Category: Business Strategy

Corporate Social Entrepreneurship: A seed born by entrepreneurs & nurtured by corporate

Corporate Social Entrepreneurship is an idea which spurts in the mind of an entrepreneur and supported by a corporate working on the realms of achieving sustainable development goals.Sustainable Development Goals (SDGs) provide an opportune framework for companies to explore such partnerships.This new way of solving society’s travails, push the envelope of what a corporate can do and challenges CSR from merely being satisfying in nature to something which is ingrained in a company’s strategy

In an earlier post of mine I had stressed on the importance of systemwide collaboration instead of working in sector-based silos to address and catalyze change.Here we examine few cases where a social entrepreneur-corporate combination has played a pivotal role in blending social value and commercial revenue.

Merger & Acquisition

How often do we hear about such corporate acquisitions in development space? Kavikrut, a BIT alumni co-founded Mobile Medics, a mobile clinic equipped with doctor, nurse, medical equipment and drug supplies which treated rural patients while travelling hard to reach villages. While Mobile Medics was looking for funding to further experiment with other delivery models, Piramal Group, a global healthcare business conglomerate saw synergies with their own vision and instead of funding, decided to create a win- win opportunity for both, leading to the absorption of the Mobile Medics team to start Piramal eSwasthya. This acquisition helped Piramal not only in effective CSR but also in extending Piramal Health’s competence through its charity vehicle, Piramal Foundation to the large rural Indian health market.

The team together tested and researched on more efficient healthcare delivery and while the model underwent numerous changes from van based , telemedicine and community worker-call center based model, owing to various challenges including doctor shortage, village politics; e-swasthya has till date treated more than 94,000 patients.

Replicating through advocacy & usage:

Microfinance movement which was boomed in the past decades, has heightened interest for all private financial institutions in India which mandated banks to carry out financial inclusion. Microfinance industry is a typical example of a hybrid organisation that produces both social value and commercial revenue. In 2004, Dr Tara Thyagrajan, Madura Microfinance realised that loans distributed are not making any significant outcome in poverty reduction but are used for daily consumption.Further, the loans that are utilized for enterprise are also not very productive as these largely by illiterate and semi-literate adults and are typically inefficient and generate very low revenue per person.With the help of Marketplace Literacy Project, (a non-profit organization, started as an initiative by Dr Madhu Vishwanathan at the University of Illinois) which enable marketplace literacy among low-literate, low-income individuals through educational programs in collaboration, developed mini MBA programs. The content dealing with fundamentals of market research, marketing and finance were delivered in the form of typical bollywood movie to inspire ladies followed by several classroom group sessions, role plays on live case study discussing the real lives and struggles of women entrepreneurs in subsistence context.microeducation2_full

What followed next was that the people who took the course showed improvement in understanding of basic principles of entrepreneurship and made better, smarter borrowers.

In another case, in a partnership with Social enterprise, D.light,Total Oil Producer and Marketer, through its Access to Energy program, sold 1 million d-Light solar lamp under the name Awango last May through its gas stations making it one of the largest distributors of quality solar products in emerging countries.While this is a tricky dimension for a corporate to place trust on a product designed by a social enterprise and promote its purchase, d-light, a 10 year old enterprise working towards improving lives of people who live without electricity could achieve that in a brief period of time.

Fostering the ivy growing on trees

There is a growing percentage of millenial torchbearers/beacons creating pathbreaking movement emphasizing on social good for society while trying to seek change in their career and often at the very core of their lives.Just like ivy grows fats because it grows on trees, leveraging the years of effort required to grow trunks and branches, business, large CSOs and government should nurture the talent of those entrepreneurs who are riding the new wave of social entrepreneurship. Various cases reinforced these sentiments.

Take the case of Kavikrut who in a bid to deliver healthcare to the 70% of its citizens lacking access to it founded Mobilemedics. Piramal gave wing to its flight letting him head the e-Swasthya by to build initial partnerships, design strategy and test pilots in villages. Similarly, Yashveer Singh,founder of National Social Entrepreneurship Forum Ashoka India found the right fit and provided him the hub to launch and promote entrepreneurship among the youth nationwide through Ashoka’s  Youth Social Venture Program

While a robust analysis of the synergies between the corporate’s mission and social enterprise founder’s agility is essential, corporates should explore ways to support and advance soccent’s efforts in driving the impact.It’s time that CSE enters mainstream lexicon and corporates should eye this development.



How leveraging collaborative expertise help scale social impact

This article was republished in Nextbillion in July 2016

Social business is a concept famously defined by Muhammad Yunus as a business that is financially self-sustainable, but recycles all profit into addressing developmental needs. But how does one measure the success of these ventures? While the metrics may be different for each social leader, Louis Boorstin, a water, sanitation and hygiene (WASH) expert, defines success for a social enterprise in terms of three equally important goals:

  • Impact: Does it demonstrably improve the health and socio-economic well being of the poor?
  • Sustainability: Does it have enough resources to keep running for many years?
  • Scale: Does it have the potential to reach millions of people?

