Text by Tony Lai
Image by Freepik
There are many definitions of strategy and for the purpose of this article, I will use the classic Michael Porter definition – which is the search for a unique and relevant position in the market in order to differentiate itself for competitive advantage.
Strategy is the link between intent and outcome. It is about how an organisation goes about getting things done. It is the combination of choices that determine product lines, distribution channels, country approach, supply chain model, consumer segments and even revenue and cost models. It is the thinking behind the whole system that is put in place for a company to deliver the outcomes it wants to deliver. Investors, shareholders and even consumers will subsequently scrutinise the strategy – the believability around whether goals will be delivered well. This is why strategy is crucial for organisations.
And yet I have found strategy to be elusive in the social sector and that frightens me. I admit that this preliminary view has come from a research project of engaging with 30-40 social organisations across six Southeast Asian cities over the last seven months. As the research carries on, perhaps my nerves would be calmed when I discover that my fears are unfounded. But until that moment arrives, my current realisation is that many social organisations enjoy amplifying problems and simplifying solutions – with little to no thinking on strategy. Here are some of the observations I have:
Talking Up the Problem
While it is good that the leaders of many social enterprises or non-profit organisations are aware of the issue they are attempting to resolve, many have spent more time ‘marketing’ this problem as a method of soliciting funds or recruiting volunteers. This has resulted in several leaders of social organisations talking up the problem with tremendous amount of data and research as a means of justifying the existence of their effort.
Executing An Idea Not a Solution
While all efforts should be applauded, my early observations seem to suggest that there is a preference for most of these organisations to pigeon hole their ‘solutions’ to education-based, training-based or services industry-based ones. On many occasions, these social organisations do not attempt to look at how the problem could be resolved other than what they can do for the victims of the problem and how education or training becomes the most logical and obvious conclusion. The eventual outcome within a city is a proliferation of social organisations providing education and/or training programmes to victims regardless of what the core problem is. Others add a services component (like a restaurant, bakery, etc.) to provide jobs. The result is the execution of a series of ideas rather than the delivery of a pipeline of integrated solutions.
Liberties of Intentions
What appear to drive these social organisations are their articulated intentions, such as “empowering victims”. Many of these intentions are not measurable in any real way and hence they serve more as inspiring goals for staff and donors rather than a strategic direction for change. Furthermore the link between how education and/or training actually empower the victims is assumed rather than proven since the rigour of what ’empowerment’ means is not mentioned. One cannot help but ask if education is seemingly the best and only answer, what is the real problem?
What Delivers Sustainability?
We have observed that many social organisations face immense problems from the 3rd year of operations when the volume of victims they are trying to help start to weigh down on the original idea they had in helping them – Where will the new jobs be? How do I balance between the commercial viability and social aspects of the organisation? Sustainability cannot come as a surprise in the third year when it could have been a consideration right from the start. What delivers sustainability? Strategy – how things get done.
Unlike the diversity of the business world where there are different solutions to a need, it has been surprising for me to find out that most social organisations that aim to address societal problems provide similar solutions. The range is definitely narrower and the depth certainly shallower. This does not make real sense when societal issues are more complex and difficult. Hence I find it hard to applaud effort when I think more could have been done and the fact that our world really needs better answers than simply ‘more helping hands’. The brains do need to be included.
Leaders of societal impact organisations seriously need to be trained in strategy. The need to learn how to think deeper about issues, take a page out of Roger Martin’s Harvard Business Review June 2007 article “How Successful Leaders Think” and have meaningful conversations around how strategy is formulated and executed. As long as this does not happen, I fear that the growth of societal impact organisations (which is inevitable) will simply be more people doing the same thing for a problem that is always changing.
Albert Einstein called doing the same thing over and over again and expecting different results ‘insanity’, but I realise that some leaders have found it gratifying to don this as a badge of honour. Until the demand for sustainable solution takes centre stage, it will be hard to see any effort towards real societal impact as anything other than a daily ritual with accessories.
About the author:
As the Chief Strategist for the Institute, Tony Lai provides leadership on all areas with regard to strategy development and execution from a business and organisation perspective. His role covers the annual workplan planning, the Southeast Asia country insight process, regional marketing and engagement and capability programmes that target adults and undergraduates. He is also the non-executive director of The Idea Factory – an innovation strategy company that moved its global operations from San Francisco to Singapore in 2002 to focus on Asia. Tony’s experience in both strategy and business has seen him hold positions in the past such as the Chief Operating Officer with APM Pte Ltd (a property management subsidiary of the ARA Group) from 2013-2014, Managing Director of Experiences at Mediacorp Pte Ltd in 2013, Assistant Chief Executive with the Singapore Tourism Board from 2009-2012 and CEO/Managing DIrector of The Idea Factory from 2001-2009.
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