worth september 2008 worth business model. worth september 2008 business model building blocks...

WORTHSeptember 2008

WORTH Business Model

WORTH September 2008

Business Model Building BlocksProduct Value Proposition What value do the products create for the customer/client?

Client

Customer Interface

Target Market Distribution Channels RelationshipDynamics

Who is customer / client? How can they be divided? How can is value delivered at an appropriate cost? What is the structure of the supply chain? Where are bottlenecks?Special needs or considerations or requirements to develop relationships with your client/customer?

Infrastructure Management

Value Configuration Capacity

Partnerships

How is value delivered? What is the structure of the value chain?What are the organization strongest capabilities and strategic assets? How will these be fully utilized?Who are the partners/alliances? How are these relationships structured?

Financial and Impact

Aspects

Cost structure

Returns

Revenue Model

How much will it cost? How will costs be broken down?

Benefits/returns to stakeholders? How quantified?How do we cover our costs/meet financial objectives to do this business?


Current WORTH Model Products

Savings products, credit, literacy Current/past strategy:

Fee-for-service Implementation through INGO partners (TSA & PCI)

Partners receive TOT, materials, and TA Two year engagement Consulting fees (recovers costs)

Grant Funded Direct implementation of WORTH program

WORTH country office (Kenya & formerly Nepal) Technical support, outreach, training and materials provided by WORTH Kenya

Self-perpetuating/no funding Organic continuation of WORTH program (Nepal) No external support


WORTH’s Business WORTH is in the business of: “Women’s

Empowerment” Ethos:

Provides tools for women to harness their own capacity to become vibrant leaders, generate wealth and teach others.

Strategies: Literacy Business Banking


WORTH’s Unique Attributes Self-help literacy Women are business owners Women are bankers Self-help by helping/teaching others Appreciative inquiry Holistic approach that includes family and community Market-driven business education approach Sustainable groups/Village banks Organic replication Low cost Scaleable Village bank health check – performance/monitoring


WORTH Premises Confidence in the capacity of women to change

their own lives Women can do anything they want, just lack tools Self-help focus If women value it they will do it Helping others increase pride Women are owners Group membership empowers

WORTHSeptember 2008

Social Franchise SWOT for WORTH


Strengths and Weaknesses Strengths

Proven model – replicable/scaleable, organic growth, self-funding and self-perpetuating

Methodology and materials “in a box.” Awards and recognition Passion of founder/marketability of “social entrepreneur” Support/brand/affiliation with Pact Inc. & Institute

Weakness Loose control (where they replicate, who they reach, approach,

materials and training) Risk quality/no quality control No guarantee of growth

Program of Pact rather than social enterprise Untested fee-for-service/franchise model


Opportunities & Threats Opportunities

Disseminate WORTH through partner organizations (social franchises) to increase outreach and avoid incurring overhead/infrastructure costs

Leverage WORTH track record Social enterprise position opens new funding markets and networks Marcia perfect profile of social entrepreneur/evangelist (funding op) Value-added complementary program (niches) Corporate and philanthropic funders in DRC for pilot Reposition WORTH as social enterprise Capture and incorporate positive innovation as it occurs in franchises

Threats No/low demand

Women cannot or are unable to pay for WORTH Franchisees cannibalize WORTH Franchisees dilute brand No/low demand for repeat patronage

WORTHSeptember 2008

Business Model Part 1

Product


WORTH Franchise “Product” WORTH Core Methodology

Incorporation of new innovations WORTH Materials

Upgraded versions New modules

Technical Support Training Monitoring Certification Peer Network

Access network resources—i.e. funding


WORTH’s Product Lifecycle

TIME

R&D Introduction Growth Maturity Decline

WORTHFranchise & Micro-franchise

Traditional WORTH

(Centrally fundedDirect implementation)

Partner Model(CPI & TSA)


Market Research questions based on product lifecycle

What are the market opportunities for social franchising? How to get customers to “try new product”? Partnership opportunities? Attractiveness to funders?

Funding opportunities? Does demand exist What are the marketing needs/requirements?

