Explore, imagine, and learn to create a better future for your enterprise, and do something about it now! New Rules for Nonprofit Organizations Let’s investigate a different future together… BUSINESS SCULPTORS Management Consultants By Marcus Coetzee, 18 September 2008
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Explore, imagine, and learn to create a better future for your enterprise, and do something about it now!
New Rules for Nonprofit Organizations
Let’s investigate a different future together…
BUSINESS SCULPTORS Management Consultants
By Marcus Coetzee, 18 September 2008
Explore, imagine, and learn to create a better future for your enterprise, and do something about it now!
It is time for us to take the “bull
by the horns” and rethink some
of our fundamentals
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HDI Index:
• Educational Attainment
• Life Expectancy
• Literacy
• GDP/capita
Increase in HDI from 1975 to 2002
South Africa has lagged behind some
of the other developing countries
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What has happened to this fine
organization – are you next?
Nonprofit organizations become business-like
• Social enterprise and income generation
• Social entrepreneurship
• Outcomes orientation
• Social accounting (Social Audit Network)
• SROI (REDF and NEF)
• Exploring financial profit
Businesses become socially responsible
• CSR and the Good Corporate Citizen
• Social and environmental reporting
• Ethical consumerism and investing
• CSI and Corporate Philanthropy
• Social responsible companies + finding talent
• Exploring social profit
NPOs and businesses converge
CONVERGENCE
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A winning team!
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…but how well would it play in a
game with new rules?
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Ten New Rules for Nonprofit Organizations
1. Start thinking of yourselves as social enterprises 2. Purpose your organization 3. Focus on your outcomes 4. Sell your outcomes; don’t beg for funding 5. Demonstrate value-for-money 6. Pursue partnerships with businesses 7. Earn income; don’t rely on donations 8. Build highly-engaged communities 9. Embrace new media 10. Become a social entrepreneur
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Rule 1: Start thinking like a social enterprise
A social enterprise is a bold and visionary organization that seeks to make a real difference in the world.
It is neither a “business” nor a “nonprofit organization” – but takes the best of both concepts and involves a subtle shift in perception.
Enterprising (adjective): Showing initiative and resourcefulness…Oxford Dictionary
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Have we always believed
in this paradigm?
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Rule 2: Purpose your organization
“Our mission is to contribute to the
operationalization of the concept of sustainable
development by building the capacity of the civil
society to respond appropriately to all sustainable
development issues through effective implementation
of strategic sustainable development projects.”
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In search for the common denominator
In the search for the
common denominator,
organizations have let
their visions and
missions become too
abstract to be useful.
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Time to discard that Vision & Mission
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Rule 2: Purpose your organization Concept Key Question Example
Purpose Why do we exist? (…and what would happen if we did not exist?)
• Reduce TB in Nyanga.
Outcomes What are the outcomes we need to achieve in order to best fulfill our purpose
• Effective district TB control strategy • Effective clinics • Effective treatment supporter system • Change in patient behaviour
Indicators How will we know if we are achieving our outcomes?
• Effective clinics (knowledge of TB amongst sisters, referral system, speed of sputum tests, record keeping…)
Blueprint How do we accumulate the resources we need and use them to achieve our outcomes and thereby fulfill our purpose? – “Business Model”
• Get payment from state • Run workshops • Setup treatment supporter system… •…
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Inputs Activities Outputs Outcomes Fulfills
Purpose
People Money Time Skill etc.
Do workshops Do training courses Do research Do mentoring Do research Do lobbying
Numbers: - participants - research reports - workshops run
Change in behaviour Change in organizations
Reason why organization exists. Change in community, society etc. that the organization seeks to bring about.
Rule 3: Focus on your outcomes
How does one determine the
effectiveness of a social enterprise?
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Inputs Activities Outputs Outcomes Fulfills
Purpose
An effective social enterprise can provide convincing evidence of having achieved its formally-stated outcomes.
Rule 3: Focus on your outcomes
Efficiency = Outcomes achieved / Inputs utilized
Productivity = Outputs achieved / Inputs utilized
SE-ROI = Value of Outcomes achieved / Value of Inputs utilized
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Rule 4: Sell your outcomes; don’t beg for funding!
1. Define your purpose and outcomes. 2. Think of yourself as “selling outcomes” to Customers and Investors as opposed to “looking for donations.” 3. Sell success – not trauma. 4. Research and pitch – don’t mass mail. 5. Develop an enticing brand. 6. Use PR to develop a presence in your industry.
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Is this your organization? Doing
good and “begging” for funding?
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Sell the outcomes
your organization
achieves!
