Business Approach of Mercy Corps - Assignment Example

? Business Approach of Mercy Corps Introduction Civil society organizations (CSOs), commonly known as non-governmental organizations (NGOs) are crucial actors for the development and progression of universal values. The CSOs mainly look after the betterment of the society. With the advancement of global market integration, CSOs gained further importance. The significance particularly appeared in fields such as alignment of social and environmental priorities and economic activities. This is the reason why civil society organizations are often considered as the integral part of global compact since its emergence. CSOs are the legally constituted corporations created by natural or legal people for the purpose of societal welfare (Craig, Taylor and Parkes, 2004). However, these establishments work independently from the government. One of the major characteristics of CSOs or NGOs is that these forms of establishments are non profitable organizations. Hence, their principal aim is not to make profits but to look after the welfare of people (Fine, 2006). This report aims at illustrating the main tactics and approaches used by a CSO in its relationship with business. In addition, the report also aims to summarise if and to what extent its tactics have evolved over time and will elucidate the discernible changes in the tactics. Lastly the study will evaluate the strategies used by the CSO and on the basis of that recommendation will be provided to the CSO in terms of improving or strengthening its activities (Barratt, 2009; Child and Gronbjerg, 2007). The civil society organizations or the non-governmental organization chosen for this study is Mercy Corps. Therefore for better understanding, the study will at first present a brief overview of the chosen CSO. Mercy Corps: A Brief Overview Mercy Corps is an international aid agency which works towards the betterment of transitional environments that has gone through certain kinds of jolts such as natural disaster, economic collapse, or conflicts. The principal intention of this CSO is to assist people who have been a victim of the environmental collapse. It was founded in the year 1979 by humanitarian Ellsworth Culver and Dan O'Neill (Bonn and Baker, 2000). The establishment is currently headquartered in Portland, Oregon and is currently headed by Neal Keny-Guyer, who is the present CEO of the company. It has around 3700 employees and operates in 40 countries around the world (mercycorps, 2013a). The employees of the company attempt to aid victimised people on an urgent basis. For instance, the employees try to bring in food and supplies as early as possible in order to enable the people restore their previous situation. This is achieved by various kinds of market-led and community-driven programs. The activities of the employees clearly reflect the enthusiasm of the organization towards the welfare of the society. Mercy Corps mostly recruits local people. As per reports, the company has 93% local employees as they believe local employees will be beneficial for their local knowledge. The CSO works for the betterment of failing states, conflict zones and nations that endured natural disasters. It remains active in places such as Zimbabwe, Somalia, Congo, Afghanistan, Iraq, Pakistan, Haiti and Indonesia among others (Bichsel, 2008). In these countries, women education is usually ignored, livelihood of a family is a matter of doubt and a child’s health is always a cause of concern. Hence, to get rid of these issues, the CSO works proactively and responds immediately. Mercy Corps prioritizes its activities on the basis of the urgency of the situation and also listens to the local inhabitants (Migdalovitz, 2010). Interestingly, Mercy Corps caters an area or locality for extended time periods in order to foster local entrepreneurship opportunities, inspire marketplaces through "cash for work" programs and a range of lending models for rebuilding social capital. Mercy Corps initiates several programs which allow them to gain market reputation and simultaneously achieve confidence of the government. From the point of view of business, the support of government and people plays an imperative role. Since its inception in the year 1979, the company has provided around US$1.95 billion as an aid to people of around 107 nations (Mercycorps, 2013b). This clearly depicts the commitment of the company towards the society but in turn creates a favourable business situation. Tactics and Approaches of Mercy Corps Strategies and tactics are integral parts of a business. It not only enables business houses to operate efficiently in the market place but also helps in aligning the activities of business with the objectives of the company. Hence, a company should have strategies, tactics and policies to guide their business (Najam, 2000). Even for a CSO or NGO, strategies are important as it defines their approaches to receive funds with which are required to carry out different operations, pay wages to the employees and maintains the operation cost. Another encouraging fact about the company is that nowadays, business houses are trying to get associated with the NGOs for the principal purpose of reaching out to new markets (Dickens, 2000). This is because large NGOs operate across the globe and they have large global exposure. Moreover, corporate houses also take the assistance of CSOs to make a global presence (Citizens Advice, 2004; Bellemare, 2000). Since the last few decades, CSOs or NGOs around the world has been the recipient of funds and grants from the governments and corporate houses. The grants are provided for the purpose of providing disaster