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The Business of HELPING

A Capitalist-Socialist Approach in Enterprise Development with Christian Attributes


by Alrey Galang, Social Business Consultant

The Business of HELPING in the developmental industry requires social responsibility


while ensuring profits are earned as values are added into each ED (Enterprise
Development) intervention. I propose the Capitalist-Socialist Concept.

ECONOMIC SYSTEM. An economic system is the structure of production, allocation


of economic inputs, distribution of economic outputs, and consumption of goods and
services in an economy. It is a set of institutions and their social relations. Alternatively, it
is the set of principles and techniques by which problems of economics are addressed,
such as the economic problem of scarcity through allocation of finite productive
resources.[1]

The economic system is composed of people and institutions, including their


relationships to productive resources, such as through the convention of property.
Examples of contemporary economic systems include capitalist systems, socialist
systems, and mixed economies.

CAPITALISM. Capitalism is an economic system in which the means of production are


privately owned and operated for a private profit; decisions regarding supply, demand,
price, distribution, and investments are made by private actors in the market rather than
by central planning by the government; profit is distributed to owners who invest in
businesses, and wages are paid to workers employed by businesses and companies. [2]

SOCIALISM. As an economic system, socialism is a system of production based on


the direct production of use-values by allocating economic inputs (the means of
production) and investments through planning to directly satisfy economic demand.
Economic calculation is based on either calculation-in-kind or a direct measure of labour
time, output for individual consumption is distributed through markets, and distribution of
income is based on individual merit or individual contribution. [3]
Capitalism and Socialism are inherently not antagonistic. Social capitalism posits that a
strong social support network for the poor enhances capital output. By decreasing
poverty, capital market participation is enlarged. Social capitalism also posits that
government regulation, and even sponsorship of markets, can lead to superior economic
outcomes, as evidenced in government sponsorship of the internet or basic securities
regulation.

THE CONCEPT & PATH OF APPROACH. The Capitalist-Socialist Concept posits


that social groups juridically organized can be identified (and/or gestated and raised) and
professionally managed to lead and run operational (manufacturing or production)
enterprises and mingle with the current capitalist economy and earn profits by it own
merits and capabilities; and be intervened in “intimate consultation” (Interventional
Consultancy) by a responsible Christian-oriented Social Business Service Provider (C-
SBSP) until it matures and released to the economic system and contaminates
neighboring social groups all in the Philippine setting.
This concept is based on the inherent Filipino value system that when one sees the
evidence of a successful system, the neighboring social groups will voluntarily come
forward, inquire and purposely adapt the proven system. Filipinos do not simply adapt
something until he can hear, see, touch, and smell (H-S-T-S trait) it. Hearsays are only
for chatting and talking about it with neighbors – not to act on it.
The Filipino psyche is like a ‘baby organism’, immature, prehistoric and ignorant until it
hears, sees, touches and smells another full-grown adult organism and becomes
contaminated by it; and replicates said organism in its social environment.
I dub this as the Perfect One Community & Contaminate the Next One concept.
The above may be radical to many but yours truly have seen it and have discussed it
with some social science personalities who are in action (not in the academe); and
strongly believe it will work in the Filipino cultural setting. A Filipino would always want
to be like his neighbor in almost every economic improvement of their neighbor’s social
life. It’s been a long trait of his – he wants to be like his progressive neighbor.
Given the above premise-concept, I propose the Capitalist-Social Approach in
Enterprise Development with a Christian dimension which will be the binding force in
keeping a capitalist-social organism grow and flourish.

OBJECTIVE OF POVERTY REDUCTION. Based on latest statistics of government,


poverty incidence is at 33% or a third of the 95 million Filipinos in our country. Various
government agencies, LGU’s and NGO’s have long involved heavily in reducing poverty
through every conceivable means based on its traditional and much-talked-about
concepts. However, poverty has not been drastically reduced over the last two decades.
Corruption in government, allowing most of the poor to continue to think ‘their poor’, the
social self-interest abuse of their number in concentrated communities (specially by
politicians and syndicated profiteers), adulteration of donor-resources and wrong
thinking processes have weakened the intent of reducing poverty.
Hence, a creative and radical approach has to be conceived and put into practice
starting with pre-qualified sectors and high-growth and essential industry segments.
Pre-qualified sectors will come from existing enterprises that support creation of jobs for
the poor and/or livelihood for suppliers or support systems.
High-growth and essential industry segments will come from the food industry (farming,
production and processing sectors), retail industry, home construction industry, out-of-
school youth supportive sector (e.g., digital animation) and other industries where labor
is of utmost need (instead of intensive computerized systems).

INTERVENTIONAL CONSULTANCY BUSINESS MODEL. Consultancy with objective


interventions will be the manner of approach in creating and growing capitalist-social
systems in target communities/industry segments.
The C-SBSP Provider will take the following 4-prong tactical approaches:
1) Create Startup Enterprises – assist/build-up newly conceived enterprises.
Example: seaweed farming in Bohol
2) Elevate Micro-Enterprises to Small-Scale level – strengthen matured Micro-
Enterprises.
Example: 2-year old branded retail food outlets
3) Strengthen SME’s – competitiveness, expand market/operations thru working capital
support, technical advancement and expand market penetration (special attention on the
Value Chain).
Example: raw onion domestic supply
4) Develop local industry segments – to contaminate industry segment actors and
district/provincial level segments
Example: digital animation and small-scale home construction sectors

Intervention programs will be short & sweet, specific, focused-target category


groups/areas (industry, geographical, interest groups, etc). Broad approaches will make
it difficult to execute, assign responsibilities to persons, assess its impact and monitor its
performance.

We cannot wait for reforms in the business environment (local and regional levels) as it
takes too long a time. Direct individual interventions can immediately create short-term
outcomes.

The Enterprise stakeholders and actors do not have to rely strongly from external
support systems but blend with these such as local government influences or
regulations, financial sector support and the general economic environment. It should
rely from its own strength as its proponents/actors make things happen for the enterprise
to profit and grow.

THE SEVEN ABIDING CONCEPTUAL FRAMEWORK. All interventions will be


governed by the following frame of active thinking:

1) Power of One – a strong socio-economic group boxes itself out in a predominant


economic system.
2) No-Free-Lunch Principle – everyone who brings in value into the Enterprise should
be rewarded.
3) Start Small, Think Big – an enterprise should start small, make it grow, sustain itself
and plan to be big.
4) Customize-Standardize Production Processes – all repetitive functional
procedures should be standardize through a quality management system (e.g., ISO
9002)
5) Target Buyers, Negotiate & Create Sales Orders – to sustain the enterprise,
purposive marketing approach will be adopted focused on generating fast revenue
streams.
6) Create the Christian Business Environment – cultivate a Christian learning system
inside the Enterprise.
7) Practice Social Business Principles – all stakeholders and actors in the Enterprise
will prepare to pay-forward to the next community-beneficiary after gaining sustainable
rewards and profits for the Enterprise.

CAUSAL LINKS = ED/CAPITALIST-SOCIAL INITIATIVE. Below is a simple causal link


framework from Enterprise Development thru the Capitalist-Social System Concept to
improving local socio-economic environment.

Small Enterprise Improved Improved


Development Small Enterprise Socio-economic
Initiative Performance Environment

> Initiate start-ups, > Increased Profits > Economic growth


> Strengthen ME's/SME's > Increase Productivity > Social stability
> Increase Competitiveness > Poverty Reduced
> C-SBSP support to > Increases in job creation,
Enterprises livelihood/Backyard
Enterprises

[1] to [3] –
Footnotes: as defined in Wikipedia