Archive for the ‘social entrepreneurship’ Category
Class today was great because we had Elliot Brown of Springboard Forward talk to us. He had a very interesting story, which I will highlight below, and then for the last remaining portion we talked about “theories of change” - what they are, what they mean, and the impact they have. Overall a very good class, with a couple of lessons learned highlighted, and one of the better stories told about a nonprofit and their success.
Elliot Brown Background
Elliot is a Stanford graduate who started working at Sun Microsystems corporation in their philanthropic arm to get a feel for the CSR landscape. After working there he worked at an East Palo Alto office running a small program and learned how not to do many things. One of the biggest downfalls was that there wasn’t enough talent in the environment, but one of the major bonuses was getting a view of how about thirty organizations worked. Then, he left that organization and started doing some consulting. One thing he started to notice is that when organizations are looking for manpower, they call temp agencies versus nonprofits that are working to find employment for their constituents. In other words, he was perplexed at why companies would pay temp agencies for workers when certain nonprofit groups were providing the service for free.
The Birth of SpringBoard & SpringBoard Forward
It was at this insight that led to the development of his first company - SpringBoard. The idea was to take the nonprofit people’s and provide them with jobs by being a middle man staffing agency “cover.” After four years, he started SpringBoard Forward, a nonprofit, that focused on helping these unemployed individuals develop the skill and mindset to succeed in the workplace. After running two organizations for six months, he definitely felt taxed and decided to shut down the for-profit and focus on the nonprofit. The reason being is that with a nonprofit you can be market driven, get funding, and have access to resources that regular businesses don’t have access. But, he also admits that he felt he needed to learn how to run a business before jumping to the nonprofit idea.
Where is SpringBoard Forward Today?
Even though traditional nonprofits have problems of scaling (due to lack of resources), he is working to create a much larger organization that can accomplish the vision of the organization. The issue that he has identified is that many of the individuals being placed by these temp agencies are low income and don’t have hope in the process of getting out of poverty and going places. His job is to help them develop and come to the job with a completely different attitude - come in with a passion, belief, and vision for the future. The ideal question he wants the people he’s helping to ask is, “How can I use the position I’m in to get where I want to go?”
While they feel they have some initial results, it hasn’t been in effect long enough to develop the proof of concept they need to scale more effectively. Because the lowest paid employees interact the most with the customers (and are Eliot’s target “client”), companies want these individuals to be engaged and effective. As such, the goal is to cut turnover in half and measure employee engagement in the process to determine effectiveness. They have a small amount of success for the people they help because 44% are promoted and receive a raise within four months of employment. But, this doesn’t do enough to establish much business value. One test he would like to do is perform several projects on a pretty big scale and evaluate the results. Did sales go up in the project group or control group?
Personal Training
This was my favorite part of the talk and stemmed from a question I asked, and that was, what is the process you provide to help these people figure out what they want to do with their lives? Elliot starts out with the amazing insight that the ethic used to be to have a good living and now it is to love what you’re doing. This developed because of the emptyness many felt from monetarily successful jobs. The idea, then, is to provide a 1 on 1 coach that asks you wat you want and what are you going to do about it? Most have the mindset that SpringBoard Forward is going to help them, but the problem is that the individual doesn’t know what to do after the coach is gone. Instead, the coach kicks them in the @ss and keeps them going. They also spend eight hours going through a “9 Step Process to Clarity.”
Getting Managers on Board
A second prong is to work with managers so that they are bought into the value of helping employees. For example, if the employee is interested in being a plumber and is working in a hotel, the manager could hand off all plumbing jobs to that employee. The result is a completely changed relationship, and this relationship is important because the #1 factor for turnover is relationship with the manager.
Lessons Learned
- Build small successes before shooting for huge ones. Prove the concept before trying to score huge deals that would most probably collapse in failure.
- Think outside the box. The idea of creating a for profit placement agency that used the nonprofit’s people was creative and worked to accomplish goals for all parties involved.
- Inspire hope. This is a bit about philosophy, but inspiring hope and meaning into a person’s life provides that individual with a sense of purpose.
