“Substitute personal greed with compassion, and the balance sheets will still work out just fine. Profit/loss statements take on a whole new dimension and meaning. Greed and capitalism are not one and the same thing. “Social” capitalism, social enterprise, is perfectly doable. This is the most effective sustainable strategy available for alleviating widespread human suffering stemming from poverty and all that comes with it — up to and including terrorism.”
Terry Hallman – founder, P-CED (1952-2011)
At the end of a recent blog, Doug Wolfgram poses an interesting question about the ability of those who are less than fully equipped to compete in today’s reputation economy:
“What if you are truly an expert but just don’t like to talk that much? What if you focused your time developing programming skills not writing skills? How does the non-writer, non-pundit or non-influencer succeed in the Social Age? Is there any hope for the closet genius? Or is that the next age…”
In a similar vein Umair Haque, writing of ‘The Next Big Thing‘, contemplates the culture of empathy in business:
“Here’s how an organization designed for empathy might work. I’d go one step past “Undercover Boss“, and institute a new rule: Every year, anybody with the word “chief” or “senior” in their title spends two weeks at an orphanage for children affected by war crimes (without a retinue of liveried footmen and tuxedoed butlers). Here’s how one designed for compassion might work. I’d go one step past philanthropy, and institute a new rule: that should a series of real-world social objectives fail to be met, bonuses are slashed by fifty percent, and reinvested in said social objectives (I know, so unfair). Here’s how one designed for love might work. Don’t like it? Don’t do it? Not feeling it? Stop working on it. Love it? Pitch it, seed it, build it, live it. Sounds a little crazy, right? Not if you’re Zappos or Netflix.”
Neither seem to be aware that what they imagine as a future scenario, is with us already in a very practical sense.
I offer a different perspective. It begins with a paper, asking ‘what if business was done differently“, to make people the central focus. It reasoned:
“We are at the very beginning of a new type of society and civilization, the Information Age. Historically, this is only the third distinct age of civilization. We lived in an agricultural age for thousands of years, which gave way to the Industrial Revolution and Industrial Age during the last three hundred years. The Industrial Age is now giving way to the Information Revolution, which is giving rise to the Information Age. Understanding this, it is appropriate to be concerned with the impact this transition is having and will continue to have on the lives of all of us. In that it is a fundamental predicate of “people-centered” economic development that no person is disposable, it follows that close attention be paid to those in the waning Industrial Age who are not equipped and prepared to take active and productive roles in an Information Age. Many, in fact, are scared, angry, and deeply resentful that they are being left out, ignored, effectively disenfranchised, discarded, thrown away as human flotsam in the name of human and social progress. We have only to ask ourselves individually whether or not this is the sort of progress we want, where we accept consciously and intentionally that human progress allows for disposing of other human beings.”
After putting these concepts into practice, an operational form, this blog 4 years ago, observed how far it had come.
“The corporations involved in this almost fantastical deployment of the machines and communications infrastructure that we now rely on profited for themselves and their shareholders, and certainly produced social and economic benefit around the world. Those efforts were and are so profound in influence as to transform human civilization itself. That is the Information Revolution, and it is nothing short of astonishing.
So it is safe to say that all these players in the Information Revolution — the enterprises that created it — have engendered almost immeasurable social benefit by way of connecting people of the world together and giving us opportunity to communicate with each other, begin to understand each other, and if we want, try to help each other.
It is that last phrase — “try to help each other” — which is what the phrase “social enterprise” is getting at. As Bill Gates said in 2000, “poor people don’t need computers.” and rejected a business approach to alleviating poverty. That statement served to mark the clear distinction between what traditional capitalism did and did not do. Gates’ aim at that time was to profit from people who could afford his company’s products, while those who couldn’t were largely or completely ignored. That has been the accepted limit of traditional capitalism. It has been a marvelous means of social benefit and economic advancement for many people. Nevertheless, those excluded are just left out.
