The "Role Of Business Practices" Is A Boring Debate

The McKinsey Quarterly has put together a special edition of their publication focused on social entrepreneurship, and while I applaud them for covering the field, some of their material is just a little stayed. Exhibit A: Their big "debate" is "should social entrepreneurs adopt the language and practice of business." Really?

This is one of those "debates" that, like whether social entrepreneurs have to be nonprofit or for-profit, just really don't matter to most of the people actually doing it.

On the "yes" side is Philanthrocapitalism author Matthew Bishop, who rightly points out that the social entrepreneurship field and nonprofit sector as a whole has an easy time lauding big new ideas, and a sometimes less easy time figuring out how to translate those ideas to impact that can be scaled up. He also rightly suggests that celebrating the full ecosystem of mission-related financiers, entrepreneurs, and service supporters is the right way to build a more successful field. I'm less sure of his suggestion that traditional management training is the silver bullet to solving these problems.

On the "no" side is the brilliant social activist and founder of Barefoot College Bunker Roy, who rightly points out that "business model" thinking very often creates or reinforces a top-down approach to change that isn't flexible enough to shift with the realities on the ground, and can implicitly crowd out poor entrepreneurs who don't have the credentials. But for all the good in his argument, it is an ideological rather than practical argument. It assumes the worst of what business can be in theory, and argues against that.

So wait a second. In this so-called debate you have two people who are both right and who are both wrong. How can that be? I don't think it's the commenters fault. I think it is because the very terms of the debate are forcing a theoretical abstractness that doesn't mirror the real world, and doesn't serve the conversation.

Talking about "the language and practice of business" and assuming that is a monolith is sort of like talking about "the language and practice of nonprofits" and trying to lump community development initiatives, affordable housing, humanitarian relief, and undergraduate education all together. In other words, it just doesn't work.

With this specific "debate," both commenters have substituted "management" for "business." Indeed, they are talking about MBAs and business plans. This is entirely different than the way most for-profit entrepreneurs I know think. They, just like how Bunker Roy describes social entrepreneurs, are full of fire and passion and are figuring out how to learn, pivot, build, react, change, adapt, and create meaning. They are not (usually) concerned with business plans that will inevitably be thrown out the window. But then again, the ones who start to become successful quickly have to shift their focus to the sort of scale, investment, management that Bishop is talking about.

If it's getting blurry fast, that's exactly the point. In the real world, these debates do not play out like they do on the theoretical page. 99.9% of "social entrepreneurs" I know -- indeed, of entrepreneurs in general -- tend to want every single tool they can get in their toolbox. They don't want to limit themselves to only one approach simply because that's what has been done before. What's more, they have a bias towards dogma smashing, which means that they are equally able to call bullshit on the nonprofit and the for-profit sector.

The interesting conversation is not, theoretically, how should social entrepreneurs approach change, and should they use business strategies. Because they all are, to greater or lesser extent. The interesting conversation is how, in real life, have and are social entrepreneurs of all stripes reassembling the approaches available from every sector to create real impact.

If we want to be a smarter field, we need to have smarter conversations.

Photocredit: makelessnoise