- Identify and eliminate biggest impediments to success. If the number one reason for problems that prevent your success aren’t being addressed - like managers in Elliot’s case - then you will never attain the level of success you are looking for.
- Set up metrics to measure progress and maintain accountability. Even though Elliot is the manager, and admits he isn’t very good at it, he is still accountable to his board and the board can fire him if he’s not performing.
Theory of Change
The general idea is to identify the major problems that prevent your goal from being implemented. Then, for each of these problems, figure out some action that can be done to take care of this issue, then follow up by measuring your success. Performing case studies on a couple organizations was very helpful in understanding the significance of this process and I think it is a great idea for any mission-driven organization.
Conclusion
Very cool class that provided a lot of insight into the life of a nonprofit. Elliot was very insightful and someone I would like to see in the future to hear how SpringBoard is progressing. The idea of a theory of change is definitely interesting, and I think it is necessary for any nonprofit to use this method of evaluation every six months to keep a hold on what they are doing and whether or not it is furthering their mission.
Today’s class wasn’t extremely exciting or eventful. For the most part, we discussed how we could make class better, one weird item that was particular to each of us, the Innovation Tournament (main event of E-Week), and brainstorming. Because most of the stuff didn’t have much practical value, I will discuss brainstorming in this post.
Rules for Brainstorming
- Throw out all ideas, even if they aren’t fully formed.
- Be willing to run with wild ideas. Don’t critique or shoot down ideas.
- Build on the ideas of others.
- Go for volume. Shoot for 100 ideas an hour
- Focus on one conversation at a time.
- Headline ideas - get essence of idea then move on.
- Bring props to facilitate creative thinking.
- Brainstorm for only 45-60 minutes.
- Provide snacks.
- Have FUN!
Crazy Ideas
- Have a Post Secret on Post It notes
- Have Post It pledged to “reduce garbage” or “recycle more.”
- Gummy bear reward cup for fulfilling goals.
- Housing project made out of garbage.
- Clothing line made out of garbage.
- Write messages to others on candy wrappers
- Post It tree much like a Christmas gift tree.
- Gummy bear ice cream social fundraiser.
- Gummy bear sculpture that everyone can eat
Conclusion
The class period was interesting in terms of wrapping up part of the necessary portions of class, and the brainstorming activity was fun. Even though the rules for brainstorming seem small and somewhat unnecessary, there are many times I realized their significance because someone broke a rule and experiencing the detriment that resulted. Overall, it was a fun experience.
Professor Tina Seelig, who I have mentioned before here and here, came to our class today. We spent the majority of the class period engaged in an activity designed by her, and I have to say it ranks in the top five of the most AMAZING classes at Stanford thus far. It was a phenomenal rush and I think I can spend at least twice as much time analyzing what happened in the activity than we actually spent on the activity. Here’s an entry of how things progressed.
Entrepreneurship Week
Entrepreneurship Week will be a week of fun and excitement in which we will take some common item and create value - value being however we want to define it. We will also see the premiere of “Imagine It!,” a movie that recaps the first ever Entrepreneurship Week and the value that was created with post it notes. Tina gave us a quick run down of what would be happening and what to expect. I am thoroughly excited, as I’m sure she is too!
Class Activity
Professor Seelig divided us into four groups. Each group was then given about 20 playing cards and the goal is to develop the tallest house of cards out of a single deck. There were a couple other rules that resulted in more points, but that was the important theme. Each team was also handed X number of sticks that could be used for trading because they were valued at one point each. Because the cards we were given were from three different decks, we quickly learned that we had to trade for a single deck if possible.
Trading
For our team, I was the official trader and I went around to each group trying to trade for the cards we didn’t have. I was able to get all from one group, and tried to create urgency between the other two groups to trade for the remaining deck. The reason being is that three decks split amongst four teams works only for three teams. Eventually, one team ended up not having trades, Tina called all of us to go back to our teams because she had an announcement.
Lose a Team Member
The announcement Tina made was to have one team member volunteer - which was me - and then that team member was “enticed” by another group and left the original team. I ended up with the group that did not do any trading and was stuck with cards that everyone wanted but had nothing to trade. We were also allowed to steal some IP, which I took as one of our simple leftover cards.
