How social entrepreneurs can solve the talent problem
The impact of social
entrepreneurs—individuals who deploy
innovation and market forces to fill social needs—is growing.
Bringing light to Africa, mobile banking to Bangladesh,
low-cost healthcare to Nepal, or even better school lunches to the
American cafeteria: in all these cases, the private sector is a big part of the
action.
That social
entrepreneurs can make a difference is not in question. But there is plenty of
potential left to unlock. What do these enterprises need to scale up? And how
can they do it?
RippleWorks, a private
foundation that supports promising social entrepreneurs around the world by
providing them with leading Silicon Valley executives as advisers, asked those
questions in a recent survey of 628 social entrepreneurs from all
over the world. The research, conducted with analytical support from McKinsey
and with funding from the Omidyar Network, included interviews with 37
investors and 10 social-enterprise leaders.
The entrepreneurs
reported that the most important barrier to growth is—surprise!—money. Almost
half said raising funds was “very” or “extremely” challenging, even as the
impactinvesting industry continues to grow. Lack of early-stage capital remains
a top challenge to the industry’s growth, according to a recent Global
Impact Investing Network survey of 158 impact investors.
The
second-most-important problem, finding and keeping talented people (36
percent), becomes crucial as entrepreneurs secure some funding. Three-quarters
of funded, early-stage companies believe the inability to access the talent
they need will have a critical impact on their businesses. And unlike other
challenges they face (such as funding, logistics, or regulatory compliance),
the talent gap is a problem that gets tougher as social enterprises scale. But
the good news is that entrepreneurs have more control in this area than they do
over funding. Here are three things they can do now, by themselves, to do
better.
Know that funding alone
is not going to solve the recruiting problem. Talent is scarce and therefore
expensive. Moreover, in many countries, the prestige, pay, and job security of
big companies are difficult to resist. Social entrepreneurs cannot compete head
to head on that basis; in the survey, even entrepreneurs with a high level of
funding continued to cite budget constraints as a top hiring barrier. Instead,
they have to build on their own strengths, selling candidates on the complete
employee value proposition—especially the mission and vision for the
organization.
Make talent a top
strategic priority that is pursued constantly. Just as entrepreneurs of all
kinds need to anticipate consumer trends and product development, they also
need to stay ahead of their hiring needs.
Gayathri Vasudevan, a
2015 “Entrepreneur of the Year” in India, is a cofounder of LabourNet,
which provides training for the unskilled. She develops plans for filling
senior-leadership positions a full year in advance, speaking with candidates on
a regular basis to build strong relationships. By taking her time, Vasudevan
can evaluate how committed the potential leaders are to LabourNet’s mission,
making them easier to retain. CEOs of social enterprises need to act as chief
recruiting officers and not delegate hiring, particularly for top positions.
They are best equipped to find the right people to translate their vision into
a successful organization. Fred Swaniker of theAfrican Leadership Group, which
has founded four Africa-based organizations, spends about half his time on
hiring. “It’s so important,” he says. “If you get that right, the rest of your
life is easy. As the CEO, I don’t let that go.”
Don’t just retain
employees—grow leaders. Turning
an enterprise into a talent-development engine is critical to retaining staff
and fillingsenior-leadership roles. If an enterprise proves it’s good at
growing leaders from within, talented people will want to stay. Training and
skill development solve another problem, too. Entry-level and midlevel
positions are easier to fill, and grooming these people for senior positions
can help avoid future hiring headaches.
Social entrepreneurs
already recognize this. In the survey, they preferred training to hiring or
seeking short-term help as a way to increase organizational capabilities. But
they need help. Smaller enterprises might be tempted to give up—they’re
frantically busy already and don’t have the time to create first-rate training
programs. Fair enough. But they can work with thirdparty providers to do
so.Glocal Healthcare in India, for example, partners with organizations
such as George Washington University and India’s National Skill
Development Corporation to develop training programs on topics from
nursing to acute care to hospital management.
While money matters—a
lot, and always—the research suggests that the human element matters more. If
entrepreneurs can anticipate the talent challenge, even as they work to secure
funding, they can stay ahead of a difficult problem that will come up quickly
as they prepare to scale.
By Rebecca Doherty and Alfonso Pulido
This article appeared on the Harvard Business Review blog on June 29, 2016,
No comments:
Post a Comment