NGO: From Charity to Social Enterprise

Image

With the dwindling funds and grants that are available, many NGOs are struggling to survive. They are either shutting down their operations or moving into new fields that have nothing to do with their mission but rather are chasing the money.

Majority of the people I meet, when I tell them “NGO” the first thing that comes to their mind is “Charity”. Now the fact that most NGOs depend on donations, grants and fundraising activities to sustain make it reasonable enough to have people link the word NGO to charity. Nevertheless, new innovative ways in income generation have been making their way to the NGO world.

In this context, and for the past few years, I’ve been advising and consulting NGOs on how to adopt a business model into their operations and projects, to create a shift in how they think about their work in an NGO not only as a way to generate enough income to sustain and grow but also a whole new mindset in what an NGO.

The point I focus on is to transform the NGO from a charity to a social enterprise. This happens when the NGO integrates into its work an income generation model that allows it to make money while leaving the positive impact it hopes for. It’s not just a matter of selling something, but rather a mind shift in how the NGO perceives itself in the community.

So here are few tips I usually share with the NGO leaders on how to go through this transformation:

  • Consider diversifying your income sources; not only donations and grants, but rather start considering fundraising activities, sponsorship,  membership fees, services, products and income generating activities that are aligned with your mission.
  • Income generating activities can be the same exact service you give to your beneficiaries, but include in it a small fee that goes as a donation to your organization. This is step one into becoming a social enterprise. Definitely more complex models can be considered on what services or products are offered for free and which are billable.
  • Invest in R&D to better understand what are the other players is in community, what services do they offer, where can you add value, what does the community really need and what is the best way to package your services/products. Utilize Design Thinking throughout the process, consider empathy and your community, really try to understand what their needs are and how can you package your work in a way that they would be willing to pa for the value they are getting.
  • Invest in Marketing to have a better outreach to your users/beneficiaries, potential partners, donors, sponsors and supporters.
  • Consider that your users/beneficiaries will be willing to pay for a service that fulfills their need, as long as it’s conceived value outweighs its costs. At its core, this is a social business transaction where you are trying to merge social value with the business value. Moreover, it’s important to clarify that the fees they pay will be considered as a donation for the NGO to ensure its sustainability, so that you can serve more people for a longer period of time. This transforms the relationship with your beneficiaries to become service users and partners in the community, a win-win situation for both of you.
  • Develop a Volunteer System into your organization to make it an integral part of its daily work and projects, this in turn gets you more community support, helps you get a better understanding of what the community really needs as the volunteers are most probably going to be from the community itself and it can held reduce running costs on human capital.

The above are just a starting point, but usually are enough to start building on them to transform the NGO from a “Charity” to a “Social Enterprise”. With good analyses, research and hard work, usually NGOs start seeing the impact within a year and will reap its benefits both on the short and long term.

So my advice to all NGO leaders, activists and good-doers, change starts with us. It’s about time we start utilizing some of the lessons learned and best practices in the business world and use them to better serve our communities. So start thinking of how are you going to help your organizations sustain, grow and become more self-dependent on securing its finances rather than having to constantly chase funds, grants and following donor agendas, not for your sake or your staff’s sake, but for the community itself to keep on benefiting.

Other interesting posts:

Guest Writer: “#1 Business Startup Killer” by Roger Khater

Dear Reader,

I’m glad and proud to present to you my third Guest Writer on the blog, Mr. Roger Khater.

Roger Khater is a Serial Entrepreneur with an Electrical Engineering degree from USJ/ESIB; in addition to his responsibilities as the Managing Director at IP Engineering Pro, he has main board roles and major managerial functions in Caliber Workforce (Human Resources Services) as a Partner and Maktabi (Virtual Office Services) as the Owner. Roger also serves as the President of the PMI Lebanon Chapter.

To know more about Roger, check his LinkedIn Profile or email him at i@rogerkhater.info

Enjoy the read!

Afif

—————————————————————————————————————————————————-

Many entrepreneurs whom I often meet have great business ideas, very few though have a good business plan, and the worst are the ones who only have a fancy website, a distinguished business card but no or not enough clients.

Call me old fashioned but the truth remains, starting a business is all about selling, assuming the business idea is viable. The act of selling involves customers, who are real people after all. So bet on people and invest in relationships.

What is the #1 business startup killer nowadays?

It is the course of actions that is driving our young entrepreneurs into having all the necessary business vehicles, from business identity, to website, to social media, etc… But they forget the key business aspect that is to sell their products or services to real people.

I never recall selling anything to a sheep.

If you have a business idea, don’t waste your time, just sell it. Get your first few customers and leverage on them. Capitalizing on your personal relation, enhance the trust quickly and stay close when needed.

Forget about the shiny stuff, they will eventually come at a later stage.

After a few successful deals, reassess your market in $ value, know your competitors, they exist in one form or another, and only now you can decide if the market size is enough or suitable for you. Embrace this market, make it your target, position your portfolio, have a value proposition and again go sell for more.

If after 2 years you are still stuck with few customers that do not generate enough income, drop the idea, change business line and redo the exercise better. Always ask for help, you need that, secure as many mentors, they will make a difference.

The key to success is gaining customers by selling to people.

The accessories are merely a plus.

 

Guest Writer: “Effective Communication: Guidelines & Tips” by Dania Dbaibo Darwish

Dear Reader,

As posted earlier, I’m hosting exceptional guest writers on my blog to share some of their experiences, knowledge and perspective that are worth shedding light on.