The Merger
Because the team I was on had pretty much nothing going for it, I proposed we should merge with my original team. One benefit is that we would have a nearly complete deck plus cards from the other two decks to prevent the other teams from getting the complete deck (and the point bonus that resulted). Another is that we would have more negotiating power and leverage because if the other two teams merged, we would still have the cards that they needed. After talking it over with my new team members, they were all for it and we proposed it to my old team. They thought it was a great idea and we created the new super team.
Finishing Off The Deck
After the merger, the other two teams realized the mistake of their hesitancy to merge. We were offered the proposition of merging with another team and because we had already merged once and were in a position of strength, we decided not to merge. Then Tina pulled out the remaining cards and decided to auction them off. Because we had twice the sticks - worth a point each - to purchase the deck, we ended up winning the bid by a point more than what the other teams had. Thus, we had a complete deck and the cards the other teams needed. We were “winning”.
Goal: Create The Most Value
Knowing that we were going to “win” by the standard of points, we started to ponder if that was actually how Tina was going to evaluate us and how we could tie the theme of the class - social entrepreneurship - into it. We realized we were stuck in this competitive mindset that said to create the most value for us, but because of one of our team members we realized the goal was to create the most value, period. As such, to create the most value in points, we should redistribute the cards to the other teams so that they had full decks. This happened with about five minutes to spare, and the elation of realizing we could all win was amazing.
Lessons Learned
- Steal good ideas. A number of the ideas presented were stolen and ended up creating a large amount of value for every team involved.
- Accountability and trust are key to future transactions. My taking a simple card when I had to leave my original team instead of the most prized card made it much easier to merge groups. One of the other individuals from another team stole extra sticks when leaving and this resulted in mistrust and made it harder to convince teams to make deals with one another.
- Know what rules to break. Rules are made to be interpreted, and it is through these interpretations that opportunities can be recognized. Be sure to recognize that there is a fine line for acting ethically and unethically, though.
- Recognize and seize opportunities. There are windows of times in which some opportunities are available, and if they aren’t recognized in time, they disappear. Be prepared to take advantage of them as they become available.
- Value is how you define it. Value can be created in a number of ways and by clearly defining what value your team wants to create, it becomes much easier to maximize that value and recognize opportunities that take you closer to your goal.
- Leverage resources. Life is full of limits, and it is through effective leverage that these resources work to your advantage.
- Team dynamics are important. By creating a stellar team where everyone knows their role and is on the same page in terms of goals is invaluable to success.
- Use time wisely. Some teams spent too much time thinking about what to do versus actually doing it. This led to missed opportunities and overanalyzing the situation - which resulted in hesitation.
Conclusion
Overall, GREAT class with lots of invaluable nuggets of wisdom. While you can read my blog articles and get a feel for what I experienced, there is no substitute for actually trying this experiment. I feel that if I participated in a variation of this experiment in multiple contexts, there would be more lessons and greater levels of understanding developed. So, stop reading and go do it yourself!
ETL today was very different from the ones I have had in the past. Today’s guest was Christine Benninger of the Humane Society of Silicon Valley (HSSV), and is very different because she isn’t part of some crazy startup or investment circle. While the HSSV appears to be very boring, I assure you the things Ms. Benninger has accomplished while there are not. There are a lot of really cool lessons to be gleaned from the podcast which can be listed to here or read below.
Christine Benninger Background
Ms. Benninger has been President of Humane Society Silicon Valley for the past 13 years. During her tenure, she implemented a spay/neuter program that reduced the number of incoming animals to the shelter from 45,000 in 1993 to approximately 9,000 in 2006. She has also implemented key policy changes that have resulted in 99 percent of animals finding new homes while simply ten years ago less than 15 percent found new homes. Since taking a management role, Mrs. Benninger has grown the Humane Society’s volunteer base from 50 to more than 700 volunteers, along with the shelter’s donor base increasing from 300 to 30,000 donors. She also owns four dogs, all of which were adopted from the HSSV.Ms. Benninger also has a strong business background, spending four years as an auditor with Arthur Andersen & Co. and 15 years with Hewlett Packard. At HP, Christine held several managerial positions both in the United States and Europe. She is a Certified Public Accountant and received an M.B.A. degree from Stanford University. On top of being President, she also serves as a board member of the State Humane Association of California and acts as a volunteer consultant to various nonprofit boards. In 1989, Business Month magazine named Ms. Benninger to its list of “100 Women to Watch in Corporate America.”
