By Special to Capital Business
Monday, August 30, 2010; 28
A growing breed of entrepreneur is popping up in the business world. "Social entrepreneurs" are using business principles to create ventures that include an element of making positive and sustainable changes in their communities.
Locally, we have some strong players in this arena -- take Honest Tea, based in Bethesda, for example. The beverage company, which makes all-natural products that are Fair Trade Certified -- meaning the production and trade of their ingredients meet certain economic and environmental criteria -- received a big investment from Coca-Cola, but remains focused on creating "healthy and honest relationships with its customers, suppliers and the environment," according to the company Web site. That's just one example of how businesses can be successful but still conscious of how their decisions affect people and the planet.
Businesses in any industry can have a social component. For entrepreneurs just starting up, or more established businesses looking to address a social problem, there are some things to consider to help plan your attack. The Center for Social Value Creation at the University of Maryland's Robert H. Smith School of Business has some advice:
1. Identify the problem and its root cause.
Melissa Carrier, executive director of the Center for Social Value Creation
"Too often, social entrepreneurs go right to the solution. As the complexity of social problems continues to rise, it is critical for would-be change agents to understand the underlying cause of the social issue they want to address. In doing so, they will create a more effective solution and achieve their goals more quickly."
2. Dream up your solution.
"Think big! As author and business expert Jim Collins famously coined the phrase BHAG, this is your time to create big, hairy, audacious goals. The recipe for success: Be imaginative, innovative and spirited in your solution-creation process."
3. Create your action plan.
"Now is the time to build a plan that is specific, achievable and time-bound. Start with key milestones in the development process and build detailed steps from there. Take your time with this step, but also recognize that your plan will inevitably change. That's the nature of entrepreneurship."
4. Identify your needs.
Julie Lloyd, assistant director of the Center for Social Value Creation
"Think creatively about where you can obtain the things you need to be successful, whether it's capital, resources or volunteer time. Look to your own personal networks first -- you'd be surprised what people are willing to offer if you simply ask."
5. Get the word out.
"These days, more than ever, you don't need to break the bank to gain supporters for your organization. One big advantage of using free and low-cost tools such as social media is that you can get immediate feedback on what works and doesn't work, and what resonates and doesn't resonate with your target audiences. It's like having your very own focus group."
6. Fund your idea.
"This is one of the most challenging aspects of being an entrepreneur. You must consider how to find alignment with different donor types such as philanthropic individuals, foundations and investors. The key is to a make a strategic match between your mission and organizational goals and the donor/investors goals. Not all funding is right for all ventures."
7. Start small, scale fast.
"Pilot, pilot, pilot before investing huge resources into your solution. You'll learn much in the process, and when it starts working, scale."
8. Measure your impact.
"Identifying how you will measure your success should not be an afterthought -- it should be part of the planning from the very beginning. The more you're able to build capturing and analyzing your outcomes into your workflow, the better off you'll be."
9. Assess and iterate.
"Even Muhammad Yunus, founder of Grameen Bank and a pioneer in the field of microcredit, has admitted to starting off with a crude -- but functional -- version. The key is in refining that version by honestly assessing what works and what doesn't, and adapting your methods over time."
Looking for some advice on a new business, or need held fixing an existing one? Capital Business and the experts at the University of Maryland's Robert H. Smith School of Business are ready to assist. Contact us at email@example.com.