To intermediaries To microentrepreneurs (micro-franchisees)

Will product enhancements Is franchise service offering different to different targets (INGO, NGO,

Corporates, WORTH Country programs, Pact)?


Analysis of Value of WORTH’s Products

Products Credit Savings Literacy Training Biz management training

Target Customers

(end users)

Poor women Poor women Poor women Poor women

Need or opportunity Few alternative sourceExpensive sources

No secure savings Read and write Numeracy No alternative

No alternative

Product or service

Render

Village banks Savings-led

On-lending $5 cash box

Women helping women Women helping womenSuccess stories

Benefits of product service

Access to credit Interest income—dividendsBankers

Safe savings and flexible Interest income--dividendsBankers

Empowerment Self-sufficiencySelf-esteem Pride

Higher income Empowerment Self-sufficiency

Competitors Savings-led creditMFIs

Savings-led creditMFIs / ROSCA

No direct competitors Government adult literacy

NGOs Integrated

Differentiation Interest comes back to women – not to intermediaryNo external fundsBankers

Savings as loan capital produces profit vis-à-vis interest to owners(poor women)

Self-helpNot building reliance on external resourcesRelevant content to what they are doing as WORTH

Self-taughtDiscussion led Appropriate level


New potential products to test

Franchise Packages Version Upgrades Niches

HIV/AIDs Community Health (demand) Financial literacy Rights and advocacy (Kenya) Political leadership Forestry and environment


Value of WORTH Franchise Services

Products Micro-Franchisee WORTH

Franchisee

INGO

Franchisee

Corporate

Franchisee

Target Customers Women Entrepreneurs from WORTH Program

WORTH country offices International Organizations Corporations

Need or opportunity Business income Maintain control of product quality and useCost-recover/revenue

Rapid growth/scale of proven self-sufficient product; cheaper than building own; marketable to funders

CSR in countries, communities where corporate operates

Product or service WORTH in a box Training

WORTHWORTH networkCertification

WORTHPeer/franchise networkCertification Member services (??)

WORTHPeer/franchise networkRecognition

Benefits of product service

Self-employment opportunityIncreased income

Internal network CommunicationsCapture innovation

Brand, complementary program, attract new SE funders, technical support, monitoring, quality assurance, accreditation, networking opportunities

PR / Brand / ImageCommunity support and outreach

Competitors MFIs, ROSCAs, free literacy programs

MFIs, ROSCAs, free literacy programs

MFIs, integrated microfinance, own programs, other partners

Other CSR programs

Differentiation Grassroots, community based, organic, material revolves around real social issues

Network of franchisees enables innovation and change, transparency, institutionalization and growth

Knowledge sharing and exchange through network, member services, transparency, global brand

Community engagement and empowerment


WORTH’s Value Propositions Value Proposition FOR the Customer

(emphasizes benefits for those purchasing WORTH’s Franchisees): WORTH Works – a proven, off-the-shelf,

supported scalable, self-sufficient, high-impact women’s empowerment program

Value Proposition FOR the client (emphasizes social impact for those benefiting from WORTH’s products): Self-determination, integrity, financial security,

personal power and peer support

WORTHSeptember 2008


Client/Customer Interface


WORTH’s Target MarketTarget Customers WOMEN Micro-

entrepreneursNGO

Franchisees

Corporations

Market Segments GeographyTypographyTribe? Religion?Language group

GeographyTypographyTribe? Religion?Language group

International NGOsNational NGOsLocal NGOs

Countries & Communities with corporate operations

Influencer Community leadersOther WORTH women Husbands and family members

Community leadersOther WORTH entrepreneurs Husbands/family Peers

NGOs board/leadershipFundersClient

Local communitiesLocal governmentsPublic perceptions Foundation mandates

Purchaser Women Women micro-entrepreneurs WORTH women

FundersGovernment (?)NGO (unrestricted)

Corporation, corporate staff or Corporate Foundation

Decision-maker WomenFamily members (husband)

