How companies innovate through
engaging with charities: findings
from an exploratory UK study
Sara Holmes
Cranfield DBA student 2004-2008
sara.holmes.dba.04@cranfield.ac.uk
Why this topic?
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Discussion with retail store manager hugely enthused by
developing a relationship with local cerebral palsy
organisation – led to reworked disability awareness training
for staff.
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Innovation identified as a benefit of CSR in practitioner
literature:
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Business in the Community – The business case for CSR
Accountability – Community enabled innovation
Nothing in academic literature
Presentation outline
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Theoretical context of research
Outline of 9 company-charity collaborations
Identifying themes: what can these tell us about firm
innovation?
Implications for companies
Implications for charities
Future research areas and discussion
Theoretical context
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Research adopts a stakeholder framework:
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Charities in these collaborations can be viewed as ‘discretionary’
stakeholders: they have legitimacy but no power or urgency
Firms engage with charities as they offer strategic legitimacy
Applying ‘open innovation’ concept to business-charity
relations:
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innovation search activity
picking up on ‘weak signals’ by accessing distinct network
Fieldwork
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Data collected between Autumn 2006 and Spring 2008.
Cases selected from across industry sectors.
Semi-structured one-to-one interviews with those closely
involved in the firm-charity collaborations:
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32 interviewees
12 male and 20 female
20 company interviewees / 12 charity interviewees
Research base
Company
Charity partner
Innovation
Retailer A
Breast cancer org
Post operative lingerie
Retailer B
Cerebral palsy org
Disability training
Energy Co
Learning disabilities org
Vulnerable customer handling
Telco
Children’s org
Integrated voice & text
Technology Co
Pre-school org
Product commercialisation
Broadcaster
Pan-disability org
Call centre / TV remote control
Gaming Co
Children’s org
Marketing channel
Bank A
Hearing impaired org
Customer service initiative
Bank B
Financial inclusion org
Financial products & route to
market
Case 1: Retailer A & Breast cancer
charity
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Relationship duration & status: 6 years, mature
Charity targetted retailer and approached it through
personal contact in lingerie marketing.
Charity networked inside retailer and 4 years on cause
taken up by retailer’s Head of Marketing.
Charity viewed as valued partner by firm with income
from retailer rising to in excess of £1m a year.
Full-time team working in retailer and charity.
Innovation outcome: lingerie for breast cancer sufferers
developed in close collaboration with charity and in
shops in less than 9 months.
Case 2: Retailer B & cerebral palsy
charity
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Relationship duration & status: 1 year, mature
Regional staff volunteering initiative in high street retailer
– staff urged to get involved by new regional manager.
Charity selected by firm as assistance it required fitted
objective of staff involvement.
Volunteering project challenged notions of disability.
Innovation outcome: redesigned staff disability training
utilising contacts and knowledge of charity: “the best
disability training I could give my team”.
Case 3: Energy Co & learning disabilities
charity
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Relationship duration & status: 2 years, developing but
3-year fixed term
Charity selected by firm as ‘charity of the year’ following
competitive pitch where charity highlighted how it could
help firm with key business goals.
First year centred on staff volunteering & charity
fundraising.
Partnership extended for further two years to allow
development of various charity initiatives.
Innovation outcome: new protocols for staff handling of
vulnerable customers.
Case 4: Telco & children’s charity
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Relationship duration & status: 5 years, developing
Charity supported by Telco on and off for years, but
partnership invigorated following firm survey of its
community initiatives.
Broad scope of activities - “holistic support” - with firm
looking to move from fundraising to strategic &
technological advice.
Relationship manager happy to commit Chairman to
attend events.
Innovation outcome: working to integrate online, text and
telephony onto one platform.
Case 5: Bank A & hearing impaired
charity
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Relationship duration & status: 5 years, declining
Charity approached Bank for sponsorship for a training initiative.
Following discussions, Bank opted to try to achieve the charity’s
Charter Mark for demonstrating best practice in service of
hearing-impaired customers.
Project mainly regarded as business initiative in Bank to increase
customers and improve corporate reputation.
Two year process where improvements to branches and
customer call centres were undertaken ahead of audit by charity.
Innovation outcome: introduction of TypeTalk service on all
inbound and outbound phone lines in customer service centres
which required top-level sign off to changes in banking policy.
Case 6: Bank B & financial inclusion charity
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Relationship duration & status: 8 years, developing
Charity founder approached key community investment
figure from Bank at a conference.
Bank gave charity a small grant and loan to begin
lending to financially-excluded in east London.
Patronage continued for 4 years when charity was
granted ‘trusted partner’ status enabling it open accounts
in its own offices.
Charity and Bank in discussions on range of financial
products & services particularly tailored to this market.
Innovation outcome: redesigned financial products and
new channel to market to serve new customer segment.
Case 7: Broadcaster & pan-disability charity
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Relationship duration & status: 5 years, declining
Broadcaster appointed disability ‘trouble shooter’ to tackle
disability issues ahead of legislation: “…sort it out was my
total job description, I just went and prodded people.”
