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The Power of Social Enterprise

Photo by Anna Del Savio (Ecuador '16, The New School)

22 Dec 2016 The Power of Social Enterprise

By Hannah Bouline,  Ecuador ’13, University of Denver

 

Four years ago I was sitting in a modest workshop stringing tags onto ribbon. The shelves full of colorfully dyed seeds hid the dull cinderblock walls. The door rested open allowing the brisk evening air to enter, and orange light from the setting sun illuminated the mountainside. Around the table sat six artisans, working as a mini assembly line to piece together necklaces – some selected tagua pieces and laid out the design, the next drilled tiny holes in the marked spots, then came attaching the pieces and leather collar. I was the last step in the process, tying on a tag and packing the necklace into a plastic bag. This operation may seem small, and especially my role in it, but this simple assembly line was actually a part of a much grander operation.

Artisan assistants working in workshop north of Otavalo, Ecuador

Artisan assistants working in workshop north of Otavalo, Ecuador

As a Global Citizen Year fellow, I lived in the rural town of San Roque in the northern Andes of Ecuador for a year in between high school and college. My daily life there included waking up on a reed mat, throwing a cold bucket of water on my head, and heading out for work in the back of a pickup truck. My experiences from that year have stuck with me in many ways, whether it be the Facebook conversations I still have with my beautiful Kichwa family or the way I think about poverty and development initiatives in general, but today I’m writing about a very specific insight that has impacted the trajectory of my life. Four years ago in that small workshop, I learned that business could change people’s lives.

Me doing color checks on dyed seeds

Me doing color checks on dyed seeds

Before that experience, I knew that I wanted to work to make a positive impact in the world – this compelled me to join the Global Citizen Year cohort in the first place. But it wasn’t until my job with Faire Collection that I realized what a powerful tool business knowledge could be in improving people’s lives. This New York City based social enterprise is a fair trade accessory company, bringing the products of marginalized artisans to thousands of boutiques around the world. As an assistant production coordinator, I helped to manage the production schedule, monitor product quality, and got to know these artisans extremely well. For them, working with Faire Collection, and receiving dignified wages for their beautiful work, was truly life changing.

My Ecuadorian home, San Roque, perched on the side of the Imbabura volcano

My Ecuadorian home, San Roque, perched on the side of the Imbabura volcano

Those necklaces that I was helping to tag were one of our best sellers, in addition to being one of the most time consuming designs to create. That’s exactly why I was helping to tag them – we were up against an export schedule to get them to a client. After some conversations with artisans about designs like this, I started trying to develop a pricing model that would more accurately account for the specific amount of labor time required by each design. We were already paying much more than what an artisan would get in a local market, but was this really a fair price? We also knew that we were paying the lead artisans enough to substantially improve their well-being, but what about their assistants? How could we make sure they were paid fair salaries as well? And, how could we ensure that we paid adequately for labor hours while remaining profitable? As I struggled to figure out the best way to do this, I realized that in order to truly help these artisans, I needed more than a passion for or understanding of social causes. I needed the business knowledge and skills that would enable me to meet this challenge, as well as many others. That realization followed me all the way to my freshman year at the University of Denver, where I immediately switched into the business school, eager to develop those skills that I found could truly make an impact.

Inside my homestay with (almost) all of my host family (yes, there’s more)

Inside my homestay with (almost) all of my host family (yes, there’s more)

Since then, social enterprise has become somewhat of a buzzword, and it gets thrown around in relation to a number of things, whether merited or not. At its core social enterprise is about using the power of business to bring about social and environmental change. The concern for impact is not a nice “corporate social responsibility” sideshow; it is the core of operations. It differs from a non-profit in that the business operations (rather than donations or grants) are able to create financial sustainability and growth.

To me, the true power of social enterprise is its consideration of every single person as a client. The common term used in the philanthropic world for the people groups are working with is beneficiary – literally meaning that whatever they are receiving is “bene” or good.

Wearing traditional Otavalena dress and modeling the newest Faire Collection designs with lead artisan Nancy and assistant Anita

Wearing traditional Otavalena dress and modeling the newest Faire Collection designs with lead artisan Nancy and assistant Anita

When working with vulnerable populations, it is often assumed that anything we are doing to help is better than what they already have – and I think it’s fair to say that this is not always the case. And while business strive to provide clients with “bene”, it is not automatically assumed. This is the difference in considering people clients rather than beneficiaries. Businesses constantly look for feedback and metrics that they are providing clients with products and services that are truly good, not just good enough. If you think about Business 101, a business model starts something like this: listen to people, identify a market need, and develop a business that meets this need. But for some reason this trajectory can get lost when we consider meeting the needs of some of the most vulnerable populations.

Working to finish homework by candlelight

Working to finish homework by candlelight

Right now I am working with a Mexico City based start-up, Vitaluz, that is working to bring solar power to the 2.2 million people in the country with no access to electricity. Currently, these families must resort to using alternatives that are harmful to their health and the environment such as candles, kerosene lamps or diesel generators. The most ironic and unjust part is that these alternatives are also the most expensive and inefficient lighting and electricity methods that exist. Using a social enterprise model has allowed Vitaluz to install and maintain solar systems with no upfront cost to the user as well as employ members of the community. Their social impact can already be seen in their 272 active users, who, on average, these save around $400pesos/month and reduce carbon emissions by 401kg/month. Vitaluz is currently working to scale their operations and become fully financially sustainable – so that this social impact can become sustainable as well.

Vitaluz founder, Yusef Jacobs, working to install solar powered electricity

Vitaluz founder, Yusef Jacobs, working to install solar powered electricity

Last year I graduated with a BS in International Business, and I’m currently pursuing my MBA. While many of my business classmates have very different goals, I am still inspired by the idea that I can use my education in a way to create positive impact. (And I challenge my fellow classmates to think of business in this way as well whenever I can!) If I didn’t believe that that this was possible, I would drop out of business school today. But from a workshop in Ecuador, to a rooftop in Mexico, and everywhere in between, evidence of the power of business models that truly create impact motivates me to continue.

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Installed Vitaluz system

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Hannah is from from Dallas, Texas and recently graduated from the University of Denver with a BSBA in International Business followed-up with a minor in Leadership Studies. She is currently pursuing an MBA with a concentration in Sustainability Studies. Hannah hopes to work in the non-profit industry or social sector to further sustainability and community development efforts. She is an avid traveler, outdoor adventurist, ferocious foodie, and, above all, a people person that wants to share her passions with others.

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