Social Enterprises Redefining the Paradigms of Organizational Growth:Deloitte Human Capital Trends Report
Deloitte’s sixth annual Human Capital Trends report titled ‘The rise of social enterprise’ was released on April 3rd during the 2018 Bersin IMPACT conference in Florida, USA. Amid concerns about automation, the need for new skills, an aging workforce and tightening labour markets, the make-or-break issue facing companies this year is the need for realignment among the C-suite to focus on business’ evolving role in society. With more than 11,000 HR and business leaders weighing in, this year’s Global Human Capital Trends report is the largest longitudinal survey of its kind.
The report discusses social enterprises at length and defines it as an organization whose mission combines revenue growth and profit-making with the need to respect and support its environment and stakeholder network. The rise of social enterprise, therefore, is a reflection of the growing importance of social capital in shaping an organization’s purpose, guiding its relationships with stakeholders, and influencing its ultimate success or failure.
Commenting on the significance of social enterprises, Gaurav Lahiri, Partner, Deloitte India said, “Today, more than ever, we are witnessing seismic changes in the workforce, the workplace, and the technologies used in the world of work. Organizations are no longer assessed based only on traditional metrics such as financial performance, or even the quality of their products or services. Rather, organizations today are increasingly judged on the basis of their relationships with their employees, their customers, and their communities, as well as their impact on society at large—transforming them from business enterprises into social enterprises.”
“As society grapples with daunting demographic, technological and social challenges, people want business leaders to fill the gap, but our research shows they have a long way to go,” said Erica Volini, Principal, Deloitte Consulting LLP, U.S. human capital leader. “This year’s report is a wake-up call for organizations to look beyond their own four walls and reimagine their broader roles in society. Integrating the C-suite to build a more social enterprise will be a differentiator for businesses to attract the right talent, drive customer loyalty and sustain long-term growth.”
Three factors catalyzing the rise of social enterprise:
Growing power of millennials
Millennials comprise a majority of the workforce in many countries, and their power is growing over time. Millennials are actively questioning the core premises of corporate behavior and the economic and social principles that guide it. Social capital plays an outsized role in where they work and what they buy, and 86 percent of millennials think that business success should be measured in terms of more than just its financial performance.
Widening leadership vacuum in society
Across the globe, people trust business more than the government. Citizens are looking to business to fill the void on critical issues such as income inequality, health care, diversity, and cyber-security to help make the world more equal or fair. This expectation is placing immense pressure on companies, but it is also creating opportunities. Organizations that engage with people and demonstrate that they are worthy of trust are burnishing their reputation, winning allies, and influencing or supplanting traditional public policy mechanisms.
Changing technological landscape
Advances in artificial intelligence (AI) and new communications technologies are fundamentally changing how work gets done, who does it, and how it influences society. People increasingly realize that rapid technological change, while holding out the promise of valuable opportunities, also creates unforeseen impacts that can undermine social cohesion. However, at the same time, technological advances will open up new opportunities for businesses to have a positive impact on society.
