OBSERVARE
Universidade Autónoma de Lisboa
e-ISSN: 1647-7251
Vol. 12, Nº. 2 (November 2021-April 2022)
137
BUSINESS MODEL OF NON-GOVERNMENTAL ORGANIZATIONS FOR THE
DEVELOPMENT OF THE EDUCATION SECTOR IN MOZAMBIQUE:
A CONSTRUCTIVIST APPROACH
PEDRO CABRITA
pncabrita@gmail.com
Independent researcher (Portugal) focused on the problematic of organizational development in
Africa, particularly in Lusophone Africa. He has a master’s in development studies from the
School of Social and Human Sciences of ISCTE-Instituto Universitário de Lisboa and bachelor in
management from Universidade Autónoma de Lisboa
RENATO PEREIRA
renato.pereira@iscte-iul.pt
Professor of General Management at ISCTE Business School, ISCTE-Instituto Universitário de
Lisboa. Researcher at the Business Research Unit (ISCTE-IUL, Portugal) the Observatory of
Foreign Relations (Universidade Autónoma de Lisboa) and the Emerging Markets Research Center
(ISCIM, Maputo). Also, PhD in management sciences, Université Paris Dauphine
MAOMEDE NAGUIB OMAR
manotio@yahoo.com.br
Post-doctorate fellow and researcher at OBSERVARE-UAL; associate professor at ISCIM-Instituto
Superior de Comunicação e Imagem de Moçambique (Mozambique) and researcher at the
Emerging Markets Research Center. Also, PhD in higher education studies and master’s in public
management, both from the University of Aveiro, as well as apost-graduate from the University
of Witwatersrand
Abstract
This research aims to determine the business model of non-governmental development
organizations (NGDOs) of the education sector in Mozambique. The work adopts a
constructivist methodological approach in two stages: (i) inductive, centered on the
construction of a proposal of social business model Canvas from the observation of 15
NGDOs operating in the education sector in the country, based on a theoretical framework
solidly supported in the literature; (ii) deductive, testing the proposed model using a panel
technique that allowed the refinement and reconstruction of the proposal initially
formulated. The paper contributes to the literature on social business models by making a
pioneering validation of knowledge built in this area and in a field of application not yet
explored. The contribution to international relations lies at the level of the data collected and
information produced on international cooperation in Mozambique.
Keywords
International cooperation, Mozambique, canvas social business model, NGDOs, Education
How to cite this article
Cabrita, Pedro; Pereira, Renato; Omar, Maomede Naguib (2021). Business model of Non-
Governamental Organizations for the development of the education sector in Mozambique: a
construtivist approach. Vol12, Nº. 2, November 2021-April 2022. Consulted [online] on the
date of the last visit, https://doi.org/10.26619/1647-7251.12.2.9
Article received on June 16, 2021 and accepted for publication on September 8, 2021
JANUS.NET, e-journal of International Relations
e-ISSN: 1647-7251
Vol. 12, Nº. 2 (November 2021-April 2022), pp. 137-159
Business model of Non-Governmental Organizations for the development of the education
sector in Mozambique: a construtivist approach
Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
138
BUSINESS MODEL OF NON-GOVERNMENTAL ORGANIZATIONS
FOR THE DEVELOPMENT OF THE EDUCATION SECTOR IN
MOZAMBIQUE: A CONSTRUCTIVIST APPROACH
1
PEDRO CABRITA
RENATO PEREIRA
MAOMEDE NAGUIB OMAR
Introduction
Non-Governmental Development Organisations (NGDOs) play an increasingly important
role in Africa because, among other reasons, the recent Covid-19 pandemic and
accelerated population growth raise challenges that are difficult to address only with
the intervention of traditional actors – state, families, and businesses.
The importance of these organizations is particularly noted in Mozambique, one of the
countries on the UN's least developed countries list, which has very pronounced
shortcomings in structural sectors such as education, health and feeding.
The business model of these organizations is generally difficult to grasp, which makes it
difficult to assess the value created by them and the extent of the externalities
(positive and negative) generated for Mozambican society.
This research, thus, contributes to the knowledge on this topic by providing a
pioneering study on NGDO business models in Mozambique, focused on the education
sector.
1. Literature review
1.1. "Third Sector" business
In Mozambique, in 2015 there were more than 11,000 non-financial institutions, 9% of
which were in the education and research sector, surpassed only by religious (26%)
and commercial (20%) organizations. Nevertheless, in terms of expenditure for
services provided, non-profit institutions (NPIs) associated with education are the ones
with the second highest percentage, being only surpassed by social services. Of this
total, only 285 are NGDOs, 53% of which are national, 32% are foreign and 15% are
1
Article translated by Hugo Alves.
