Chapter 2Social Entrepreneurship and Innovation

Profit focus vs Impact focusA) organizations with no focusB) organizations focused on achieving a purpose other than profit (old school not for profits)C) organizations maximizing profits at the expense of other purposes (old school corporations)D) organizations aligning purpose and profit maximization (new school entrepreneurs)

Bottom of the Pyramidhttp://www.youtube.com/watch?v=CPnx6gLcfK4&feature=related

http://www.youtube.com/watch?v=lHEzFlfHUjU&feature=related

Business Model Canvashttp://www.free-power-point-templates.com/articles/business-model-canvas-and-presentations/

Social EntrepreneurshipDefining social venture using the Business Model Canvas

Define the enterprise, both the social side and the revenue-generating side.How the venture will achieve an impact on the social issue that is being targeted.

Yellow stickers = Coca Cola ; Green stickers = Partner (Sabco); Orange stickers = Manual Distribution Centers owed by independent entrepreneurs who coordinate distribution to small shops and restaurants= 80% of distributed sales volume in East African countries

GrameenphoneGoal: to provide universal access to telecommunications services in remote, rural areas of BangladeshVillagers were too poor to afford telephones Partnered with Grameen Bank, microfinance institution, to provide local women with microloans to purchase mobile phonesThe women sold calling services in their villages, repaid the loans, earned income, and improved their social status

GrameenphoneFor-profit model with a positive impact on rural BangladeshThe company eventually provided over 200,000 women in rural areas with income-earning opportunities Raised their social statusConnected 60,000 villages to mobile phone networksReached 100 million people Turned a profitBecame Bangladeshi governments biggest taxpayer

Grammenphone Business Model

Customer Segments Defines the different groups of people or organizations an enterprise aims to serve. Group them into distinct segments with common needs, common behaviors, or other attributes. Decision about which segments to serve and which segments to ignore. Understanding of specific customer needs

Value Propositions Describes the bundle of products / services that create value for a specific Customer Segment. Reason why customers turn to one company over another. Solves a customer problem / satisfies a customer need. Some Value Propositions are innovative and represent a new or disruptive offer. Others are similar to existing market offers, but with added features or attributes.

ChannelsDescribes how a company communicates with and reaches its Customer Segments to deliver a Value Proposition. Communication, distribution, and sales channels Customer touch points that play an important role in the customer experience.

Customer Relationships Describes the types of relationships a company establishes with specific Customer Segments. Relationships can be from personal to completely automated.

Revenue Streams Cash a company generates from each Customer Segment (costs must be subtracted from revenues to create earnings). For what value is each Customer Segment truly willing to pay? Each Revenue Stream may feature a different pricing mechanism or technique, such as fixed list prices, bargaining, auctioning, market dependent, volume dependent, etc

Key Resources Describes the most important assets required to make a business model work. Key resources can be physical, financial, intellectual, or human. Key resources can be owned or leased by the company

Key Activities Describes the most important things a company must do to make its business model work.They are required to create and offer a Value Proposition, reach markets, maintain Customer Relationships, and earn revenues.

Key Partnerships Describes the network of suppliers and partners Companies create alliances to optimize their business models, reduce risk, or acquire resources.

Cost Structure Describes the most important costs incurred under a particular business model. Creating and delivering value, maintaining Customer Relationships, and generating revenue all incur costs. Costs can be calculated relatively easily after defining Key Resources, Key Activities, and Key Partnerships.