How Leveraging Collaborative Expertise Helps Scale Social Impact
Global, July, 01 2016 -
Social business is a concept famously defined by Muhammad Yunus as a business that is financially self-sustainable, but recycles all profit into addressing developmental needs. But how does one measure the success of these ventures?
While the metrics may be different for each social leader, Louis Boorstin, a water, sanitation and hygiene (WASH) expert, defines success for a social enterprise in terms of three equally important goals:
- Impact: Does it demonstrably improve the health and socioeconomic well-being of the poor?
- Sustainability: Does it have enough resources to keep running for many years?
- Scale: Does it have the potential to reach millions of people?
The landscape of social enterprise is strewn with tales of struggle. While pursuing the first goal, many leaders find it difficult to chase the other two goals simultaneously. No doubt that lack of funds is a major challenge for organisations, but with more financing options available, social business leaders are increasingly overcoming these resource constraints. The leaders of these social enterprises and nonprofit organizations, however, have countless other tasks to manage and balls to juggle. Problems like inefficient distribution, ineffective supply chains, the inability to grow customer bases, inadequate pricing models, or an absence of economies of scale creep in. Fine-tuning business models, growing customer bases and converting one-time users to regular customers all require strong expertise, which the founding team may not possess. For instance, an organisation focused on developing a technology to reduce water consumption in farms, or to sell clean cookstoves, often finds it challenging to create a market for these unmet needs. And yet, only a few solutions have achieved impressive scale and by doing so have been able to improve the lives of millions of people.
On the other hand, partnerships with sector specialists or government bodies create an opportunity for these companies to identify and address specific challenges that would otherwise go unchecked. The idea here is not merely to create a consulting business (where partners consult via teleconferencing or move to client office for a week) or a corporate social responsibility side project that is restricted to investing financial resources, but rather a co-creation process – a time-consuming one, indeed.
Below are some examples of how the right type partnership can ignite a movement of social change at the systemic level.
POWER OF NETWORKS: CO-CREATING WITH EXPERTS
Toilet Board Coalition (TBC) is a global alliance of corporations, government agencies, multilateral institutions, sanitation experts and nonprofit organisations. Its unifying goal is improving sanitation, to catalyze and accelerate scalable market-based initiatives by leveraging the best of the members’ networks, assets, capabilities and financial resources.
Svadha, a subsidiary of eKutir, is an Indian social business that provides a comprehensive sanitation solution for low-income rural consumers in India. The company trains and supports local entrepreneurs who manufacture latrine components, market them in villages and offer installation and after-sales service. While finding funding to scale up is a daunting task, Svadha also faces the challenge of increasing consumer demand and improving the revenue of entrepreneurs. Those entrepreneurs need to sell 300 toilets a year for Svadha to break even in two years. How did they approach the problem?
Under the umbrella of TBC, Svadha partnered with Unilever to test marketing approaches to accelerate toilet adoption, while multinational Kimberly-Clark committed to drive greater consumer engagement through more targeted communication strategies. Alliances such as TBC underscore the tremendous potential the marriage of corporate and philanthropic worlds can bring and ensure all partner organisations are focused on improving the lives of people (in this case through providing better access to sanitation facilities). Leveraging the expertise of private players helps the organisation receive guidance for widespread adoption, while private sectors, on the other hand, benefit by developing a greater knowledge of understanding and deepening their relationship with consumers from emerging economies.
OUTSOURCING EXPERTISE FOR ACHIEVING BEST PRACTICES
Global Fund had channeled close to US $1billion for an AIDS prevention program in Tanzania, but getting the medicines due to last-mile infrastructure problems is a perennial challenge. The ubiquitous presence of Coca-Cola bottles was an insight for development practitioners to use Coke’s expertise in solving the distribution problem. In the past, Coke has helped organisations distribute malaria bed nets and condoms to rural villages. However, the challenge here was to improve reach of not just a few products, but more than 3,000 different, expensive drugs, with varying storage requirements.
With many decades of experience working in rural markets of Africa, Coke decided that instead of lending its vehicles to supply lifesaving pharmaceuticals, it would share knowledge of its supply-chain management capabilities. Coca-Cola, in partnership with the country’s Medical Stores Department (MSD), mapped out health facilities (approximately 5,000 of them) by using software to organize distribution, training workers and advising MSD on route planning, scheduling and the best types of vehicle to use to reach small, faraway villages. The project, known as Project Last Mile, also tapped into the Coca-Cola ecosystem of suppliers and service providers to leverage their input and specialized skills.
Result: The new management information system enabled MSD to supply directly to the network health facility whenever a request is made, instead of delivering to its 500-odd warehouses with limited capacity and infrastructure to store the medicines. The program, launched in 2010, was so successful across Tanzania, Ghana and Mozambique, that Coke is expanding its support into additional countries.
Apart from creating value and offering a competitive advantage, the project is aiming to achieve reduced mortality and improved well-being of its own employees, as Coke is one of the largest employers in Africa.
AVOID THE PREJUDICE TRAP: IT’S ALL A GAME OF COORDINATION
When individuals, organisations, businesses, charities and governments prejudge one another’s habits, inaction often is the result. Businesses are often seen as short-sighted and exploitative, governments as inefficient and bureaucratic, NGOs and charities as naïve and inefficient. But Swapnil Chaturvedi of Samagra Sanitation eliminated many of these prejudices when, instead of building new toilets, he decided to revamp existing municipality toilets while liaising with the Pune government. Unlike many public-private partnerships, where there’s little incentive for local people to pay to maintain public toilets, Samagra Sanitation-managed facilities in the Pune slum blocks has netted a 600 percent increase in payment. The business has done this by drastically improving the condition of area toilets, such as increasing ventilation, water access and introducing child-friendly bowls – instilling a sense of ownership in the community. Read more about this effort here.
Organisations, networks and governments should foster a culture of ongoing interactions with people from other sectors and collaborate to develop new structures and business models that can be replicated. The commitment demands time and extended effort. But for those with an appetite to buy into the risk, there is a tremendous potential for social ventures to scale and create a massive impact.