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
139
unclassified institutions. 35 were dedicated only to education, occupying the second
highest percentage after human health and social action activities. Its presence is most
notorious in the provinces of Inhambane, Sofala and Manica, being mostly in municipal
areas compared to districts without local authority. The number of organizations of this
nature has continuously growth since 1975, reaching a maximum of 582. They employ
about 17,000 people, mostly men. Compared to other areas, the growth of this
segment has been constant, while in other sectorsit varies depending on the time and
volume of investment (INE, 2015).
The activity of these social organizations falls under the so-called "third sector". This
epithet is due to the terminology of "civil society organizations" (CSOs) that do not fit
into the other two business categories (first sector, government; and, second sector,
market) (Aveni, 2018; Osborne, 2008).
The third sector is made up of organizations whose mission is to contribute directly and
specifically to the welfare of a community in which resources are extremely limited,
taking the nature of foundations, associations, religious organizations, cooperatives,
among other civil activity organizations created on the initiative of citizens, hence
having been called "Non-Governmental Organizations" (Defourny& Nyssens, 2008).
They are active in major public service areas, such as "health, education, culture,
human rights, housing, environmental protection, local development, or personal
development" (Salvatore, 2004, p. 27).
These organizations contribute to production, distribution, provision of services,
assistance, savings, and security in a democratic andcollective way, and associated
manner with free initiative and the right to individual freedom. They have created a
new concept of economy, called "solidarity economy" for not recognizing the market as
an area of operation for their business model (Singer, 2002).
The strategy and structure of these organizations varies widely, and three different
cases can be identified. In a first group, we find organizations that have a social
mission, and are therefore fully inserted in the solidarity economy. In a second group,
we find organizations that operate with two interconnected business models, one
oriented to competitive success in the market and another that channels its resources
towards social purposes. Finally, we have a third group that has two totally separate
businesses and where fundraising is completely autonomous from the social cause and
has a purely profitable purpose (Aveni, 2018).
The space of action and the capacity to raise support from public agencies and other
entities by these organizations has increased substantially, and theoretical and
ideological criticism have emergedin the wake of the criticism of the relationship
between capitalism, social inequalities, and poverty (Singer & Brandt, 1980). With
these criticisms, fragmentation also arose by areas of activity, leading to a
specialization that did not seek to solve all social problems at the same time (Gohn,
1997).
It is in this context that NGOsin education are beginning to emerge in force, presenting
palliative perspectives, change, innovation and political pressure, exposing the gaps of
political power regarding the guarantee of access to education. Initially, these were
isolated initiatives, with low visibility and little sustainability. However, with the
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
140
improvement of results and the increase of studies and attention from academics, their
initiatives have gained importance and social notoriety, although there are also
negative impacts (Coutinho, 2004).
According to Freire (1987, 1989, 1992), the role of these organizations in popular
education has been extremely positive. This has given them a role of "protectors" of
the populations, which has substantially strengthened their social legitimacy.
With the increasing importance of NGOs and the evolution of the concept of
"development", the concept of "NGDOs" (non-governmental organizations for
development) emerges, also emerging the need to specify concrete areas of action of
these organizations (Calheiros, 2003; Seers, 1969).
The institutionalization of the concept of "development" arises from the need for
scientific validation and political-institutional recognition in the post-World War II, for
various reasons, the most cited being the independence of the former European
colonies and the need to rebuild Europe, both linked to the foundation of accumulation
processes, the need to create social order and the convergence of the state's
interventionist logics in the economy (Roque-Amaro, 2017).
This concept has become morecomplexwith the theoretical evolution of both Keynesian
and Marxist-Leninist inspiration, in the dichotomy capitalism–socialism, which has
mobilized politicians and anonymous citizens, strategies and plans, theories and
practices. From 1992 on, it will be dubbed "post-development", or beginning of a new
era, from the different experiences of industrialization and economic growth, cultural
values, and geostrategic interests, finally basing on the logics of inequality and gender
domination (Roque-Amaro, 2003).
Just as the discussion around the concept mobilizes different positions and arguments,
the projects of non-governmental organizations for development also vary in
form,organization, and objectives because of the constant emergence of new problems.
The sphere of action of these organizations is divided into three main areas:
development cooperation, education for global citizenship, and humanitarian and
emergency action (Portuguese NGDO Platform, 2020).
The number of these organizations has been continuously increasing, being
accompanied by the expansion of literature related to the subject (Bendell, 2000). This
growth has led to the emergence of institutes and foundations to measure, facilitate,
and certify their real impacts, as well as to connect the associated and involved parties,
such as the government, individuals and collectives, public bodies, and community
institutions (Patrocínio, 2020). Recently, one of the qualifications associated with
NGDOs that has gained the most importance is that of "OSCIP" (Civil Society
Organization of Public Interest) that recognizes them as partners of public authorities
(Neto, 2017).
