Setbacks in social business creation

Last week on PBS I watched The New Recruits. Jeff Trexler, consultant to the production, has given us a valuable perspective on the "warts and all" documentary about Acumen Fund fellows launching social businesses. Last week, I also finished reading Muhammad Yunus's new book: Building Social Business. Both experiences left me feeling distressed and dismayed. The ventures revealed in the documentary and book seem to be classic cases of failing to escape the incumbent space. Everyone we're being shown as creating social businesses appears to be playing a rule book that states:
  1. Manage the brand. Make this a "social business" in name only while acting like a typical product delivery system with a learning disability.
  2. Businesses require hierarchies. Get started on a right foot with that winning combination of superiors and subordinates, policy enforcement and power-over others.
  3. Customers are clueless. Don't listen to customers when inventing the products or designing a sales/service strategy.
  4. Employees learn best by formal instruction. Don't mentor individuals, coach personal development or set up peer support systems.
  5. Value is provided by the goods sold. Don't allow for value to be intrinsic to the experience of the individual customers in their own contexts.
  6. Work against what customers are already doing for themselves. Generate innovations that are too creative, different and unfamiliar to gain acceptance among users.
  7. Make the business financially sustainable. Generate enough sales to cover the expanding overhead without considering ecologies, communities and infrastructures
I was astonished by the documentary and the book. Is no one launching a social business reading Clayton Christensen, Jeff Jarvis, Chris Anderson or Umair Haque? Aren't business models getting revised by technologies, connectivity and lessons from the global recession? Isn't this 2010?

Upon further reflection, I suspect these entrepreneurs are college graduates who have been prepared to function in the previous century with empirically verified practices. Higher ed cannot prepare them for the next economy because the research has not been done yet on changes that have yet to occur.


  1. The rules of a Social Business are being rewritten, the problem isn't the rules, it's the old business model that has been entrenched into our scholars brains. The Paradigm Shift that has to take place isn't going to happen with those speaking or writing these books today.

    The generations behind me will reshape and rewrite the rules, the world hasn't arrived here online yet, there is still another 3 Billion to come, then you will see the new rule book be created if it hasn't already begun.

    Sad commentary on how conditioned we are with the Industrial Age thinking. I'm over 50 and I get it, I'm willing to make the change, but it's still not easy. I'll be covering much of this in my next book. The Open & Free Business Model - The Future of Business.

    Many Blessings, Owen

  2. Owen: I agree with what you're seeing about it's "not here yet". I also share your optimism about the new rule book getting created by younger generations than us. Good luck with writing your next book in a way that reaches your intended audience and gets them talking.