Monday, March 10, 2014

Social Entrepreneurship

CHAPTER ONE: Introduction to the Village of Darsanapur

A long time ago, there was a tiny village in India called Darsanapur. 
Darsanapur had a very sad socio-economic make-up. 
There was one very rich landlord who owned all the fields in and around the village.  And the village had about one hundred-odd families of landless labourers who toiled hard in these fields from sunrise to sundown to make a pittance wage from the landlord.
Every day, the labourers toiled hard in the fields to make a minimum wage.  This wage just about allowed them to make ends meet, with no savings.  Many of them could not even eat a daily meal, since the wages they earned were so little, that any other unplanned expense such as sickness or travel left them with no alternative but to skip their mid-day meal.
Now in this village was a small temple in that was managed by a very good-hearted pujari (priest).  Every day, after completing his daily puja (prayers), the pujari walked for several hours to neighbouring villages to beg for alms and food.  Most of what he collected, he brought back and took to the fields to share with some poor farmer who was going hungry.
This routine had been going on for a few years.


One day, a rich trading merchant moved into the village of Darsanapur.  This merchant was a shrewd businessman who had earned his wealth through hard work and entrepreneurship. He built a big house close to the temple.
The pujari thought he should try his luck and went to beg for alms at the merchant’s house. 
The merchant was a good man and gave the pujari some food in alms. 
The pujari promptly took the food to some hungry farmers in the field.  Within a short while, he was back at the merchant’s house to beg for more.  The merchant was puzzled at first but did not want to offend the pujari so he gave the pujari some more food.  Sure enough, the pujari distributed this additional food to some other hungry farmers and was back at the merchant’s house in no time to ask for more.  The puzzled merchant then asked the pujari why it was that he kept asking for food.  Did he just have a large appetite?
The disheartened pujari then told the merchant all about how there was this one rich landlord in Darsanapur and how he paid only pittance as wage to the landless farmers.  The pujari also described how he walked for several hours every day to get food for them from neighbouring villages. 
The merchant carefully heard all about the pujari’s hard work to collect enough food for the helpless landless farmers of Darsanapur.
Then the merchant gave the pujari ten coins and said, “Go buy a big tiffin box.  So that when you come the next time, you can carry enough food for your friends and you don’t have to walk back and forth from the fields in this scorching sun.”  The pujari gratefully took the ten coins from the merchant. 
The next day, the pujari was back at the merchant’s house begging for alms and food for himself and for the landless farmers.  The merchant asked him for the tiffin box so that he could give him enough food for all.
However, the pujari said, “Dear merchant, forgive me but I did not buy the tiffin box.”  “The pain of seeing hungry farmers was too great for me.  So instead I spent the ten coins on buying fruit and distributed the fruit among farmers for their families.  My heart yearns for them and I could not bring myself to spend money on anything other than on fruit for the poor families.”
The merchant was quiet.  He was thinking hard but did not share his thoughts with the pujari.
He quietly gave the pujari as much food as the pujari could carry and then sent him off on his way.  In a short while, the pujari came back for more food to the merchant’s house.  But found the house locked.  The pujari was shocked and angry! How could the merchant go away?  Didn’t he know that there were so many hungry farmers who could benefit from alms?  In his heart of heart, he could not help but curse the merchant for having deserted the poor farmers.


The merchant had actually not gone away.  He had locked his house in rage that the pujari had violated his trust and not bought the tiffin box with the money.  The merchant was in a shed in his backyard.  He was packing clothes, some supplies and some material for trade for a long tour. 
Early the next morning, the merchant took off in his horse-cart and began a tour that would take him several months to complete.  This tour involved a visit to 30 towns that were close to the village of Darsanapur.
At each town that the merchant went to, he first contacted some of the wealthiest traders and either sold them some goods or purchased some merchandize from them.  This allowed him to make friends with them.  He then would describe to them the plight of the villagers of Darsanapur and asked for their help. Over the months of his travel, within each of the 30 towns the merchant visited, he established trading partners who:

  1. Agreed to trade with him regularly
  2. Agreed to put aside a share of the profits to fund one cartload of food once a month for the poor farmers of Darsanapur.

After about 3 months of this exhausting but profitable tour, the merchant returned back to Darsanapur.  By now, he had a donor committed to supplying food for each day of the month in addition some profitable trade deals.  It was late in the evening when the merchant returned back to Darsanapur.


