How does social enterprise measure up? Presented by: The Collaborative for Innovative

1. How does social enterprise measure up? Presented by: The Collaborative for Innovative Social Enterprise Development (CISED)

2. Introduce the concept of social costs & social outcomes • Start to identify ways to measure social impact • Start to identify the social costs for your SE • Develop an understanding of the challenge of balancing social and economic objectives

3. Attached is an excerpt of the CS marketing plan which I feel is ready for implementation.  The attached includes the objectives, strategies, and related workplans – which are based on the audit that was done in late summer.  If you would like to see the full plan or audit findings, pls let me know. Any feedback is welcome – thx.  • Krackers Katering Case • Social Objectives – Why are you doing this? • Social Impact Measurement • Asset Building/Accommodation Strategies • Balancing your bottom lines • Social Costs

4. Case Study

5. “To create meaningful paid employment and trainingfor individuals with mental illness and other barriers to employment, while offering a high quality catering service that sustains the environment and supports the local community.”

6. Began in 1999 as AESB employing mental health consumers & survivors • +$200K funding from various sources • Objective to provide vocational training to enable “clients” to meet their goal of seeking meaningful employment outside of Krackers • Revenues of $7369 in year 1 • 2oo4: • 88% of revenues from nfp organizations & health sector • 10% from private sector • Average order was $174

8. Why are you doing this?

10. Parallel strategies offer fulfilling long-term work opportunities for people who are able to work, but requires a supported work environment • Linking strategies work with people who face barriers to employment, and can with training & support, fit into mainstream work environments

11. Linking Strategy: Krackers has a goal of 25% to mainstream employment

12. How will you know you’ve made an impact?

13. Demonstrate the value created by the organization Show the impact of grants, social investors Assess the organization’s ability to align with its mission Make the case for further investment in the organization Check the effectiveness of management

14. What is the mission of our organization ? What barriers that our clients face are we looking to improve ? What are our goals for measuring performance ? How many resources can we reasonably invest for performance measurement ? How it will improve the effectiveness of our organization ? What do our funders expect?

15. KrackersKatering & other Causeway SE’s Identify the impact of working in a social enterprise on clients Survey given to clients based on the Sustainable Livelihoods Asset Areas Preliminary analysis show a higher personal asset increase than expected and lower financial assets increase than expected Guiding further management decisions -> i.e. financial literacy training

16. Section of Causeway Social Impact Measurement Survey given to client-employees

17. How are you going to achieve your social objectives?

18. Accommodation Strategy: • Strategies & practices that SE’s use to support their target population to participate in the business, and engage in the broader community • Two processes: • Change work environment to remove barriers to participation • Promote behavior change that supports people to be more employable

19. Clarity about the rules & expectations of the workplace • Supportive culture • Timing of work • Supervisors & Assistants who support task completion • Organization of tasks • Tool design & ergonomics

20. More structured work environment that demonstrates clear expectations of behavior • Put positive routines in place • Formal training & and informal personal support • On-going assessment and counseling support to help people adapt & retain employment

21. Job related training (ie serving & event planning, food prep, safe food handling, H&S, customer service, inventory mgmt) • Generic work skills training (ie time mgmt, personal hygiene, problem solving, conflict resolution, team work) • Personal development (ie employment planning, crisis intervention, performance U employment evaluations)

22. Job coaching & support: • Extensive & onsite • Flexibility: • leave, sickness, mental health issues • scheduling & hours • Regulatory accommodations: • ODSP & OW

23. Accommodating policies: • Progressive discipline policy • Open door policy & support to discuss personal issues (ie mental health, housing, addictions, housing, etc.) • Progressive movement: • into further employment or education

24. How will you balance your triple bottom line?

25. Financial health vs client health • “big orders” vs “small orders” • Training and retaining employees • Accommodation – planning for the unplanned • The cost of moving to a triple bottom line