As their importanceincreased, the need to measure the impact of these organizations
arose. To this end, performance indicators have been created in monitoring and
managing operations and resources and achieving objectives, both to measure the
impact of organisations in an individual way and jointly (Lugoboni et al, 2016).
Indicators should focus "on a process as systematic and objective as possible,
consisting of evaluating a project, programme or policy, its design, implementation and
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
141
results. It is intended to determine the relevance and degree of achievement of the
objectives, as well as efficiency, effectiveness, impact, and sustainability in terms of
development. An evaluation should provide credible and useful information and allow
lessons learned to be incorporated into the decision-making process of beneficiaries
and donors"(CICLP, 2014, p.8). It is also necessary to follow a process for evaluation
and it is therefore mandatory that indicators are based on recognized formulas to
increase their credibility and realism (Cohen & Franco, 1999).
1.2. Canvas Business Model and Canvas Social Business Model
The business model is an intermediate layer between the strategic and operational
dimensions of an organization and describes how it creates, delivers, and
retainseconomic value (Osterwalder, 2004). Its structure is based on a set of building
blocks that allow us to understand how this process occurs (Osterwalder & Pigneur,
2010).
Osterwalder & Pigneur (2010) developed the business modeling tool known as
“Business Model Canvas”,specifically targeting for-profit organizations, based on 9
building blocks: "customer segmentation","value propositions", "channels", "customer
relationship", "sources of income", "key resources", "key activities", "key partnerships",
and "cost structure".
With the extensive and successful use of this tool, suggestions have emerged to extend
its use to non-profit businesses or with social impacts (Resende, 2016). Although
Business Model Canvaswas created for all types of businesses aimed at creating value,
its use by social organizations implied considerable adaptations (Doherty, 2019).
It was with this concern in mind that we sought to develop a “Social Business Model
Canvas”. From several advanced proposals (e.g., Agafonow& Donaldson, 2015;
Canestrino et al., 2019; Carayannis, 2021; Czinkota et al., 2020; Gauthier et al., 2020;
Maurya, 2010; Sabatier et al., 2017; Sparviero, 2019; Spiess-Knafl et al., 2015; Umar
et al., 2020), the Social Entrepreneurship Agency, among others, has been developing
and refining a complete Social Business Model Canvas framework (SEA, 2020).
The choice of these building blocks aimed to ensure the following: the validation of the
basic idea; the reduction of risks; the obtaining of resources; the reflection on oneself
and on its business; the media; and, finally, support for management. This led to the
need to contemplate the structure of the business plan through entity history;
underlying market; positioning in the market; design concept/idea/product; commercial
strategy; management and control of the business; investment required; and their
financial projections.
All information must be present in the final table, and it must be accompanied by a
visual learning methodology through colors that facilitate the distinction of related
areas, with an action plan in 4 stages and groups: the creation of value (green); the
value proposition (orange); the delivery of the value (yellow); and capturing and
sharing value (blue). In addition to these there is also the Mission of the value (dark
grey) and the Externalities of the same (light grey). Finally, the model must be
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
142
accompanied by the explanation of each choice with an accessible and direct
languageand, if possible, should mention the timeframe of each objective.
Figure 1 - Representation of the Social Business Model Canvas
Mission
What is the main objective and purpose? This should be the space linked to the organizational and
personal origins and also to present the protagonist decisions and activities supporting the Mission
Positive
Externalities
What are the main
benefits and positive
impacts of the
activities performed
by the organization?
Problem
What is the group's main
problem and its
perspective?
Key Activities
What are the
key actions to be
taken, to meet
the objectives?
Relationship
with the
beneficiaries
Who will
receive the
value
proposition?
What is the
relationship to
be had withthe
target group
and what are
the points to
be taken into
account?
Relationship with
Taxpayers
Who can contribute
to the organization
and how to maintain
the relationship
between parties?
Solution
Whatistheproposedsolutio
n to solve
thedetectedproblem ?
Indicators/Res
ults
What are the
indicators that
were chosen to
measure the
impact? Whether
they are social,
political,
environmental
or economic.
Channels
How to access
resources and
how to get
them to their
destinations?
Partners
Who are the key
partners that can
contribute to
success?
Negative
Externalities
What are the side
effects on the target
group and third
parties? How to
mitigate these.
Cost Structure
What are the main costs to be taken into account in
the strategic elaboration of the plans?
Financial Sustainability
What are the budget limits and how do you
keep spending and revenues in balance?
