Yunfan Zhu Blog 9: Determine Social Impact

To determine a venture’s social impact is probably one of the most difficult tasks when comes to create the business plan for social ventures. As a matter of fact it is one of the most difficult tasks for all nonprofit arts organizations. To predict the venture’s future is already close to impossible to predict the venture’s impact to the society in the future is simply devastating. NPOs rely heavily on government and foundation grants, and for every grant the organization applies, the grant proposal must state how this grant will benefit the organization and its community. Essentially, a description of the grant’s social impact.

This article highlights the importance or assessing social impacts for ventures and it gave a few examples on how entrepreneurs measure their ventures through different matrix:

http://www.theguardian.com/social-enterprise-network/2012/dec/12/best-bits-measuring-demonstrating-impact

  

The reason of why determine the social impact is such a difficult task is because there are so many other factors to a social change. It is almost impossible to predict social impacts precisely without assessing large amount of facts and data. Moreover, it requires the founders of ventures to define success in terms of future expectations. Sounds perfectly innocent and harmless but it is really asking the founders about what exactly is the venture, what they want out of the venture, why do they start the venture, what are the motives and passion behind the venture and eventually to the philosophical question we’ve been struggled to come up an answer with since the start of human civilization: “Who am I and what do I want to make out of myself”. Some people never figure that out, some don’t even have the ability to ask themselves in the first place.

For the cynical and resource lacking nonprofit arts organizations the development department (the department which apply all the grants) usually apply the “reverse thinking” strategy. Instead of looking at the specific program and the community as a whole. Most organizations first look at the grants and foundations they are applying to and assess program’s social impact according to the grants guideline or the foundation’s mission. If the foundation gave most of its grants to programs that support inner city education, then the organization’s program would most certainly unfortunately, although this cheating code like approach may get the job done it cannot be applied to determine a venture’s social impact (I guess you can if you are determined to start a nonprofit). Because like we learned in class, we have to ask the question “what would happen anyways without our venture?” which sometimes lead to the depressing fact that the venture may have little to contribute to the society. And when that happens the venture founders have nothing but to reevaluate the social impact,

iCraftPath’s mission is to help educate local crafters so they’ll know better when it comes to establish their own microbusinesses thus generating more profit and stimulate the entire industry as a whole. But what would iCraftPath’s social impact be? Traditionally speaking crafters exist because they are somewhat “anti-social”, they don’t believe in mass production and they want more human interaction, creativity and originality. They are charging to the direction that opposites the rest of the society. Moreover, when consider the economic environment of the society as a whole we must evaluate how resources allocated. If crafters have better businesses and can sale more products, who would suffer from it? People only have so much money to spend, if the craft industry is going to grow what industry is going to shrink? The surface of this venture is to help crafters and we can simply evaluate the social impact by assessing the number of crafters who registered for our services and their level of satisfaction. But if we look closer to the issues we can clearly identify that this is not a venture to just help crafters grow their businesses, this is a venture to help crafters “steal” businesses from traditional department store and mass production retailors. Thus, to evaluate the social impact of iCraftPath, we not only have to assess the crafters who are affected by our venture, we’ll also have to look at the financials of local chain supermarkets and department stores. Do you think it is necessary for entrepreneurs to look beyond their ventures and look into a bigger picture when it comes to measure social impacts? What do you think about some of NPOs’ “I’ll say whatever to your liking” approach in measuring social impacts?