relief services and implementing projects that help in benefitting the society (Howell and Pearce, 2001; Hutter and O’Mahony, 2004). The aim of Mercy Corps is to assist people to get rid of the crises they confront and also providing the opportunities they deserve (Mercycorps, 2013d). Moreover, Mercy Corps also initiates programs that provide communities across the world with various support and tools they require in transforming their life for the betterment. However, along with the welfare and development of society and individual who are victims of different types of crisis, Mercy Corps plays crucial roles in the development of business as well. The CSO has always maintained a positive approach towards the welfare of business communities. Mercy Corps holds different types of interactive sessions and programs for the established and aspiring entrepreneurs as one of their tactics to promote business. With this approach the CSO, attempted to generate a sense of trust among the budding entrepreneurs. In the similar way, the company initiates various types of program for the benefit and development of the new and established entrepreneurs. The CSO has also entered into a treaty with MIF for the purpose of providing online mentoring to entrepreneurs belonging to Mexico and Guatemala. For instance, Mercy Corps has recently signed a deal with The Multilateral Investment Fund (MIF) that will help around 1500 micro and small enterprises (MSEs). The CSO seeks to offer mentoring through an online platform (IADB, 2013) Another evident approach used by them in the context of business is corporate partnerships. The company has entered into a treaty with a number of corporate houses which allowed them to get global exposure and received several grants from the corporate houses. The corporate houses mostly grant these donations as a part of their corporate social responsibility investments. Hence, it is evident that the approach of the company mutually benefits both CSO as well as the partnering organization. Mercy Corps is collaborating with increasingly diverse and wide set of partners at all the hierarchies of private, public and civil society sectors so as to address the challenges and drive the work. The partnership activity of the company reflects the values of the company in the form of fund responsibility, local ownership and long term sustainability. The priority of the company to promote sustainability creates a secure and productive environment is a sign of the CSO’s commitment towards developing business (mercycorps, 2011). Apart from the indirect assistance offered to the CSO, it also provides direct assistance to the companies in the form of financial supports. Mercy Corps offer loans to the small business owners at a lower interest rate and easy repayment option. It mainly offers financial assistance to those entrepreneurs who do not qualify for availing loans from financial institutions. Along with those educational services, various training programs and consulting services and networking opportunities are provided for the purpose of ensuring the entrepreneurs build a successful business (Mercycorpsnw, 2013). Initiation of such support programs allowed the company to create around 160 new jobs and that benefitted the society from an overall point of view. The above discussion has clearly enlightened the fact that Mercy Corps has a positive outlook for the development of business ventures. The activities of the company pertaining to business development and societal development also reflect the same. Hence, it can be concluded that Mercy Corps is a CSO that fosters business activities with its range of programs and solutions. Evolution of the Tactics Founded in the year 1979, the principal aim of the CSO is to alleviate poverty and suffering by aiding people and building a secure and productive community. Since its inception, the company has continually demonstrated innovation, timeliness and capability to adapt quickly to the changing external situation. From the time of its inception, the organization has helped people overcome the tough times and ensured long term stability. The principal approach of the company has always been to help communities and societies to overcome crisis and turn the same into new opportunities. Initially, the organization was founded for the principal aim of saving refugee fund. This was principally meant for helping the Cambodian refugees who were struggling due to scarcity of food and outbreak of war. During that era, the organization has been able to raise $1 million and provided the same as an aid to the people of Cambodia and help recover their crisis. The strategy of the organization i.e. to help people overcome crisis situation was further strengthened in the year 1980 (Tyler, 2002; United Nations Food and Agriculture Organization, 2004). The company puts more emphasis on innovation and sustainable development of the company. In the context of their philanthropic activities, the functions of the organization kept on evolving over time. During the mid of 1980s the focus of the company shifted to more rational activities. The organization started to offer job training and simultaneously initiated programs to foster the development of business ventures. In the meantime the company also offered several job opportunities to the people across the globe. The organization also took imperative roles in developing the food security issues in Sudan and accelerates the economic development of the country. In the similar way, the organization launched similar programs in countries such as Afghanistan, Ethiopia etc. so as to encourage economic developments. This tactic of the organization continued