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Social Entrepreneurship and Innovation

Social Entrepreneurship and Innovation. Presented. by Jamila Aman. Workshop Purpose. Celebrate and build on success Outline systematic approach Earned income Establish business objectives/criteria Product development Product screening Risk management and readiness Shared services (MSO)

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Social Entrepreneurship and Innovation

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  1. Social Entrepreneurship and Innovation IFS Conference 2008 Jamila Aman's Presentation

  2. Presented byJamila Aman IFS Conference 2008 Jamila Aman's Presentation

  3. Workshop Purpose • Celebrate and build on success • Outline systematic approach • Earned income • Establish business objectives/criteria • Product development • Product screening • Risk management and readiness • Shared services (MSO) • Venture philanthropy IFS Conference 2008 Jamila Aman's Presentation

  4. Social Entrepreneurship • We are a world of wall builders, partitioners, and dividers of space. We long for the security of safe places. We construct these barriers in a vain attempt to control the elements, to keep the rain from dampening the fire, the wind from covering ours lives with the inevitable dust. Many of the walls we build are essential to our survival. Many, however, are not. By fortifying the unnecessary walls, we in business (for profit and not-for-profit)..huddle in the systems we have closed. The consequences: thinking decays and novelty vanishes. • Open Boundaries- Howard Sherman and Ron Schultz1998 IFS Conference 2008 Jamila Aman's Presentation

  5. Social Entrepreneurship • Application of entrepreneurial attitudes to social sector: • Change is the norm • Embrace change • Seek change • Client focused • Shift resources from low to high productivity • Calculated risks • Create something new • Strive for Transparency IFS Conference 2008 Jamila Aman's Presentation

  6. Organisational ReadinessRisk Management IFS Conference 2008 Jamila Aman's Presentation

  7. Issues • Fear of loss of control • Resources – financial/human • Risk averse culture • Conflicting ends • Lack of structure/governance for success IFS Conference 2008 Jamila Aman's Presentation

  8. Organizational Readiness • Strategy • Governance • Human resources • Finances • Operations, Products and Services • Market perspective IFS Conference 2008 Jamila Aman's Presentation

  9. Strategic Management Overview D. Throughput A. Output C. Input Current State Strategic Implementation Annual Strategic Review and Update Future State Change Management 5. Current State Assessment and Business Planning Parallel Process with Key Stakeholders 2. Strategic Planning: Vision, Mission, Values 4. Objective Development B. Feedback 3.Strategic Priority IFS Conference 2008 Jamila Aman's Presentation

  10. Mapping the Future Ideal Future Vision • Formulate dreams that are worth believing in & fighting for by meeting 3 challenges. Challenge #1. Vision Statement Challenge #2. Mission Statement Challenge #3. Core Values IFS Conference 2008 Jamila Aman's Presentation

  11. Ideal Future Vision Answer all or any of the following questions: What will put you out of business? What is your ultimate vision of success? What is your ideal community vision? Answers may be - end of homelessness, hunger etc. IFS Conference 2008 Jamila Aman's Presentation

  12. Mission What is your organization’s part in achieving the vision? What do we produce? Who do we serve? How do we do it? IFS Conference 2008 Jamila Aman's Presentation

  13. Values What do board members & employees stand for & embrace? What are the rules? May include integrity, transparency, entrepreneurship, innovation etc IFS Conference 2008 Jamila Aman's Presentation

  14. Strategic Priority Development Balanced Score Card Format Consider organizational success from more than one perspective, for example: Internal Business Processes Client Financial Human Resources IFS Conference 2008 Jamila Aman's Presentation

  15. Strategic Priorities Financial Answer the question: How do you wish to appear to your owners/funders? Internal Business Processes Client Vision Mission Values Answer the question: In order to achieve your mission, what business processes must you excel at? Answer the question: How do you wish appear to your client/customer? Human Resources Answer the question: How do you sustain your ability to learn and grow? IFS Conference 2008 Jamila Aman's Presentation

