timothy ma - risk management in the journey to social innovation
TRANSCRIPT
Risk Management in the Journey of Social Innovation
Timothy MaRSW, FCRP, JP
Vice-chairman, General Chamber of Social EnterpriseProject Consultant, Project Flame, The City Univ. of Hong Kong
HKUST Institute for Emerging Market Studies (IEMS)Academic Seminar Series
Setting the Scene
• Social Innovation is a trendy term nowadays
• More than 50% of those born in 1995 decided not to be an employee, but want to start their own business (China)
• Social Issues are no longer to be the monopoly of Govt., but a civic movement to offer innovative solution from the public
Yet, with the heart & passion, would it then be safe and sustainable enough to move on………….
The Agenda
• Why we start our social innovation?
• What would be the risks we shall encounter at the journey of social innovation / social
enterprise…..
• What / how we can do better in preparing for the risk, handle / face it more competently
• Revisit our VMV at social innovation
Pre-amble: Why we start our social innovation?
Ask yourself three essential questions prior to your journey of social innovation:
• 1. What change you are going to make for the
society?
• 2. If your social innovation failed, who would
be the most losers? Why?
• 3. At the eve of the termination of your social
innovation, what you want other people to
talk about you?
The Three Questions
Answering these 3 questions helps us to be away from risk:
• A. Setting our vision, mission and value
• B. Setting our focus of target and priority
• C. Concerning the quality of our service /
product from the social innovation(Ref: Drucker, Peter: 5 Essential Questions you ever have to ask
for your Org. HBS)
Identifying the VMV
AT the course of VMV development, three principles have to be in mind:
a. Never repeat others , or copying others, or even be the same as others, unless you are sure you are better than others
b. Never aim at destroying or killing others, so as to monopolize or dominant the market, but to co-operate to form united front and partner
c. Have to be innovative, but only for the beneficiaries but not for the curiosity or self-interest
Risks to be faced at Social Innovation(Please share….)
• 1.
• 2.
• 3.
• 4.
• 5.
• 6.
• 7.
• 8.
Risks to be faced –Suggested by other participants
• 1. Failure t to deliver social impact(4), uncertainty on
social impact (2)
• 2.Business Failure (2)
• 3.Environment – social – governance (2)
• 4.Balance between personal and entrepreneurial life (2)
• 5.Not being successful in building the org.
• 6.Stuck in the middle – losing my identity
• 7.Lack of capital for Phases of change (4)
• 8.Implementation replication
Risks to be faced –Suggested by Other Participants
• 9.Adminstrative and distributional blockages
• 10.Disordered growth
• 11. Losing organization’s value
• 12. I believe or the World needs
• 13. Scaling ability, sustainability (2)
• 14. Missing the main point
• 15. Attached to personal results
• 16. Operator or mentor hyper
1st Utmost Risk –Your Vision/ Mission
• A. Not knowing what you are trying to do or tackle with
• B. Not share your Mission with the ones youlove much- partner, Girl/Boy Friend/ Parents
• C. Just comes out of short term inspiration• D. Did not do any research to see if your idea is
already in the market• E. Start the initiative without getting available
funding or other resources
Suggested Solutions
• 1. Share more of your dream with others
• 2. Listen to feedback and challenges
• 3. Refine and reframe your social mission again and
again
• 4. Looking for a mentor (may be experienced SEr) to
seek their advice
• 5. Work out a feasible business plan prior to starting
• 6. Securing certain amount / resource prior to
starting
2nd Utmost Risk –Review on Capacity & Support
Even you got a great idea, initiative, innovation, but still not doing the below two reviews on yourself / team and starts immaturely:
• A. Capacities – including knowledge, technique,
skill, marketing, service delivery, etc…..
• B. Supports – including govt. policy, customer,
demand, parents, peers, media, etc…
In short, i.e. checking your asset….(ref: Leonard, Herman B: A Short Note on Public Sector Strategic
Planning, HBS 2002)
Suggested ways
• 1. Conduct an over-all check list test to identify yourcapacity and support
• 2. Identify which ever you are missing, lacking• 3. Formulate plan to increase, improve your capacity
and support, i.e. strengthen your asset by:-- inviting impact investor-- attending conference, seminar, training courses-- meeting with government officials -- joining as member of General Chamber of Social
Enterprise
3rd Utmost Risk -- Sustainability
Sustainability of your social enterprise operation. Four Sustaining factors are:
• A. Achievement of your social mission
• B. Continuation of funding source in
• C. Service effectiveness brings benefits to
customers and beneficiaries
• D. Endurance of your social impact – creating a
sustainable impact to influence the entire
society
Suggested Solutions
• 1. Periodically review the achievement of your social mission – measuring the effectiveness on change
• 2. Assessing the sustainability of your financialresource, and whether the operation brings in INCOME / PROFIT
• 3. Identify any ways to improve, enhance your service delivery / quality level of service / product so as to keep loyal customers and increase newcustomers
• 4. Asking how many people know about your service, and review the increase of support, e.g. Volunteers
4th Utmost Risk – Calculation of Cost
Social Entrepreneur always get a challenge of not be cost sensitive…..
• A. Unit Cost Accounting
• B. Full cost recovery budget
• C. Cash in / out flow
• D. Contingency fund
• E. Have your also count on your personal
input?
