Six steps to conquer The Evolution™: Social enterprise replacing charity
Social enterprise is replacing charity and that is great news! Before getting too alarmed, understand that this represents an amazing opportunity for the charitable sector and all of us who have made social impact our life’s work. Let’s look at the facts. Slow economic growth is the new normal in Canada. Overwhelmingly, most economists agree that the ten-year outlook for growth is going to be much slower and lower than we have been used to over the past few decades. Led by uncertainty in the stock markets and political unknowns, Canadian businesses and Canadian families will continue to have more pressures on them when it comes to making financial decisions, inclusive of their philanthropic support for the causes that matter to them.
Sounds like a lot of bad news
All of this leads to the underlying factors contributing to The Paradigm Shift (covered in this CharityVillage article). Giving trends are changing. Younger audiences are increasingly supporting the causes that matter to them through their daily buying decisions. Daily choices have become a fundamental component of the giving lexicon. These same audiences are placing less value on what you do and are more interested in how you allow them to engage. They want you to allow them to contribute in a manner that is relevant, feels personally meaningful and makes them feel part of a larger community. Writing cheques or making direct financial contributions doesn’t feel authentic or relevant to them… heck, they do not even have cheques!
The major output of The Paradigm Shift that we are now seeing is The Evolution. Social enterprises have emerged as the new model of engagement for consumers who wish to have cause impact. Charities are trying to solve the same issues as these social enterprises but have been slow to adopt this new model of fund development and stakeholder engagement themselves. That needs to change and the change needs to happen now as the current path has been identified as unsustainable to deliver on organizational impact goals.
Sustainable funding, sustainable businesses
The charities we all work for, with, or represent are in the business of delivering cause impact. Through their missions and working their visions, they are having significant positive impact, but funding this work is a looming dark cloud that seems to seldom pass. Funding for charities generally comes by way of three revenue sources; philanthropy, government funding and earned income. By now, every one of us should be accepting of the fact that philanthropy and government funding are on the decline or at risk and only earned income represents a model for sustainable fund development.
Social enterprise replacing charity
Social enterprises have found dedicated audiences and they are building engaged communities. Businesses have taken the risk and have proven for charities that there is demand for this type of offering. Our focus now becomes creating an authentic and relevant in-house social enterprise model within the organizations we represent. The second thing these successful social enterprises give us are some great examples to learn from and if desired, even mimic their business practices and positioning. In so many ways, they have done much of the heavy lifting. It is now on the charitable sector to create their own earned revenue channels that support and advance the brand value they have built over the years.
Six steps to conquer the evolution
Here are the key steps needed to successfully identify and build out an in-house social enterprise model:
- Define the organization’s unique value proposition to its stakeholders
- Determine which audience segments the organization is best positioned to deliver value to
- Define that audience’s needs
- Ideate product or service offering that deliver on the organization’s unique value proposition and deliver on target audience needs
- Complete competitive analysis & develop the product or service offering
- Create the communications and partnerships plans that will support the organization’s launch of its social enterprise offering
The final bell
The Evolution represents the opportunity of a generation for leaders of traditional organizations to think and act like entrepreneurs to disrupt the status quo and deliver long term, sustainable revenue models and engagement for their organizations. An in-house social enterprise model may not be right for every organization, but we would implore every leader to at minimum explore the possibility today of how The Evolution could apply and deliver value to advancing your cause mission.
This article has been shared fom CharityVillage.
James Chalmers is the Group President and CEO at TACK10 Strategy. “Manifesto: TACK10 is an award-winning professional consultancy focused on building and delivering products, tools, services and training in the areas of Growth Strategy, Performance Management and Partnership Portfolio Optimization. We work across four business groups; Brand, Cause, Property and SME to deliver unparalleled measurable results against organizational objectives. As a for-profit business, TACK10 believes it is our role to have a positive impact in the communities in which we operate. In 2017, TACK10 made the bold decision to become a Certified “B” Corporation. The ethos of this manifests through a commitment to: People, Purpose and Profit. 5% Pledge: Annually TACK10 invests 5% of the previous year’s total revenue in providing complimentary services to organizations who themselves are having a positive social, environmental and economic impact in the communities in which they operate.” They can be reached at www.tack10.com.
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