Ms. Benninger’s Beginning in HSSV
Even though she wasn’t looking for a new career, Ms. Benninger decided to send in her resume and cover letter and hope for an interview because it seemed interesting. After four months, she received a reply and went in for the interview. They offered her the job and she accepted on the spot before hearing what her responsibilities would be and the compensation involved. Her reasoning for making the decision was because it felt right in her heart and gut, and as such she decided to go for it and hasn’t regretted the decision one bit. I personally identify with this because I make quite a few decisions based on my gut, and even though I make a mistake and fail miserably occasionally, I succeed more often than not and it makes up for the failure.
Early Strategic Decisions
When Ms. Benninger started at the HSSV, the contract with the county that provided 90% of the funding was being cancelled and they had only 300 donors. There was no support from local vets, the government, and the community; and employees were dealing drugs on site. Some animals were being sold to bunchers for use in somewhat questionable labs. They didn’t want to ask for donations because the board felt it gave the impression that they were begging. The one thing it did have going for it according to Ms. Benninger is an amazing mission, and that is to save and enhance lives. Even though there some huge revenue issues looming, Ms. Benninger decided they had to expand into the animal control realm and bid on contracts. In a period of six months, they had nine contracts in different cities that helped keep them afloat.
Finding the Right People
There was a lot of turmoil the first year, and Ms. Benninger ended up creating a complete turnover in management. Because there was too much distrust within the organization, something had to be done to get the right people involved. When looking for people who shared a similar vision and would be a good fit, Ms. Benninger identified luck as one of the primary motivating factors for finding some people. She was able to bring some colleagues from HP over because she was able to share the vision and dream of the mission. It was all about the difference an individual can make in saving an animal’s life.
Passion is a Double-Edged Sword
When it came to hiring “regular” employees, Ms. Benninger found it particularly easy to find those who are passionate about working for the HSSV versus those looking for a paycheck. The problem comes though when people are too passionate and will do nearly anything for the mission. In those cases, passion ends up being personal and in times of conflict, teamwork has a tendency of going out the door if the individual passionately believes they are right. It is important to find the right balance of passion so that individuals will work effectively as a team.
Evolution of Business Strategies
After getting the HSSV out of its revenue crisis and developing a stronger management team, Ms. Benninger began to recognize the inherent clash between animal control and performing humane work. The objective of animal control is to keep people safe from animals., while humane work is to protect animals. As such, the decided to focus on their mission and drop the animal control portion. Even though 60% of their revenue came from animal control contracts, the inherent conflict had the opportunity of alienating all parties and destroying the momentum that was being developed. The most significant problem they decided to focus on was the community save rate - the number of animals that get adopted out of shelters. The average save rate is between 30% and 68% in Santa Clara county, yet Ms. Benninger was able to get that number to 90% in HSSV. Because they have been so successful, they have also been able to engage in something called regional rescue, which allows the HSSV to adopt animals from other shelters that would normally be euthanized. Sometimes these animals have medical or behavioral problems that the original shelter isn’t willing to treat, so it works out well that the HSSV adopts these animals.
Future Role
In the coming years, Ms. Benninger would like to attack the core issue of what drives animals to shelters. She identifies the core issue as a lack of commitment to pets, and feels that being involved in a community that enhances the human-animal bond would do wonders to solving this problem. As such, the HSSV has made the decision that current facility does not fit in with this new dynamic of providing a community and is intending to build a new facility that acts as an animal community center. it is a combination of the traditional shelter services of adoption, education and spay/neuter, but will also develop a community outreach program that includes daycare, boarding, grooming, dog parks, a pet store, and a cafe. The idea is to allow like minded individuals to come together and develop a social network full of opportunities for both the owner and their pet. They will have a place to come and essentially develop a sense of family, and it is this vision that Ms. Benninger perceives as the solution to commitment issues. From a business perspective this will also allow the center to diversify with alternative revenue streams.