till the end of 1980s, but the focus again shifted from directly offering assistance to victimized people to provide opportunities for development. For example, in the year 1989 Mercy Corps started to support the business communities so as to ensure their development. The organization supported both budding entrepreneurs as well as established companies. For instance, the registered micro financial institutions of the organization have lent $1.5 billion to small business owners and entrepreneurs (Anheier, Glasius and Kaldor, 2001; Cascio, 2003). Alongside business development activities, the company continued to carry out other entrepreneurial activities. In the meantime, the CSO imitated programs and organized various types of events for social development. Some of the notable ones are safe drinking water programs, health and medical services and ensuring food security. In the context of its business development activities, one of the most prominent works of the organization was the development of wholesale bank in Indonesia. This not only helped the underprivileged section of the society by offering them with banking opportunities, but also creating several jobs. In addition, another instance that showcases Mercy Corp’s positive stance towards helping business is the organization’s assistance to business houses of Japan to reopen their closed business after tsunami in Japan (mercycorps, 2013b). One of the latest approaches of the company towards promoting business was facilitating support markets and value chain development. However, the CSO achieved more recognition for its role in promoting business. As a reward, the organization won Fast Company Social Capitalist Awards for its entrepreneurial and innovative approaches. Hence, from the above discussion it is evident that the organization has kept on evolving over time. Moreover, during the evolution process a constant change in the tactics of the company has also been identified. The next section of the study will illustrate those discernible changes in tactics of Mercy Corps. Discernible Changes in Tactics There are numerous discernible changes that appeared in the approaches and tactics of the company. One of the most evident changes was related to the shifting focus of the organization towards the activities. The organization started for the principal purpose of helping deprived people and providing assistance to the people who are victims of any kind of disasters. However, with the course of time the organization’s tactics changed from offering assistance to create opportunities. Mercy Corps tried to concentrate more on the development of business in the communities where they have worked. Interestingly, the strategy of the organization in the context of business development also changed rapidly over time. For instance, Mercy Corps was usually known for offering financial assistance to the entrepreneurs as well as to the established business hours for helping them recover from the tough situations. However, Mercy corps adopted new approaches such as facilitating support markets, value chain development, improving market access, market-led workforce development etc. These are some of the evident as well as tactical changes from the part of the company. In the context of facilitating support services and value chain development, Mercy Corps mainly offered infrastructural support that may help a company to function efficiently, compete and grow in the market. The infrastructural services are mainly offered in the form of transport, storage, marketing facilities, information services and cell phone alert among others. In the similar way, Mercy Corps also attempts to develop the entire value chain of a business. In addition, effective employment practices are also offered to them in order to fulfil their requirements and enhance the competitiveness by implementing more effective practices (Mercycorps, 2013c). Hence, from the above discussion it is obvious that the strategies and tactics of Mercy Corps have evolved over time and they made numerous changes in their strategic approach. The changes however are mostly visible in the contexts of its business development activities. Tactics used by Mercy Corps Mercy Corps has used several strategies and tactics for the purpose of developing the business. One such approach with which the CSO received colossal benefit was the market development sector approach. The organization mainly implements three different approaches across its program of market development. One among the three strategies mentioned is pro-poor development strategy. This strategy enables Mercy Corps to ascertain that marginalised and at-risk populations are developing their business and are playing proactive roles in the process of market upgrading. Moreover, the organization is also attempting to bridge the gap between economically disadvantaged and more competitive economic players. This in-turn greatly helps in alleviating the tension and also ensures long term sustainability as well as productivity (Comfort and Kapucu, 2006; Guo and Acar, 2005). Another approach of the company is a sustainable market driven approach. In this approach, the CSO gets the opportunity to leverage the current market forces and foster partnership with the private sector. Furthermore, in order to make sure an increase in the supply of products and services are in line with the market demands, the organization influences as well as encouraging the new and existing entrepreneurs to carefully analyse the market scenario and demand that encompasses factors such as price, quality and volume to name a few before creating a plan for supply and procurement. This market led strategy allows