Source: Adapted from SEA (2020)
Within THE NGDOs, the approach is tailored according to the target audiences, their
activities, relationships, and desired results, so that the organisation concerned
competently fulfils its mission. This segmentation is justified by the variety of NGDOs
and responses to be made to the different groups and realities of the most diverse
development challenges. In addition to the variety of beneficiaries segments, within
each of the areas the emergence of new inequalities and barriers to development
causes new segments to emerge, accompanied by new approaches and distinguishing
factors.
2. Empirical study
2.1. Research methodology
The objective of this work is to build a business model proposal for NGDOs in the
education sector in Mozambique. Considering that a study of this nature had never
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
143
been carried out in this country before, we formulated the following research
questionsq: How is the(social) business model of Mozambican NGDOs in the education
sector characterized? Does the use of the Social Business Model Canvas tool allowyou
to describe this business model?
To answer these questions, we divided empirical work into two stages: (i) an inductive
stage, based on observation, analysis, description, and interpretation of the business
models of fifteen NGDOs in the education sector working in Mozambique. These
organizations were selected based on their approach, results achieved and availability
of information. The sample was stratified by size (small, medium and large), regional
focus (international, national and local) and also by motivation (political, religious,
social, etc.), culminating in the construction of a provisional proposal of a business
model representative of the reality studied according to the Framework Social Business
Canvas Model (SEA, 2020);(ii) a deductive and confirmatory step, through a focus
groupmethodology, in which a carefullyselected panel of observers was invited to
assess the provisional proposal, extracting from its feedback elements that allowed the
refinement of the model and the submission of a second proposal, empirically
supported.
Data analysis, in both stages, was performed through qualitative and quantitative
modeling techniques using Microsoft Excel software.
2.2. Problem and Solution
The fundamental problem is the lack of access to education in Mozambique. The
solution is the availability of resources that can make a difference generating a chain
effect that changes not only the availability of education, but all the factors linked to it.
However, not all realities have the same problems or the same responsiveness, so the
main difference between the studiedNGDOs lies precisely in the different approaches
and responses mobilized.
2.3. Segmentation - Beneficiaries
With three types of education – formal, non-formal and informal – and various levels of
evolution within each, the first challenge for NGDOs in the field of education is the
choice of the approach to be followed,considering the existing population, the historical
context, the existing conditions, the potential, interests, and the duration of the
project.
All fifteen studiedNGDOs made the evaluation process for the decision and chose to
create schools with formal education models in isolated places, choosing for this reason
segregated populations with difficult access to education and urban centers. Although
the Mozambican state provides schools throughout the country, they are not of
widespread access and there are no responses for isolated populations.
The type of teaching chosen is formal education because it is the type of education
promoted by the Mozambican state. There are, however, differences in the selection of
students and trainees for the programs and in the level of education provided.
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
144
In the studiedNGDOs, fourteen of the fifteen have as object early childhood and basic
education, one of which focuses only on early childhood education and the other only
on basic education. Of the same fourteen, only six have projects with secondary school
students, seven with university students and nine with teachers and communities.
Based on the data collected, one can see that the preference goes to the most basic
levels. Older individuals have greater obligations to contribute to family support and
tend to drop out of school before reaching secondary level. This results in the
sustainability of projects due to lack of audience, forcing interested students to send
students to other locations with scholarships.
The number of NGDOswith adult and community training shows that there is interest
and beneficiaries available. These projects vary in approach and purpose from group to
group and locality to locality.
2.4. Key activities and resources - Beneficiaries
In the area of education, the key elements are:
− space/rooms;
− teachers/trainers
− students/trainees
− educational/formative content;
− school supplies.
All other necessary resources, such as uniforms, computer devices, toilets, canteen,
among others, are not priorities.
In ten of the NGDOs analyzed, it was on their own initiative and using own funds that
the space for the classes was created. These spaces end up being multipurpose,
allowing community meetings, temporary health posts, among others.
Teachers/trainers are usually Mozambicans. The students are mostly localsof the area
where the classes take place and the peripheries of these localities. When significant
travel is required,networks are created between communities to ensure the safety of
the student. In this study, three of the NGDOs had this network created. There is rarely
a refusal of students, even when headcount far exceeds maximum capacity.
The contents taught are official and defined by the government. These programmes are
generally adapted to the local reality, atthe level oflanguage, practices, andcustoms, to
enhance the adoption and results. Depending on the level of education and the NGDOs
approach, local crafts are also taught to fix populations and increase the impact on
local development.
Most projects take place in isolated areas where there is no access to school supplies.
Therefore, they must be bought elsewhere, eventually coming directly from abroad.
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
145
In view of the deep needs of the populations in which they are included, NGDOs end up
developing other activities in key areas such as health, nutrition, water, community
participation, technological innovation, services, and the environment.
