Social enterprise workbook

YC name

WB

Social enterprise workbook

PROMOTING YOUTH-DRIVEN SOCIAL ENTERPRISES

CREATING OPPORTUNITIES WITH SOCIAL IMPACT

OPERATING MODEL

STRUCTURES SPECIFIC ACTIVITIES SUPPORT SYSTEMS

RESOURCE STRATEGY

“PEOPLE & THINGS” RESOURCE REQUIREMENTS MOBILISING RESOURCES

THE BUSINESS MODEL

WHAT’S THE DESIRED SOCIAL IMPACT?

FORMULATE MISSION, SPECIFIC OBJECTIVES AND DESIRED CHANGES OF THE SOCIAL ENTERPRISE

ASSESSMENT OF: CHANGES

SOCIAL NEEDS

SOCIAL ASSETS

COLLECTIVE EXPERIENCES

PROMOTING SOCIAL ENTREPRENEURSHIP AND OPPORTUNITY ORIENTED MINDSETS

IDEATION PROCESS

YOUTH SPEAK UP

MAPPING IDEAS QUALIFYING IDEAS

GENERATING PROMISING IDEAS

The participant workbook

The training is accompanied by a participant workbook. The workbook contains exercise templates and tasks for the participants to fill out continuously during the trainings as well as tasks to be carried out between the training sessions. This will ensure that the participants have all the relevant information collated for setting up and implementing their new social enterprises.

Filling out the workbook can be an “evening exercise” or take-home exercise after the trainings where other trainings materials are used such as flipcharts and creative materials.

It is important that you fill out the assignments in the workbook and share it with your youth centre. You should keep the workbook available and always bring it to trainings and meetings.

BACKGROUND

The E4L program under YEFL Ghana works with a number of youth centers (YCs) in Northern Region in Ghana. The strategic objective is to support the YCs to become organisations that are run independently by youth and for youth – and organisations that are financially viable. Therefore, the aim is to support 5 youth centres to transform their structure into social enterprises, that can sustain their daily running and activities that provide the local youth with new and better opportunities.

Our definition of a social enterprise

The concept of social enterprise is not well known in Ghana in general and it is not universally nor consistently defined in Ghana. We find inspiration in the British Council definition of social enterprises as ‘businesses that exist to address social and environment needs, and focus on reinvesting earnings into the business and/or the community’.

The mantra of a social enterprise is to balance making profits with a social mission and it is important to state that the commercial viability of a social enterprise is as important as its social mission. It involves the innovative use and combination of resources to pursue opportunities to catalyze social change and/ or address social needs.

To be effective, social enterprises have to solve the problem of achieving the right trade-off between the dual objectives of profit and purpose.

THEORETICAL BACKGROUND

This model is founded on several theoretical definitions and concepts. The main ones that it draws upon are: What are social enterprises and social entrepreneurs, effectuation, bricolage, design thinking and business development. They will be introduced shortly below to ensure that the you understand the model and are able to convey its principles and methodologies to your fellow youth center colleagues.

the overall model

PROMOTING YOUTH-DRIVEN SOCIAL ENTERPRISES

COLLECTIVE FIT

THE

ENTERPRISE

needs & Assets

• Changes in Society

• Community Needs

• Community Assets

• Personal & Collective Experience

SOCIAL IMPACT

• Mission, Vision and Values

• What is our specific objective for change?

• What do we need to achieve the change?

IDEATION

• Mapping Ideas

• Qualifying Ideas

ACTION PLAN

•

• Analysis of current youth center as a business ENTERPRISE

• Social Enterprise Business Plan

MINDSET

• Opportunity Oriented Mindset

• “How can we” attitude

• Social Enterprise Attitude

• Bricolage

• Passion & Commitment

• Support Systems

• Organisational Structures

• Identify Resource Requirements

• People & Things

• Financial Assets & Needs

• Resource Mobilisation Plan

Creating worthwhile opportunities

The overall development of the model is inspired by the “Opportunity Creation Process” model (see below).

