Social Enterprise Buzz » Opinion

Big Data Means Big Potential for Taiwanese Social Enterprise (Op-Ed)

Remi Kanji — Thu, 10 Jan 2013 18:13:00 +0000

Robust public health data offers social innovators a myriad of potential opportunities, and Taiwan is sitting on a data goldmine. Taiwanese health records are digitized, kept on a Java Virtual Machine chip attached to each individual’s health card and updated in a central system.

The cards almost look like a credit or debit card, save for the photo and vital statistics. And carrying a Taiwanese health card is a bit like carrying a folder with your medical history: the chip stores individual patient data including information on allergies, medical history, and past test results. It even allows for efficient billing, so that hospitals are quickly reimbursed for their services.

While many in the medical field already consider these health cards cutting edge, the data generated by health cards should be used for more than simply informing government programs. If the data were made freely available (anonymized, of course), Taiwanese social innovators would find new ways of creatively tackling public health challenges.

Health innovation is becoming vital in Taiwan as its population rapidly ages, dramatically increasing costs to Taiwan’s National Health Insurance (NHI) program. In an effort to plan around cost increases, the government is increasingly looking at long term care. A key component of such care involves finding and funding innovative preventative and holistic medicine – pushing people to adopt healthier lifestyles and get early screening. No easy task.

One example of a program attempting to encourage healthier living is Zhishan Lohas, known as 5 Doctors 6 Patients in English. It provides its members with health checkups that focus on improvement, exercise programs, and consultation and access to nutritious food. The program is funded based on a capitation model – if patients collectively save the government an agreed upon amount of money, they get to reap the benefits in savings.

But how are these savings calculated? In the case of Zhishan Lohas, patients’ costs at the beginning of program participation are compared to those they incur during participation. This proxy is actually quite problematic, because individuals face more health problems as they get older – how to account for the complex impacts of aging? A better methodology would be to compare a program participant against a peer group with a similar age range, sharing similar risk factors.

Great data helps build realistic proxies, which form the basis of a lot of financial social innovations. Take social impact bonds (SIBs) – individuals or corporations buy bonds, which are then used to fund a social program. While a normal bond is a financial investment with a financial return, SIBs have a social return that in turn informs financial savings.

Case in point: Riker’s Island Jail in New York has recently implemented a social bonds program funding criminal rehabilitation. Program graduates’ recidivism rates are compared against those of the general prison population. If there is a drop, the state has saved the money it would cost to both try and jail people who might have otherwise become repeat offenders. These savings then determine the interest rate offered on SIBs.

Good data on overall recidivism – not just that of program participants – is required to ensure that programs have the impacts and savings the claim to engender, however. Similarly, health programs that are premised on decreasing costs need a robust point of comparison to showcase their impact.

Making data widely available requires public consent, and there may be concerns about security – after all no one wants information about their private illness to become public. A database on public health could perhaps refrain from providing individual case data, instead providing aggregate statistics searchable by disease, risk factors, and vital statistics like gender and age.

Geography could be kept as a broad category to ensure privacy. More specific and locally oriented data could require an organization to sign a non-disclosure agreement protecting patient confidentiality. Finally, if this database is introduced with adequate consultation of the Taiwanese people, it will likely help communicate and assuage concerns about privacy.

Privacy concerns aside, the fix to create such a program would be simple. It would require a searchable online database allowing programs like Zhishan Lohas to ‘construct’ a proxy for an individual taking their program, by aggregating information from non-participants sharing factors like age, gender, and risk.

An individual’s progress could then be compared to that of their peers, who are also aging and exposed to similar environmental factors, providing a clearer picture of program impact.

Zhishan Lohas is just one innovative program that could be improved using NHI data – the possibilities for a creative, data-minded social entrepreneur or programmer are limitless. Zhishan Lohas itself has recognized the potential of data: it is exploring collaboration with IBM to add their information to a cloud based health management platform.

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The Right End of the Tail

Melinda Jacobs — Thu, 03 Jan 2013 16:45:24 +0000

The most successful people – the smartest, most talented, maybe the richest, or the most motivated – fall on the right end of a standard bell curve. While the bulk of society falls within predictable standard deviations from the middle, those on the right tail are the best of the best, the small percentage that exceed statistical expectations.

In Taiwan, the right tail, or at least the right side of the bell curve, would have very distinct qualities: the best students go to National Taiwan University (or another National university), and then join the government or a large company. There is a distinct view of what success means, and it is closely tied to grades in school, how many languages you speak, and the number of sports, “hobbies” or musical instruments you play. However, none of these qualities are fundamentally tied to success in entrepreneurship or social innovation – they fail to capture the “try and fail” mentality, the persistence that defines an individual’s ability to not just be at the right end of the tail, but move it forward.