The organizations analyzed have activities in three different areas, in addition to
education, and only one of them has some participation in only one extra area and a
single organization participates in all other areas.
They all have community projects, focusing on an integrated approach to development.
Health is the second emphasis of care, focusing on the action in the education of
healthy practices, medical examinations, and availability of medications. Then we find
the concern for the lack of nutrition and water, under the maxim that "a hungry
student does not learn", materialized by the availability of meals in school that for
many represents the only hot meal they have during the day.
Finally, in the two least participated areas we find technological innovation and services
(eight) and the environment (four). It should be noted that there is no standardized
relationship between the size of NGDOs and their presence in different areas, and that
seems more like a strategic option issue.
Summing up all the projects of all NGDOs, we have a total of seventy-two in education,
with a maximum of fifteen and a minimum of only one per organization. Unlike extra
activities, in education activities the dimension is critical. BigNGDOs have a larger and
more decentralized area of activity, with fifteen projects taking place simultaneously in
fifteen different locations. Small ones, however, usually have more than one project at
the same time, focus on the same location for synergies of Results/Impacts.
2.5. Channels
Since channels are the way to connect the parties considering key activities and
resources, one can strategically define the following 3: communication, distribution,
sales, and donations.
Starting with the communication channel, the goal is to present and make known what
has been and will be done to strengthen or create relationships with the target
associates, while disseminating relevant information. This communication has an
internal and an external component:
− Internal communication - between the participants of the organization. The main
result is the account and activity report where the results of internal activities are
disclosed.
− External communication - with civil society, with beneficiaries and taxpayers.
In our sample, only four of the fifteen chose to subcontract the communication. All
NGDOsthat were studied have accounts on social networks (Facebook, Instagram,
Twitter, LinkedIn, among others), a website and a newsletter. On all these platforms
thereare links to the website. These tend to be transparent in their content, easy to
navigate and oriented to attract potential supporters of the cause, be they associates,
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
146
donors, volunteers, or partners. Many even include a blog or news wall.
Newslettersvaryfrom monthly, quarterly, semiannual, and yearly. They are almost all
digital and delivered by email. Four of the organizations deliver paper magazines,
letters, and bulletins.
In addition to these, there are other communication channels such as television,
telephone and radio, the latter being only used by one of them. Based on our data
collection it is possible to state that although there are investments in communication,
they are mostly reduced and are not used in a differentiating way.
As for distribution channels, these are used, in most cases, for both the main activity
and the secondary activities. Regarding the main activity, the school materials of both
pupils and teachers are concerned and may also include other assets. There are three
main origins: the localities themselves (six of fifteen), other national localities (fourteen
of fifteen) or foreign (twelve of fifteen). Local distribution is common in projects that
have been on the ground for the longest time, revealing that distribution channels
evolve over time. As for the other two origins, the exchanges are greater at national
level, except in a case that favors foreigners.
Finally, in sales channels and donations it is possible to detect a pattern in the type of
contact because all privilege electronic communication with their donors, partners, and
customers, including digital signing of contracts, receipt of contributions by bank
transfer and communications/meetings on virtual platforms. As for physical contact,
twelve NGDOs, do so to deepen the relationship between the parties, using dynamics of
active participation, dissemination of data and holding face-to-face events. The three
that do not, receive their financial contributions almost exclusively from the same
sources of funding.
2.6. Relationship with beneficiaries
Knowing the needs and constraints of the beneficiaries, it is possible not only to define
the strategy of implementation of the project, but also the monitoring of its
participants:
− A priori - Before the implementation of the projects, their leaders went to the
localities to check the interest of potential students and family members, study their
culture, raise needs, define objectives, and prepare an initial proposal. In most
cases, formal or formal agreements have been made with local community leaders
and education leaders to ensure the commitment of the various parties.
− During – It was identified that some of the projects have no deadline and others
have only a generic one (e.g., last quarter of year X, or when another objective is
reached). This makes the evaluation during crucial, focusing on the relationship with
beneficiaries by measuring levels of school interest and adapting to needs. The focus
is as much on the result as on the adhesion of students, teachers, and the
community where the project is inserted, since without themit will hardly be
successful.
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Business model of Non-Governmental Organizations for the development of the education
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
147
− posteriori - Reaching the end of the project cycle, it is necessary to measure its level
of achievement. In addition, it is required to bridge the gap with future proposals
from the same or other organizations.
2.7. Relationship with customers/contributors
In the studiedNGDOs, the importance of customers/taxpayers who assume themselves
as funders/investors of the organization is linked to the channels of communication and
sales/donations. Both parties seek to carry out the interest, the retention of
stakeholders and the expansion of the offer, not only to increase the network of
contacts but also the value of the raisings, which will increase financial sustainability.
