What would it take for social enterprises to become a hot career choice among B school graduates?
Part II
In the first part of the blog, we touched upon what were social enterprises and what social entrepreneurs did. We also explored aspirations of B School students and the gaps present when faced with a career in social enterprises. In this concluding section, we will look at some of the ways in which these gaps can be addressed.
To re-cap, some of the gaps because of which social enterprises are very rarely a career choice for graduating B-School students include:
| Expectation of B-School students | Social Enterprise offering | Gap - Issue raised |
| Attractive compensation | Very limited compensation | Financial insecurity, doubts about sustenance |
| Work content | Challenging work assignments;adequate opportunity to utilise education; | None. In fact social enteprises offer an enterpreneurial work setting and hence fertile ground for applying business school education |
| Opportunities for growth | Some but not a fully defined career progression | Professional growth ? Future/forward linkages; recognition in mainstream organisations |
| Professional work place settings | Unlikely to be a fancy office; but likely provide functional workplace | peer pressure;societal expectations not met |
Potential Solutions:
1. The Business Model of the Social Enterprise should be for-profit.
At the outset, the most the important factor is to design the social enterprise as a for-profit enterprise. This has multiple ramifications, namely: increases the chances of commerical funding which in turn sets off a chain; it provides sufficient finances to attract top-talent including B School graduates; necessitates the need for commercial/business metrics; increases the competitive nature of the work environment and provides a stimulating atmosphere.
Understandably this is not possible in all scenarios but where possible, the drive should be towards revenue -generation through independence to profits.
2. Enhanced role of the VC/PE organisations
Given that financial backing is critical to the success of social enterprises and attracting top-talent, there are multiple ways in which VC/PE organisations can provide stimulus and support.
a. VC/PE LP's could stipulate that part of the funds or profits generated from exits be invested in social enterprises. These investments could either look for only return of the capital or modest returns (6-9%).
b. LP's/FII's/HNI's could set-up more funds that are specifically targeted at the social enterprise space. Exisiting organisations such as Bridges could work as role-models.
3. Forward/Industry Links
One of the uncertainities associated with working in a social enterprise is lack of future prospects and the difficulty in making a transition back into mainstream commercial organisations.
Just as in successful private/public partnerships, I believe strong symbiotic relationships can be created between social enterprises and commercial organisations. For commercial organisations, these partnerships can be an integral part of their CSR policy, while for social enterprises the avantage is from access to resources. Additionally, it helps create the links and networks which can help talent movement.
4. Governmental and regulatory support
Governments can play a vital catalytic role and foster the social entrepreneurial space. Governments can do this via policy and through other measures such as:
a. Provide tax exemptions not only for social enterprised who generate profits but also for the investor community to encourage investments
b. Identify unmet social needs which can benefit from a entrepreneurial set-up, step-back and provide support for entrepreneurs who would like to address such issues without bureaucratic hindrance. The government could set-up a national database with a list of such problems and invite suggestions, solutions.
c. Part of the government budget outlay shoud include specific allocations for social enterprises.
5. Social Metrics to be used as performance indicators
A lack of generally accepted metrics in the social dimension makes it difficult to assess the progress or impact of a social enterprise. Additionally, social enterprises do not always use commerical metrics to measure performance in areas such as Operations, Finance, HR etc. Adopting a commercial mind-set adna applying these measures can add further credence to these organisations and also affect individual performances. Each social enterprise can also devise its own set of social metrics and make this publicly available in a easy-to-understand form.
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