Social Sustainability vs. Financial sustainability, which one is appropriate for telecentre initiatives?

[Fatema Begum Labony]

When we discuss about sustainability of telecentres we often discuss about financial sustainability. Drive for financial sustainability sometimes creates obstacle to provide quality information service. What is your opinion regards this issue?

Please share your ideas and experiences.

[Wangchuk Chungyalpa]

All telecentres provide high value service – access to ICT. They help bridge the digital divide in small steps. Financial sustainability issue varies depending upon the business model that a telecentre follows. Many telecentres are public and government funded and many more are dependent upon third party donors. Financial sustainability for these telecentres takes a different path. They have a different set of criteria, for example, providing computer education, providing knowledge resource, hosting community events and more. These criteria’s are usually in alignment with the values and objectives of the donors. For telecentres that are independent of government and public or third party funding, financial sustainability is directly dependent upon the commercial success of the services they provide. While value added services such as computer and internet classes are highly beneficial, if it is not commercially viable, the telecentre is likely to fail. Coupled with high cost of operating a medium sized telecentre even with a single staff can be challenging, unless, the business has substantial working capital, it can definitely be categorized as high risk and therefore higher rate of failure. An enterprise has to evaluate all its risks – both tangible risks and intangible risks and than take the best judgement.

[Niranjan Meegammana]

Dear Fatema
Telecenters first started with a social motive, later tuned to an enterprice motive as it scaled up. It is not possible to select one side as it's practically a mix. In my studies I find that most telecenters find the meeting point of both objectives.

In my studies I find that telecenters working with right mix of both do better than others. The right mix depend on location, community, poverty and capacity in the telecentric sence, in the network sence participation, operator skills, leadership, quality, quantity matters to define network mix which more closer to marketing mix.

However the selection of mix totally depend on TC it self, who has to deside what they like to achive and what scale they like to achive it. This defines their business plan. Projects and activities.

As an example Hingurukaduwa Nenasala make no reveneu, provide totally free service, and depend on donor support for sustainability and it has worked for 7 Years and they dont think they have a risk, they survive and flurish.

Thanamalwila Nenasala started a serivice model and improved business and has found a right mix for survival and will sustain them self

Lunugala Nenasala having a social background have tried to develop a business for 3 years and still not profitable, but survive, they want to change their strategy

A good strategic business plan should deside this.


Niranjan Meegammana
http://www.shilpasayura.org

[Sandra Nassali]

Social sustainability is one aspect of sustainable development. It encompasses human rights, labor rights, and sustainable development; which is about ensuring a better quality of life for everyone, now and for future generations to come.

Sustainable Development must takes into account social factors as well as economic and environmental considerations. Social factors include things such as:
- Numbers of people with jobs
- Poverty
- Opportunities for education and training
- Health and availability of medical services
- Human rights and equal opportunities
- Crime and social disorder levels
- Housing provisions and quality

Some of these factors can be readily measured. For example, employment rates and average incomes can be taken from official statistics. The Gross Domestic product (GDP) of a country puts a monetary value on the wealth of the nation. These indicators can give a measure of the standard of living but not necessarily show the quality of life.

Measuring human rights and equal opportunities can be more subjective and may need to take into account people's personal experiences and opinions. These are more difficult to measure but are important as they all impact on a person's quality of life.

Financial sustainability on the other hand is achieved when service and infrastructure levels and standards are delivered according to a long term plan without the need to increase rates or reduce services. It;
- Ensures that public resources are distributed fairly between current and future ratepayers.
- Means people remain in a healthy financial position.
- Gives financial outcomes greater stability and certainty.
- Ensures consistent delivery of essential community services and the efficient development and maintainance of infrastructure
- Gives everyone a fair degree of stability and predictability when it comes to current and future rates.

Looking at them generically, I think telecentres should go social sustainability as this doesn't only address income per capital but puts into consideration other factors like human rights. These too are part of what development is about; it isn't only attained through financial growths.

Cheers

Sandra

[Francis Mwathi]

Financial sustainability is critical for survival, but social and institutional sustainability is also key. Social sustainability is achievable through professionalize telecentre activities without losing sight of values of access, participation and empowerment. The community audience must feel a sense of ownership.

A telecentre needs to foster self-reliance, ownership and the investment of local communities in order to promote institutional, social and ultimately financial sustainability.