The model focuses on creating entrepreneurial opportunities that are worthy to pursue. Both in terms of creating a positive social change and financial sustainability. Their model is a framework to guide social entrepreneurs through the process of creating a worthwhile opportunity. It is divided into 2 steps:

In the second step focus is on how to take the brilliant idea and convert it into a worthwhile opportunity, which is the bigger challenge. The chances of success are increased if the ideas are grounded in plausible hypotheses about the underlying social impact theory and a business model that includes an effective operating model and a viable resource strategy (see figure 2).

1) generating promising ideas, and

2) Developing attractive ideas into attractive opportunities.

The first step; Generating promising ideas is stimulated by personal and colective experiences, changes, social needs and social assets if the social entrepreneur adopts an opportunity-oriented mindset, actively looking for new possibilities to have significant positive social impact. Successful social entrepreneurs embody a “how can” attitude: How can I address a particular social need or make the most of existing social assets to improve society? How can I capitalize on recent changes to create new opportunities for social impact?

SOCIAL NEEDS

The operating model describes how the social impact theory will be implemented in practice. It is a combination of specific activities, structures and support systems that are designed to work together to bring about the intended social change. The resource strategy is based on how you have decided that the most effective operating model looks like for you. PROMISING IDEAS

SOCIAL ASSETS

STEP

STEP

Design thinking

Design Thinking is a process in which we seek to understand the user, challenge assumptions, and redefine problems in an attempt to identify alternative strategies and solutions that might not be instantly apparent with our initial level of understanding. At the same time, Design Thinking provides a solutionbased approach to solving problems. It is a way of thinking and working as well as a collection of handson methods.

Thinking is extremely useful in tackling problems that are ill-defined or unknown, by re-framing the problem in human-centric ways, creating many ideas in brainstorming sessions, and adopting a hands-on approach in prototyping and testing. Design Thinking also involves ongoing experimentation: sketching, prototyping, testing, and trying out concepts and ideas.

The five phases

There are five phases in design-thinking (as we apply it) and they are:

1. Empathise – with your users

2. Define – your users’ needs, their problem, and your insights

3. Ideate – by challenging assumptions and creating ideas for innovative solutions

4. Prototype – to start creating solutions

5. Test – solutions

You should not understand the phases as a hierarchical or step-by-step process. Instead, you should look at it as an overview of the modes or phases that contribute to an innovative project, rather than sequential steps.

Entrepreneurial approaches: Effectuation and bricolage

Effectuation

Effectuation is an approach to making decisions and performing actions in entrepreneurship processes, where you identify the next, best step by assessing the resources available in order to achieve your goals, while continuously balancing these goals with your resources and actions.

Effectuation differs from the causal logic, where there is a predetermined goal and the process to achieve it is carefully planned in accordance to a set of given resources. The fundamental worldview for effectuation is called the Pilot-in-the-plane which describes the future as something you can influence by your actions, i.e., you can create your own opportunities. Expert entrepreneurs believe that people shape the future. They believe that if they can make the future happen, they don’t need to worry about predicting the future. The focus is on using a set of evolving means to achieve new and different goals. Effectual thinkers believe that if I can control the future - I do not need to predict it.

Bricolage

Can be defined as “making do by applying combinations of resources at hand to new problems and opportunities”.

In an entrepreneurial context, bricolage is creating something from nothing by making do with what is at hand to solve problems and uncover opportunities.

EMPATHISE DEFINE IDEATE PROTOTYPE TEST

THe five principles of effectuation

BIRD IN HAND PRINCIPLE

Start with your means. Don’t wait for the perfect opportunity. Start taking action, based on what you have readily available: who you are, what you know, and who you know.

AFFORDABLE LOSS PRINCIPLE

1 4

Set affordable loss. Evaluate opportunities based on whether the downside is acceptable, rather than on the attractiveness of the predicted upside.

LEMONADE PRINCIPLE

Leverage contingencies and embrace surprises that arise from uncertain situations, remaining flexible rather than tethered to existing goals.

CRAZY-QUILT PRINCIPLE

Form partnerships with people and organizations willing to make a real commitment to jointly creating the future--product, firm, market--with you. Don’t worry so much about competitive analyses and strategic planning.

PILOT-IN-THE-PLANE

Control < > predict: By focusing on activities within their control, expert entrepreneurs know their actions will result in the desired outcomes. An effectual worldview is rooted in the belief that the future is neither found nor predicted, but rather made.

1 3 5

module 1the social enterprise

This first module aims at helping you to understand what a social enterprise is or can be.

