One of the greatest parts of being married is learning all sorts of wonderful things about yourself and life in general as part of the process. Here's one...
Giving is not always fun. Sacrifice of any size isn't easy. Even things as simple as being interrupted in your morning reading to do a quick favor or having to unexpectedly stop at the grocery store on the way home to pick up an ingredient for dinner can be obnoxious. When the interdependence that accompanies any relationship becomes a game of endless asking to give, it quickly becomes tedious for both the "asker" and "askee."
Ironically, perhaps the best and easiest way to avoid this "giving fatigue" is to start doing more offering. I find that the more I anticipate needs and offer to do things for others, the better I feel about actually performing those tasks, even when they are exactly the same favors that I found formerly irritating.
I've found the same to be true in my philanthropic giving. Those times when the idea to give has been my own - when it has been unsolicited - I've found the giving not only more gratifying but far more memorable.
I could say the same about work. Taking initiative and volunteering to do is much more fun that being delegated to.
So, again, lesson number 5,143 from marriage... Being asked to give is tiring. Offering to give is empowering and enjoyable. So anticipate needs, offer help, and watch your relationships be transformed.
A ton of research exists of this question, and two traits that frequently come up are low risk aversion and a high tolerance for ambiguity.
Breaking that down a bit...
Risk is something we intuitively understand as betting on the unknown. However, the specific definition of risk applied by economists (esp those of the Knightian variety) is directly linked to quantifiable expected outcomes. For example, a horse-racing track gives you the odds of your horse winning, and you know/can control the amount of money you will wager on the horse. With that information, you can calculate the expected outcome of betting lots of money on the long shot (hint: it's probably a very small number). You are taking a risk, but its a relatively known and well-understood risk.
Ambiguity, on the other hand, is tied to uncertainty, which Frank Knight was sage enough to help us understand as situations in which the odds of winning and expected outcomes can't be quantified. So having a tolerance for ambiguity is about an ability and willingness to move forward and make decisions despite lots of unknowns.
Ok, good stuff so far. But are both required for entrepreneurial success? Authors like Amar Bhide have shown us, using empirical research, that a willingness to take big risks is not something that most entrepreneurs are endowed with. Real-life entrepreneurs start with a simple idea that requires little investment and, therefore, does not constitute a major risk. To boot, entrepreneurs, even those who have founded Inc 500 companies, have low opportunity costs. They are generally not turning down great job opportunities and big money elsewhere in order to start their business. They tend to have limited experience/skills and often are creating a business as much out of necessity and a desire to be self-employed as out of raw ambition. In fact, a low risk aversion doesn't seem to be necessary for entrepreneurial success until massive inflows of cash are needed to scale and/or the business has grown to a size where future failure would destroy the entrepreneur's small fortune.
What about a tolerance for ambiguity? That does seem critical, as great entrepreneurs are generally operating in new and developing markets where unknowns abound and effective opportunism often determines success.
But there is one piece missing here - a critical one - that ties into that idea of opportunism. On the one hand, being opportunistic relates to making decisions and moving forward despite perfect information and a coherent strategy. It requires a leap of faith and tolerance for ambiguity.
On the other hand, opportunism is very much "destructive." It often requires throwing out a formulated plan of attack and way of thinking about the entire business. It requires a shamelessness and lack of pride in opinion/authorship that allows the entrepreneur to wholly re-design his/her company around new information and opportunities. Those are unique skills and traits that fall under the categories of "humility" and "adaptability" that traditional ideal types of the entrepreneur generally fail to fully explore and consider.
The lesson here is this...If you are interested in starting your own business but are the kind of individual who has a hard time changing course once you've committed (publicly or privately) to a plan, you've got a problem. It's not a downside that can't be overcome, but it's one that needs to be acknowledged, understood, and compensated for if you hope to make your company a success.
Today, as the globe struggles with an historic economic decline, it's time for a new revolution. I'd like to advance a hypothesis: Today's great competitive challenge isn't going from Good to Great. For people, companies, and countries, it's going from great to good.
Going from great to good is the single most disruptive move a country, company, or person can make today. Here are five principles from going from great to good — contrasted with their Good to Great predecessors.
Social enterprises, which pursue ethical goals as well as profits, are the modern equivalent of the older philanthropic business movement led by Quakers of which Cadbury was a part.
Appropriately, Cadbury even bought a social enterprise - Green & Black's, the fair-trade chocolate brand - for a rumoured *20m in 2005.
Rod Schwartz, who runs the ClearlySo social business website, says: "The whole social enterprise movement owes its intellectual history in the UK to the Quakers." Mr Schwartz, a former investment banker, sees ethical business movements as a reaction to the excesses of capitalism. He says: "Back then it was dark satanic mills, now it is bonuses in the City." Argument is raging in the social business sector as to whether Kraft will dispense with Cadbury's extensive fair-trade commitments, a plot that Kraft wearily denies.