You can sell:
Functioning Clinics
Reduced crime rate
Policy Changes
Functioning Police
Stations
People Employed
Decrease inn rate of HIV, TB, Teenage Pregnancy
Responsible Teens
Rehabilitated Offenders
Treatment Adherence
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Rule 4: Sell your outcomes; don’t beg for funding! Which of your organizations is
selling tragedy and trauma?
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Sell success, not problems! www.abalimi.org.za
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• Nonprofit organizations should research corporates to find out how they can help them improve their strategic position.
• “Pitch to investors” rather than simply write and send of hundreds of proposals to unfamiliar investors.
• Make sure that companies that want to invest in your cause can easily find you!
Pitch
CSR
Demand
Favourable Policy
Supply
Research and Pitch – don’t mass mail
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Would you look at a proposal of these orgs?
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Brand is the sense that people have of an organization or product. It is frequently intangible yet has meaning.
Brands can be so powerful that they can motivate people to give their lives to a cause.
It is more than just:
• Name, Logo and Corporate ID and Look
• Reputation
• Purpose
• Customer Experience
• History, successes and failures
A brand for your organization?
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Does the brand of this good
organization excite you?
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…and the brand of
this organization?
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Rule 5: Demonstrate value-for-money
Investors and Customers experience value-for-money when you satisfy their needs at a reasonable price and risk.
Photo by Calvin Wallace
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Are you substantially (e.g. 2-5 times) better than your “competitors” at:
1. Having the required social impact / $ paid or invested (some social enterprises even pay the investment back with profit.)
2. Accounting for your social impact – social accounting?
3. Reporting on your progress (in real time…)?
4. Improving your investors’ and/ or customers’ strategic position?
Demonstrate value-for-money
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Rule 6: Pursue partnerships with businesses
Help Businesses to :
Honour responsibilities
Increase demand for products and services
Develop favourable policy environment
Secure supplies of valuable inputs
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The BEE ownership partnership
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Rule 7: Earn income; don’t rely on donations
It is immoral for your nonprofit
organizations to rely on “donations!”
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• “Pioneer Human Services has been nationally recognized as a model social enterprise. Since our founding in 1963, we have served over 100,000 people through an integrated array of services including housing, employment, training, treatment, counseling, and re-entry services. Some of the people we serve are recovering from chemical dependencies; some are ex-offenders; others are homeless, but all are individuals on the margins of society.”
• “Pioneer is a unique nonprofit organization in that it earns 99% of its income through the sale of its products or services. As social entrepreneurs, we combine the passionate pursuit of our social mission with the discipline and innovation of a for-profit company. ”
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Does TADSA earn income
or receive donations?
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Social enterprises are well-established in the United Kingdom:
• 55,000 social enterprises
• Turnover of £27 billion/year
• Employs 5% of workforce
• Government has a social enterprise strategy and department of social enterprise
• Legal form for social enterprises (community interest company)
• Social enterprise funds (e.g. DOH has £100 million in investment fund for social enterprises.)
Social enterprises in the UK
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Rule 8: Build highly-engaged communities
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• Japan won’t hunt humpback whales in southern ocean this summer for “scientific research” due to international pressure!
• Green Peace ran campaign to name a whale they were tracking on satellite.
• 130,000 people voted for “Mr Splashy Pants”
Rule 8: Build highly engaged communities
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Rule 9: Embrace new media – some starting points
1. Website
2. Social Networking
3. Blogging
4. Subscription and Mailing Lists
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What if I Google your cause in order to find a good investment – will I find YOU?
Highway Hospice comes out No 1.
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Have you bought your cause’s keywords?
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Does your organization have Facebook?
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A blog for your organization?
This is one of the 39 blogs I
review every evening.
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Viral Marketing
Vernon Koekemoer – a plumber
at a rave in Boxburg?
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Rule 10: Become a social entrepreneur
Resources: (Time, money, expertise etc.)
Purpose Fulfilled
Blueprint
A social entrepreneur asks how he/she can improve social impact ten-fold using existing resources!
New Philosophy? New Paradigm? New Blueprint? New Rules?
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Model 2: Recycling Tetra-Pak Rehabilitating Prisoners and Packaging waste
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Tetra Pak
Timber Plastics recycles waste and employs
former prisoners
NICRO manages
rehabilitation
SASOL ChemCity
Green and low cost building materials
Fibre to Paper Mills
Earns income Provides
rehabilitation
Enterprise development and honouring responsibilities
Rehabilitating Prisoners and Packaging waste
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Photo by Sung the Vagabond
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