THE SOCIAL ENTERPRISE

• Understanding Social Enterprise Models

• Analysis of current youth center as a business

How do we define a social enterprise?

Exercise 1 - our activities

our activities

our most promising opportunities

current YOUth center assessment

Human resources

Organisation

Activity level

Members

INNER CIRCLE - NOT AT ALL

SECOND CIRCLE - TO A LOW LEVEL

THIRD CIRCLE - TO SOME LEVEL

FOURTH CIRCLE - TO A HIGH LEVEL

FIFTH LEVEL - TO A HIGH DEGREE

Management

Financial resources

Strategy

Physical resources

YC as social enterprise assessment

Human resources

Organisation

Activity level

Members

INNER CIRCLE - NOT AT ALL

SECOND CIRCLE - TO A LOW LEVEL

THIRD CIRCLE - TO SOME LEVEL

FOURTH CIRCLE - TO A HIGH LEVEL

FIFTH LEVEL - TO A HIGH DEGREE

Management

Financial resources

Strategy

Physical resources

module 2 - assessment

Change in society

Social entrepreneurs strive to create change in society, but they are also highly stimulated by changes around them. Due to this they search for change, respond to it and exploit it as an opportunity.

Changes in society can create new community needs or community assets, relevant to be aware of when looking for promising ideas. An example could be that the delivery of 4G network has improved significantly in a district thus providing new opportunities for providing services based on internet access. This could be a course, a facility etc. at the youth centre.

Community needs

Community needs can be understood as the gaps between socially desirable conditions and the existing reality. The participants can search for the social community needs that they and the YCs can address. For an idea to be promising, the youth groups’ values and commitment to addressing a particular social need must be shared by enough key stakeholders to give the proposed venture some initial viability.

The youth group must look beyond their personal references and search for social needs in the whole community. In relation to community needs this model focuses on youth related needs in the districts that the YC can work to address.

Community assets

When looking for social needs there is a risk of over-emphasizing the negative. Looking for community assets too, will present the community in a new light and may inspire creative new ideas that would not be visible if the youth group looked at only needs. It is important to understand the tangible and intangible assets in a community as it can lead to the development of promising ideas. It will also give the youth a sense of efficacy and help them understand what resources they have available – and see their resources in a new light. It is closely linked to the personal and collective experiences of the group.

ASSESSMENT

• Changes in Society

• Community Needs

• Community Assets

• Personal & Collective Experience

Personal and collective experiences

Personal experiences often motivate, inspire, or inform the idea generation process. Many successful new ventures ideas arise from the entrepreneurs’ education, work experience, hobbies or experiences in community. Dissatisfaction with the status quo often stimulate entrepreneurial creativity, encouraging social entrepreneurs to look for new approaches to problems and frustrations they have encountered personally or seen in society.

Both negative and positive experiences can inspire to social entrepreneurial ideas. The youth group being a group of individuals with different personal experiences, make it necessary to share the experiences within the group to get an overall view of the collective experiences in the group. Also, they already share common experiences from their former work in the youth group.

relevant changes in our society

List and describe the relevant positive and/or negative changes that have taken place in your society that could be turned into worthwhile opportunities.

main community needs & assets

assets: needs:

our pool of means & resources

module 3 - assessment

Personal and collective resources, community needs, community assets, and change can stimulate promising ideas, but only if the social entrepreneur also adopts an opportunity-oriented mindset, actively looking for new possibilities to have significant positive social impact. As stated in module 2 social entrepreneurs often start by paying careful attention to what is going on around them. When they have identified important problems or difficulties in society, they start looking for opportunities to solve the issues. An opportunity-oriented mindset, being able to see opportunities everywhere, is crucial to social entrepreneurs to be able to find possible solutions to social community needs.

MINDSET

• Opportunity Oriented Mindset

• “How can we” attitude

• Social Enterprise Attitude

• Bricolage

• Passion & Commitment

Dreams and needs

Dreams: needs:

our resources & materials

our best ideas

ideas with opportunities

Total score

Does it have a value creation opportunity?

How will it benefit the youth?

How will it benefit the YC?

Do we have the relevant resources?

Do we have a shared passion for this?