The fuss highlights the fact that relations between the social enterprise movement and mainstream business are often uneasy. Typically, social entrepreneurs are at least as interested in ethical goals as they are in making money.
Really enjoyed this bit in the Financial Times on social enterprise and its odd relationship with both traditional businesses and existing forms of incorporating. (ht: Rodney Schwartz - @rodneyschwartz)
Reminds me a lot of a recent Social Earth post of mine (here), which also discussed the Kraft-Cadbury deal. My post was written after Cadbury rejected the initial offer, and I fooled myself into thinking that they would continue to fight a Kraft takeover on the basis of cultural differences. (There is a nice BBC article on Cadbury's heritage here. ht: @nlw of change.org.)
Unfortunately, Cadbury ceded after Kraft sweetened the deal, marking a sad day for social enterprise.
One of my favorite New Yorker cartoons shows an office worker slumped against the wall, clutching his chest. As worried colleagues rush to aid the stricken employee, he mumbles: “Don’t worry, it was just a fleeting sense of purpose.”
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Here’s an experiment for you. Pull together your company’s latest annual report, its mission statement, and your CEOs last few blog posts. Read through these documents and note the key phrases. Make a list of oft-repeated words. Now do a little content analysis. What are the goals and ideas that get a lot of airtime in your company? It’s probably notions like superiority, advantage, leadership, differentiation, value, focus, discipline, accountability, and efficiency. Nothing wrong with this, but do these goals quicken your pulse? Do they speak to your heart? Are they “good” in any cosmic sense?
Now think about Michelangelo, Galileo, Jefferson, Gandhi, William Wilberforce. Martin Luther King and Mother Theresa. What were the ideals that inspired these individuals to acts of greatness? Was it anything on your list of commercial values? Probably not. Remarkable contributions are typically spawned by a passionate commitment to transcendent values such as beauty, truth, wisdom, justice, charity, fidelity, joy, courage and honor.
I talk to a lot of CEOs, and every one professes a commitment to building a “high performance” organization—but is this really possible if the core values of the corporation are venal rather than venerable? I think not. And that’s why humanizing the language and practice of management is a business imperative (as well as a moral duty).
A noble purpose inspires sacrifice, stimulates innovation and encourages perseverance. In so doing, it transforms great talent into exceptional accomplishment. That’s a fact—and it leaves me wondering: Why are words like “love,” “devotion” and “honor” so seldom heard within the halls of corporate-dom? Why are the ideals that matter most to human beings the ones that are most notably absent in managerial discourse?
[...]
Why is it that managers are so willing to acknowledge the idea of a company dedicated to timeless human values and yet so unwilling to become practical advocates for those values within their own organizations? I have a hunch. I think corporate life is so manifestly inhuman—so mechanical, mundane and materialistic—that any attempt to inject a spiritual note into the overtly secular proceedings just feels wildly out of place—the workplace equivalent of reading a Bible in a brothel.
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Every organization is “values-driven.” The only question is, what values are in the driver’s seat?
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Which brings me back to my worry. Given all this, why is the language of business so sterile, so uninspiring and so relentlessly banal? Is it because business is the province of engineers and economists rather than artists and theologians? Is it because the emphasis on rationality and pragmatism squashes idealism? I’m not sure. But I know this—customers, investors, taxpayers and policymakers believe there’s a hole in the soul of business. The only way for managers to change this fact, and regain the moral high ground, is to embrace what Socrates called the good, the just and the beautiful.
Imagine you are walking along a wide sidewalk downtown Your City, USA. In front of you and to the left you spot a table. People are handing out vitamin supplement samples... for free. Do you take one?
A block later, you encounter another table set up. It's a different group, but also handing out vitamin supplements for a small fee - say $0.25 for a mini bottle. Do you buy one?
Now, guess which table was more successful at encouraging people to try vitamin supplements?
A recent Fast Company article citing a similar experiment conducted by J-PAL has created a bit of a stir in the social enterprise blogosphere this last week.
The Fast Company article concluded that J-PAL's experiment, which demonstrated that free mosquito nets were more widely adopted than paid-for nets, had proven false the widely-held belief that it's right to have the poor pay small fees for development-related goods and services because doing so encourages a sense of ownership. Really?
Hudnut's post makes the great point that, while it may not always be appropriate to have the poor pay, "charity doesn't scale." Noguera agrees that "free" sometimes is the best approach, even though market-based approached are generally preferable. He also remarks on how cross-subsidies can make the latter possible within a social enterprise model. Both make wonderful points.
