was while taking a beginning accounting course from Norm Nemrow as an undergrad at Brigham Young University. I remember him sharing that he’d had some experience with microbusiness, but I especially remember perking up when he mentioned that he thought microbusiness had the potential for doing more good for poverty than any other model. That was it. I heard the term, I perked up at the idea, and then I moved on to various other stories and successes for the next 8-9 years.

(It occurs to me that one might need to be very cautious about how casually they throw out time periods like “8-9″ years. That’s almost a third of my life. But I digress.)

FAILURE

I had some failures.

First, the financial sales career (is it a career if you’ve only been working it for 5 years?) I’d been working in fell apart miserably and the company that I worked for shut its doors. Second, I had invested heavily into some real estate and mortgage related ventures, and those all went underwater when the market turned poorly in the end of 2008. After a very short time, I had no assets, some very significant debts, and I was without my significant income to provide some semblance of safety. The point is that I found myself at a point in my life where I was feeling vulnerable and therefore more sensitive to others’ vulnerability.

REDISCOVERY

In the latter half of 2009, still trying to rebuild my finances, I ran into a list on Forbes.com of some of the most influential business thinkers in the world. I’ve always been a sucker for those kinds of heavily summarized but easily digested lists, so I allowed myself a quick look through. The list was viewed as a slide-show from least influential to most. A couple of the names were easily recognizable from business rock star Richard Branson to technology godfathers Steve Jobs and Bill Gates to one of my favorite economists Paul Krugman and even another name that I quickly recognized in Malcolm Gladwell. I also noted a couple other names on the list that had some interesting points about them that I thought I would follow up on. However, I admit to becoming a bit distracted when I ran into a slide of a man named Muhammad Yunus who was captioned as being a champion of microcredit.

There was that term again.

Whoa. I remembered that. I didn’t even make it to the next slide for a while. I quickly opened up a couple new tabs in my browser, and I learned about the fascinating work that Yunus had done in lending to small groups of people (primarily women) in small villages and in developing Grameen bank. From a methodological standpoint I was fascinated by his work. I worked in the lending industry for years, and what he was doing really was very unique and, from the perspective of the average bank, very difficult. From a purely humanitarian standpoint, I was deeply touched. I was at a point in my own life where I had gone from a position of being in significant financial control to suddenly having a “bagful of mistakes” (even if they weren’t all my own) and feeling vulnerable. Whether it would do the same for somebody else or not doesn’t really matter, because this time, reading about Yunus’ work and the impact it was making on so many who really were very vulnerable and dependent resonated deeply with me.

But I wasn’t done. I hadn’t finished the list yet.

SEALING MY FATE

I didn’t know it at the time, but the next 5 minutes were about to completely change me. If there’s such a thing as being “born again” in the business world, it was about to happen to me.

I went through a few more slides, some of which I’ve already named, and nodded my head at some of the recognized names. I then clicked the arrow that took me to the last slide – the most influential thinker according to this list. The man listed was C.K. Prahalad, a professor at the Ross School of Business at the University of Michigan. I’d never heard his name. I didn’t recognize him. I had just seen Steve Jobs, Paul Krugman, and Malcolm Gladwell. Who’s C.K Prahalad? The following is the direct quote of Forbes.com’s caption for C.K. Prahalad:

“C.K. Prahalad’s influence on the business world is immense,” says Des Dearlove, co-creator of the global ranking with Stuart Crainer. “He coined the term ‘core competencies’ in the 1990s, which set the strategy agenda for a generation of managers. More recently, his work on The Fortune at the Bottom of the Pyramid has shown the role business can play in tackling world poverty.”

from Forbes.com

note: It turns out that the list I was viewing on Forbes.com was really a clipping of a list from Stuart Crainer and Des Dearlove’s The Thinkers 50 list for 2009. You can find the full list here in www.thinkers50.com.

What struck me was the last line regarding the “role business can play in tackling world poverty.” First, it hit my taking-care-of-the-vulnerable-person bone again. Second, the number-one person on this list from a publication that I respected was the second person, previously unknown to me, that was referenced for the difference they were making with poverty. What was I missing? Third, and finally, the idea that business was the means to alleviating poverty resonated immediately with me as a sustainable solution (although I admit I didn’t think of it in those terms).

I had to know more.

Following that rather brief but very moving experience, I quickly went to Amazon.com, found The Fortune at the Bottom of the Pyramid and ordered myself a copy. I’ll explain more in future posts about why this book ended up being so important to me, but the gist of it is that this was really just the beginning of the story for me. I spent hours upon hours afterward looking up more information on Yunus and Prahalad and their work. I quickly learned about the work that Kiva was doing with microlending and the social venture work over at Acumen Fund. I couldn’t get enough of the subject of social enterprise, and I started telling lots of family and friends about it. I learned from talking to a couple friends who were already involved, one who had just finished an internship with Kiva, that there were opportunities to get involved here in Utah, where I live.

Now I want to do more.

That was about one year ago that I discovered Muhammad Yunus and C.K. Prahalad. I’ve learned volumes more about the subject, and it’s getting more and more clear to me that I still have only scratched the surface of what had already been happening for years as well as the dramatic changes that are happening in social enterprise at this time. I’m still not sure what role I’m going to play in the space. If all I get to be is an excited voice on the subject – fine. But I would like to do more, and I’m determined to find where my interests for business development and connecting sustainable business models with the most developing parts of our world (also the vast majority of our world) meet the social enterprise space.

See you there?

See you there.

note: C.K. Prahalad passed away earlier this year. For any interested the Harvard Business Review has a special page dedicated to his remembrance at their website.

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