Women micro-entrepreneurs WORTH women

FundersNGO (unrestricted)

Corporation, corporate staff or Corporate Foundation

User Women Women NGO staff (service delivery)Clients

Community of interest


Customer BenefitsFranchise

Product

Benefits

INGO Franchisee

*Proven* program in a box; upgrades, training & TA, WORTH and Pact Brand, program growth/expansion (complements core programs), value added impact, cheaper than “implementing own program,” broaden network, access to proven quality products, monitoring and open doors to new funding option, entry to social enterprise/entrepreneurship

Local NGO - Franchisee

*Proven* program in a box; upgrades, training & TA, WORTH Brand, program growth/expansion (complements core programs), value added impact, cheaper than “implementing own program,” broaden network, proven quality products, monitoring and open doors to new funding options

WORTH – as franchisee

Capture residual income to cover operating costs , scalable, increase impact , access new sources of funding, reposition WORTH as social enterprise, continuous process of improvement/R&D from franchise network, strengthen brand

WORTH Entrepreneurs

Income, business owner, help other women, empower others through access to WORTH, strengthen community


WORTH Client/Customer Interface

WORTHWORTH Employees

WORTH Entrepreneurs

Legend: Customer

FranchiseesNGO

Market Women


Relationship Dynamics (need to fill out)

Customers Special needs or considerations Motivates purchase

INGOs Brand, complementary program, attract new SE funders, technical support, monitoring, quality assurance, accreditation, networking opportunities

Corporations PR / Brand / ImageCommunity support and outreach

NGOs Partnership, involvement

WORTH Franchises Internal network CommunicationsCapture innovation

Micro-entrepreneurs N/A Self-employment opportunityIncreased income

Communities Involvement, local solution

What are the special needs or considerations required establish relationships with WORTH’s customers? What motivates these customers to buy WORTH products?


WORTH PartnersPartner Nature of

relationshipBenefit to WORTH Benefit to Partner

Pact Inc. Strategic partner;Joint MOU

Investor, brand, relationships, strategic guidance, field infrastructure and HR

LessonsRecognized as an innovatorWORTH brand

Pact Institute Strategic partner;Contractual servicesMOU

Investor, back office, services: partnership development, financial management services, fundraising, impact measurement, knowledge managements (intra/internet), IT and systems support, strategic planning

Recognized supporter/enabler of social innovation/caseCase for scaling Case for incubator of social enterprise “Lab” for testing of new ideas-i.e. social franchising & micro-franchisingNew sources of funding - social investors

Pact Kenya Fiduciary agentStrategic partner

Infrastructure, local NGO (Kenyan), local networks, legal aspects, logistics

Funding, associated with WORTH Brand, potential franchisee

DRC???


WORTH Distribution Channels

Distribution Method

INGOS IndividualsMicro-entrepreneurs

CBOs WORTH Country Office

Corporate Governments??

Franchisee X X X XSales Force X

Distribution Market WORTH

WORTHSeptember 2008


Infrastructure & Management


Franchise Structures in Testing

WORTHGlobal

National NGO

WORTHKenya

AdminFundraising

Assumptions in testing:

1. Will women pay for WORTH (price point)?

2. Do women want to be WORTH Entrepreneurs?

3. Will Women monitor WORTH programs after a sale?

4. What incentives are required to retain WORTH entrepreneurs?

Technical AssistanceTrainingOutreach

Distribution

Channel

Sales &Marketing

X X X X X X X X X X X XX X X Women X X X X X X X X X X X X X X X X X

CustomerEnd user

Micro-franchisees


Franchise Models to Test

WORTHGlobal

WORTHCountry

WORTHMicro-entrepreneur

X X X X X X X X X X X XX X X X X X X X X X X X X X X X X X X X X X X X

Women

Franchise

WORTHGlobal

WORTHCountry

WORTHMicro-entrepreneur

X X X X X X X X X X X XX X X X X X X X X X X X X X X X X X X X X X X X

Women

FranchiseNGO/Corp

$

$

$

$

A. B.Franchisor

Franchisor


Assumptions to test in other pilots

A: WORTH Franchisee Value of WORTH network Ability to scale with this model

Barriers & Benefits Revenue potential to support

WORTH in country Repeat patronage from customers

(women) Ability to control quality, IP beyond

first 12 months Cannibalization from micro-

entrepreneurs/women, other

B: NGO/INGO intermediary Franchisee Market demand

Willingness and ability to pay WORTH to be franchisee

At what price Value to franchisee Needs and wants of franchisee

Implications on services and business lines (i.e. is this one business or two)

