Saturday, October 04, 2008

SE-Session 8: Running a successful social enterprise

Today's session was very less of a presentation and more of a discussion session. The instructor started out by asking each student's objective and encouraged us to think back and identify one instance that caused a "shift" in us towards social entrepreneurship. His belief is that the answer to what social transformation we want to bring lies there (I feel while this may be true, it need not apply universally to all!).

After that elaborated on eSafal, a social enterprise that he conceived to provide an IT enabled, integrated approach to making agriculture. He discussed his initiative as a "case study" to provide an idea of what forms a successful social initiative. As part of implementing his process, he identified different aspects involved in this like

1. Investments (seeds, fertilizers) and people involved there
2. Farming techniques
3. Output (and people involved like consumer companies, middlemen).

He came up with a process to train the farmers on improved farming techniques to save on inputs (fertilizers, water), reduce waster (during transportation etc), improve quality of produce (cotton in this case).

He discussed this idea to drive home the following points (at least these are all what I perceived from his example)
  • Identify your target beneficiary group in specific. (It may be kids...but are the school children or are they uneducated kids?)
  • Identify various aspects involved in your initiative and identify stakeholders in each aspect
  • Create a business model which benefits every stakeholder, so that it provides a reason for him/her to invest in it.
  • When you identify a problem, track the problem all the way back to its root cause and eliminate the root cause. For example, cotton produced by farmers were contaminated by human and animal hair, threads from dress farmers wear. This costs the cotton buyer a lot of money to improve quality of cotton, he worked to modify the process used for harvesting and transportation of cotton to eliminate contamination at source, which saved a lot of cost to the consumer. This in turn translated to more money for the farmers.
  • Remember the triple bottom line Profit, People and Environment. Measure the impact of your social initiative in terms of all the three and and in terms of social impact it has caused (improved standard of living, better education, better soil quality etc.)
  • Social Return on Investment.
In an email communication to me later, Mr. Ravi summarized the session as follows.

Based on the conversation, the takeaway from the conversations I had with all of you - to start or be with an NGO - in a nutshell are

  1. Identify ONE AREA which is your PASSION
  2. Do complete study on the various aspects of that area chosen and take the best practices already at work in the world…RESEARCH, RESEARCH….
  3. Do a pilot with a small target group and – check out all the issues, challenges that are being faced…
  4. DOCUMENT the processes and brainstorm with similar mind set people
  5. Create a MODEL which is a sustainable one…slightly bigger than the Pilot and showcase the sustainability and the SROI
  6. Market the Model with a group of investors and make it work
  7. Scale the area of operations to check out the challenges and issues being faced…
  8. Document and fine tune the process and market with funding agencies SCALE it up in new areas.. or locations …

Bottom Line
  1. ensure that the community buys in the model,
  2. train and build capacity in the community that they take over the processes
  3. The community pays a token amount for the services they get..
  4. The other stakeholders get value for the investment they make…
  5. Have everything transparent
  6. Publicise it through Word of Mouth, Media, different workshops and events…DON’T be shy of talking about it….
Take-home of the day

Model the social enterprise to benefit each stakeholder, not just the end beneficiary

Calculate the Social Return on Investment

Create a process and document it well. Creating a process will help maintain a quality of implementation (the absence of the person who conceived the idea will not compromise the quality of execution). Documentation keeps every one on the same page

Brief Profile of Mr. Ravi Shankar
Mr. Ravi Shankar is a postgraduate in Operations Research and a graduate in Mathematics from University of Delhi, India. Earlier he as a member of senior Management team in Satyam Computer Services and Nagarjuna Fertilizers ltd., Hyderabad.

He is the Creator of eSafal,(a social enterprise based on application of IT in rural development).. He successfully implemented a pilot project on this enterprise in 2005. This model focused on value creation at all levels by participation and involvement of all stake holders. In 2006, this model was judged as the finalist in Global Social Venture Competition. Presently he is consultant to Government Departments and Rural Development Projects. He is also an Advisor to NGOs like Roshan Vikas.

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