To this end, in addition to the use of the communication channel, organisations seek to
attract, maintain, and broaden interest as follows:
− Godparents (solidary sponsors)/associates - The raising takes place in two main
ways: the indirect, through the information available in the communication channels
and the word of mouth among acquaintances of the organization; and direct, in the
events of the organization and in tête-à-tête programs. Direct fundraising is
considered more effective.
− Donations - Work for those interested in supporting, but without availability or
interest in staying associated, that is, without additional commitments or
responsibilities. It can be constant or punctual and have as object the most varied
type of goods or services. The more specific the donation request, the higher the
probability of obtaining a higher value.
− Sales – They are carried out through an independent/autonomous business, but
associated with the cause, and the value proposition is the support to education
although the usefulness of products and services is different from it.
− Funds and grants – A privileged route to financing non-profit organizations, it is a
source that is always at the top of the priorities of NGDOs.
− Events – They are one of the most effective means to achieve the three objectives of
the relationship with customers. They allow you to create a hybrid space between
formal/informal and exclusive/open. However, they entail increased charges.
Based on the collected data, it is possible to notice that all fifteen NGDOs use
donations, twelve of them use funds and grants, and ten have godparents/associates.
Of the twelve organizations that receive funds and grants, only eight have at the same
time godparents/associates. In other cases, when they do not have solidary
sponsors/associates, have funds and subsidies and vice versa, except in a case where it
was chosen not to use any of these mechanisms. The organization of events was
observed in eight organizations and six of them make sales to customers.
On average, three of these mechanisms are used by each organization, two of which
use them all, four of them use four, seven of them use three and two of them only use
two. One cannot identify a relationship between the choice of relationship forms and
the size of the organization, its origin, or success rate. It is, however, possible to detect
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that when organizations are in the expansion phase, they opt for two main approaches
to increase the number of customers/contributors.
The results obtained allow us to conclude that contributions per donation are a source
of funding generally used, both for the reasons listed above and for their versatility,
easy adaptation to the needs of NGDOsand by the reduced need for commitment.
Donations materialize in different ways: money, school supplies, clothing, clothes and
even air miles; no dominant pattern has been identified. In addition to the permanent
open bank transfer mechanism, many organizations choose specific moments in
advance by disclosing the timing of such collections. Another possible means
istaxconsignment incountries where it exists, which, despite not reaching significant
values, contributes to the public notoriety of the NGDO.
Aid for funds and grants has been growing and showing up as one of the main forms of
support for new organisations in need of initial investment. Funds vary in origin, but
most are deprived of institutions, foundations, companies, and organizations. There is,
however, a significant use of public funds. Most applications are renewed when the fund
comes to an end, so it is important to maintain the relationship and show the results
and impacts. In the organizations that were analyzed, only one of them uses funds and
subsidies in addition to donations, which shows their concern to join civil society.
The use of the concept of godparent/associate is very popular among NGDOsin
education. Those receive periodic information about their godchildren, constantly
strengthening the bonds between the parties. To have as many solidary sponsors as
possible, organizations provide flexible financial contribution schemes. This component
is usually not sufficient to sustain project expenditure, forcing organisations to look for
complementary forms of funding.
Events have a diversity that is difficult to standardize. They include workshops,
training, group activities, meals, play sessions, hiking, among others. There is also a
wide variety of results, whether in terms of profits, increased network of associates,
dissemination of a given project, among others, regardless of the size of the NGDO or
its level of notoriety. In the analyzed sample, five out of eight of those who chose to
bet on the events had godparents/associates.
Finally, the option to make associates into clients has been a little used option in the
sample that was studied. All NGDOs that do so, have products associated with
education and some produced in the localities of the projects or that are traditional in
respective areas. Of the six that do as such, only one focuses exclusively on sales as a
source of income, in addition to donations. However, they all have a social impact
organization model.
2.8. Cost structure
Knowing the main and secondary activities, their associated factors, the channels that
are used and the specific needs of beneficiaries and taxpayers/customers, it is possible
to have a complete view of the costs that the organization will incur in a project. The
collected data in this study does not allow to indicate a pattern for the two categories
mentioned in the theoretical contextualization (fixed costs and variable costs) or for the
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Pedro Cabrita, Renato Pereira, Maomede Naguib Omar
149
two structures (economies of scale and economies of scope) due to the lack of
information and the various specific approaches and strategies. However, it is possible
to mark and relate the main expenses found.
Fixedcosts:
− Expenseswith project staff - The four main cost centers identified in schools are:
teachers, trainers, and educators; the school's attendants and assistants; the cooks
(when there is a canteen); and school supplies (including school insurance). In
addition to those, there are administrative services and management,as well as
coordination, that are ensured as much as possible by local people to strengthen
organizational sustainability.
