#19: Small business self-assessment & action plan for impact
Is your for-profit business a social enterprise?
Well, the good news is there’s no technical definition. However, the following is a solid guide to see whether or not this term generally applies to you and if not, steps any small or medium business can take to be more impactful.
First, note all that apply to you from the list below:
- My company employs others. (1)
- When creating my company policies and practices my company considers options such as paid parental leave, living wages, retirement savings contribution, professional development, employee satisfaction, diversity in hiring and non-discrimination, financial transparency with employees, and employee ownership. (2)
- My company engages regularly with our community and other small businesses and nonprofit organizations within it. (1)
- My company engages regularly in local and/or national policy influencing and decision making. (1)
- My company and/or its employees (within company policies) regularly donate to and/or volunteer with nonprofit organizations. (1)
- When purchasing products and services to use, my company considers the ethical and sustainability practices of our suppliers. (2)
- My company actively recruits nonprofits or other mission-driven companies as clients or customers and has products or services that fit their unique budgets and needs (3)
- My company has a mission statement, theory of change, metrics dashboard, or other tools and frameworks reflecting our commitment and model to making social impact. (3)
- My company has paying customers who are different than the artisans, suppliers, or other communities it regularly benefits. (5)
- Social impact is integrated within my company’s business model; in order to make profit, we make lives better and vice versa. (5)
Add up your total score (add the total of the numbers in the parentheses next to whatever you selected above. Yes, I modeled this off old quizzes I used to take in magazines when I was sixteen).
If your total is less than 5
You’re not quite there yet, but you’re on your way. Look through each of the bullets above and note areas where you can improve. Then focus and action plan. Take this assessment again in a few months and once you’ve gotten a 5 or above, a) celebrate and b) shoot me a note to let me know (and I’ll remotely cheers to you!).
If your total is 5-10
You’re so close! In order to be what I consider a true blue social enterprise, you need to have that last bullet – Social impact is integrated within my company’s business model; in order to make profit, we make lives better and vice versa – selected. There are lots of ways to do this in any company. Here are some examples to get you thinking:
You’re a small tech agency but you look around and are employing only one woman and partnering with other small tech companies in your neighborhood, mostly founded by white men. Ok. There’s tons of opportunity there. First of all, figure out how to get more ladies on your team – ideally in decision-making roles. Secondly, everybody needs tech help.
Price out a service package that may work for clients without ginormous budgets and start selling to nonprofits and other mission-driven clients (don't give away your product or service; just pare it down). Good – this is a start. And then . . . BOOM! You find a program that trains developers in low-income communities in all the languages your team deploys. Partner with them. Partner with them exclusively for your contracted development talent. Now, all of a sudden, any time any client pays for you to do anything it’s benefiting these developers from low-income communities.
You are a wedding-planning company that employs a small but mighty team of stylists, planners, and sales squad. Great. You have zero wiggle room in your budget to dedicate to any nonprofits. That’s ok – because your clients do! Set up a program within your shop that allows the couples and wedding parties you work with to donate their wedding wear to nonprofits that do things like provide dresses to teens in low-income neighborhoods for prom or suits to formerly incarcerated men to use for job interviews. You also are all about that gay marriage, so set up a Go Fund Me page to challenge clients and their wedding attendees to donate to a fund supporting an agency that facilitates adoption and IVF for gay couples. The wedding that donates the most will get a free case of champagne from the local liquor store (get them to donate this; they will).
Ok. You’re close, but impact is still a one-off thing, not integrated your business model. So you go to your computer one night and do a supplier audit and opportunity analysis, and realize there is a bakery in your city that provides job training services as part of a rehabilitation program, venues that voluntarily pay above minimum wage to event staff, and dress makers that refuse to engage in sweatshop labor.
You have an opportunity in front of you to rebrand as the first social impact wedding planning company in your city that partners exclusively with mission-driven preferred vendors. Does this mean saying bye to some prior preferred vendors? It sure does, but that’s what’s going to make you an Impact Boss™ and will help differentiate you in a rather saturated and generic market – and knowing that your impact is your brand, you go for it.
Ok, you probably get it by now – look at your supply chain and the people you employ, figure out how to support and employ the most vulnerable communities there. But wait, you make something. Something that hundreds of refugees coming to your city completely lack. You read all these reports about how refugees arrive in your city, are set up with apartments then . . . crickets.
Often with an entire family in a studio apartment, these refugees have no furniture. Not even a mattress. You can’t make mattresses, but you can create a kitchen table and some chairs. While your furniture is high-end, you also know how to make something on the more affordable side. So you raise the price on your higher-end furniture a bit to subsidize the construction and materials of a basic kitchen set for refugee families. You donate this.
But you also know that all humans, regardless of income, are empowered by their purchasing power. So you create a relationship with refugee communities through nonprofits that support them, and over time develop an entire line of furniture these communities can afford once they gain employment. You partner with a community bank or credit union to develop a financing model for these refugees to use in purchasing your furniture that explores indicators aside from FICO scores (which they likely won't have) to evaluate creditworthiness. Heck, you may even hire a couple of your customers as apprentices. You might even use a delivery service that employs at-need populations. But you’re also providing refugees with the dignity of being able to save for and afford nice, customized handmade furniture. You are letting them practice and build a habit of smart spending and investment. There you go.
If your total is above 10
You are quite definitely a social enterprise in my book and employing practices regularly that integrate impact into your day-to-day operations. Here are some next steps you may want to consider:
Look into Fair Trade or B Corp certification. While Fair Trade focuses a lot on supply chain practices, B Corps goes beyond just baseline social impact into true triple-bottom-line areas such as employee policies, governance, and environmental impact (which I’m not an expert in at all but fully support). Before you jump in you should get started with the much more extensive B Corp self assessment, which will churn out some more detailed next steps for you to take toward being certification-ready. Note that B Corp is a certification, not the Benefit Corporation tax incorporation.
Also: are you reviewing and reporting on your impact regularly with your team? Make sure you do! Use your impact to sell your products or services. Whether you sell to individuals or other businesses, this is a huge your impact is a huge value proposition for your customers.
Finally: Action plan for impact
After reading through the above, record the five things you’re going to do to max out your impact, noting what you're going to do, when you'll do it by, and how you'll hold yourself (or your team) accountable. And as always, you know I'm here should you need any outside expertise or help 😉.