The Definitive Guide to Scaling Social Enterprise

Rizwan Tayabaliwww.socialeffect.org | www.globosocial.org

© 2007 Charteris plc 2

Outline

1.Commercial vs. Social Scaling

2.Three Myths

3.New Models for Scaling Social Enterprise

4.The Future

Commercial vs. Social Scaling

Commercial scaling is about more money

The dream is explosive financial growth

Typically via any of 4 scaling models

Organic GrowthFranchisingAcquisition

Merger

These models are often costly in both their inefficiencies and the

challenges of managing quality...

...but profits and easy access to borrowing typically mask these issues.

These models are also often assumed to be the ONLY options for

ALL organisations.

Social scaling however is about better outcomes

The dream is a world without hardship

Different goals require different approaches

Which means that the same models are NOT necessarily the answer.

Some SE’s are easy to scale using standard commercial models...

...typically where they offer simple products or packaged services

For those with complex human factor programmes it is not so straightforward

They face significant organisational challenges in scaling through

traditional models

Lack of sector infrastructure

Skills or capacity gaps

Local dependence on CEO/Founder

Raising Necessary Investment

So we need to start thinking differently

3 Myths

Myth 1

Commercial models apply for all orgs

Myth 2

Replicating process is the way to scale

Myth 3

Scaling is typically linear

New Models for Social Scaling

True social enterprises create and prove financially viable models of

change...

...they are NOT simply about making money in socially beneficial ways.

So although scaling for social enterprises involves elements of

traditional commercial scaling up to the point of proving sustainable

models...

...beyond that, the end-goal is about scaling the outcomes.

The SE’s model of viable change must therefore be seen as

separately scalable from the organisation itself.

4 Categories

NOTE:

1. Scaling can be quantitative or qualitative, but ideally both., so aim for approaches that best achieve these together.

2. The examples given, even if not always perfectly in the SE space, are simply to provide reference and proof that these scaling mechanisms can and do exist. They are a viable basis

for customisation, innovation, or mixing and matching depending on your organisation’s model of change.

1. Piggybacking

i.e. Leveraging the scale of others

Scaling through government

e.g. Cimientos who have convinced the Argentinian state to model their 500,000 scholarships on the ones they provide

Scaling through policy

e.g. Care Peru who prove their models work and then lobby presidential candidates to ensure that policy is amended to

safeguard change when they get in power

Scaling through transgovernmental organisations

e.g. Convincing, or merging with, entities like the Red Cross or UNICEF to incorporate proven models.

Scaling through business

e.g. Hybrid value chains like the partnership between Carlos Cruz and Danone to offer formal job opportunities to

marginalized communities outside Mexico City while creating a new distribution channel for nutritious goods.

Organisation must evolve to support delivery

2. Dispersal

i.e. Seeding the model and facilitating the spread

Scaling through transferability

e.g. 826 National and Transition Towns that have seeded a host of local variants around the original model

Scaling through microfranchising

e.g. Vision Spring’s “Business in a Bag” empowering local entrepreneurs to launch their own businesses selling eyeglasses

Organisation must evolve to manage spread or distribution

3. Movement

For models where successful social outcomes require changing mass

behaviour

Scaling through brand

e.g. La Usina who are developing a premium clothing brand that raises awareness of disability rights

Scaling through mass participation

e.g. Ashoka in Mexico who are aiming to create a culture of civil action via a 10 year managed program of ideas for change

Scaling through co-operation

e.g. Movimento Nossa São Paulo which is a network of 600 civil organisations working together to lobby government

with an agenda and set of goals to provide a better quality of life for all inhabitants of São Paulo

Organisation must evolve to manage the logistics supporting movement

4. Open Standards

i.e. Leveraging open interaction for funding, design, development, and

delivery.

Scaling through open source

e.g. Ushahidi which uses open standards and collaborative networks for sourcing development and leverages the power

of crowds for delivering change

Scaling through open design

e.g. Cipla’s generic retroviral drugs. Open (unpatented) design can and should be extended to product innovations addressing social needs. Innovator may enforce commons

licensing for efficiency and learning sharing with organisations that reproduce design.

Scaling through collaborative networks

e.g. SpineConnect, which is a collaborative innovation network (CoIN) for spine surgeons to collaborate on difficult

and unusual cases and develop better outcomes.

Organisation must scale to provideadvisory support and platforms

for continuous improvement

The Future?

The world is changing

Both sectors are realising that building in financial or social aspects

at start, adds little extra cost and significant rewards

Web 2.0 is forcing companies to converse to build loyalty, which in

turns forces them to humanise and stay true to social values.

Social entities are using brand, business model innovation, creating revenue streams, and leveraging the

power of crowds.

The sectors will merge even further

New models of operating, new ways of working, and new options for scaling will continue to arise...

Watch this space!!

Rizwan TayabaliSE Consultant, Social Effectrizwan.tayabali@gmail.com www.rizwantayabali.info www.socialeffect.org | www.globosocial.orgFind me on Twitter & LinkedIn