− Expenses with the organization's staff - In addition to the human resources of the
projects, there are also people who work in the management of the organization
itself. The main functional areas identified are strategy, financing, communication,
accounting, human resources, and project management.
− Office supplies - Most workers are associated with the consumption of materials.
There is a tendency to make a forecast of these consumptions or even a delimitation
of budgetary possibilities to fix these costs.
− Communications - To create a communication channel between projects and the
organization it is necessary to develop a safe, stable, and cost-effective approach.
Although it is not a reality common to all NGDOs studied, most of them
favourinternet for this purpose.
− Leasing - Both in the projects and in the organizations' locations there are associated
leases, mainly of equipment and facilities. In the sample that was studied, leasing is
justified because itis less costly than the acquisition. It is possible, however, to see
that the most common rental cases refer to real estate.
− Services - Unlike the rental of equipment and facilities, in the provision of services
there is a balanced division between the expenses of the projects and those of the
general administration.
Variablecosts:
− Energy and water - These costs arise from both basic and superfluous consumption
as the utility differs. Much information about them was not found in the NGDOs
evaluated.
− Depreciation - Based on the study done, it is possible to detect that this type of cost
is reduced compared to the other projects’ charges.
− Feeding - In NGDOs that had feeding canteens for their students, costs often vary,
making it impossible to classify them as a fixed cost. Nevertheless, in the sample
these costs are presented as fixed because an average is made that varies
depending on the location and other relevant constraints.
− Other expenses - All other expenses required.
With its costs listed, we can see that fixed costs are more significant than the variables
in NGDOsin education, preponderating the economies of scope. At the same time, there
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150
are economies of scale in exported goods, from clothing to school supplies as well as in
food products.
2.9. Financial sustainability
Financial sustainability is the NGDO's long-term ability to generate the financial
resources that are necessary to develop its strategic purpose. To dothis, it is necessary
to ensure that the sources of revenue are sufficient to cover the expenses necessary to
carry out strategic planning, accounting, flexibility/adaptability, and vision for the
future.
The value and number of sources of income have been increasing in NGDOs, enhancing
the emergence and expansion of this type of organizations. Themainsources of
resources are as follows:
− Sponsorship fromlegal entities;
− Support from individuals;
− Donations from foundations and international organizations;
− Partnerships with government agencies;
− Consignment of taxes.
2.10. Main partnerships
Partnerships have different origins, but the common purpose of optimizing business
models, reducing risk, and increasing capabilities. They vary in type and motivation,
depending on the specific focus, and can therefore reach different elements of the
business model.
The main types are four, having as a common element the win-win logicthat
determines the basis of a key partnership:
− Strategic alliances - Partnership between non-competing organizations seeking
complementarity;
− “Coopetition” - Cooperation between competing organizations that want to share
risks;
− Joint ventures - Joint creation of new temporary businesses, usually to respond to a
tender/call,which individually none of them could win;
− Buyer-supplier agreements - Targeting predictable and stable supplies, especially in
markets characterized by volatility.
In terms of motivations, one can find four main types: optimization and economy of
scale; cost reduction through subcontracting and infrastructure sharing; reducing the
risk of uncertainty through partner involvement; and acquisition of resources and
private activities, such as know-how,licenses or even investment capacity.
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Partnerships within NGDOs are usually made with a particular focus. In addition to the
association with small entities and individuals, there is growing concern about the
impact of involvement with large companies that are increasingly appealing to
corporate social responsibility.
2.11. Value proposition
By having a common problem and strategic objectives, the NGDOs studied converge on
a similar value proposition. The main difference between them lies at the level of
communication channels, fundraising approaches,as well as the locations where they
focus.
If one Analyzes the value proposition in a deep way, it is identified that the biggest
difference is in the communication channels,particularlywebsites, because there is an
appreciable variation in quality and accessibility, ease of navigation, availability of
information and speed of response to contacts.
The creation of value for the possible taxpayer is done through the dissemination of the
reality object of intervention, using images and videos of local people, in general
children, who despite living in strongly disadvantaged contexts, show great happiness
for being able to go to school. Another approach is the presentation of results that give
a perspective of effectiveness, success, and impact on development.
2.12. Results/Impact
The fifteen NGDOs studied present different indicators and results, but all consider
efficiency, effectiveness, relevance, and impact. All of them show the evolution of
school performance, the number of students and the number of actions carried out.
Regarding the evolution of school achievement, the most used indicators are the
following: the literacy rate; the human development index; the average age of
schooling; the average mortality/life expectancy rate in the first five years; family
income; and poverty reduction.