  16. Earned Income IFS Conference 2008 Jamila Aman's Presentation

  17. Results in Other Ventures • 90% of successful ventures relate to the non-profit’s mission • Planning matters • 46% of non-profits with ventures have more than one • 69% are profitable • Profitability is reached in 2.5 years on average • Only 10% use a spin-off – cutting edge • The largest benefit is the creation of an entrepreneurial culture (58%) IFS Conference 2008 Jamila Aman's Presentation From a survey of non-profits operating business ventures

  18. Systematic Approach IFS Conference 2008 Jamila Aman's Presentation

  19. Systematic Approach • Determine organisational • Need for innovation • Purpose • Organisational readiness and commitment • Product development • Search for opportunities • Create new services and screening • Research, design, testing • Launch, evaluation and revision • Portfolio approach IFS Conference 2008 Jamila Aman's Presentation

  20. Strengthens OrganisationsAchieves Mission • Generates revenue • Unrestricted • Greater degree of control • Enables growth beyond funding base • Supports mission and strategic plan • Create valuable new services/SROI • Enhances profile IFS Conference 2008 Jamila Aman's Presentation

  21. Balancing Mission and Financial Return IFS Conference 2008 Jamila Aman's Presentation

  22. Product Development ProcessPlanning for Success IFS Conference 2008 Jamila Aman's Presentation

  23. Definition of a Good Idea • Meets a significant customer need – a market • Return on investment • Risk managed • Competitive advantage • Cost • Performance • Leverages a strength/asset • Fits with mission/values IFS Conference 2008 Jamila Aman's Presentation

  24. Enterprises • Mission related products or services • Same product, new market: geographic or customer • Programme related products (manuals)/services (EAP) • Staff resources (MSO/training) • Public sector contracting • New product/leveraging organisational strengths • Client resources (social firm) • Soft assets intellectual property (licensing/franchising) • Hard assets (rental) • Unrelated business (Ben & Jerry’s) IFS Conference 2008 Jamila Aman's Presentation

  25. Product CreationPre-work • Scan • Community trends and needs • Potential market opportunities – market research • Attend conferences/read magazines/annual reports/web/etc • Assess what competitors are doing • Scan • Internal capacities (swot) • Leading edge networking IFS Conference 2008 Jamila Aman's Presentation

  26. Brainstorming • Use information/knowledge/fantasy/dreams/intuition • Build on experiences of and skills/knowledge in the organisation • Lateral thinking, scramble patterns • e.g. pose a problem and only outrageous solutions are suggested • Look at data for opportunities, look at it from other people’s perspectives • Be excited, accept thoughts/play with them - have fun • Bring experts from different organisations together • Discuss with others, family, friends, associates IFS Conference 2008 Jamila Aman's Presentation

  27. Level 1 Screening Criteria Does the idea further your vision, mission, values and strategic priorities? 1=no, 2=partial fit, 3=full fit Is there a potential customer benefit? 1=none, 2=some need/some customers, 3=urgent need/many customers Are there profit potential (by third year)? 1= less than 20K, 2=more than 20 k but less than 50k, 3= more than 50k What investment is required? 1 = major investment , 2 = minor investment, 3 = achieve with current resources Is there a champion? 1=no, 2= neutral 3=yes Is there risk? 1 = high risk (no known mitigation), 2 = medium risk (new strategies needed), 3 = low risk (strategies in place) Scoring: each idea will have a score of 6-18 IFS Conference 2008 Jamila Aman's Presentation

  28. Screening Phase 2 • Create a concept statement • Describe product • Target audience and reason for buying it • When, where, how? • Product attractiveness • Financial results • Marketing issues and competitors • Risk factors • Does it fit with the organisation? • Test with sample of external experts IFS Conference 2008 Jamila Aman's Presentation

  29. Screening Phase 3Feasibility Analysis and Priority Setting • Does the product have financial potential? • How likely is the product to implemented successfully (easy or hard)? • Is an investment required? • Is an investment justifiable in terms of financial or mission improvement? • Does the product advance mission and strategic priorities? IFS Conference 2008 Jamila Aman's Presentation