The next morning, the merchant went to the fields. The landless farmers were quite surprised to see this well-dressed man in the scorching sun. 
The merchant told them of his plans.  “I will ensure that all of you have enough food for lunch every day.  However, I need to have 3 men every-day who will ride to the town I tell you in my horse-cart.  They will then ride back with 2 carts of goods for me and one cart full of food for the village.”
The farmers readily agreed.  Giving up one day of labour was a small price to pay for 3 men to get lunch for all hundred farmers.  The merchant was happy too that he was getting free help to transport his goods – which meant more profit. 
And so it came to pass.  Every day, 3 labourers would ride the merchant’s horse-cart to one of the towns and carry back two carts of goods and one cart of food to Darsanapur.  And the farmers feasted on a hearty lunch every day in the fields.
Everybody was happy!  The farmers for the food, the traders from the neighbouring villages for the business and profits, the merchant for being able to get free labour and a profitable business.  In fact, the landlord was happy too!  The merchant had started buying the produce from the farm and using his newly created transport organization was able to sell farm produce from Darsanapur to the 30 neighbouring towns for higher profits.  This allowed the landlord to make a little more money than he used to in the past. Well, almost everybody was happy – not the pujari.
The pujari was very angry at the merchant.  In the pujari’s view, the merchant was exploiting the poor farmers for personal profit. 
“How dare the merchant ask the farmers to transport his goods for free despite being so wealthy?” thought the pujari to himself.  “And how dare the merchant exploit the charity of his trading partners for personal benefit.  This was so immoral!  Surely the merchant would rot in hell,” he thought to himself.
The pujari remembered the long hard days where he slept on an empty stomach just to make sure that at least some farmers did not go hungry.  However, now the pujari realized that he needed to beg for alms for only himself.  The farmers did not really need any lunch because now they had a cartful of food every day.  They could also save a little money from their wages and use it for emergencies.  So while he was happy that the farmers were not in trouble, he was very angry that the immoral merchant who had denied him food for the farmers on the second day of his visit and who was personally benefiting from all the charity being done by his trading partners, was so popular – not only with the farmers, but also with the wicked landlord. 
But the nice man that he was, the pujari prayed for the merchant every day in the temple, requesting God to forgive the merchant for his immoral and selfish behaviour.

CHAPTER FIVE: Moral of the Story

The Sanskrit word for philosophy or direct vision is Darsana.  This short story is seeking to provoke thoughts around the vision or philosophy of social entrepreneurship. 

5 Key inferences that could be drawn from this story are:

1. Innovation and Entrepreneurship is crucial to impact change in Social Sector

While the pujari had a good heart and worked very hard to help his fellow farmers, he could but make only limited impact on their lives.  It was only the innovation and entrepreneurship demonstrated by the merchant that actually created a sustainable change in the socio-economic landscape of Darsanapur.

2. Critical to engage stake-holders as part of the change management process

Many leading change leaders agree that sustainable change needs the involvement of the stakeholders for whose benefit you are attempting the change.  The merchant ensured that the farmers were in some ways contributing to the process that would help make their lives better.  Pure welfare assistance or hand-outs rarely leads to sustainable change.  It may be wiser to invest resources in teaching people to fish and then motivating them to fish for themselves as opposed to giving out fish as alms!
3. Unity is Strength
An important extension of the engagement of stakeholders is the notion of community assets.  When you have a community own an asset or process of improvement, each individual looks out for the other and can divide the risks and responsibilities so that no one person is overwhelmed.  This principle is used widely by the Government of India when extending subsidies to self-governed self-help-groups (SHG) as opposed to individuals.

4. Sustainability

Sustainability is an important principle of social entrepreneurship.  The pujari although well-meaning deflected resources away from a tiffin box (that could have been a sustainable solution enabler) to food (that was a short term gain).  Planning for sustainability is cardinal in social enterprise.

5. Generating Surplus is Crucial for Stability
Many individuals view the notion of generating a surplus or a profit as being in contradiction with trying to help people.  Somehow, making profits while trying to impact quality of life is viewed as immoral.  The fact is, that profits or surplus allow you to attract strong talent and build organizational strength that brings growth and sustainability to a social enterprise.  As Dan Pallota warns us, “Don’t confuse morality with frugality!”


  1. One crucial problem : there is nothing that the 30 different traders gain from setting aside one cartload of food every month. If there was a way for them to benefit materially, it'd become sustainable

    1. Good point Ashutosh.
      One interpretation could be that like in modern times, the one cartload of food is akin to a "sales tax" @ rate of 1/30 that goes towards "public good".
      Thanks for your comment.