Eastside Social Enterprise Blog

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Eastside is a business consultancy that provides services to civil society organisations. Adopting a business-like approach, we help social organisations to explore how they can improve their sustainability whilst continuing to grow their impact.

Wednesday, 27 May 2009

Scaling social enterprise: Let’s get together

In an earlier blog in the year, I concurred with Craig Dearden-Phillips’s notion that 2009 is going to be the year of the merger.

Well - five months on - I want to make a slight shift in prognosis and declare 2009 neither being the year of the merger, nor the Ox for that matter, but the year of the partnership.

Last week, I spoke at a kick-off meeting for a Third Sector Consortium. This initiative aims to bring together third sector organisations in partnership to deliver publicly-funded welfare, employment and healthcare contracts.

The logic is that third sector organisations are being squeezed out of many public sector contracts because they are too small – and yet it is these organisations that are best placed to deliver some of the (up to) £30bn worth of services being commissioned in the next 12 to 24 months.

The Consortium aims to connect a number of large third sector organisations to act as a primary contractor, and commission out delivery through a network of local social enterprises.

Can it work?

Well, most people I have spoken to are positive – although are also quick to point out its challenges.

There will be many hurdles ahead. But, I think this is an intervention worth our attention. It’s a very positive sector-led response and will help build the capacity of social enterprises to deliver more of their services to meet the growing needs of the times.

It appeals to me because it’s disruptive and has the potential for widespread change.

For this reason, we will be getting involved and partnering with Futurebuilders to develop this initiative further.

If you would also like to get involved or have any questions then please do get in touch


mike chitty said...

Mergers are usuallly attractive propositions - IN THEORY.

In practice very few of them delveir on the promised improvements becuase the issue sof culture and integration are poorly handled. Simply put cornersare cut in managing the process of merger.

Personally I would tend to choose a strategy to achieve optimal size through managed organic growth rather than merger. They rarely turn out to be the 'marriage made in heaven' that we would hope for.

Richard L said...

Mike - i agree that mergers often fail to deliver because of 'soft' issues. The level of success does vary depending on what type of merger we're talking about. I have observed that mergers of equals - two organisations of the same size joining up - are particularly hard to manage successfully.

This is one of reasons that i think the partnership approach is appealing. Where mergers are often defensive, a partnership between two entities to bid for a contract is positive. It allows both organisations to retain their identity and uniqueness. This is the logic behind the Third Sector Consortium mentioned in the blog.

Charles Haywood Cox said...

there was a great article on Jeff Skoll and social entrepreneurship on Saturday in the FT..see if you can get hold of it!