  30. The Success Quadrant Fit with Organisation IFS Conference 2008 Jamila Aman's Presentation

  31. First Set of Measures Product A IFS Conference 2008 Jamila Aman's Presentation

  32. Product A Second Set of Measures IFS Conference 2008 Jamila Aman's Presentation

  33. Product A Strength of Idea Fit with Organisation IFS Conference 2008 Jamila Aman's Presentation

  34. Screening Phase 4Business Planning IFS Conference 2008 Jamila Aman's Presentation

  35. Benefits of Writing a Business Plan • Refines the idea • Writing it down makes it real • Creates a framework for making the idea happen • Method of external communication • Internal due-diligence tool IFS Conference 2008 Jamila Aman's Presentation

  36. Guidelines for Successful Plans • Aim for a maximum of no more than twenty pages in the main body of the plan  • Be as brief and crisp as possible when explaining your idea and strategy • Quantitative • Specific • Cover what investors are looking for • Address risk and exit IFS Conference 2008 Jamila Aman's Presentation

  37. Business Plan Format • Cover Page and Executive Summary • Description of the business • Industry and Market Analysis • Marketing, Communications and Sales Plan • Management and Operations / Launch Plan • Risk Assessment and Contingency Plan • Exit Strategy • Financial Plan for Your Venture • Supporting Documents IFS Conference 2008 Jamila Aman's Presentation

  38. Development Testing Launch After That…. Entrepreneur IFS Conference 2008 Jamila Aman's Presentation

  39. Organisational Structure IFS Conference 2008 Jamila Aman's Presentation

  40. Why Separate? • Different cultures/ends • Shield non-profit from business risk • Raise external capital • Enhance focus on non-core markets without compromising non-profit’s purpose or funding IFS Conference 2008 Jamila Aman's Presentation

  41. Structure Non-profit Organisation Business Business Business Intellectual Property Enterprises Holdings Business Operational Support Purchase Of Service Investors IFS Conference 2008 Jamila Aman's Presentation

  42. Transition • Clean break, separate entities • Share resources, purchasing services • Conflict of interest • Sharing management • Compensation • Share purchasing • Transition plan and monitoring IFS Conference 2008 Jamila Aman's Presentation

  43. Relationship With Non-profit • Customer/vendor/owner (major shareholder) • Separate companies – consistent vision • Some price concessions to keep charity as a customer and meet mission • Mutually beneficial for Enterprises to succeed • Negotiated and governed by contract IFS Conference 2008 Jamila Aman's Presentation

  44. Significant Key To Success • Foster a dynamic, success generating, entrepreneurial ethos • Provide support to staff who are: • Creative • Innovative • Entrepreneurial • Productive • Successful • Aspiring IFS Conference 2008 Jamila Aman's Presentation

  45. Partnerships, Alliances Mergers, Acquisitions IFS Conference 2008 Jamila Aman's Presentation

  46. Working together • Creating efficiencies • Enhancing quality • Allowing for a focus on services • Supporting social enterprise IFS Conference 2008 Jamila Aman's Presentation

  47. Context • Pressure to create efficiencies • Enormous duplication IFS Conference 2008 Jamila Aman's Presentation

  48. One Approach - MSO • A management service organisation (MSO) is an integration that includes the creation of a new organisation in order to integrate administrative and fundraising functions, and thus to increase the administrative efficiency and effectiveness of participating organisations. It may include co-location. IFS Conference 2008 Jamila Aman's Presentation

  49. Benefits • Enhances quality, strengthens organisation • Generates revenue: cost savings/profit • Frees management time • Keep up • Enhances profile/reinforces advocacy partnering • Reduces risk • Entrepreneurial spirit • Supports mission and strategic plan IFS Conference 2008 Jamila Aman's Presentation

  50. Examples of Savings and Quality Enhancement • Procurement • Average 26%, Up to 50% on certain items • One organisation – 32% savings (equivalent of a 1 FTE freed up for the organisation) • Finance/HR/IT • Higher quality, more comprehensive service • Potential for savings/minimally breakeven • Fundraising –access to focused expertise at low cost IFS Conference 2008 Jamila Aman's Presentation

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