[UgaBYTES] EATLF- Social enterprise and how to sustain telecentres

[Peter Burgess]

Dear Colleagues

Damas Ogwe has it right ... and includes in his summary the following:
//////
i-   Break even point: These enterprises have to be driven to some
extent the profit motive. They must strive to keep their expenditure
below their income levels. They have to at least break even.
//////
Again ... if the cash inflow is not enough to pay the bills, the
telecentre closes. This is not about "profit" ... this is about basic
economics and the survival or sustainability of the activity. If there
is not enough cash in ... end of story.

HOW to reduce costs ... first of all, know what they are, and how they
change as different decisions are made. Know how VALUE changes as the
costs are changed. Low costs that result in ZERO value is not much
use.

HOW to increase inflow ... figure out how to do something at low cost
that has a lot of VALUE, and figure out how the value can be used to
drive cash inflow. Either sell the service and get money for it, or
use the value to justify donor grants or financial loans.

Sincerely

Peter Burgess
____________
Peter Burgess
The Transparency and Accountability Network: Tr-Ac-Net in New York
www.tr-ac-net.org
IMMC - The Integrated Malaria Management Consortium Inc.
www.IMMConsortium.org
917 432 1191 or 212 772 6918  peterbnyc at gmail.com

On 10/23/07, Damas Ogwe <damasogwe at yahoo.co.uk> wrote:
> Hi All,
>
> I have had a chance to see some of the comments on the above subject and I
> must admit that there seems to be a realization that this might be just the
> way to go if telecentres are to achieve total or a meaningful level of
> sustainability.
>
> Social enterprises can basically be defined as businesses or institutions
> which trade with a social purpose. These may owned by businessmen or by the
> community.
>
> According to the Social Enterpise Coalition, the British Government's
> definition of social enterprises is:
> "A social enterprise is a business with primarily social objectives whose
> surpluses are principally reinvested for that purpose in the business or in
> the community, rather than being driven by the need to maximise profit for
> shareholders and owners."
>
> http://www.socialenterprise.org.uk/Page.aspx?SP=1878Social
> Enterprise - a strategy for success DTI, 2004
>
> It is noteworthy that the British Government and others in the European
> Union already have or are at advanced stages of developing strategies for
> encouraging more social entrepreneurship. Most countries in the developing
> world(third world) have no such intentions and even where they exist, they
> are in the form of acres worth of pages full of impressive academic
> arguments which are gathering dusts in some bookshelf inherited from the
> colonial era governments.
>
> The issue of Social enterprises and how to sustain telecentres, I believe is
> an idea whose time has come. We need to move away from the dependence (or is
> it over dependence) on donors and funders. Often, telecentres find
> themselves on their knees owing to this donor dependence. It is not a rarity
> to find projects being abandoned mid-way by donors. though some of the
> reasons for abandonment may be valid such as  mismanagement of funds, a
> simple matter (though not very simple at times) such as a donor agency
> changing its policies may mean that millions of shillings already pumped
> into a project can be laid to waste.
>
> Thus the idea of social entrepreneurship is important. However, at least
> several key elements ought to be in place for such to succeed. These
> include:
>
> i-   Break even point: These enterprises have to be driven to some extent
> the profit motive. They must strive to keep their expenditure below their
> income levels. They have to at least break even.
>
> ii-   Social motive : This refers to the aim of serving the community and
> addressing specific needs and challenges in the community.
>
> iii-   A we feeling: This refers to the ownership of the telecentre. The
> community should ideally have a sense of ownership.other stakeholders too
> may be included. however this may not be fully mandatory since some
> telecentres are  privately owned and  are operated purely on the profit
> motive but still manage to address specific social needs.
>
> Ensuring sustainability of telecentres is vital if the ICT4D concept is to
> see the light of day especially in the rural areas.
>
> However, there are a cocktail of other factors which must come to pass for
> the social entrepreneur and his/her enterprise to achieve sustainability.
> These include issues such as:
>
> a-   Leadership and governance
> b-   Marketing
> c-   Relevance of services
> d-   Financial management
> e-   Correct entry points especially where the telecentre seeks to encourage
> community ownership.
>
> Regards
>
> Damas Ogwe
> Ugunja Community Resource Centre
> Cell - +254 - 721 - 605082
>