Unconventional Solution to Feral Cat Issue
Eighty percent of all euthanasia occurs to cats. The vast majority of those that are homeless, and it is estimated that there are 125,000 homeless in Santa Clara county. Because cats are more elusive than dogs, they are treated somewhat as second class citizens and thus the problem isn’t perceived to be as serious as it really is. The traditional approach that was to catch cats off the street and then euthanize them. The problem with this is that they breed faster than can be euthanized. The catch neuter release program instead works allow the colony to decline because the same number of cats are on the street but they are no longer able to reproduce. She knew that donors don’t want to pay $25-40 per cat to spay them, so she had to go to the city for support. In order to get the city to pay for this idea, though, Ms. Benninger had to phrase the cost in terms of what the city was used to. As such, she pointed out that to catch and euthanize a cat, it costs approximately $200 (which the government was already paying), yet it would only cost $25-40 to spay them. Let’s just say the city went for the idea.
Perception of Value
Originally, the HSSV charged $25 to adopt a cat and $40 for a dog. Five years after she took over, the California Veterinary Association did a study that showed people who paid less for adoption saw the animal as worth less and were more willing to give them up. Ms. Benninger then decided to raise prices to increase the perception of value because she felt that these individuals were more likely to keep their adopted pet. At the same time, she decided to end the message that cats aren’t as important as dogs. After the first year of the change to $110 for each, there was a 10% increase in adoptions and a 50% decrease in returns. To me, this is an amazing insight and I’m very impressed that it actually worked.
How to Get Involved
The average stay of an animal is two weeks to seven months before they get a home. Therefore, to keep the animals in good condition they need volunteers that simply come and love the animals to keep them in good social condition. Sure, they need people to clean kennels, work events, stuff envelopes, do analytical studies, etc., but the easiest way to get involved is as a socializer. One example of a study that is being performed, though, is determining who is leaving without a pet and why? Also, as a final plug, Ms. Benninger says that no contribution is too small (time and money), and she absolutely loves it when little old ladies send them $5.
Audience question: How do you manage your own passion and other people’s passion?
I have to agree with Ms. Benninger when she immediately responded that it is a very difficult question to answer. She says that we should start with ourselves and be willing to strike a healthy balance. From there, we can work to develop a strong team with everyone willing to be a team player versus an extremely passionate individual. She worries about people who absolutely love animals and are willing to state that they think they are much better than people. Essentially, what she really needs is strong people-people. Also, because it is easy to work 15 hours a day, 7 days a week, you have to take care of one another and be able to tell people when to go home.
Conclusion
Although Ms. Benninger may seem at first glance nothing like an entrepreneur, after listening to her talk and reading her accomplishments, it’s easy to see that she is a perfect example of the entrepreneurial spirit. She has a knack for generating concrete results at the same time as passionately pursuing a social mission. Her strong analytical capabilities and amazing strategic thinking provides her with the assets to creating lasting change that adds value to the world.
Our most recent class wasn’t extremely insightful, but we covered a lot and explored a couple things in greater detail. The first half of the class was spent discussing for profit versus nonprofit and the second half involved a quick presentation by me of triple bottom line (TBL) economics and discussion of some of the trip logistics. Because the class didn’t discuss too much that can be reinterpreted into a post, I’ll spend most of my time reiterating my talk into this post.
For Profit or Nonprofit?
The first task of the night was to split into three groups with an average of four people in each group. The first round of discussion involved discussing nonprofits with for profit characteristics, and analyzing whether or not these these crossover characteristics either helped or detracted from their mission. The second round focused on for profits with nonprofit characteristics, and whether or not these characteristics helped or hurt their bottom line or return on investment. I was a bit surprised (but happy) that the overwhelming conclusion from each group was that these crossover points created a certain type of synergy that was beneficial to the organization in question. No one thought that it hurt the organization. In fact, it almost makes me want to analyze organizations that tried the hybrid model and failed.
