Posted on Thursday 13 June 2013 by Ulster Business

Tim Smit

Social innovation has the potential to drive the most important change in corporate structures in history, according to the founder of the Eden Project, Sir Tim Smit.

Speaking at the EBN Congress in Derry, organised by Noribic, Sir Tim used tales from his own experience of setting up the biodome project in Cornwall – which cost £141m to build and has since generated over £1bn in revenue for the local economy – to illustrate the potential power of social enterprises.

"I think social enterprise has the potential to be one of the most important business innovations in the last 250 years," he told Ulster Business after his speech.

"A great business by its very nature should have great outcomes. But the best outcomes are reached by social enterprises because they are able to optimise their profits rather than maximise them. Limited companies are obligated to maximise their profits."

The Eden Project visionary said the old cliché that a social enterprise was an organisation with the heart of the public sector and the management of the private sector was a flawed way to look the concept because "the public sector doesn't have a heart and some private sector companies are very badly run".

"Social innovation is often seen as a rather fuzzy concept because social enterprises have largely been hi-jacked by Government who see social enterprise as an arm of the third sector, which is not how I see it. As a result a lot of social enterprises are, almost paradoxically, not very enterprising," he added.

"Most people look at problems, for example the health service, and approach them in terms of changing what is there. What I would say is imagine there is no health service, how do you start again? That's one of the things we need to foster, that sort of thinking."

Sir Tim said the biggest challenge facing social enterprise was getting more smart people to work for them, rather than going into investment banking and management consulting.

"Social enterprises should be set up so that if people are successful it is possible not only to see social gain but actually benchmark their success against the stakeholder's success. If someone sets up a social enterprise and is turning over £30m and making profit of £10m there's no reason in my mind, if it is done in a transparent way, why they shouldn't make £1m themselves," he said.

"There is an unhealthy desire to portray social enterprise as though you should be wearing a hairshirt. If you are effecting social change in a positive way, the more successful you are, the more you should be able to earn."

He believes partnerships between community organisations and the private sector will become increasingly important, citing the Cornwall Together project in which consumers have clubbed together to maximise their energy buying power.

"The danger is that an opportunity of creating new alliances is being missed because they seem to think social enterprises should be not for profit. If they are going to be social enterprises they ought to be charging enough to enable them to invest for the future, rather than just breaking even all the time," he said.

Eight simple rules

Sir Tim Smit said he has eight rules for people who work at the Eden Project that are applicable to other organisations looking to foster innovation.

• You cannot start your workday before saying "hello" to 20 other people.

• Read two books a year outside your sphere of interest that you would not normally read.

• Do the same with plays – particularly if you don't like the theatre.

• Do the same with movies – take recommendations from co-workers.

• Do the same with concerts. The idea of all these is points is to "take the blinkers off your eyes" and intentionally seek new ideas and inspiration.

• Once a year, stand up and explain why you love to work for Eden. If you have to do this, he believes that you'll deal with all the reasons you don't love Eden before giving your talk.

• Eden's top 80 team members must all do one guerilla act of generosity for other people once a year, without them knowing about it.

• Once a year prepare a meal for the 20 people who make it worthwhile coming into work. "People are different when the sun goes down – most of the great decisions we've taken at the Eden Project have been made by wine-light," he said.

• Sir Tim's 9th rule, for himself, is to accept every third invitation he receives. "Magic is created by meeting the people you didn't know you were meant to meet," he said.

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