The landscape of social enterprise is strewn with tales of struggle.In the pursuit of the first goal, many leaders find it difficult  to chase other two goals simultaneously. No doubt that lack of funds is a major challenge for organisations to succeed, but with various financing options available, social leaders often manage to overcome these resource constraints. The leaders of these social entrepreneurial organizations, however, have countless other tasks to manage and balls to juggle. Problems like inefficient distribution, ineffective supply chains, the inability to grow customer bases, inadequate pricing models, or an absence of economies of scale creep in. Fine tuning business models, growing customer bases, converting one-time users to regular customers requires strong expertise, which the founding team may not possess. An organisation focused on developing a technology to reduce water consumption in farms, clean cook-stoves; often finds it challenging to create a market of these unmet needs. And yet, only a few solutions have achieved impressive scale and by doing so have been able to improve the lives of millions of people.

On the other hand, partnerships with sector specialists or government bodies creates an opportunity for these accelerator companies to identify and address specific challenges that would otherwise go untackled. The idea here is not merely a consulting business (where partners consult via teleconferencing or moving to client office for a week) or a corporate social responsibility side project that is restricted to investing financial resources, but rather a co-creation process – a time consuming one, indeed.

Here are some examples of how a right partnership can ignite a movement of social change at the systemic level.

Partnership

  • Power of Networks: Co-creating with experts

Toilet Board Coalition(TBC) is a global alliance of corporations, government agencies, multilateral institutions, sanitation experts and non-profit organisations, with a unifying goal of improving sanitation, to catalyze and accelerate scalable market-based initiatives by leveraging the best of the member’s networks, assets, capabilities, and financial resources.

Svadha, a subsidiary of eKutir is an Indian social business that provides a comprehensive sanitation solution for low-income rural consumers in India. The company trains and supports local entrepreneurs who manufacture latrine components, market them in villages and offer installation and after-sales service. While finding funding to scale up is a daunting task; Svadha also faces the challenge of increasing consumer demand and improving the revenue of entrepreneurs, which requires entrepreneurs to sell 300 toilets an year for Svadha to break-even in 2 years time. How did they approach the problem?

Under the umbrella of TBC, Svadha partnered with Unilever for testing marketing approaches to accelerate toilet adoption, while Kimberly-Clark committed to drive greater consumer engagement through more targeted communication strategies. Alliances such as TBC underscore the tremendous potential the marriage of corporate and philanthropic worlds can bring and ensure that all  partner organisation are same level focused on improving the lives of people(in this case through providing better access to sanitation facilities). Leveraging the expertise of private players help the organisation receive the guidance for widespread adoption, while, private sectors on the other hand benefit by developing a greater knowledge of  understanding and deepening their relationship with consumers from emerging economies.

  • Outsourcing expertise for achieving Best Practices

Global Fund had channeled close to US  $1billion for AIDS prevention program in Tanzania, but getting the medicines to the last mile had always been a challenge due to poor infrastructure. The ubiquitous presence of Coca-Cola bottles was an insight for development practitioners to use Coke’s expertise in solving the distribution problem. Coke has in the past helped organisation to distribute malaria bed nets and condoms to the rural village, However, unlike in the past, the challenge here was to improve reach of their more than 3000 different, yet expensive drugs, with storage specification.

With many decades of experience working in rural markets of Africa, Coke decided that instead of lending its vehicles to supply life saving pharmaceuticals, it would share knowledge of their supply-chain management capabilities. Coca-Cola, in partnership with country’s Medical Stores Department (MSD), mapped out health facilities (approximately 5,000 of them), using software to organize distribution, training workers and advising MSD on route planning, scheduling and the best types of vehicle to use to reach small, faraway villages. The project also tapped into the Coca-Cola ecosystem of suppliers and service providers to leverage their input and specialized skills.

Result: The new management information system enabled MSD to supply directly to the network health facility whenever a request is made, instead of delivering to its 500 odd warehouses with limited capacity and infrastructure to store these medicines.The program, launched in 2010, was so successful across Tanzania, Ghana and Mozambique, that Coke is planning to expand its support into additional countries.

Apart from creating value and offering a competitive advantage, the Project is aiming to achieve reduced mortality and improved well-being of its own employees, for Coke is the third-largest employer in Africa.

  • Avoid the Prejudice Trap: It’s all a Game of coordination

When individuals/organisations/businesses/charities/governments pre-judge each other’s habits, inaction often is the result. Businesses are often seen as short-term minded and exploitative, governments as inefficient and bureaucratic,NGOs and charities as naïve and inefficient. But Swapnil Chaturvedi of Samagra Sanitation eliminated these prejudices when, instead of building new toilets, he decided to revamp existing municipality toilets while liaising with Pune government (they call this their SMART partnership philosophy). This wasn’t a part of Swapnil’s  original plan;  he was initially converting toilet waste into biogas while generating revenue from the waste or building modern toilets. Both ideas were discarded because of lack of space in urban India or financial sustainability. However, unlike many public private partnerships, where there’s no incentive for maintaining or running these toilets, here initial capital expenditure is covered by these partnerships. Meanwhile in return for operating these toilets, local women are hired from the community and earn 100% of the revenue collected.

Organisations, networks,and government should foster a culture of ongoing interactions with people from other sectors and collaborate to develop new structures and business models that can be replicated.The commitment demands time and extended effort. But for those with an appetite to buy into the risk, there is a tremendous potential for social ventures to scale and create a massive impact.