Triple Bottom Line Economics
After the discussion of the organizations, I gave a short talk about TBL economics. As for a quick history of TBL, the term was coined by John Elkington in 1997 by his book Cannibals with Forks (a great read). He has been working in the field of sustainable development for over 25 years and operates a consulting firm called SUSTAINability with branches throughout Europe and the United States.
Seven Step Framework
- Increase in Competition. This is easy to see with internet startup. Low barriers to entry and a huge potential upside make this industry the perfect example. With increasing globalization, the trend will continue.
- Understand values and relevance to business. Social entrepreneurship epitomizes this step, and since its been gaining significant momentum, I would say we are reaching the point where values in business are becoming mainstream.
- Transparency & Accountability. This was the main focus of my paper and I feel it is the step that we are currently working to integrate. We are hearing more about individual organizations that are integrating transparency and accountability, and the positive benefits that are coming about because of their integration (Ex: IBM and its involvement in the open source community).
- Life-cycle technology. This hasn’t quite registered on the radars yet, but it’s the idea that a product with start its life and end its in the same manufacturing process. For example, old cellphones will be used to make the new cellphones, rather than being thrown away.
- Partnerships. Again, internet startups already exemplify the early stages of this step, and the major reason why this is happening is due to the necessity of speed in deployment. A new business may leverage some open source framework, Google’s advertising system, YouTube’s video system, and Facebook’s networking platform to create an integrated solution for a particular niche. This is necessary because the cost in time and resources is much too great to create equally competent internal systems.
- Faster scales with longer, strategic timeframes. The innovation process is continuing to shrink, and products are spending less and less time on the shelves before they are replaced with newer/better/faster products. Even though this is occurring, more organizations will simultaneously take long-term approaches to the potential ramifications of their business procedures. Google has incorporated this into their business strategies by advising investors not to invest in Google if their looking for short term gains.
- From exclusive to inclusive forms of corporate governance. The final step is an integration of all of the previous steps into a synergistic whole. The idea is that everyone affected by a particular company or process will have a say in that organization or process.
Quick Example of Integration
Looking for talent at community colleges, Microsoft recognized the special challenges that community colleges face: “IT curricula are not standardized, technology used in classrooms is often outdated, and there are no systematic professional development programs to keep faculty up to date.” Microsoft provided $50 million for a five-year initiative and targeted all three problems. The benefit for society was that the investment in local infrastructure and sharing of world-class knowledge and technology over time resulted in providing individuals greater career opportunities along with better teaching facilities for students. The benefit for Microsoft was obviously more qualified engineers. (Excerpt from my research paper, which is attached below).
Main Critique of TBL Economics
The most significant complaint about TBL and similar ideas/frameworks is the idea of measuring social or environmental progress quantitatively. If one organization has a 5% increase of women in management and another donates 2% of it’s profits to socially responsible causes, who is creating better change? That is a difficult question to answer, but frameworks are being developed to help facilitate the measurement. As an answer to the measurement of abstract qualities, a prime example is eBay’s reputation measurement system. Even though it’s hard to put a value on this abstract quality, eBay has successfully done it and has been extremely profitable in part because of it. As such, even though it may be hard to quantify these qualities, we shouldn’t give up before we start but instead go through a process of trial and error to develop a system that works. Even though we will fail multiple times, I have faith we will eventually develop a system that works.
Know Your Role and Conclusion
Overall, this framework has a lot of potential, but needs a lot of work and support from all parties involved to be fully implemented. Governments need to play a supportive, proactive role in developing and mandating a wide-scale framework. Businesses need to realize the upside to developing a TBL outlook and harnessing the ideas so that they work for the business as well as society. Also, citizens need to support legislation in favor of TBL and purchase from organizations that are best capitalizing on the ideas of TBL. Finally, if you thought this post was interesting, you should read my paper which focuses more on step three of the process and can be downloaded here.