While reading the Harvard Business Review in June, I came across “3 Ways Social Entrepreneurs Can Solve Their Talent Problem,” by Rebecca Doherty and Alfonso Pulido. Here is a summary of that article; I think the author’s conclusions are useful particularly for early-stage entrepreneurs in mission-driven, socially conscious companies.
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Today’s business organizations are increasingly committed to addressing social needs throughout the world. The birth and growth of social entrepreneurism is evidence of that commitment, with companies created specifically to address social ills and bring about social change. These organizations are impacting myriad industries—and individuals—worldwide.
Learning to “scale up” is critical to the long-term success and broad reach of such socially driven organizations. To maintain meaningful impact, they must focus efforts on efficient and effective growth.
With this in mind, RippleWorks surveyed 628 social entrepreneurs to uncover what these enterprises need in order to “scale up” and what challenges they face in finding and keeping talent.
So what keeps companies from effectively scaling up? Across the board, survey respondents selected “access to early-stage capital” as their biggest hurdle (48% called it very or extremely challenging), with talent acquisition and retention coming in second overall (36%).
While acknowledging the importance of access to capital, Doherty and Pulido focus on the second category—attracting and keeping talent. They offer three talent-focused solutions that can bridge the gap in capital to effectively hire and retain employees.
- First, though funding can help attract talent—as it allows for higher salaries and more financial incentive to remain with the company long-term—money is not the only factor in a candidate’s mind. Instead, social entrepreneurs and their organizations must look beyond money to offer a “complete employee value proposition,” including the opportunity to make a significant and lasting impact through social entrepreneurship.
- Second, talent development should not be considered “complete” after hiring the right candidate. Rather talent acquisition and development should be integrated as key objectives of company strategy, and high-level leaders should take active roles in hiring.
- Third, companies must grow leaders from within the organization, so employees can imagine the future. Talented individuals will stay with the organization if they see employees being mentored and promoted from within rather than solely being hired from the outside.
Of all the categories discussed in the survey, finding and keeping talent was the only category that became more difficult as organizations grew: 25% of early-stage unfunded social enterprises called the category “very” or “extremely” challenging, and the percentage increased to 38% for early-stage funded enterprises and 45% for later-stage funded enterprises.