In this context, my second guest writer is Mrs. Dania Dbaibo Darwish a holder of a BBA & an MA in Psychology from AUB. She is an Associate Certified Professional Life & Career Coach, a Certified Master level NLP practitioner, a Certified Hypnotherapist, & a trained Counselor. She has a background career in Sales & Marketing of consumer goods; & as a Psychology instructor at AUB.  For several years now, she runs her own practice at Coaching Your 3Ps (Personal & Professional Progress) as a Coach, Counselor, Hypnotherapist, & Trainer. Dania is the founding president of the Lebanese Coach Association (LCA) & is very active in other NGOs. She’s known for her dynamic & positive personality.

To get to know her better check:  Website || Blog || LinkedIn || Twitter || YouTube || Facebook  || Pinterest

Enjoy the read!

Afif

—————————————————————————————————————————————————-

You all learned how to talk, but did you all learn how to communicate effectively? Effective and positive communication is an advanced skill that requires your conscious practice and effort until it is mastered. It serves living harmoniously with others, persuading, and influencing family, friends, and colleagues on the job. Once you know few secrets about proper communication, your chances of succeeding in all life domains grow up exponentially. Furthermore, your internal voice will frequently be screaming “Victoryyyy!” in major disagreements as you remain totally agreeable to your counterparts. All it takes is entering the mindset of the person(s) you’re communicating with, and then positively bringing them to your own. As a first step, here are some few guiding essentials for casual conversations, interactions, requests, arguments, or confrontations:

Build rapport: Subtly match and mirror the person you’re talking with (i.e. get in the rhythm of the way they’re speaking, body posture, use of language, etc….). Generally, people who are like each other tend to like each other, so do your best to synchronize your way with theirs.

Listen (don’t just hear): We have two ears and one mouth mainly to listen twice as much as we speak. Instead of mentally rehearsing your next argument, actively listen to what really matters to the other person. Their needs will be your guide to satisfy instead of deviating off-topic.

Words, tone, and body language: In the famous Mehrabian study, these turned out to have an effect of 8%, 37%, and 55% respectively. Never underestimate, therefore, the profound effects of the silent messages behind your unspoken words. It’s “how” you say things that gives much more meaning.

Address them by name often: You’ll be reaching out for their most prominent identity and softly caressing their ego each time. It will sound like flattery.

Maintain eye contact: This ensures you’re retaining connection. It gives the message that you’re interested in what they’re saying and that they’re heard. Remember how it feels when you’re talking to someone and they look away or roll their eyes? Yes…. Utterly disrespectful!

Empathize: Use your interpersonal intelligence and the ability to be in the other person’s shoes to identify with their feeling, ideas, and situation. Ask yourself: what is it like to be in their position. Paraphrase what they’re saying when you can. This conveys that they’re well understood.

Always ask good questions: You can always direct the flow of your conversation through asking open ended questions. This is a sure way to release your counterpart’s defensiveness and probe them to come to mutual conclusions. Avoid giving unsolicited advice till you’re asked.

Once you arm yourself with the above necessities in your interactions, you can further use the following tips to make any point you want with least resistance by your counterpart. You can disagree without being disagreeable; influence while valuing the other person’s stance; and pleasantly direct others’ behavior. Depending on the argument or the situation, you can:

Get them to agree more:  For beginning conversations, ask questions to get them to agree on, say, 3 things. This is part of building rapport. Questions like: the weather is too hot this morning, isn’t it? The traffic was unbearable today, right? You can, then, introduce your request or the point you want to make.

Focus on giving feedback: At times, you’d want to appraise a piece of work or assess a situation. Don’t criticize by just saying what’s not right. Praise the good points as well. As a whole, your opinion will be better received.

Sandwich your feedback: Whenever you have something negative to say, make sure you sandwich it between two positive statements. Start off by complimenting the other person somehow (relevant attributes, qualities, or work); give your negative opinion (in a nice way of course); and then finish up your statements by praising again. These positive statements act as a sandwich buffering any negativity sensed in between.

Feed forward: When you give feedback, you may need to state the preferred scenario for a specific outcome (e.g. behavior or way). It is an assertiveness technique used in relationships (parent to child, or in partnerships) and mentoring. Don’t remain vague about future direction. Probe them by asking questions to get to the ideal response, or suggest it when they don’t know.

Use the “agreement frame”: Nothing beats defensiveness than agreeing first. Use points in your counterpart’s view to agree with, first. Say things like: “I agree that…. And I respect that…. And I really appreciate that….” Then say: “at the same time, I think that…..” stating your disagreement. Never use the word “but” after agreeing. It negates everything you said before it.

The pleasant “no”: Don’t get caught in saying “yes” to others’ requests at your own expense. When you offer an explanation to why you can’t handle their request, you’ll be saying “yes” to yourself. You can start off by saying: “Yes, I appreciate your resorting to me to handle this. I really would like to help you out. At the same time, I have to…..” and list the reasons why you can’t while offering an alternative way or a later time to do it.

Focus on solutions:  Avoid getting sucked up in discussing the problem and rather consider the alternatives to resolving it (more on “win-win” solutions). In doing that, consider the interests and benefits to both of you (you get that through empathetic listening and asking probing questions).

The above tips are really powerful in maintaining positive interactions with others. After all, research shows that for any relationship to thrive, it is necessary to have 5 positive statements to tip off the effect of one negatively stated comment. To become a positive effective communicator requires a conscious decision. With practice, it will become second nature like all other arts to be mastered :)