But what about the simple fact that "free" is virtually ALWAYS going to be preferable to consumers! Especially when the alternative is a small fee. I haven't read the J-PAL study cited in the Fast Company article, but if it's as straightforward as it sounds, the outcome should be no surprise to anyone.
The real question is not, "To free or not to free?" The real question is, Do you measure success by how many mosquito nets you hand out? If so, maybe free is best. But I'd prefer to measure success based on what % of people are using their mosquito nets six months later. Or perhaps the % of mosquito nets that are still effective (i.e. in good shape) after 12 months. Or the change in the number of new malaria cases in the community after 3 years. If these are the outcomes you're trying to impact, maybe selling them a mosquito net at a small fee still is the best solution.
Which brings me to my real point here. Businesses frequently have to create markets and stimulate demand through consumer education and advertising (though internet startups are increasingly doing this through free). With effort, they get people to value their product enough to pay for it.
Should international development be any different?
Much of my writing time these days is being dedicated to SocialEarth.org, where I'm a contributing writer. It's a fantastic site, so please check it out - http://www.socialearth.org.
My articles on SocialEarth can be found here - Mike's Posts. Thanks for reading!
We need to continue working toward a fair, net measure of impact - to include social, environmental, and economic impact - so that we can more holistically judge an organization's success
Until we have more holistic measures for impact that are reliable and fair, we need to be very careful about placing social enterprise on a pedestal above traditional business. We can't assume that social enterprises are always generating more positive impact simply because they have grand mission statements and self-identify as "social." The proof, as they say, is in the pudding, and experience has shown us that even the best of intentions only get you so far.
I started this post many weeks ago after watching this fantastic TED Talk on how we define success:
I was reminded of it and inspired to finish it - sort of - after reading a recent post from Nathaniel Whittemore on Silicon Valley's future ability to change the world. Nathaniel's post is interesting and insightful, and also a bit provocative. It particularly touches on a hot-button issue for me; that is, whether/how we judge social vs. traditional enterprises.
I posted a long comment on his post that I am republishing here because it outlines my basic thoughts on the topic. Enjoy!
"Reading [Nathaniel's post] makes me think there is a storm brewing in Silicon Valley. Is there a growing divide based on the perception that a get-rich-quick culture is starting to replace the idealism of the past? Where is the angst and animosity coming from?
'...this hyperbole is why the nonprofit sector can have such a hard time interacting with the corporate world. It's hard to spent time with groups like Samasource that are trying to fundamentally shift the paradigm of outsourcing to create real growth and development opportunities for the developing world, or the Acumen Fund that is investing in local market solutions to water distribution, and then to be told that easier, faster, funner consumption of stuff is in the same ballpark. It's not even the same sport.'
I don't agree much with this statement. I'm fine acknowledging they're different, but implicit is that one is inherently always better than the other. Is a social business with 15 employees and 50 customers automatically better than a company like Amazon.com just because it has a nobler mission? Amazon has created employment for 20,000 people and generated enormous wealth that can be re-invested in other businesses, perhaps some "social." It has also given small booksellers an outlet for making a better living, similar to eBay, which is a primary source of income for 1.3 million people (and being replicated in the developing world). Take intuit as another example. Why should they be less worthy? They have in my opinion done an admirable job over their history of democratizing ERP-like applications and giving small business the technology/tools they need to operate more efficiently. You no longer have to be able to afford an Oracle or SAP implementation to manage payroll and a chart of accounts. Likewise, Mint.com may have sold out in some people's estimation, but it has done an admirable job of improving financial literacy and helping individuals (including me) make better financial decisions. Imagine Intuit and Mint.com technology in the hands of social entrepreneurs around the world, allowing them to better run their businesses and make smarter choices. That would be world-changing, even if unsexy because it's payroll and accounting. In fact, it's not much different than a salesforce automation or internet search and advertising company helping social enterprises better measure their impact. Similarly, you say,"All due respect to Zappos, a better way to buy shoes is not the same as changing the world." But how different is Zappos from Tom's Shoes? A cynic could say Zappos is giving us a better way to buy shoes and Tom's is making us feel better about buying more shoes. Moreover, Zappos is one business decision away from being Tom's. I agree, however, with your other point. The most ambitious and talented young entrepreneurs are starting to migrate to the social enterprise sector, making it in essence the next "high tech" in its ability to draw the best and brightest. And so we are likely to see more and more amazing things from these individuals. That's fantastic and desirable. But that won't negate the need for innovations that are less strictly "social" in their orientation and more like Zappos and Netflix. Social enterprise may stand apart, but I disagree that we should think it stands above. And I really struggle with the idea that a "holier than thou" mentality might make non-profits and social enterprises look down on the accomplishments of these "other" companies. This has been the trend in the past, and I see little good that has come of it."