To whom much is given, much is expected; however, the status quo fails to empower the type of mentality or skills that will sustain growth and prosperity in the local economy. This is evidenced by the struggle of Taiwanese companies to innovate (and their competitive lag) and the growing number of students leaving the island, in search of opportunities, challenges, and prestige they aren’t currently finding here. In short, they need a push in the right (pun intended) direction to not only move the economy here forward, but keep it from falling to the left. Taiwan is making some solid efforts on the entrepreneurship front: there are several incubators in Taipei offering seed financing and other services to would-be entrepreneurs.

However, aside from keeping talented people out of large corporations, it also seems to be encouraging hobby entrepreneurship as companies pivot and restart, failing to really fail their businesses, while still seeing funding continue. While I applaud these efforts and certainly see their value, there is also a case to be made for clustering resources: just like the 20/80 rule, very few of the businesses generate the most returns in any economy. Identifying and leveraging those growth potentials will help Taiwan get out of start-up and move into scale-up as part of its effort to move the economy forward.

The same lesson can also be applied to help social entrepreneurs on the island: currently, it’s hard to be anything but small. Many purpose-driven organizations run on passion alone, and face difficulty in systematizing their delivery of public value. There is a major gap between their entrepreneurial ambitions and the resources that could help perfect operations, attract talent, and expand their delivery of social value. More than tax codes and government support, it’s a system wide gap between the needs of entrepreneurs for resources of all types, and a system that continues to privilege the current version of success.

Of course there is a right tail of entrepreneurs and social innovators – there are lots of businesses, people and organizations making big impact. We just need to find a better way to push them, and all the people their work impacts, to the right.

This article first appeared in the Social Innovation Research Group December newsletter.

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The Myths of Social Enterprises (Op-Ed)

Rachel Chan — Tue, 25 Sep 2012 14:02:08 +0000

The concept of social enterprises has a long history, albeit manifested under different names and orientations. The backlash against the deficiencies of capitalism in recent years has accentuated the development of social enterprises around the world. However, there is still not a shared consensus of what essentially a social enterprise is.

Social enterprise has philanthropic roots in the US and cooperative origins in the UK. More recently, some governments are also trying to encourage the third sector to take a more market-driven approach in providing social goods. Social enterprises are therefore often narrowly seen as organisations seeking to solve the problems of the bottom of the pyramid or challenges in developing economies.

According to the Wikipedia definition, a social enterprise is “an organisation that applies commercial strategies to maximise improvements in human and environmental well being, rather than maximising profits for external shareholders”. Social and environmental challenges are obviously not confined to the have-nots. Developed economies also have their challenges. Pollution, wastes, obesity, stress-related diseases, aging population, education, housing, workplace relations and work-life balance are but a few examples. Therefore it is conceptually inappropriate to limit the scope of social enterprises.

The second fallacy is that social enterprises must be non-profit organisations. To repute this argument, it is essential to understand what non-profit and for-profit mean. A non-profit organization is an organization that does not distribute its surplus funds to its owners or shareholders; whereas a for-profit organization can do so. It is also important to differentiate between the concepts of for-profit and profit maximization. Whilst the latter should be condemned, there is nothing wrong for an organization to provide incentives to its investors through the distribution of dividends. The distribution of profits should not compromise the enterprises’ social benefits. Indeed if we want more private investors to be involved in the delivery of social goods, instead of just relying on government funds and subsidies, there is every justification that a social enterprise can be for-profit.

The social and environmental challenges that we are facing today are enormous, and in order to solve these problems, a social enterprise also has to be an innovative enterprise as well. The innovation can be in the technology, product, service, delivery process, customer experience or in how the enterprise is managed. Scalability is another issue, in order that the enterprise can attain maximum impact on the society.

All in all, social enterprises should be a lot more than non-profit organisations serving the needs of or creating employment opportunities for the disadvantaged segments of the society. And social enterprises should definitely not be a euphemism for non-profit organisations struggling to develop a viable business model with no or limited innovation.

Many of the enterprises that do not name themselves as social enterprises are also creating enormous benefits to our society. Many technology ventures are cases in point. My favorite example is LinkedIn. Most people will not associate LinkedIn as a social enterprise. But it is certainly doing a lot of good in connecting professionals around the world. Another example is Zappos. The happiness culture advocated by Tony Hsieh is creating a lot of good to its employees and customers. By demonstrating the crucial link between the purpose of an organization and sustainable growth, the Zappos culture is also influencing companies around the world in a big way. But I do not think Tony will ever call himself a social entrepreneur.

