Big businesses can support social enterprises commercially and help them grow to the next level. Social enterprises are now part of the fabric of British life. Up and down the country they are tackling social problems and improving communities, people's life chances and the environment, and then reinvesting their profits back into the business or the local community. They are a growing, exciting and vibrant part of the mix in today's jobs market.
Annette Hardcastle
However, with the dramatic growth seen in this sector in the last decade, is there a cloud on the horizon that could hinder further development?
Boston Consulting Group's report on social investment highlights the barriers to unlocking growth in this nascent market. The challenges for social enterprises include knowing how to invest; understanding how to expand either geographically or services provided; maintaining a commercially sustainable business model – all while staying focused on the enterprise's direct beneficiaries. In a nutshell, many social businesses reach a sustainable size and then hit a glass ceiling. The nature of these organisations means they employ talented, experienced and committed people but may lack specific technical specialists in key areas to grow to the next level.
This is where big businesses have a role and a mutually beneficial relationship between traditional corporates and social businesses can be struck – a relationship where skills and know-how are shared.
Working at British Gas, I have seen this first hand as part of my work with the London Early Years Foundation (LEYF) – an organisation that runs 24 nurseries in London. Here are a few of the ways large businesses and social enterprises can help each other.
1. Creating a structure that enables scaling and delivers cost efficiencies
Organisations wanting to grow can reach a ceiling where simply increasing the number of 'flexible' resources that do everything from contacting customers to invoicing, becomes inefficient.
Larger organisations by their nature will have experience in creating business processes and supporting infrastructure that are suitable for big companies, whether in finance, IT, HR or customer contact. Businesses can help social enterprises create systems that work at all levels – creating economies of scale without compromising levels of support.
I experienced this in my work with the London Early Years Foundation. Nursery managers at each site did everything from answer the phone from prospective customers to collecting payment; not a model that could be scaled with the organisation's growth plans. We were able to step in and help them create a small but effective customer contact centre, to manage some of the core processes; helping free their staff up for front-line nursery work. This is one of the objectives businesses and social enterprises share – the need to grow without losing their customer focus.
2. Providing commercial and marketing expertise
Social enterprises by their nature are 'commercial' as they trade products and services. However, we're being told that some lack deep expertise across all commercial areas that are key to growth. This could include creating a cohesive and impactful brand or developing marketing campaigns. Social organisations don't usually have the ability to buy-in this expertise externally so businesses can play a useful role by sharing their sales, marketing and communications capabilities.
3. Strategic planning
For any social enterprise, their core focus is likely to be their day-to-day operation and supporting beneficiaries. One area that a large corporate can support is helping the social business to take a step back and applying a strategic approach to planning and long-term decision-making. This can mean translating the vision into an actionable strategy, evaluating different routes to growth and developing the right strategic relationships; whether through the board or a broader network.
4. Learning from social enterprises
The relationship between social enterprises and big business flows both ways. Speaking from personal experience, being seconded from a business to a social enterprise is one of the most inspiring things employees can do.
I've learnt new skills working with senior business leaders within the London Early Years Foundation – new skills I will take back to British Gas. Taking time to work in a different place broadens your horizons, and reinvigorates you by having tried something new.
A point worth making is these benefits don't come automatically. Collaboration between large businesses and social enterprises only works when both sides approach the relationship in the right way.
Clearly-defined, realistic objectives are vital, as is a ruthless focus on the end goal (rather than the temptation to do everything). Both sides also need to come with open minds and be willing to learn – no one has the monopoly on good ideas.
Finally it's important that both parties have a legacy in mind. It's vital the expertise doesn't vanish once the collaboration ends and that the benefits remain embedded within both organisations in the long term. I firmly believe that this is a future model that we will see with increasing regularity in the future – a model that will bring benefits to social enterprises, big businesses and the wider economy in the years ahead.
Annette Hardcastle works in residential customer services at British Gas but has recently been seconded to the London Early Years Foundation (LEYF), a social enterprise that aims to make quality childcare accessible for everyone. This arrangement is part of the British Gas partnership with the Social Business Trust. (
http://www.theguardian.com/social-enterprise-network/2013/aug/07/big-businesses-support-social-enterprises)
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