26. Focus: • Understanding niche market, use of referral network • Partnerships & Capacity: • Effective & collaborative • Back-up support system • Human resources: • Right blend of staff & autonomy • Tracking : • Both social & business costs • Long term vision: • Constant small steps • Priorities: • Business model has to be right for social outcomes to happen

27. How much do your social goals cost?

28. It’s a social cost if it’s incurred to accomplish a social mission; • It’s a business cost if it’s incurred by a similar for-profit business in the same industry; • If all social costs are taken out, the remaining cost structure should be comparable to a for-profit business in the same industry

29. Employment based: Krackers Katering - ongoing training means extra training, supervision, job development & coaching costs Mission based: Mothercraft Doula Service: wider market means higher marketing costs Environmental Biz: higher product costs (local & green suppliers) Revenue based: Habitat for Humanity re-Store: high volunteer involvement – increased time to recruit, train, manage volunteers

30. Social Costs • Cost of goods sold • Food wastage • Labour (training & production) • Supervision • Operating expenses • Equipment purchases & repairs • Insurance costs • Business Costs • Cost of goods sold • Labour • Repairs & maintenance • Utilities • Rent • Prof & biz fees • Advertising & promo • Insurance

31. Planning– what will it take to run the business (financial, expertise, time)? Logical partners? • Decision making – does it make sense to expand or contract? How efficient is the business? • Goal setting – what is realistically achievable? Willl the outcomes justify the costs? • Budgeting – how much cash, fundraising, funding is needed?

32. No exact method: • Part observation, part use of industry information • Track over time to validate • Balance between level of accuracy/detail & time needed • Consider the value & use of information • Can start with industry information: • What does a comparable for-profit business look like? • What are the social costs up and above? (business & organization)

33. Whole industry (% of revenues) Bottom Quartile Lower Middle Upper Middle Top Quartile % of bizs reporting Total revenue 100 100 100 100 100 Cost of sales - wages 1.1 2.8 5.5 12.4 28.7 - purchases 31.8 41.5 42.1 41.0 89.3 Operating expenses - Labour 6.4 6.9 13.1 16.8 55.1 • Rent 7.3 6.1 7.0 6.6 56.3 - Adv & promo 1.3 1.1 1.1 1.7 64.5 Total expenses 85.8 89.2 94.8 100.4 99.9 Net profit/loss 14.2 10.8 5.2 -0.4 99.9

34. Profitable vs Non-profitable businesses (thousands of dollars) Bottom Quartile Lower Middle Upper Middle Top Quartile Profitable 69.6% of all bizs Total revenue 43.2 88.6 187.4 906.8 Total expenses 30.6 69.7 158.3 853.7 Net Profit 12.6 18.9 29.1 53.0 Non-profitable 31.4% of all bizs Total revenue 44.5 87.1 198.4 1028.6 Total expenses 54.8 108.5 225.9 1131 Net Profit -10.4 -21.4 -27.5 -102.4

35. Tracking Time in the CSM • Total of ~$47,000 in annual social costs in staff time • Challenges implementing tracking system in other businesses • Have yet to track other social costs such as food waste

37. Return to the Business Model Canvas & Napkin Financials • Add (or start a new canvas) Accommodation Strategies, Conflicts, Balancing Strategies, & Social Cost items • Put $ amount on the social costs on the Napkin Financials

38. Where can I find out more?

39. http://www.cised.ca/workshops/training-materials • MaRS White Paper on Social Metrics • Business of Inclusion • Add your own resources through the comments!

40. 4Good Consulting • Market Research, Logo & Print Design, Video or Photo Essay – more next week • Prosperity Centre • Carleton University & Causeway • Looking for three SE’s to analyze social impact • Coaching

41. Phew!

42. Business Model Canvas • Market Research Worksheet • Who should write your business plan & how it should be approached • Social Objective & Social Impact Measurement • Asset Building & Accommodation Strategies • Balancing Strategies • Social Costs

43. Questions • Evaluation • Workshop next week – • Feb.25th, 9:30-4:30pm, same location