Because of the confusion and sometimes the unfortunately negative associations of a social enterprise, some organisations and advocates in social innovation have stopped using the term. We are seeing more and more people making references to “impact ventures” or “for purpose” organisations instead.

As Juliet says, “What’s in a name? That which we call a rose by any other name would smell as sweet.” So long as the enterprise is making a difference and creating positive value to the society, there is actually no point in debating whether it is a social enterprise. This is the approach we take in the Make a Difference (MaD) Venture Fellows Programme. We are inviting young, innovative, do good and do well entrepreneurs to join the Programme in Hong Kong on 24-27 Jan 2013. They can work in diverse sectors from environment, energy, education, medical and health care to technology that enhances productivity and connectivity and management practices that build happy teams and customers. This Programme aims to celebrate and support entrepreneurs who are making a difference to scale new heights by connecting them with capital, networks and market knowledge in Asia. If you are MaD enough, please apply via www.MaD.asia by 28 Oct 2012.

This post first appeared on The Catalysts. Photo from mad.asia.

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Let’s Support Both Charities And Social Enterprises

Wan Saiful Wan Jan — Fri, 10 Aug 2012 14:02:57 +0000

A speaker at last month’s National Conference on Corporate Social Responsibility (CSR) and Social Business was reported to have called for companies to move away from charitable work and create social businesses instead. He claimed that charity is a stop gap measure that merely mitigates socio-economic problems, but does not offer long term solutions to those problems. He also added that charities could incur very high operational costs, with some as high as 70 percent, unlike social enterprises which can be more efficient.

This is a dangerous and uncalled for statement that pits charities against social enterprises. Nevertheless I do not believe that the statement was intended to be a call for civil war between the two sectors. I think the speaker was sincerely excited by the concept of social entrepreneurship.

The real challenge that we have in Malaysia today is not so much about which model is better. Rather it is the fact that both the charity and social enterprise models are neither properly understood nor well supported.

Private charitable organisations are the backbone of a morally-conscious society. Note that I use the term “private” in describing charitable organisations to distinguish it from a new form of “GLC” that has proliferated in Malaysia, namely the “Government Linked Charities”. These pseudo-charities are just like their business counterparts. They are both tools to achieve certain political agenda, and they crowd out the real actors in the field.

Coming back to the topic at hand, private charities act as vehicles for people to voluntarily do good. Unlike taxes which are coerced by law, charity is an act of kindness that you do despite the law. You help the needy because you want to, not because there is a threat of punishment. This is the noblest expression of society’s moral consciousness.

Social enterprise is just different incarnation of the same moral consciousness. The most commonly used definition for social enterprise is that it is a business with social aims. Social enterprise and charities actually complement each other and they both are tools for people to do good. They are not competitors or enemies.

When I asked for her comment, Quek Sue Yian, Director of Hong Leong Foundation, made a very good point by saying that social enterprise is not the magic solution but is just another tool in the fight against poverty. She argued that it is more important to focus on solutions and not methods, and that the different methods have to be tailored appropriately so that the actual mission is achieved. Exactly. Arguing that the social enterprise model is better than charity, or vice versa, is just simply misguided.

A far more important task is to help society understand the nature of the good work put in by both social enterprises and charities. I have only worked in the Malaysian charity scene for less than three years. And, together with a few good friends, this October we will start a social enterprise venture to provide care for autistic children in Rawang. I must say that the short period has been quite a whirlwind tour, and the last thing I want is for the two models to be pitted against one another.

The best experience I have had – fortunately or unfortunately – are mainly when working with foreign partners and funders. They seem understand better what charities are and they know exactly how to assess the effectiveness of the partnership.

As for local funders, many are very good but some need serious help. I must stress that this is not really a problem of the funding bodies themselves, but it stems from the lack of proper understanding about the nature of charities.

To illustrate, one funding body, a yayasan, once asked me to justify why we put overheads and operating costs in our funding application. They do not want to fund the operating costs of not-for-profit organisations. I wonder how they expect us to pay our bills and salaries to run the project if there is no money for operations.

Another funder caused real upset in our small team by their attitude. They turned the funding arrangement into a master-servant relationship by giving my project team unworkable deadlines despite what was agreed at the start of the project. There was even a time when my project manager received an email at 6.43pm on a Friday evening, demanding a full financial report to be submitted by Monday. They seem to assume that by virtue of funding our work, they suddenly become the one who must be obeyed.

These are just two examples. But, as I said, we cannot fault the organisations alone. The modern charity world in Malaysia is still relatively new and everyone is learning. Both charity and social enterprise are important ingredients in the “doing good” recipe book. But in order to effectively support social enterprise, I do think we need to firstly appreciate the value and the nature of charitable work. For the spirit of doing good in social entrepreneurship partly originates from the charitable sector. The two are interlinked.