How to maintain quality assurance and control

Repeat patronage from customers (intermediaries)

Revenue structure Cannibalization from intermediary Scalability Does intermediary need a margin


Proposed Transition Structure

V a ca n tP ro g ram A ss is ta n t

In te rns

V a ca n tO p e ra tio ns

V irtu e V e n tu resM B A T e am

M a rc ia O d e llD ire c to r

W O R T H G lo b a l

W O R T HA d v iso ry B o a rd

T B D

P ilo t #1In p roce ss

P ilo t #2In P ro ce ss

P ilo t #3

W O R T H K e n yaJa ck ieG ra ceJo yce

P ilo t #4

D R CS uzan ne

W O R T H A F R IC AK e n ya

C E OP a c t In stitu te

P a ct IncB o a rd


Potential Future Structure

P ro gra m /fu n d ra is ingA ss is ta n t

W O R T HE n trep re ne u rs

F ra n ch ise es

F ra n ch ise M a na g erM e m be r S ev ices


W O R T H K e n ya


W O R T H D R C

C O OW O R T H G lo b a l

P re sid e n tW O R T H G lo b a l

M a rc ia O d e ll

W O R T HB o a rd o f D ire c to rs

P a c t In stitu te


Value Configuration

• TOT• TA• Monitoring• Organizing new franchises• Curriculum development • R&D (operations)• Accreditation/certification

WORTH GLOBALWORTH

Field Offices

• Fundraising • Marketing / PR • Member service: network communications, updated methodologies, new materials, new income producing activities, etc.• KM and communications • R&D and new innovations (network)

• Training• TA• Monitoring• Mobilizes entrepreneurs• Data collection • Quality assurance

Franchisee

• Outreach • Sales• Program delivery• Monitoring

Micro-entrepreneurs


WORTH Value Chain

Value Ad:Customer valueLower costFaster implementation Quality, proven modelSalable Peer network Social valueLocal ownershipBuilding know-howImproved literacyEconomic securitySelf-esteem Empowerment

Establish A WORTHSocial Franchise

Local andRegional replication

Value Ad:Customer value+ Rapid expansion Greater customer insights Customer access (language, trust, etc.)New products

Social value+ Local solutionLocal employmentRural development Community involvementEnhanced learning

WORTHMicro-entrepreneurs

Value Ad:Customer valueEnhanced learning network More productsMore partnersGreater coverage/scaleStronger brand

Social valueEmployment creationRural developmentRegional/national engagementBuilding know-howSystemic change/empowerment

Future

WORTHSeptember 2008

Capacity


Capacity Utilization (to fill out)

What are the organization strongest capabilities and strategic assets? How will these be fully utilized?


Independent Governance Structure Pact and non-Pact representation (SE) Board must be an operational/working board to assist

growth barriers (i.e. fundraising, finance, marketing/PR) Human resources

Operations, franchise, business management/sale roles Job descriptions not current or representative of

responsibilities Leadership

Focus on representation, networking and fundraising Social entrepreneur leading WORTH

Capacity Building for SE Transition (1)


Capacity Building for SE Transition (2) Operations

Cookie cutter operations Product line and planned R&D Franchise services KM systems, operating procedures and systems to ensure

efficiencies, transparency and solid communications Culture

Market-orientation Adaptive and flexible model Strategic decision making Business resources utilization (use strategic and business plans)


Capacity Building for SE Transition (3)

Financial resources Decrease dependency on grants Shift to sales model Social entrepreneurship fundraising Shift from fund accounting to financial accounting and management

