What does it take to grow your social enterprise, and how do you know you’re ready for the next step? The TRANSFORM Support Hub, powered by MovingWorlds, teamed up with the Miller Center for Social Entrepreneurship to host a two-part webinar series about its proven ‘ScaleOut’ framework to help social enterprises assess their readiness for scale through expansion into new markets.
Part One of the series focused on the framework itself, and you can find a summary of key takeaways from that session here. On June 22nd, we welcomed the Miller Center back for part two of the series, focusing on practical tips and live coaching with social entrepreneurs each navigating their own paths to scale. You can access the full recording of Part Two here, and catch up on the key takeaways below!
Before You Scale, Make Sure Key Factors Are in Place
Scaling is the ultimate goal of almost every entrepreneur, but scaling too soon can backfire. Make sure that your organization has the right foundational elements in place to be able to deliver at a larger volume without sacrificing quality or impact. For example, if your organization doesn’t have the capacity to maintain its level of quality control at larger volumes, you may lose customers when what’s delivered doesn’t meet expectations.
While You Scale: Questions to Consider
1. Have you determined what parts of the operating model need to be rigorously preserved, and what parts need to be adjusted?
An important yet often overlooked aspect of scaling is determining what elements and processes you need to preserve, versus what parts you need to adapt. The factors you rigorously preserve are those that keep your business sustainable and impactful – your key differentiators. The core of your offering and what makes you unique needs to be protected, and the other elements around it can adapt to facilitate the delivery of that core at a larger scale.
2. Do you have a plan for communicating your scaling strategy to stakeholders – team, partners, investors?
To scale effectively, you need to bring the right stakeholders along. Make sure that you have a compelling narrative that speaks to the core of your offering. Don’t make the mistake of assuming that the value of your offering is self-evident! Distill what you have into a compelling message that explains what it is, how it works, and why it needs to scale. Of course, you can tweak and tailor the messaging for each audience, but the core elements should remain the same.
3. Does the rate of execution match the team’s current capabilities?
This is another area that the Miller Center team identified as often overlooked, yet critically important. Part of the ScaleOut process involves doing a formal assessment of each part of the business model – its processes, staffing, and impact. You need to know what your current capabilities are and start on those terms to see where you need to build existing capabilities, hire as you go, or partner to fill in gaps. Don’t speed past this! If you don’t have the people, even the best expansion plan won’t work because you won’t have the capacity to deliver on it.
4. Do you have a training plan for new and existing staff that covers the spectrum of topics needed to execute scaling?
Consistent, repeatable processes are key to scale, and incomplete training will limit the impact of scaling. If your social enterprise acquires or merges with another entity, you’ll need a plan to integrate the teams, as well as the culture and processes. This also applies to social enterprises planning to leverage partnerships as part of their growth – you’ll need to train your new partner to be able to deliver the intended impact.
5. Do you have a plan that identifies what types of resources you need, when you need them, and how you will acquire them?
While you may not have every resource in place when you begin your path to scale, you still need to understand where the gaps are and how you’ll fill them over time. Make sure you take the time to develop a plan that addresses the “who, when, and how” of acquiring the resources you need, when you need them. Remaining agile helps here – slow, bureaucratic processes to hiring or partnering can block you.
6. How will you be “ambidextrous”? How will you delegate responsibilities?
In this context, being “ambidextrous” means being able to effectively manage both your current business and the new business you’re expanding into. The only way to do this effectively as a Founder is to delegate, and to shift your mindset from working in your business to working on your business. In the startup phase, it may be appropriate for the Founder to be involved in all decisions across business units. But that won’t work during the scale-up phase, and trying to maintain that level of involvement can lead to “Founder’s Syndrome” and hamstring growth. This takes honest assessment on the part of the Founder about how well you delegate, and what should be delegated. Delegating decisions across the team is essential if you want your business to grow.
Preserving Hands-On Learning While Developing a Long-Term Vision
The scenario: In the session, we heard from a Founder of a hands-on learning company that provides chemistry kits for students to undertake their own STEM experiments at home. In approaching partners, the Founder received pushback about the lack of a technology element. The Founder wants to maintain the hands-on aspects of the kit as originally designed. How can technology be incorporated without diluting the original intent?
The advice: The Miller Center team agreed that the hands-on element of the kits themselves was a key differentiating factor, and should be preserved. However, they suggested looking at the kits themselves as a starting point, and incorporating technology (such as an app) into the longer-term vision and learning plan. How can technology be used to facilitate ongoing engagement and learning with STEM once the initial interest is sparked? This could look like starting with the kit, then going on to learn other related concepts via an app, other kits, or an online learning platform. Understanding what potential partners are screening for, and having a long-term vision that incorporates that into the learning plan, increases chances of success.
Scaling a Healthcare App by Developing Better Partnership Screening
The scenario: In the session, we heard from the Founder of a healthcare startup in India that uses an app to empower community health workers to facilitate telemedicine delivery in rural areas. The Founder has been approached by various NGOs interested in leveraging the app to run their own projects related to healthcare, and wanted to know whether his social enterprise should be focused on marketing exclusively in India, or expand its focus to international markets.
The advice: The Miller Center team advised that before expanding to another geography, the Founder needs to have a solid understanding of what makes partnerships with NGOs successful (or not successful.) The team suggested starting with an assessment of the app’s current level of delivery in India, then analyzing the most and least successful partners for common characteristics. Getting clear on the characteristics that potential partners need to be successful with the app enables better screening and success outcomes. Once those are in place, it makes sense to start thinking about other markets and piloting with NGOs that meet those clearly defined success criteria.
Lessons Learned from Scaling Too Soon
The scenario: In discussing lessons learned, one Founder of an insurance social enterprise spoke up about his experience scaling too soon, then having to pivot to scale back down. After initial success in one market, the enterprise then scaled into four new ones, but without the additional resources, training, and delegation in place to be truly ambidextrous.
The outcome: This enterprise survived the scale up and retraction, and has come out of the experience with excellent proven software, processes, and a better idea of the criteria for markets it can successfully serve in a way that’s differentiated from competitors. Similar to the example above, a key lesson was the importance of isolating the criteria for markets you can really be successful in, and then being able to identify, document, and communicate those factors with team members to ensure success.
We are grateful to the Miller Center team for sharing its valuable framework and insights with our community, and for all of the social entrepreneurs on the call who contributed to such a lively and meaningful discussion! We hope you’ll join us again for next month’s social enterprise growth webinar, “Using Social Impact as a Sales Advantage” featuring Tim Rann of Mercy Corps Ventures.