Chapter 5: Developing a Strategy and a Business
Model
1) Analyzing Environments
Companies now face increasingly turbulent, complex and threatening environments.
Adapting the organization to changing environmental conditions has become
mandatory. The ability to modify and implement new strategies quickly is important.
Economic pressures, industry changes, regulatory pressures and changes in
consumer preference can affect ability of the business to sell its products or services.
The strategic management perspective highlights the significance of devoting more
attention to analyzing environments and formulating strategies that relate directly to
environmental changes.
2) Strategic Management:
It is a set of managerial decisions and actions that determines the long-term
performance of the organization. It involves:
Environment scanning:
Strategy formulation: There are three levels of strategies:
o Corporate level
o Business unit level
o Functional level
Evaluation and control has to be ensured so that goals of the organization are
accomplished.
3) Strategy for BoP market: 4 A marketing
According to CK Prahalad, there is a need to evolve the 4As marketing mix which are:
. Availability, Affordability, Acceptability and Awareness.
Availability : Firm should consider about the distribution channel for the goods
and services to make sure the product is available in as many places as possible.
Affordability: BoP market consumer has a low disposable incomes, product
which would like to market to them must be affordable to them.
Acceptability: When marketing to the BoP market, our aim is not just making the
consumer to buy the products. It is also very important to make them to accept
the products and use it.
Awareness: BoP consumer have a low exposure level to brand due to the nature
of their geographic dispersion. High levels of illiteracy, media black out zone are
all the obstacles to create awareness about a product. Media channel that can
choose to create awareness are radio, TV, wall painting and posters and word of
mouth marketing. Collaboration with NGOs and government institutions to
create awareness is also very helpful.
Human Values Ecosystem Framework in Marketing to the BoP:
The basic concept of 4A marketing mix can be improved by moving from product
centric marketing and customer centric marketing to human ways of reaching out.
4) Make your Social Enterprise Unique
You will surely follow the best social enterprise practices and support an amazing
cause. However, please make it sure that your product appeals to your market,
otherwise your business won’t gain the grip. A successful social enterprise
combines appealing to the social cause of your target consumer and offering the
products that resonate with their needs and wants.
People feel more connected to social enterprises when they are invited to
participate in the process. Simply asking them what social issues matter most,
involving them in the philanthropic process will help them feel connected on a
deeper level and change them from customers to ambassadors.
Storytelling should be at the heart of your social enterprise. If you are supporting a
cause that does not resonate with your customers, you are already off on the wrong
foot. Take time to understand the issues your target audience cares about, and
insert your company into the conversation.
We must go for content Marketing. Content created on SlideShare, YouTube, Flickr
and corporate blogs is all easily shareable and interactive.
It is the responsibility of business to convert information into new ideas, that is, into
new solutions. For example, the major innovations of the last 20 years were, to a
large extent, the result of converting the new social environment — the Internet —
into business opportunities. This resulted from a new platform that enabled the
sharing of ideas by means of forums, blogs, wikis etc.
5) Social Enterprise Business Models
To have success on the market, a SE has to operate according to the commercial
principles.
A business model includes two key elements:
1. An operating strategy that includes internal organizational structure and external
partnerships that are crucial for creating the organization’s intended impact;
and,
2. A resource strategy that defines where and on what terms the organization will
acquire the resources (financial and human) it needs to do its work.
A social enterprise can be integrated with the non-profit organization in one of
several ways:
Embedded:
The enterprise and the social program are one and the same
The business is created to serve clients (central to the mission)
Integrated:
The business activities overlap with the social programs
The business is created as a funding mechanism in order to expand/enhance the
mission of the organization
External:
Social and business activities are separate and may or may not be related to the
mission of the organization
The business is created mainly as a funding mechanism to support social
activities.
The various types of business models are summarized a table in the chapter. These
social enterprise business models can be applied equally to institutions, programs, or
service delivery.
6) Social Entrepreneurship in India – Profitable Sectors
Education: Sector with a track record of profit: The Education sector has shown a
marked degree of financial stability and growth potential.
Health: Sector with large growth potential: Although the sector currently produces a
very small number of profit-making entities, it has the lowest percentage (13%) of
loss-making enterprises.
Rural Development: Sector to watch out for future growth: Despite the fact that the
largest number of social enterprises are in this field, it is the biggest loss-making
sector at the moment. However, Rural Development demonstrated the largest
revenue increases last year, so there could be more surprises in store.
