A few days ago, I was interviewed by a market research firm on behalf of a social enterprise. While that in itself was a novelty, what struck me as odd was that this firm proposed to increase involvement of well-wishers with the business. Immediately, red flags went up in my head.
I have been involved in the development sector for almost two decades now and I can say that well-wishers may mean well, but they are often ineffective and sometimes they are actually counter-productive. And, this is particularly so, in the case of social businesses.
Well-wishers may or may not be investors. They may or may not be customers. And, they may or may not know anything about business. But they feel compelled to advise the fledgling business in topics outside their area of expertise, just to be helpful. Not out of malice, but because they can empathize with the plight of a struggling business with social objectives.
For NGOs and social enterprise managers who are starved for information and expertise, the free advice is too good to pass up. Not wanting to look a gift horse in the mouth, they do not do check whether the well-wisher has sufficient knowledge or experience to give advice on the topic in question.
Secondly, most of this advise comes in the form of armchair philosophizing, that is, without knowledge of ground realities. I have come across comments such as, “They should build a strong brand that everyone recognizes. I have a friend who can design the logo for them.” As if the secret to branding is a good logo, assuming that branding is even required. What if the ideal customer segment for that business are retailers who will rebrand the product and sell in their retail outlets. What if the product in question is unprofitable at the contribution margin level and no amount of branding is going to make it profitable?
Often such advise is given without spending even an hour to understand the business — who the customers are (or should be), what the products are, are these products viable in the market, etc etc.
These same well wishers would hesitate to give professional advice to a client without spending time understanding their financials, operations and business needs. But somehow when it comes to social enterprises they feel obliged to advise just to be helpful, within their time constraints. For sure, sometimes their advise can be highly beneficial to the business. But at other times, it may make things worse.
Lastly, if the social enterprise is business savvy enough to ask the right questions and then decide not to follow the advice, they have the added burden of explaining to the well-wisher why they did not follow the free advice.
So, to all the well-wishers out there, I request you to help your favorite social enterprise by advising them only on areas of your professional expertise and experience. And most important, give advice only after taking the time to understand the real problems by studying the enterprise’s books, observing their operations and talking with the business managers in detail — just like you would for your employer or client.
Because in business, “something” can be worse than nothing.