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8 Ways to Ensure Your Social Enterprise Can Make Ends Meet

8 Ways to Ensure Your Social Enterprise Can Make Ends Meet

When starting a Social Enterprise, you will have to juggle many competing priorities. One that should always be at the top of the agenda is ensuring that at the very least, you are creating enough income from the enterprise to cover the costs of running it…or making both ends meet.

Here are eight things to consider to keep your social enterprise on track:

1. Ensure you have an entrepreneurial mindset.

As the person leading your social enterprise, you’ll want to ensure that you adopt the traits of the most successful entrepreneurs from all walks of the business world; these characteristics include:

  • Being fearless
  • Being prepared to take risks
  • Being action-orientated
  • Not being phased by temporary failures
  • Being persistent, optimistic and resourceful

Your mindset will impact everything that you do, and it will largely determine the success that you’re able to create for your social enterprise. This includes being able to attract the necessary income to your venture.

2. Know your social enterprise’s story.

Stories create an easy way for people to buy into both you and your social enterprise. What is the story behind why you got into this business? For many social entrepreneurs, this often happens when they discover an ugly truth about society – something they find so shocking, disturbing, or unacceptable that they have to do something about it.

For example, Andy Bradley, who grew up watching his parents lovingly run a home care facility, set up Frameworks 4 Change after later working in the National Health Service and discovering that not all nurses were as compassionate as his mother had been. With an ambition to change the culture of nursing entirely, he set about devising a training course teaching a series of habits nurses can adopt to make sure they are always compassionate, regardless of how busy they are.

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Sharing your story allows those who are interested in your social enterprise to connect with you and your mission, which is a crucial ingredient in keeping your enterprise going strong.

3. Don’t prioritize your social aim over business viability.

In his Feb 2014 article, Dan Zasatwany stated that the principle of “income must come before impact” was not necessarily being implemented amongst the majority of social entrepreneurs, citing that there was “a lack of widespread understanding in the sector about what it means to be an ‘enterprise.’”

One of the main things to understand about a social enterprise is that, first and foremost, it’s a business. Although it may exist to fulfill a social aim, it will only be able to do that in proportion to the profits that it generates.

Having a passion to make a difference is not enough to make a social enterprise successful. In order make ends meet, you must first ensure that, particularly in the early days, your focus is on creating a viable, standalone business model that can survive long enough to make your social aim a reality.

4. Do the business basics and create a business plan.

Remember, first and foremost your social enterprise is a business. As such, you need to ensure that you’ve carried out the same steps that someone setting up a traditional business would do. Although you don’t want to suffer analysis paralysis and spend too much time in the planning phase, some basic groundwork is necessary to ensure that you are going into a venture that has a realistic chance of creating a profit. Some key areas to include in your business plan are:

  • Research: What’s already happening in the industry that you want to go into? What will be unique about what you are going to do or how you’re going to do it? Who is actually spending money on the products or services that you are going to be selling?
  • Financial Forecast: Based on your research, how much will you charge for your products and services, and how much can you reasonably expect to sell over a specific time frame? Be comfortable with the idea that you are trying to create a profit. Don’t let your passion for your social aim see you practically giving things away, including your time.
  • The Break Even Point: If you intend to make your living with this social enterprise, how much do you need to sell in order to cover both your business costs and your basic living expenses? Knowing your daily, weekly and monthly break-even point will give you a great focus in the early days of your social enterprise, and is a crucial part in making sure you can pay the bills on time. This article provides some useful tips on how to calculate your break even point.

5. Know and understand your target audience.

Being clear on your niche audience – that specific group of people who are going to be paying for your products and services – allows you to market to them more effectively, and to ensure that you’re meeting their needs. This, in turn, will allow you to make a bigger impact on your social aim.

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Be aware, of course, that with a social enterprise, often the people who are going to be paying for your products and services are not the same people who are going to be using your products and services. Your message needs to be effective with the people who provide the cash to make your enterprise possible.

Marketing, branding and innovation expert Rafe Offer emphasizes that you need to understand your customer by really getting to know what it’s like to be them, and he suggests role-playing with them in their environment to achieve this. He also encourages a marketing approach that is focused on making them feel good.

Getting this area of your social enterprise right will mean repeat business from customers that can become raving fans, which ultimately will be an important part of creating the income that will not only make ends meet, but will create more social impact for your business.

6. Have a scalable system for success.

Following the collapse of his own social enterprise, Matthew Cain identified that one of the features of successful start-ups was that they had a replicable system that was first tested and proven on a small scale. Once a successful system of trading has been established, it’s then scaled up to increase turnover and profits. Cain found that waiting to launch an enterprise with big numbers was one of the top five reasons that social enterprises fail to make both ends meet. You can read about the other four reasons here.

