Harvard Case - Health Leads: Reaching for Impact (A)
"Health Leads: Reaching for Impact (A)" Harvard business case study is written by V. Kasturi Rangan, Sarah Appleby. It deals with the challenges in the field of Social Enterprise. The case study is 16 page(s) long and it was first published on : Sep 21, 2016
At Fern Fort University, we recommend that Health Leads adopt a hybrid organizational structure that leverages the strengths of both non-profit and for-profit models. This approach will enable them to scale their impact, attract diverse funding sources, and build a sustainable business model that prioritizes social impact.
2. Background
This case study focuses on Health Leads, a non-profit organization founded by Rebecca Onie in 2005. Health Leads aims to address the social determinants of health by connecting low-income patients with essential resources like food, housing, and transportation. Their innovative model utilizes trained 'Health Leads' volunteers to identify patients' needs and connect them with community resources. The case study highlights the organization's growth challenges, particularly in securing sustainable funding and scaling their impact.
The main protagonists are Rebecca Onie, the founder and CEO of Health Leads, and her team, who are grappling with the organization's future direction and sustainability.
3. Analysis of the Case Study
Strategic Framework: This case can be analyzed through the lens of Social Entrepreneurship and Impact Investing. Health Leads is a prime example of a social enterprise that aims to create a positive social impact while generating revenue.
Key Considerations:
- Mission and Impact: Health Leads' mission is deeply rooted in social justice and equity, aiming to improve health outcomes for underserved communities.
- Financial Sustainability: The organization faces a constant challenge of securing sustainable funding to support its growth and expansion.
- Scalability: Health Leads needs to find ways to scale its operations effectively to reach a larger population and maximize its impact.
- Organizational Structure: The current non-profit model limits Health Leads' ability to attract diverse funding sources and leverage market-based solutions.
- Partnerships: Building strong partnerships with hospitals, community organizations, and government agencies is crucial for Health Leads' success.
Analysis:
- Social Impact: Health Leads has a demonstrably positive impact on the lives of low-income patients by addressing the social determinants of health. Their model is innovative and addresses a critical need in the healthcare system.
- Financial Sustainability: The reliance on grants and donations makes Health Leads vulnerable to funding fluctuations. The organization needs to diversify its revenue streams and explore alternative funding models.
- Scalability: The current model, while effective, is not easily scalable. Expanding to new markets and increasing service delivery requires a more robust and adaptable structure.
- Organizational Structure: The non-profit structure, while effective for mission-driven work, limits access to investment capital and market-based solutions.
- Partnerships: Health Leads has successfully built partnerships with hospitals and community organizations, but further strengthening these relationships and forging new alliances is crucial for growth.
4. Recommendations
Adopt a Hybrid Organizational Structure: Health Leads should consider creating a hybrid organization, combining the mission-driven focus of a non-profit with the flexibility and resources of a for-profit entity. This can be achieved through:
- Creating a separate for-profit subsidiary: This subsidiary can focus on developing and delivering services that generate revenue, while the non-profit entity continues to focus on advocacy and impact measurement.
- Establishing a social enterprise arm: This arm can develop innovative programs and services that address social needs while generating revenue through market-based solutions.
Develop a Diversified Revenue Model: Health Leads should explore various revenue streams beyond traditional grants and donations. This can include:
- Fee-for-service contracts: Partnering with hospitals and healthcare providers to offer services on a fee-for-service basis.
- Social impact bonds: Working with investors to develop social impact bonds that provide funding based on achieving specific health outcomes.
- Corporate social responsibility partnerships: Collaborating with corporations to develop programs that align with their CSR goals.
- Social impact investments: Attracting impact investors who are interested in supporting social enterprises with a strong track record.
Scale Operations Strategically: To reach a larger population, Health Leads should focus on:
- Developing a scalable technology platform: This platform can streamline service delivery, track patient outcomes, and facilitate communication with partners.
- Implementing a social franchising model: This model can enable Health Leads to expand to new markets by partnering with local organizations and entrepreneurs.
- Building a strong network of volunteers: Investing in volunteer training and recruitment programs to ensure a consistent and reliable workforce.
Strengthen Partnerships: Health Leads should focus on building strategic alliances with:
- Hospitals and healthcare providers: Collaborating on joint initiatives, integrating services, and sharing data.
- Community organizations: Partnering with organizations that provide essential resources like food, housing, and transportation.
- Government agencies: Engaging with government agencies to advocate for policy changes and secure funding.
5. Basis of Recommendations
These recommendations are based on the following considerations:
- Core competencies and consistency with mission: The hybrid organizational structure and diversified revenue model align with Health Leads' mission by ensuring financial sustainability while maintaining its focus on social impact.
- External customers and internal clients: The recommendations prioritize the needs of both patients and healthcare providers by offering efficient and effective services while strengthening partnerships.
- Competitors: The hybrid model allows Health Leads to compete effectively with other organizations in the social impact space by offering a unique value proposition and attracting diverse funding sources.
- Attractiveness - quantitative measures: The recommendations aim to improve Health Leads' financial performance by increasing revenue streams and reducing reliance on grants.
- Assumptions: The recommendations assume that Health Leads can successfully develop a scalable technology platform, build a strong network of volunteers, and forge strategic partnerships with key stakeholders.
6. Conclusion
By adopting a hybrid organizational structure, diversifying revenue streams, and scaling operations strategically, Health Leads can create a sustainable business model that prioritizes social impact and reaches a larger population. This approach will enable the organization to achieve its mission of improving health outcomes for low-income patients and address the social determinants of health.
7. Discussion
Alternative Options:
- Remain as a traditional non-profit: This option would require Health Leads to continue relying heavily on grants and donations, limiting its growth potential and financial stability.
- Become a fully for-profit entity: This option could lead to a shift in focus from social impact to profit maximization, potentially compromising the organization's mission.
Risks and Key Assumptions:
- Risk of losing focus on mission: The hybrid model needs to be carefully implemented to ensure that the for-profit arm does not overshadow the non-profit mission.
- Risk of attracting investors with conflicting priorities: Health Leads needs to carefully select investors who share its values and commitment to social impact.
- Assumption of successful implementation: The success of the recommendations depends on the organization's ability to execute the strategies effectively and overcome potential challenges.
8. Next Steps
- Develop a detailed feasibility study: Conduct a comprehensive analysis of the hybrid model, including financial projections, market research, and stakeholder engagement.
- Create a pilot program: Implement a pilot program to test the hybrid model and gather data on its effectiveness.
- Develop a strategic plan: Outline the organization's long-term goals, strategies, and key performance indicators for the hybrid model.
- Secure funding: Seek funding from impact investors, foundations, and corporations to support the development and implementation of the hybrid model.
- Build a strong team: Recruit and retain talented individuals with expertise in social entrepreneurship, finance, and operations.
By taking these steps, Health Leads can successfully transition to a hybrid organizational structure and position itself for sustainable growth and impact in the years to come.
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Case Description
Explores strategies to achieve system-level impact for a nonprofit focused on addressing patients' basic social needs through healthcare institutions. Founded in 1996 with a volunteer-staffed help desk at Boston Medical Center connecting low-income patients with basic resources like heating assistance, job training, and childcare programs, by 2013 the nonprofit had grown to 6 cities and 1,000 volunteers serving over 11,000 patients annually. At the end of a successful "proof plan" period, Health Leads Co-Founder and CEO Rebecca Onie and her team faced the question of how to make meeting patients' social needs a standard part of health care in the U.S.: replicate Health Leads' proven model or instigate a social care movement?
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