IDEA

stakeholder mapping

stakeholder interest influence total score

score THE STAKEHOLDERS ACCORDING TO:

Low - 1

Medium - 2

High - 3

module 4 - social impact

A ‘social enterprise’ is any enterprise that prioritizes transformative social impact while pursuing financial sustainability. Social enterprises can have nonprofit or for-profit legal structures, but they must have two key elements:

• A social impact mission: a clear goal to improve lives or the environment

• A business model: a strategy for how an enterprise will create, deliver and capture value in a sustainable way

SOCIAL IMPACT

• Mission, Vision and Values

• What is our specific objective for change?

• What do we need to achieve the change?

OUR CURRENT vision & Mission

VALUE

THE VISION TREE

CLOUDS

OUR new vision & Mission

OUR change objectives

MODULE 5 –

IDEATION PROCESS

The purpose of Module 5 is for the you to identify and select activities or products that can create revenue in your youth center. Or, in other words –come up with a range of business ideas

The aim is not to end up with an endless list of “what could be fun to have” but rather activities and products that are in line with the needs of the youth in the district (the customers or users), their current experiences, the means available, the fit with your objectives, and the “passion” of the youth running and using the centers.

Mapping ideas

The ideas selected might be both existing ideas/activities, revisions of activities and new activities. The important focus is to map ideas that the users will need (and buy) and which can generate revenue for the youth center, while also contributing to the YCs social mission.

Qualifying Ideas

Based on the initial mapping you will have time to go into further detail and explore the feasibility of the idea: What is the value in this idea for the young users, who are the users, do we have the required resources and means, and what will it take to implement?

Selecting Ideas

Based on the idea qualification the participants will select the most feasible and viable ideas to continue working on. The ideas that have been qualified can be rated after their relevance to the users, the available resources and experience and based on the rating 2-3 main ideas can be chosen to prototype, test and implement. These ideas are also what will feed into the operating model’s key activities, the resource requirements and the YC business plan.

IDEATION PROCESS

• Mapping Ideas

• Qualifying Ideas

• Selecting Ideas

IDEAS FROm brainstorm

idea description

idea scorecard

THE BUSINESS MODEL - key components

Example of business model components

Entrepreneurship boot camps

OUTREACH AND MOBILISATION SELECT PARTICI-

OUTREACH TO SCHOOLS, OPINION LEADERS, MEMBERS, NETWORK

SET UP ENTREPRENEURSHIP CORRDINATION TEAM OF PARTICIPANTS

6 VOLUNTEERS FOR ECT, NETWORK, MEMBERS, OPINION LEADERS

COMMUNICATION, TRANSPORT

ESTABLISH AND TRAIN VSLA GROUP(S)

3 FOLLOW UP TRAININGS

KEY ACTIVITIES

VILLAGE AGENTS, PARENTAL SUPPORT, E4L PROGRAM, ROLE MODELS

ENSURE YC HAVE 2 VILLAGE AGENTS, COLLABORATION WITH E4L OUTLINED

ECT, VILLAGE AGENTS, E4L, ROLE MODELS EQUIPMENTSPONSORS

VSLA BOX, TRAINING MATERIALS, TRANSPORT VILLAGE AGENTS

PLAN BOOT CAMP HOLD BOOT CAMP TRAINING

E4L PROGRAM, FORMER PARTICIPANTS, LOCAL MENTORS

ENTREPRENEURSHIP TEAM RESPONSIBLE TOGETHER WITH E4L

ECT, E4L FACILITATORS, ROLE MODELS, SPONSORS

MENTORING AND LESSON SHARING

E4L PROGRAM, FORMER PARTICIPANTS, LOCAL MENTORS

ECT RESPONSIBLE TOGETHER WITH E4L (HOLD TRAINING AT YC)

SUPPORT ENTREPRENEURS TO PASS IT ON IN YOUTH CENTRE

E4L PROGRAM, FORMER PARTICIPANTS, ENTREPRENEUR DAYS IN

YC (ECT) SETUP ENTREPRENEUR HUB TO FACILITATE. GET COORDINATOR

ECT, E4L ROLE MODELS, MENTORS, SPONSORS

YC (ECT), E4L, LOCAL BUSINESSES, SCHOOLS, PARTNERS, DA, COORDINATOR

VENUE, MATERIALS, ACCOMODATION,

TRAINING MATERIALS

THINGS

VENUE MATERIALS (PAPER, FLIPCHARTS, COMPUTER, INTERNET)

MODULE 6 –OPERATING MODEL

Every worthwhile opportunity needs to be supported by a business model. A business model should include an effective operating model as well as a viable resource strategy.