Scaling up – also referred to as ‘social franchising’ – is a model that is becoming popular amongst social businesses that borrows from the experience of the commercial franchising sector. A social enterprise that has done this successfully is Care and Share Associates (CASA)who have duplicated their system of employee-owned social care homes and services to several sites around the UK.

Social reform organization The Shaftesbury Partnership compiled a useful report on social franchising in 2011 that you can access here.

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7. Measure your impact.

As part of what he calls his BIB (Business Impact Brand) method for starting a social enterprise, Marquis Cabrera talks about the importance of being able to measure the impact that you intend to, or have already made.

For example, he cites that Sword and Plough, a social enterprise that re-purposes military surplus waste into fashionable bags and accessories, has a social mission to “empower veteran employment, reduce waste and strengthen shared military-civil understanding.” At the time of his article, Sword and Plough reported that so far they had

  • recycled 15,000 lbs of military waste
  • created $400,000 of sales through the sale of 2600 products (with 10% of profits going back to veteran initiatives)
  • created 36 jobs for military veterans.

How could you state the impact of your social enterprise today? Measuring your impact will not only make it clearer for other people to connect and contribute to what you are doing, but will force you to look at the numbers in your social enterprise. Tracking your numbers is vital for making sure you are not spending more than you are creating in income.

8. Don’t go it alone.

Being an entrepreneur in any business can be a lonely affair, particularly if you are working from home. However, as a social entrepreneur, you may find this to be even more true as the pressing weight of fulfilling your social mission is added to the feelings of isolation that many traditional entrepreneurs experience.

Therefore, it’s important that you focus on building up a network of people who buy into your social aim and share your vision. One of the ways to do this early on is to put together a Board of Governors to give you objective assistance in ensuring that your enterprise is achieving its social aim, fulfilling its mission statement and is on track to meet its financial goals and targets.

Other important relationships to cultivate are

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  • Mentors
  • Advisors
  • Champions
  • High profile contacts within your online and offline networks

Attending business networking groups can be a great place to create these relationships if they don’t exist already. Your Board of Governors will be an important part of keeping you on track financially.

Social entrepreneur, presenter and consultant Phil Tulba is a Trustee and Director of Adrenaline Alley, an award winning social enterprise. He offers these closing words of advice to social enterprises seeking to make ends meet in their venture:

“Always make sure you are as close as you can be to your customers, beneficiaries and stakeholders. Losing sight of where you have come from, your market and your mission could result in disaster, and it’s sometimes not an easy line to walk.”

Featured photo credit: Jarmoluk via pixabay.com

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Last Updated on February 18, 2019

How to Motivate Employees and Boost Team Productivity

How to Motivate Employees and Boost Team Productivity

These days, in a world with cognitive, AI, and extraordinary advances, we have failed at the most basic stimulus: motivation. Why do I say so? Just take a look at these statistics:

58 percent of managers said they didn’t receive any management training as per a CareerBuilder.com survey. Only 12% of employees leave their jobs because of more money. Research indicates that around 80% of employees leave their jobs due to “lack of appreciation”. Due to fear of failing, more than half of American workers don’t take their paid vacations. 53% of Americans are unhappy at work (not engaged). And 1 in 3 are working in a field they don’t like.[1]

Archaic people management and HR structures are the root cause.

“If you want to build a ship, don’t drum up the men to gather wood, divide the work, and give orders. Instead, teach them to yearn for the vast and endless sea.” – Antoine de Saint-Exupery

So how to motivate employees and boost team productivity?

Here are 3 key things that you can do to motivate your employees and boost team productivity:

1. Run Your Team/Group/Company like a Lean Startup

The Lean Startup phenomena by Eric Ries has been socialized across millions all over the globe. In a nutshell, it is a methodology for developing businesses and products, which aims to shorten product development cycles and rapidly discover if a proposed business model is viable; this is achieved by adopting a combination of business-hypothesis-driven experimentation, iterative product releases, and validated learning.[2]

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Encourage Your Employees

When you empower your employees (or family members) to do what they deem to be best for a particular roadblock, idea, or improvement, you create magic. You create genuine trust. You enable innovation. The result is happy, inspired employees who feel they have a say in the grand cosmic stage at work.

Note that increasing the competency level of employees and coaching and mentoring them along the way is key. You yourself, need to do the same. Nourish your brain – and get a mentor that will keep you at the edge of your game.

Offer Rewards

Motivation is also intrinsic. The startups I have worked at offered instant rewards — not just fat checks or equity increments, but Oscar-style nominations.

The non-monetary rewards were actually more coveted, and grandiose: lunch with the CEO, tickets to an Obama fund-raiser, horse-back riding with a world-class equestrian.

Compare this to a dodgy, corporate, white-cubicle dinosaur that had a “yearly performance review” where both parties dread the conversation. In a world of instant WhatsApp messages, having a conversation about performance, likes and dislikes cannot just happen annually in 60 minutes. Employees need to be rooted in the belief that their manager genuinely cares about them.

