Examining the Ecosystem: Scaling Social Ventures with Impact

            When considering the multiple dimensions of social innovations’ efficacy and potential for diffusion, it becomes increasingly clear that the importance of contextual compatibility cannot be overstated. Several of this week’s articles employed the buzzword “ecosystem” to underscore the need for social ventures to think carefully about their “theories of change” and the contexts in which they operate _{[1], [2]}. This ecosystem-specific method of evaluation has been central to the social innovation paradigm for some time now – in the 1999 article entitled “From Spare Change to Real Change: The Social Sector as a Beta Site for Business Innovation,” the Harvard Business Review provides examples of highly context-specific business partnerships that fostered positive social change _[3]. These partnerships included Bell Atlantic’s establishment of computer networks in inner-city public schools, IBM’s Reinventing Education program, welfare-to-work programs sponsored by Marriott International and United Airlines, and BankBoston’s inner-city development program to provide access to high-quality financial services – all of which were started more than two decades ago.

            Both the success of these programs and the ways in which they were phased out over time exemplify the importance of context and dynamism in defining the potential scale of a social venture. One very important point to remember is that growth and continuity do not necessarily guarantee increased impact. Some of the ways entrepreneurs can demonstrate a commitment to impact over growth include: transferring control to local ownership, partnering with would-be competitors, and measuring broader adoption of the model over time _[2]. Partnerships of all kinds can “cultivate the ecosystem,” especially when context-specific approaches and mutuality are goals. Although partnerships with non-profits and government agencies are more complicated than traditional business-to-business partnerships because they may be driven by goals other than profitability _[3], they represent organizational capabilities that can be utilized to scale impact _[1].

When I interned in the District Office of Congressman Mike Honda in 2013, I wrote a report about the educational ventures of Microsoft, Intel, and Applied Materials for the office to present at a conference about social innovation partnerships between government agencies and corporations in Silicon Valley to improve STEM education. Those three corporations have developed highly effective education programs in Silicon Valley and around the world, and their success can perhaps be attributed to the seven scaling methods described in the Harvard Business Review _[2]. All three companies boast an impressive list of successful social ventures; however, one that is especially relevant to this analysis is Microsoft’s record of alliance-building. In 2012, Microsoft hosted more than 100 NGO Connection Days which were attended by more than 6,000 NGOs and 12,800 individuals, the company gave families access to refurbished laptops for only $150 through the U.S. Federal Communication Commission’s GoodPC Program, and the list goes on. Microsoft effectively used revenue generated by its own operations to “close the gaps preventing [successful innovations] from reaching scale” _[2], empower local change agents, and create easy-to-replicate models of innovation – all without undermining local initiative.

Moving forward, I would be interested to know if there are any social ventures that have made a significant impact while radically departing from the formula for scaling as outlined by the Harvard Business Review (2012). Also, what might be some of the drawbacks to partnership in the long-term?

[1] How to Take a Social Venture to Scale, Harvard Business Review (2012)

[2] It’s Not All Bout Growth for Social Enterprises, Harvard Business Review (2013)

[3] From Spare Change to Real Change: The Social Sector as a Beta Site for Business Innovation, Harvard Business Review (1999) https://hbr.org/1999/05/from-spare-change-to-real-change-the-social-sector-as-beta-site-for-business-innovation