entrepreneurs and small firms to focus on market – driven production and capitalize on the opportunity provided by the market driven production approach. This greatly minimizes the waste in production and simultaneously saves valuable natural and human resources (Junglas and Ives, 2007; Maitland and Tapia, 2007). The third approach of the organization towards developing the situation of the new and established entrepreneurs, Mercy Corps undertakes a multifaceted approach to program intercession and simultaneously targeting players and establishments at different hierarchies of the value chain and providing them with the sustainable and adaptable solution for long term growth and immediate relief. The diverse range of programs initiated by the company offered resources for market up-gradation at the national, local and international levels. In addition, the programs also provided the opportunity to develop and support strategies for the start-up entrepreneurs. Lastly, this approach also increased the development and recovery opportunities for the established business houses. Thus, it clearly reflects that the tactics and approaches of the company are meant for the sole purpose of encouraging identical momentum for the economic recovery as well as offer growth opportunities for all the segments of the market (mercycorps, 2013c). Recommendations This section of the study will offer Mercy Corps some recommendation by which they can strengthen and improve their activities. It has been observed that the company puts in strong efforts in the development of the market and business ventures by offering various support services. These services range from financial assistance to consultancy services. In addition, the company also offers training and mentoring services to the candidates who are in requirement of the same. However, still there are areas in which the CSO can focus on and can further strengthen their activities. The areas of focus and the activities which can be undertaken by the company are presented below: - Mercy Corps is strongly recommended to initiate programs that not only helps the emerging entrepreneurs but also supports established entrepreneurs as well in further developing their business. For example, the CSO can organize seminars in which they can offer different ideas pertaining to business growth. This will greatly benefit the companies which are tagged as small and medium sized enterprise. Such sessions may help these entrepreneurs to convert their small or medium sized business into a large venture. One of the biggest advantages of undertaking this activity is that it will help them to generate a sense of trust among the people of the society and moreover government of the respective countries will also get highly satisfied with their approach (Comfort, Sungu, Johnson and Dunn, 2001). In order to carry out any task or accomplish any task successfully, a company or any establishment need to have sufficient manpower for the same. Hence, it is essential that CSO maintains a steady workforce. The CSO is also strongly recommended to motivate and compensate employees in such a manner that they draw high satisfaction from it. This will also result in better performance and low attrition rate. It is important that the staff members working for the NGO or CSO have high morale as they are the one who will be implementing and initiating the programs on behalf of the organization. Thus, recommending Mercy Corps to ensure high employee morale by appropriately compensating them along with additional benefits is justified according to the context (Griffin and Moorehead, 2012). It has been observed that non-governmental organizations (NGOs) or the Civil Society Organizations (CSOs) have continually pushed for sustainable development at both national and international levels. The campaigning groups have played the key role in driving intergovernmental negotiations. This ranges from regulation of the hazardous wastes to the prohibition on the use of land mines and abolishment of the slavery system. However, it has found that majority of the CSOs are not concentrating on the different process of the government before initializing a program or campaign. Similar is also the case with Mercy Corps. Hence, the organization is strongly recommended to focus on the government as well as the intergovernmental process as they often ignore this aspect resulting in a weaker campaign. Mercy Corps is mainly involved in providing relief to the individuals who are the victims of different disasters and calamities. In addition, they also provide different kind of assistance to the entrepreneurs to uplift them. However, they hardly involve themselves into projects that directly benefit the people of rural places. Despite, colossal development opportunities the organization only focuses on these two aspects. Hence, the organization is strongly recommended to focus on the area of rural development. This can be initiated in the form of aiding rural people with medical checkups, development of sanitation system and development of drinking water infrastructure to name a few. Such activities will not only increase the reputation of Mercy Corps but will be also tagged as a CSO that is involved into a range of social development activities. As a result of this, the chances of government grants and corporate grants will increase and hence can be beneficial for the organization. The last recommendation for Mercy Corps in order to strengthen their activities and position in the market is that they should implement a communication platform to make people aware about the activities they are undertaking. 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