Key activities

The operating model describes how the social impact objectives and activities will be implemented in practice. The model breaks down the social business opportunity into needed activities and trace a chain of activities from inputs to outcomes, identifying every necessary step in between. For each business opportunity you will need to find the activities you have to do and in which order you will do it, with the first activity placed to the left.

Support systems

To devise a resource-smart operating structure, the social entrepreneur should consider the needed support system.

After having identified the key activities it is necessary to make structural decisions. You need to ask yourself which capabilities you have already, which you will need to develop and which you will need to get from others. Others can be affiliates, partners, suppliers, volunteers etc.

To assure that you devise a resource-smart structure it might be worth imagining a range of different possibilities. Some capabilities can be delivered in multiple ways and it can be valuable to consider a few different possibilities. You might come up with a better solution by using your creativity and imagination to consider different combinations. Furthermore, looking for the cheapest solution is not always leading you to the most efficient use of scarce resources if this solution does not fit your mission or leaves you with a low quality.

Connected to the chain of activities you have a chain of support structures. For each activity you have to consider what kind of support you need to complete

the activity.

OPERATING MODEL

• Key Activities

• Support Systems

• Organisational Structures

Organizational Structures

To make sure that you will actually be able to handle all the key activities and to coordinate with all the players in the support system you need to set up an organization for your social enterprise. You need to know who is responsible for what activity and who coordinates the activities? I addition you also need to know who has to work closely together in a team and kind of management you will need.

The organization relates directly to the chains of key activities and support structures.

KEY ACTIVITIES BREAKDOWN

KEY ACTIVITIES BREAKDOWN

KEY ACTIVITIES BREAKDOWN

What support do we need?

Outline what support you need for each of your activity chains

What support do we need?

Outline what support you need for each of your activity chains

What support do we need?

Outline what support you need for each of your activity chains

how should we organize?

how should we organize?

how should we organize?

Success critera

step 5

What are the success criteria for this activity for year 1?

State what it is, when it will be done and by who

step 4

State what it is, when it will be done and by who

step 3

State what it is, when it will be done and by who

step 2

State what it is, when it will be done and by who

step 1

Key activity or objective

What is the first step? State what it is, when it will be done and by who

What is the key activity or change objective you want to work on?

2

and by who

work on?

activity or change objective you want to

when it will be done

What is the key

step? State what it is,

What is the first

and by who

done and by who

and by who

when it will be done

when it will be

when it will be done

and by who

State what it is,

State what it is,

State what it is,

when it will be done

year 1?

State what it is,

step 1 step 2 step 3 step 4 step 5

Success critera

Success critera

step 5

What are the success criteria for this activity for year 1?

State what it is, when it will be done and by who

step 4

State what it is, when it will be done and by who

step 3

State what it is, when it will be done and by who

step 2

State what it is, when it will be done and by who

step 1

Key activity or objective

What is the first step? State what it is, when it will be done and by who

What is the key activity or change objective you want to work on?

MODULE 7 –RESOURCE STRATEGY

Two essential components in a business model is the operating model that outlines what activities do we have; what structures are needed to support that; and how do we need to organize to implement these activities? This was developed in module 6.

The other essential component is having a viable resource strategy to support your business. Without that the operating model cannot create value. The two needs to correspond and ensure that is a plausible model where the resource strategy reinforces the effectiveness of the operating model.

Thus, module 7 builds on the operating model and exercises introduced in Module 6.

Module 7 focuses on what resources you will need to run the business and how to make a plan for mobilizing the resources. Fundamentally, the social enterprise needs ‘people’ and ‘things’ to start up or go forward.

’People’ have intangible resources such as skills, knowledge, network, time, credentials etc.

‘Things’ are understood as the resources that people need or use e.g. space, equipment. For the social enterprise both types of resources can sometimes be attained without money, so the resource strategy is more than a financial strategy. 1 2 3 4 5 PEOPLE 1 2 3 4 5 THINGS

RESOURCE STRATEGY

• Identify Resource Requirements

• People & Things

• Financial Assets & Needs

• Resource Mobilisation Plan

Should we charge the intended users?