Legal and Organizational Structure Legal structure that enables growth (taxes, earned income,

liabilities,HR implications, opportunities for funding, allows for franchising)

Organizational structure that enable for self-sufficiency (i.e. consolidated overhead, opportunities for cross subsidization, asset leveraging, HR capacity utilization, fundraising and earned income)

WORTHSeptember 2008

Job Descriptions


Marcia Odell, Managing Director

Fundraising Grant writing / business plan writing Technical inputs to proposals

PR and Networking International representation

Marketing & Global Brand Management Manage grant reporting and administration Technical supervision to new curriculum development Strategic planning Board / Pact Liaison


Franchise Manager

Franchise network management KM, communications

Franchise services Integration of new products or process innovation Technical inputs to proposals and grant writing Technical consulting or supervision to technical consulting Quality control “Productization” of WORTH materials/methodology Branding (product/operations level)


Operations Manager

Responsibilities Strategic and business

planning Sustainability Growth

Leadership and oversight of senior management

Reporting to the board Operations Management Donor relations Organizational accountability Fundraising

Qualifications “Proven track record” of:

managing a growing company/social enterprise leadership experience

Africa/developing country experience

Entrepreneurial Successful fundraising/contract

negotiation MBA or masters’ level education Excellent written and oral

communications skills Creative problem solver French a plus


WORTH Advisory Board

One or more of the following: Jean-Louis John Whalen Nancy Murphy Matt Medlin TBD


SE Technical Expertise

Responsibilities Social Enterprise design Market research Business planning and strategic planning Fundraising support Connections/network linkages Social Enterprise Capacity

Knowledge transfer Marketing support Support operations, field testing (R&D) and implementation

WORTHSeptember 2008

Business Model Part 4:

Financial & Impact Aspects


WORTH Cost Structure

WORTH Country OfficesOverhead, operations

fundraising, sales, R&D,Franchise services:

TA, monitoringTraining

WORTHFranchisee

Profit center(Will need to discuss

Cost/fee structureHere)

FranchiseeProfit center

WORTH Franchise Package

(Purchase Materials &

Services)

WORTH GlobalCost Center

Overhead, marketing,fundraising, communications,

franchise services, professional fees

Micro-franchisees

Profit

Making

PartialCostRecoveryUntil??

Forecasts

Ongoing Subsidy

Required


Revenue Model

Pact Institute $$Equity Investment

Franchisees

$$ S

ub

gra

nt

Su

bs

idy

Legend: = internal flows = external flows

Fee

s $$

$

WORTH Micro-Franchisees

$$$Philanthropic

WORTH Country$$Fees

$$Philanthropic

WORTHGlobal


Potential Funding Sources

WORTH Global

Funders HybridFoundations: * Program Related Investments Social Venture Funds: * Social LoansGovernment: * Soft loans

Philanthropic Social Investors: * GrantsFoundations: * Grants Government: *GrantsIndividuals: *Donations

WORTH Country OfficesWORTH Franchisees

Pact Institute

Earned IncomeFee-for-service

Sales

Franchise fees


Consulting: Government Contracts

Fee-for-ServicePrivate contracts

Training fees

Revenue Sources

WORTHGlobal

For-Profit DetectionBusinesses

WORTH Field

Franchise feesMaterial fees

Sales commissions

Social Entrepreneurship funding Individuals

Foundations

WORTHSeptember 2008

Returns: Social and Financial


Returns/metrics (to fill out) Impact measurements Social Return on Investment (SROI) Financial measurements Business measurements

How will you measure success???


Model Model Informs Business Plan

Value proposition Product and services features/design

Target customer Market opportunity

Distribution channel Marketing/outreach and sales model

Customer Relationships Brand and Reputation

Value configuration Operating model

Core competencies and capabilities Organizational culture & management model

Partnership Partners and partnership model

Revenue model Financial sources and flows

Returns Social impact model and metrics

Cost structure Capital requirements and uses

worth september 2008 worth business model. worth september 2008 business model building blocks...

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