Business initiative: “we need 60,000 customers to break even
and we want to be the best”.
Broadcaster used pan-disability charity to facilitate access to
local groups representing people with physical & mental
disabilities and implemented series of recommendations
coming out of focus groups.
Charity also provided verification of steps taken by the
broadcaster.
Innovation outcome: new call-centre to cater for disabled
customers and re-designed TV remote control.
Case 8: Gaming Co & children’s charity
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Relationship duration & status: 4 years, developing
Relationship began at regional level when charity contacted
company for help with running a bingo fundraising event.
Events replicated by charity in other regions with assistance
from the firm: “I wouldn’t go to another bingo organiser now, I
really wouldn’t, they’re part of it”.
After 4 years firm and charity formed national partnership.
Collaboration viewed by firm as means of showcasing its core
business skills to opinion formers supporting the charity.
Innovation outcome: identification and exploitation of new
marketing channel. (Gaming firms are limited by legislation in
what marketing and advertising they can undertake).
Case 9: Technology Co & Pre-School charity
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Relationship duration & status: 8 years, mature
Global initiative delivered differently in national markets
giving young children access to computers.
In UK, initiative focuses on nurseries and firm selected
the pre-school charity to help it deliver the project.
Charity provided advice on computer design and
manages the annual distribution of 120-150 units.
Scheme now tied to firm’s employee volunteering
programme.
Innovation outcome: commercial version of the preschool computer launched in UK in 2007.
Framework for thematic analysis
Engagement context
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Why did firm want
to engage with
charity?
- business-related
- employee-related
- CSR programme
Who initiated the
relationship?
- firm
- charity
Engagement operation
ƒ What is the
engagement about?
- scope of activities
- scope development
ƒ How do the parties
interact?
- boundary spanner role
- TMT involvement
ƒ Engagement
characteristics?
- stakeholder audience
- demonstrating CSR
- relationship focus
Innovation outcome
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Innovation type?
- product,
- process,
- service
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Innovation process?
- emergent
- planned
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Charity skills used to
deliver innovation?
- knowledge
- network
- charity as test-bed
Firm
eng’ment
driver
Firm
selection
of charity
Activity
TMT
scope &
input
development
Boundary
spanner
role in
innovation
SH & CSR
focus
Rel’n
focus
Innov type
Innovation
process
1
Business
Reactive
Narrow –
Extended
Direct
Indirect
External –
Yes
Yes
Product
Emergent
2
Employee Proactive Narrow –
Extended
Indirect
Direct
Internal –
No
No
Process
Emergent
3
Employee Proactive Broad –
Extended
Direct
Indirect
Yes
Process
Planned
4
CSR
Proactive Broad –
Extended
Direct
Indirect
Chiefly
internal Yes
External –
Yes
Yes
Product
Emergent
5
Business
Proactive Narrow –
Limited
Indirect
Direct
External –
Yes
No
Service
Planned
6
Business
& CSR
Reactive
Direct
Indirect
External –
Yes
Yes
Product &
Service
Emergent
7
Business
Proactive Narrow –
Limited
Indirect
Direct
External –
Yes
No
Product &
Service
Planned
8
Employee Reactive
Narrow –
Extended
Indirect
Direct
Internal –
No
Yes
Process
Emergent
9
CSR
Proactive Narrow –
Limited
Indirect
Indirect
External Yes
No
Product
Planned
Narrow –
Extended
Key findings
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Process innovations appear linked to an internal stakeholder focus
and employee-driven charity engagement.
Product & service innovations appear linked to an external
stakeholder focus, where firms are keen to demonstrate their CSR
credentials and stem from business or CSR driven engagements.
Emergent innovations appear associated with engagements where
the initial scope of activity has been extended and there is a sense
that the relationship has developed.
Planned innovations appear associated with engagements where
there is a limited initial scope which is not extended and actors in
these engagements do not articulate a sense of relationship
development.
Where there is no direct senior management involvement in the
initiative, the main firm boundary spanner (relationship manager) is
directly responsible for progressing the innovation.
Implications for companies
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There doesn’t need to be a strategic imperative to start a
relationship with a charity…
… but managers should think, as relationship develops,
about how it can deliver value.
If the collaboration does not have senior management
involvement, it is key to appoint a relationship manager
who is enabled to progress ideas from the collaboration.
Implications for charities
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Be aware of what the company’s after:
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An exploitative relationship – targetted use of charity skills /
network for particular project.
An explorative relationship – generic charity of the year type
engagement.
Companies are wide open to ideas if they’re made
relevant to their business.
Endnotes & discussion
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Small scale study so treat findings with caution.
Also, companies in study largely ‘self-selecting’ which
may skew findings.
Possible next step: to look at firm-charity relationships
that didn’t result in an innovation.
Mentioned this research at a regional BITC meeting and
asked what people thought and main reply was: “we
wouldn’t want to do that – might be seen as exploiting
charities”.
Questions & Comments please…
sara.holmes.dba.04@cranfield.ac.uk