[Seuwandi Yapa]

Hi Fatema, Thank you for starting this discussion.
I agree with Francis for his idea that "Financial sustainability is critical for survival, but social and institutional sustainability is also key." Financial sustainability is very much needed for the overall success of a telecentre. Establishing Nenasalas (telecentres) in Sri Lanka, Information & Communication Technology Agency (ICTA) has invested lot of funding to provide equipments, training, connectivity free of charge. Further ICTA conducts monitoring and evaluation of the nenasala network as well. The ultimate goal of ICTA is to establish a self sustain Nenasala network in Sri Lanka in future, which help to enhance the ICT literacy among Sri Lankan Community.
In achieving this goal, Nenasala operators or the Managers are expected to have a proper financial management of their respective Nenasala centres. In other words, the Nenasalas should adopt a proper business plan. There were lot of the projects launched in Sri Lanka, which helped to established telecentres, but almost all of them were failed to sustain once the allocated funding were finished. Therefore, ICTA always encourage Nenasala operators ad managers to generate an income. On the other hand, Nenasala owner has to bear the cost of electricity, staff salary, or stationary that they use in the centre and if they could generate an income they will be able to carry out the services to the community without any difficulty. under such circumstances, ICTA always promote self sustainability of Nenasala network in Sri Lanka.

Its also important to note that, ICTA's advice to Nenasala operators and managers to provide service at a lower cost than the private owed commercialized telecentres. Sri Lanka is a developing country and our community has a lower income rate. Due to financial difficulties, our people were constrained to obtain the benefits of ICT. If the Nenasala charged a high rate for the services that they provide, people will further experience the constrains of financial difficulties.

so, with this Sri Lankan experience, i suggest- for a telecentre its always good to have a proper financial sustainability plan. :)

[Niranjan Meegammana]

Thanks Seuwandi joining in
In my experience with grass root telecenters i see sustainability as an open concept in which meaning may vary community to community. A telecenter started by a business professional definitely would follow money to the depth. But in reality rural communities in Sri Lanka, we are unable to find professionals to run a telecenter. In most cases we the temple finds a volunteer to run it.

Unless they are situated in a location accessible to business services, there is no real money. Free internet access, Tech Support, M & E capacity building and EVS have helped them to sustain them selves. Sri Lankan local model has evolved it'self with the government assistance and patronage at all times. The money spent on Nenasala is a worthwhile effort as we were able to improve our villages with ICT. As an example 150+ Nenasala in Sri Lanka provide Local Language e Learning serving rural students having special needs in education. The lack of books, teachers, labs and other resources in rural education finds an open education solution through Nenasala.

These Nenasala are not the most revenue generators but do the job on ground effectively as well as generate sustainable revenue from this community service which help us change the society. At the same time we have Nenasala who are well above financial sustainability. A more common feature in in all nenasala sustainable or on the way to the sustainability has a society around them.

Which mean Social Sustainability has helped their initiatives. I think the right mix is more on the Social Sustainability Aspect, Financial sustainability needed but it shoud follow social sustainability, not other way around. Nenasala being a social investment made on a National need requires any initiative to be Socially sustainable.

as a Telecenter theory what's socially sustainable will be financially sustainable looks more appropriate to me.

Niranjan Meegammana
http://www.shilpasayura.org

[Fatema Begum Labony]

Thank you for your participation. In Bangladesh we are working for both financial and social sustainability. I believe social sustainability is more important than financial sustainability for a telecentre as a social enterprise. Community people will run their telecentre if telecentres can attract them by providing need based service. And this is the difference between a commercial institute and a social enterprise.

[Seuwandi Yapa]

Dear all,
I would like you to follow the blog posted by Vignesh, few months back on this topic. hope his contribution will also enrich the discussion ahead.
read more

[Shahid Uddin Akbar]

It is a continious discussion in the telecentre forums for last many years and possible now everybody is on the same understanding of balancing both social and financial sustainability in any telecentre initiatives. This is nothing conflicting to integrate financial sustainbility in social cause. After around a decade of telecentre movement, now almost everybody is talking about 'revenue plan' withing the business model, even the donors are also keen on this and it happend due to the non-existence or non-performence of telecentre after the donor fund is dried up.

As Labony rightly said, Bangladesh is a place where both social and finacial sustainability are being considered in any telecentres now. The question of sustainability may not even exist in coming days as the 'access to information' is becoming much easier and 'common access points' are becoming more available on different alternate medias. If a school or cyber cafe has the similar access facility like a telecentre with all relevant information and link to all support services, Do we really need separate 'telecentre' kind of initiatives?

[Sandra Nassali]

Hi Seuwandi...could you please provide a link to this blog? Thanks

[Seuwandi Yapa]

Hi sandra,
I think you have requested the link to the Vignesh's blog.
here is it,
http://telecentrecommunity.ning.com/profiles/blogs/2086278:BlogPost...

regards :)

[Masahudu M. Marhey]

Hello Fatima,

I thank you for starting this discussion, it is a laudable topic worthy of discussion. To begin with, there two faces to whether the sustainability of telecentre depends on either the social or financial aspect of it. In the beginning telecentres are socially driven of late we have to attached the finacial aspect to make it more sustainable.The issue therefore is that, one can not wholeheartedly pick one of these as the most appropriate. The two are like Siemens twins as far as the sustainability of the telecentre is concern.