It is imperative that we do not slice up the already small world of charities and social enterprises.
Instead we need to help both to grow and to flourish. Malaysia will be better if these two complementary sectors can walk hand in hand.

This post first appeared in The Edge. Photo from Institute for Democracy and Economic Affairs.

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Why Collaboration is Driving Social Change (Op-Ed)

Melissa Ip — Mon, 23 Jan 2012 21:06:18 +0000

Take a look at what is happening around us in the social enterprise space and you may notice a certain trend. The trend is collaboration. Collaboration is everywhere. It happens in many ways. We have open collaborative platforms like OpenIDEO who are solving problems with dialogue and concepts from the online community. We have crowdfunding platforms like StartSomeGood who gather funds from multiple parties to help social entrepreneurs launch their ideas. If anything is going to make an impact in the world, it would be thanks to collaboration.

To me, collaboration was always a good thing. She’s an expert on something, he’s an expert on something else, you’re an expert on this, and I’m an expert on that. Together, we fill each others’ shoes and achieve a particular goal.

The reason I think collaboration has become such a driving force in social change and innovation is because we live on the same planet. True, this was always the case but we’ve done so disconnectedly in the past. Yet because of the urgency of global problems we gradually realize that we share common problems. That means we have similar goals to achieve and achieve fast. I may be affected by pollution, but so may you. And to our advantage, you and I may live on different parts of the world, meaning we may also be exposed to different environments, experiences and even ways of thinking. This allows us to tackle a common problem by bringing together different perspectives and skills. We collaborate.

Another reason is that problems of society are too complex to rely alone on the government, business, or community to solve. Each party has their own resources and their own expertise. We cannot afford to wait and rely on one party to fix problems because they simply do not have the means. Suppose we needed to build a local arena. Without zoning of the government, construction from business, or participation of the community, it would be difficult to realize the project. A simple example as such would put a light on how difficult it can be to tackle issues affecting the world.

Thus as we move forward to create social change, we can expect collaboration to help changemakers achieve their goals. And since everyone is a changemaker, there is every reason you need to participate in collaboration and help the world.

Start Collaboration
Here is a list of websites to get you started in collaborating for social change.

Crowdfunding:

33needs. 33needs is a crowdfunding website for social enterprises making an impact in either of 6 categories: the planet, education, community, health, opportunity, and sustainable food.
Buzzbnk. Buzzbnk is a crowdfunding website for social entrepreneurs and social ventures to raise funds. It is based in UK and contributions are made in British Pound Sterling (GBP). It is open to ventures from around the world with plans to accept US dollar and Euro in the future.
Causes. Causes supports projects and nonprofits that make the world a better place.
CauseVox. CauseVox helps organizations create online websites for fundraising. They feature a seamless donation processing system for 501(c)(3) organizations on the websites.
ioby. ioby allows individuals to start or engage in projects around their local area by donation and community involvement. The organization is based in New York City and has a strong focus in the surrounding area.
Kiva. Kiva lets individuals give loans for as low as $25 to support entrepreneurs around the world to alleviate poverty. Businesses are usually from low income communities with no access to capital.
Microplace. Microplace allows individuals to invest in projects and causes of the working poor. Interest is earned on the investment which, when matured, may be returned to the investor.
StartSomeGood. StartSomeGood is a crowdfunding platform connecting social entrepreneurs and supporters.

Online Community:

Change.org. Change.org is an online tool that allows individuals to start online petitions on the issues they care about.
Idealist. Idealist is an online community with a mission to connect people, organizations, and resources that help build a world of people living free and dignified lives.
Nabuur. Nabuur is an online volunteering platform that connects volunteers with local communities in Africa, Asia, and Latin America to share ideas and find solutions to local issues.
Ned.com. Ned.com is an online space for social entrepreneurs and social ventures.
NetSquared. NetSquared operates an online community blog for users to contribute their ideas, projects, or lessons learned about working in technology and social change.
OpenIDEO. OpenIDEO is a social development platform. OpenIDEO posts challenges for the online community to develop solutions by contribution through three phases: inspiration, conceptualization, and evaluation. At the end, the strongest concepts are chosen and the goal is that these concepts become implemented in reality.
Social Edge. Social Edge is a global online community where social entrepreneurs and those from the social benefit sectors connect, learn, inspire, and share resources.
TakingItGlobal. TakingItGlobal is an online community focused on youths 13-30 to collaborate on global education, social entrepreneurship, and civic engagement.
UnLtdWorld. UnLtdWorld is an open platform that connects social entrepreneurs, people, tools, and information needed to change the world.

Miss something? Add your comments below.

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