Many social entrepreneurs are reluctant to charge their primary beneficiaries, especially when the beneficiaries are poor or are seen as deserving the benefit. This reluctance is morally appropriate in some cases, but it can also be patronizing and paternalistic. In Chapter 1, we noted that one of the trends in social entrepreneurship is encouraging people to take responsibility for addressing their own problems. Sometimes charging a fee, even a small one, can add to people’s sense of empowerment and responsibility. Charging fees screens out those who aren’t serious. Those who choose to pay a fee tend to have a greater commitment.

Finally, charging a fee opens us to a market discipline that can be helpful. If no one will pay, we may not be delivering the value we think we are. Paying also gives beneficiaries more right to complain than if they receive free services. Creative structures can be developed to address affordability issues. These structures include sliding scales (with lower fees for poorer people), scholarships, and deferred payment.

Inspiration for mobilizing resources

There are different ways for social enterprises to mobilize resources. Here are some of the options:

Build partnerships and alliances

When resources are scarce or hard to mobilize, as is often the case in a start-up stage, it may be wise to build resource-based partnerships with others that have (perhaps under-utilized) resources of the kind required. This could be partnering with E4L to provide the training in a bootcamp, a local bank to provide VSLA boxes, a school or mosque to provide space, or the DA providing venues, or the local radio to advertise for the youth center. Or it could be borrowing/sharing equipment that is needed, e.g. printer, tablets, etc. Remember that partnerships may come with trade-offs that participants have to weigh – are they in line with the objectives and what are the risks involved?

Attract donations or sponsorships

It is possible to find donations or sponsorships from people, institutions or businesses that are sympathetic to your mission. It can be in the form of cash, products, goods or services. A local established business man/woman might be willing to support entrepreneur boot camps, or the local stationary shop might be willing to donate supplies to the center or give reduced prices.

Volunteers and in-kind donations

Volunteers are one of the YCs main resources and they can significantly reduce the cash need for a social enterprise. It is important to be aware of fact that there are risks related to over relying on volunteer work. There may be certain critical tasks/positions where efficiency and continuity weighs in. Volunteering or in-kind donations may also be from external people. E.g. the local business man/woman who volunteers and mentor new entrepreneurs or the local teacher who has study clubs every week, or the local contractor donating left over materials.

Payments from users and members

It is necessary to decide whether or not to charge users or members of the YC/SE for services. This could be membership fees, payment for using e.g. computer/internet, or for receiving trainings. The users are –basically – the customers. Do you feel that they should contribute, or do you want to find a business model where everything is free? Which requires that that your organization needs to find more resources.

Produce and sell products

One of the youth center’s activities may also involve some production. For instance, training in vocational skills create a product (e.g. beads) that can be sold to support the running of the center. Or collecting plastics or waste that can be sold to. It might also be upcycled to new products – e.g. producing lamps from tins or soda cans. Think creatively!

Sell your services to possible other customers

The YC might also have more intangible products to sell in the form of skills or services. This could be carrying out a survey for the DA or an NGO, training other VSLA groups at a fee, or doing radio programs on specific issues. The sky is the limit – it all depends on how participants perceive their own capabilities as a marketable asset.

what people do we need?

what people do we need?

what people do we need?

what things do we need?

what things do we need?

what things do we need?

NOTES

Start up budget

Buildings cost

total buildings

Equipment & inventory

total Equipment & inventory

advertisement & promotion

total advertisement & promotion

KEY ACTIVITIES carried out now

total OKey activities

Total costs for start up

cash at hand or assets

Total budget for start up

Monthly operating budget

income

total income utilities, equipment cost

total Equipment & utilities

staff

total staff

Other costs

total Other costs

Total monthly running costs

balance income and costs

resources to mobilize

DONATIONS/SPONSORSHIPS

VOLUNTEERS/IN-KIND DONATION

PRODUCE OR SELL PRODUCTS AND SERVICES

USER/MEMBER PAYMENTS

PARTNERSHIPS/ALLIANCES

OTHERS

resource mobilisation plan

resource mobilisation plan