How Your Business Can Carry Out Social Innovation (And Become A Force For Good)
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Under normal business conditions, the assumption is often that a unique business model will safeguard you from future threats, but this may not be the case during a crisis. As such, an enterprise’s survival depends on how wisely you have managed resources- and how you will be managing them in the future until the economy revives. But during a crisis like the one we are having now, businesses, even while they struggle to survive, must also find ways to contribute to the society- especially since our communities, as a whole, are struggling.
Social innovations are innovative activities, services, or products that meet social needs, and they allow you to impact the behavior of individuals or groups of people in ways that are not always economically motivated. The three key sections of a business model for firms in the social innovation space are impact, market, and business operations. Most startups are familiar with the market and business operations part of the business model, so I thought I’d explain impact in this article. Impact focuses on the problems you are solving, the beneficiaries, the impact of change, and the impact on beneficiaries and employees if you close down.
Many companies are currently struggling with the last point mentioned above, as employees are bearing the brunt of the market fallout. So, what can you do to minimize this impact? In such cases, I would advise offer equity to employees for reduced pay or no pay, or if you are terminating contracts, offer to recruit or rehire when markets open up. The main thing for companies to recognize at this stage is that you can have a tremendous impact on the world by the message you are sending out. Are you inclusive? Do you live your values? What matters most: profits or people?
If you are a for-profit firm, maybe now is the best time to look at business models in the social innovation space. While the below business models focus on communities and talent during a time of isolation, fragmentation, inability to afford healthcare, and unemployment, they are also applicable to the government.
1. Skills development Inclusive employment focuses on the skills development of marginalized communities through job opportunities. Create a company or a branch that offers skills training and a small stipend, and this will get the “job done” while also developing skills for those hired that they can leverage when the market opens up. This practice is often used in coding jobs, but they can also be used in other areas like engineering, assembly of goods, infrastructure development/maintenance, or services.
2. Barter for talent Many communities have a lack of resources (infrastructure or finance), but they do have talent. One method being suggested during COVID-19 is to use people for contact tracing, and then pay stipends/food coupons or vouchers in exchange. This concept can be extended to care for elderly, depression hotlines, and so much more. Another idea is to make use of consultancy and services offered by those who have recently lost their jobs. Companies, however, may need to find a methods to “buy” these skills even if they cannot offer cash. Consider the needs of the hour. Maybe offer an extension to one’s Zoom subscription? A reduction in your fees for advertising? We need to look at barter as a method for managing expenses during this time. Incidentally, this concept can also be extended for paying rent if the landlord cannot pause on rentals.
3. Cross-subsidization Use your sales to cross-subsidize payment for those who cannot afford the product or service. Pharma companies and those working in the hospital or health sector can donate a portion of their proceeds to those who do not have sufficient insurance coverage or for COVID testing. Those in the e-meeting or telecommunication space can use a portion of their profits to subsidize costs for small businesses to keep them afloat. These are just a few options- you get the idea!
4. Cooperatives Now is the time for communities to get into recycling and upcycling, provided you can manage the disinfection part, of course. Use the time to sort, recycle, and upcycle your “stuff,” and share this either via platforms (hopefully tech companies like Amazon can help), or within the community. This crisis has made social isolation a big problem, and we want to make sure no one gets left behind. For instance: if you have a garden, grow produce! Food security is an issue where borders have closed. We need to create stronger communities, and this may help create a movement!
5. Frugal engineering Now is the time to work on the redesign of products and services that are costly and not affordable. Set up community sites for this challenges, and find a way to crowdshare intellectual property, since, after all, the talent we speak of still need to eat and feed their families. Work on those “complex problems” like communicating with the elderly, especially if you live a continent away. Channelize the creativity and energy in directions that benefit society.
These are just a few ideas that I have- but I am sure there are more out there. Do drop me a line, and tell me what else can work during times like this.