Give Autonomy

Another key attribute is autonomy. Most employees start brushing their resumes and cruising LinkedIn when their hands are tied in their current positions: approval forms, long meetings, escalations, and more meetings. In the world of agile and scrum masters, deliberating for the sake of deliberating is poison. You will choke the very employees that giddily accepted the job initially to “change the world”.

Within a reasonable realm of assessment and deep-dives, trust your employees to do the heavy lifting. Give them access to the knowledge, people and resources that help them directly make the choices that will shape the future of your team, and your company.

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Eliminate yourself as the bottleneck – and interject yourself as a benevolent, servant leader that is the symbol of high-performing organizations.

2. Apply the 90/90/1 Rule

I recently saw a video by Deepak Sharma (a leadership adviser) about productivity and this principle stuck with me. Here’s what it’s about:

Devote the First 90 Minutes of Your Day to Important Project

For the next 90 days, devote the first 90 minutes of your day to your most important project—nothing else. Do this for yourself and your employees.

We usually get sucked into the most wasteful, operational activities in the morning which robs our focus, and steers us into an unwanted rabbit hole. So mute your notifications, avoid the temptation to check your exploding inbox, and scroll your Instagram feed later. Instead, focus on that ONE thing that will provide real value to you, your team, or your business/company/home.

Apply this rule to yourself – and your team. Your team will thank you. Note: If you’re feeling really stretched for time, you can always hack the rule by testing out a “45/45/1” version.

A To Do Scheduling System

Another version of this is to use the Kanban concept, developed by Taiichi Ohno, an industrial engineer at Toyota. Kanban is a scheduling system employing boards and cards.

The most basic version is a canvas with “To-do”, “Doing”, and “Done” boards (or columns). Each activity or task is a “card” that moves from one column to the other. I use Trello (a Kanban-inspired app) that is a key system for my personal and professional life. It allows me to understand my workload, their priority, and due dates.

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I use importance and effort metrics (scores) for each task to understand what is truly necessary in my life to work on. It negates the FIFO (first-in, first out) paradox that has plagued millions of people. Instead, it allows me to take stock of what is on my plate, and then bite on what truly will move the needle for me, my team, my life, and my company.

With a limited appetite (at least for some), would you eat the veggies, fries, mashed potatoes and leave the sizzling steak? No, you wouldn’t (unless you are a vegan and ended up in the wrong restaurant).

Approach your work with a weighted vengeance – and encourage your team to do the same.

3. Align Passion and Skills to Purpose

The heart of human excellence often begins to beat when you discover a pursuit that absorbs you, frees you, challenges you, and gives you a sense of meaning, joy and passion.

“The most fortunate people on earth are those who have found a calling that’s bigger than they are—that moves them and fills their lives with constant passion, aliveness, and growth.” — Richard Leider

An ace team-member once told me that while she enjoys working for the company we both used to work at, she really hated anything to do with technology. She was more of a “people” person, and did not want to sit behind a desk sifting through lines of code.

What struck me was that she was in that role for more than a decade and had just spoken up. The good thing is she spoke up. She expressed her desire and interests. And it allowed her to get into a role of her liking within 30 days.

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Ask If They like What They’re Doing

If you, or a team member is frustrated, demotivated, or not performing at their best – one of the questions you should ask is whether they like what they are doing. Then genuinely try to help them get to the role they should be in (whether in the same team/company or not).

There’s a reason why 53% of Americans (and perhaps more or same across the globe) are unhappy at work. A butcher cannot be an ace salad maker. Pursue your passion – and help pave the way for your team. Unlock your potential and theirs. You will command and lead a supercharged team.

“Your time is limited, so don’t waste it living someone else’s life. Don’t be trapped by dogma – which is living with the results of other people’s thinking. Don’t let the noise of other’s opinions drown out your own inner voice. And most important, have the courage to follow your heart and intuition. They somehow already know what you truly want to become. Everything else is secondary.” – Steve Jobs

The Bottom Line

Sometimes, passion has to be ignited. It is dormant, clouded by busy-ness, buried by wrong career choices, and plagued by non-supportive eco-systems. Some will climb out of it, but we as society — and in the case of business teams — incumbent upon the manager/CEO/leader to foster, grow, and nurture the employee.

Teach her the ropes. Show her the path. Advise him as you would yourself. Let them lead, and make mistakes. Do not fear them, rather make them the leader you would want to become.

For your not-so-great team members, understand that it is not personal, it is just not a good fit. Help them move on to the pastures they would be fit to graze on. Hence, hire slow (and fire fast).

Your team is a reflection of you. Boosting their confidence and helping them achieve the impossible is motivation. Focus on that, and you will have a productive team that you and your company will be proud of.

More Resources About Team Management

Featured photo credit: rawpixel via unsplash.com

Reference

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