The term “social enterprise” in the various but similar forms in which it is being used today — 2008 — refers to enterprises created specifically to help those people that traditional capitalism and for profit enterprise don’t address for the simple reason that poor or insufficiently affluent people haven’t enough money to be of concern or interest. Put another way, social enterprise aims specifically to help and assist people who fall through the cracks. Allowing that some people do not matter, as things are turning out, allows that other people do not matter and those cracks are widening to swallow up more and more people. Social enterprise is the first concerted effort in the Information Age to at least attempt to rectify that problem, if only because letting it get worse and worse threatens more and more of us. Growing numbers of people are coming to understand that “them” might equal “me.” Call it compassion, or call it enlightened and increasingly impassioned self-interest. Either way, we are all in this together, and we will each have to decide for ourselves what it means to ignore someone to death, or not.”
So what has this meant, in a practical sense?
It was in Russia in 1999 where this new way of doing business helped other people create business, 10,000 micro enterprises in the Tomsk region of Siberia. Tomsk had been chosen partly for its role as a communication centre, but determined vested local interests defended access to the Information Highway. It was nevertheless highly successful and replicated by USAID in several other cities.
The internet had brought me in contact with my colleague. Our relationship began with a conversation about the Ignorance and Want Allegory from Dickens’ Christmas Carol.
It was the internet which later made me aware of his fast for economic rights in the US and the means for me to try and raise awareness. In the end I offered him an exit strategy inviting him to the UK.
We then spent many weeks early in 2004 creating a business plan to address poverty in the UK, it proposed a strategy for rural community broadband which would invest profits in local economic development.
Later in 2004, came the siege at Beslan and this time the internet became the means for those who wished to make a direct connection with those afflicted, in the spirit of international friendship and compassion.
On reflection, this was the year that Facebook went large, with the traffic and monetise approach, a rather different interpretation of being social.
It was the medium by which I became aware of the story of Torez, from a visiting NGO and the means by which an awareness raising campaign developed a strategy for intervention in full public view. I learned later, that this was described as ‘radical transparency.
It was also the medium by which the final paper, describing a ‘Marshall Plan’ was propagated. When published online it reasoned:
‘This is a long-term permanently sustainable program, the basis for “people-centered” economic development. Core focus is always on people and their needs, with neediest people having first priority – as contrasted with the eternal chase for financial profit and numbers where people, social benefit, and human well-being are often and routinely overlooked or ignored altogether. This is in keeping with the fundamental objectives of Marshall Plan: policy aimed at hunger, poverty, desperation and chaos. This is a bottom-up approach, starting with Ukraine’s poorest and most desperate citizens, rather than a “top-down” approach that might not ever benefit them. They cannot wait, particularly children. Impedance by anyone or any group of people constitutes precisely what the original Marshall Plan was dedicated to opposing. Those who suffer most, and those in greatest need, must be helped first — not secondarily, along the way or by the way. ‘
The concepts it described of profit for social purpose would be reflected 5 years later when Harvard professors Michael Porter and Mark Kramer described ‘Creating Shared Value’. It differs however in that it’s not about making a profit by solving social problems as Kramer advocates, but using profit as prescribed by Caritas in Vertate:
‘This is not merely a matter of a “third sector”, but of a broad new composite reality embracing the private and public spheres, one which does not exclude profit, but instead considers it a means for achieving human and social ends. Whether such companies distribute dividends or not, whether their juridical structure corresponds to one or other of the established forms, becomes secondary in relation to their willingness to view profit as a means of achieving the goal of a more humane market and society’
The impact and influence, in the cause which my colleague gave his life to and that for which he should be celebrated , was his commitment to the idea that Every Child Deserves a Family
My answer then is that rather than being the next age of business, today these two interpretations sit side by side, almost as if in a parallel universe.
Today we have two groups of people using the term social business. For some it’s social media business, typified by Brian Solis . For others, Like Muhammad Yunus, it’s social purpose business – to do good to people and the planet.