Social Enterprise Models Prepare the Way Forward: A Guest Post

By John Herron

At the UMB School of Social Work on an evening in May, Gar Alperovitz, speaking about his new book, suggested the best way to look at work being done on social change is to regard it as preparation for a new economy.

Alperovitz says it takes a generation or two to realize all the benefits of the early work of pioneers in preparing for major change. This is a comforting notion. We don’t have to accomplish everything necessary for social change that will make our society more fair and our capitalistic system more democratic. It is not a failure to make the effort toward a goal that only others will accomplish when the time is ripe. Each effort prepares the way for future success. Major changes to systemic failure—our current situation with wealth distribution, for example—will come about when the pain is distributed widely enough and leaders rise up from the bottom and the middle class to seek change. This rang true for me in two situations in my career.

One was as a young social worker in a psychiatric research center. At the time, we were designing a study to take individuals recovering from schizophrenia off medication to see if they would do as well using it ‘as needed’ rather than ‘all the time’—the current practice. We were more than five years in the design stage! We kept changing the protocol all the while collecting data. I was frustrated and challenged the researchers to stick to one protocol. A venerable researcher took me to lunch and pointed out that the preliminary data we had generated while we tested how to do the study had actually encouraged others around the world to try other medication-free models. These trials would not have been possible without our efforts.

Harbor-City-ServicesThe second situation is a recent one. Last October, I merged a social enterprise, which I started, with another nonprofit to continue and grow the mission with a stronger company. Social enterprises are a way to solve a social problem using business practices. Importantly, they offer ‘earned income’ as an additional source of revenue for nonprofits to address social problems so there is less reliance on philanthropy or government. In my case, the mission was creating jobs for individuals with mental illnesses and/or substance abuse. The business was record storage and shredding, commercial moving and storage. Rather than rely on any philanthropy or government contracts, this company competed in the marketplace as a self-supporting entity. In effect, I had a single source of revenue rather than a diversified revenue stream. This left the company with reduced benefits, low wages and kept it from growing to scale. By time of the merger we needed philanthropic help to cover debts and make it possible to save the brand, jobs and mission.

After hearing Gar and remembering my experience in research, I can look on this company as proving that a social enterprise, without sufficient capital and without broad community ‘ownership’ still managed to stay in business for 25 years! We have proven that it can be done and we have prepared a way for others to do it better. Go for it world! As Gar says, “Just do it.”

John Herron, MSW, MBA has spent 42 years focused on the study and treatment of schizophrenia as a clinician, teacher, researcher, and administrator. He received his Bachelors degree in History from Loyola College in 1969, his Masters in Social Work from the University of Maryland in 1975, and his executive Masters in Business Administration from Loyola University of Maryland in 1999. Herron founded Harbor City Services, Inc., a self-sustaining social enterprise employing individuals in recovery from mental illness and/or substance abuse disorders in 1987, to improve long-term employment outcomes for those in recovery in spite of their having a chronic illness. He is an assistant clinical professor at University of Maryland School of Medicine, Maryland Psychiatric Research Center and an instructor at Columbia University School of Social Work. He is also past president of the Maryland Chapter of the Social Enterprise Alliance and president of the MECU Credit Union Foundation. The integration of Harbor City Services into Humanim will be completed by October 2012.