Suggested Solutions
• 1. Invite an account friend to help your business plan• 2. Design a full check list on your cost, from printing to
transport, from design to production, etc…• 3. Adopt an unit cost strategy to identify your every cost,
and so identify ways to cut cost• 4. Estimate the cash in / out flow to prepare for the
payment and potential cash risk• 5. Always remember to plan for your own salary at the
budget• 6. Try not to allocate all of your saving into the SE, but
remain small part for contingency fund, and, maintain agood relationship with your potential supporter - family
5th Utmost Risk –Marketing & Promotion
Some social entrepreneur think that just with a good heart, and lovely mind, people will then love your product and service..
• A. The market is confusing
• B. Users / Customers sometimes not knowing
their need,
• C. Customers buy your product / service due
to branding, fame and peers referral, you
need to let them know you and your service
Suggested Ways
• 1. Engaging a marketing friend to help design your product and service – brand building with eye-catching name and colour
• 2. Mobilization of social media, above the line andbelow the line marketing
• 3. Consider the Social Marketing – friends / fan marketing, user loyalty program, etc..
• 4. Prepare budget for product / service design • 5. Organizing the customer feedback for further
improvement
6th Utmost Risk – Quality / Loyalty
Never think people buy or use your service due to supporting your great dream, they come to you due to quality and need.
Have to ask yourself:• A. Whether your service / product is need driven?
Continuation of the need – where to find, and how to create their loyalty?
• B. Will the customer and service users come backto you after the first time?
• C. Never try to bribe them by your loving heart…but Quality is forever the FIRST
Suggested Ways
• 1. Frequently assess where is your customer need
• 2. Asking what else you can offer other than the
current service
• 3. Detecting the reasons of low response,
consumption rate
• 4. Looks for rooms for Improvement
• 5. Consider using Secret Customers to test the service
• 6. Taking part on competition / award to know where
you are
7th Utmost Risk –Cannot build a Strong Team
You can never be a social entrepreneur by yourself, but by a team. How to build your strong team, and also avoiding conflict, argument, and handling of diversified views
A Non- Strong Team can:• a. Steal your idea and start a new one as your
competitor• b. possess personal agenda• c. Creating hurdle at the midst of development• d. Delay your growth plan
Suggested Ways
• 1. Frequently share your dreams and missions with
your colleagues and team members
• 2. Motivate them also to build their dream within
your mission
• 3. Offering decent package to your staff
• 4. Delegation of authority – create their ownership
• 5. Arranging external visits to other SEs or similar
operations to learn from others
• 6. Offering promotion chances to colleagues
Suggested Ways
• 1. Frequently share your dreams and missions with
your colleagues and team members
• 2. Motivate them also to build their dream within
your mission
• 3. Offering decent package to your staff
• 4. Delegation of authority – create their ownership
• 5. Arranging external visits to other SEs or similar
operations to learn from others
• 6. Offering promotion chances to colleagues
8th Utmost Risk – Protection of your Intellectual Property / Creation
With the social innovative mind, you have your unique social enterprise. Yet, the success of your great idea can attract external investment, impact investor, enemy’s attack
• A. Have your registered your trade mark
• B. Have your registered your IP
• C. Have you obtained the license of
monopoly?
Registered Trade Mark of
Suggested Ways
• 1. Identify the most unique, special and particular (USP)process or kind of your product / service process
• 2. Document the detail process, characters and thehistory of your own creation
• 3. Double check whether there’s any similarities in yourcountry, or in the world
• 4. Employ an IPR lawyer to help registering your IPR• 5. It may take 1 to two years, but good to proceed with
the registration to prevent others from registration• 6. Upon success, should try every means to promote• 7. Yet, can leave a space for licensing or franchizing
9th Utmost Risk – Not Doing R & D
A great idea can be out-dated, replicated, or out-going by other advance technique, in particularly when is in-responsive to the changing need and world• A. Not checking any update on the changing
need• B. Not checking any latest technology / skill• C. Not spending money or hiring consultant to
identify the next 3 years of your service model
Suggested Ways
• 1. Conduct more frequent on meeting with yourcustomers / service users
• 2. Identify any rooms for better improvement, re-creation or streamlining the service process
• 3. Employ out-source consultant to conduct product test, or new product creation
• 4. Yet, have to sign undertaking that all creations are belongs to your propriety
• 5. Allocate certain percentage of your operation fund for R & D
10th Utmost Risk –You as the key stakeholder
Your Social Innovation/ Enterprise is not going to run on, if you
• A. are disappointed with the response
• B. feel really lonely at the SE journey
• C. are inpatient to wait the belated impact
• D. are too worried about the cash issue
• E. Your better half / parents ask you to STOP
• F. Decided to give up
Suggested Ways
• 1. Never be 200 % involvement on daily operation• 2. Consider the 7 – 2 – 1 scale: 7 on daily operation, 2 on
R & D, 1 on Day dreaming, dreaming for new invention• 3. Identify Mentor to be shoulder of your tears and
frustration• 4. Maintain ideal relations with your family, who is the
utmost source of support• 5. Take a break if you are really tired• 6. Cry sometimes to let emotion out• 7. At time of ultimate difficulties, Give Up and Let Go
timely
Revisiting our VMV –The Three Questions
Answering again the 3 questions will help us to be away from risk:
• A. Setting our vision, mission and value
• B. Setting our focus of target and priority
• C. Concerning the quality of our service / product
(Ref: Drucker, Peter: 5 Essential Questions you ever have to ask for your Org. HBS)
References
• Drucker, Peter: 5 Essential Questions you ever have to ask for your Org. HBS
• Leonard, Herman B: A Short Note on Public Sector Strategic Planning, HBS 2002
• Tse, KK : 8 Characters of Social Entrepreneurs, HK
Questions & Answers
• Questions Welcome…..
• Welcome to share your concerns and views….
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