In terms of the number of students, this indicator measures not only
participants/influenced but also associated material assets, to go beyond the simple
registration of students present through these: attendance rates; number of
subscribers; school progression; average age; resources that are available per student;
number of textbooks; number of scholarships available; school supplies, among others.
Regarding the number of actions performed, both school and extracurricular activities
are reflected, making all the dynamics of the teaching-learning process. The number of
schools are considered; the number of classes given per class; exchanges made; the
number of meals served; the number of health examinations carried out; the number
of sessions with the community; and the number of projects developed.
The local development resulting from the NGDOs studied is notorious and presents
several stimulating results/impacts for beneficiaries, workers, and taxpayers.
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2.13. Positive and negative externalities
In positive externalities, we have the positive evolution of the local human
development index.
Starting with the fight against poverty, by empowering the population, the existing
economic activities undergo an upgrade process while creating space for other activities
to develop. With this evolution, resources are freed up to invest more in health, which
leads to increased hope and quality of life for populations. Another important aspect,
related to local trade, is that it tends to increase in areas close to schools, creating a
virtuous cycle.
In parallel to formal education, there is general and community education where moral
and civic education is transmitted, favoring citizenship and the strengthening of
democratic values. Well-structured education networks make it easier to implement
national and international policies, measures, and actions, favoring and accelerating
their evolution. There are also other factors associated with the education promoted by
these NGDOs, such as the reduction of child labor and the development of talents.
On the side of negative externalities, we have the dependence of local communities on
NGDOs. That makes it to local communities become vulnerable to the economic
fluctuations of countries where sources of income are located and to changes in the
interests of taxpayers. On the other hand, when they feel this support, national
authorities relax their own efforts and investments, making it difficult to standardize
education at the country level, creating and deepening differences between
communities. Imbalances in local commercial activities may also arise, leading to the
segregation of certain communities and giving rise to new communities in need.
2.14. Mission
Despite differences in strategies, main activities, internal organization, value
proposition, projects, beneficiaries, customers, channels, cost structure, financial
sustainability, problems, and solutions, it is possible to conclude that the mission of
NGDOsin education in Mozambique is to promote the sectorto combat inequalities and
increase the development of the country, seeking change for the better.
3. Social business model Canvas of education NGDOs in Mozambique
3.1. Presentation of the proposed model
Based on the empirical analysis developed in the previous section, we advanced with
the following proposal of social business model Canvas for NGDOsin education in
Mozambique:
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Figure 2 - Proposal of a social business model Canvas for NGDOsin education in
Mozambique
Mission
To promote education as a way to reduce inequalities specific to each locality and as a crucial factor for
progress in development.
Positive
Externalities
- Empowerment of
the population
- Increase in
productivity
- Emergence of
new activities
- Stimulation of the
economies
- Improvements in
the health sector
- Democratic
communitarianism
Problem
Vulnerability
of
communities
due to low
level of
education.
Key Activities
- Classes/training
-Community
Participation
- FundRaising
Secondary
Activities
- HealthandWellness
Note: Based on the
activities, define all
necessary resources
Value Proposition
To convey the value
proposition in the most
impactful, visual and
attractive way, showing
that:
- Supporting the
development of realities
in need is accessible
- Everyone has the
possibility to contribute.
- The results are
noticeable, and the
more possibilities there
are, the more it
changes.
Relationship
with the
beneficiaries
Measuring their
interest and
evolution in order
to give a complete
andadapted
response
- A Priori
- During
- Posteriori
Relationship
with taxpayers
Defining a strategy
to attract interest
and raisefunds
through:
- Solidary
Sponsors/Associat
es
- Donations
- Sales
- Events
- Funds andGrants
Solution
To enable
access to
education for
all interested
members of
the target
audience
Indicators/Results
- Number of Students
- Evolution of school
performance
- No. of actionstaken
Communication
Channels
- Social Network
- WebSite
- Newsletter
Distribution
Channels
- International
-
NationalDistributio
n
- Local
Distribution
Sales Channels
- Direct
- Indirect
Partners
To Detect all those
who can contribute
with goods and
services
-
Associations/Instit
utions
- Companies
- Publicentities
- Local partners
Negative
Externalities
- Dependence of
the population on
the NGO
- Acting in thethird
sector
- Diversity of
means among
NGOs
- Possibility of
unbalancing the
economy
- Creation of
segregated
communities
CostStructure
To try to define fixed costs and variable costs
in order to reduce risksand look for partners
that can help reduce these.
Financial Sustainability
- Try to forecast costs so that at th eend of the year
expenses do not exceed revenues.
- Create a financial cushion to reducerisks
Source: Own elaboration
3.2. Model validation
To validate the model built, a focus group techniquewas used, materialized in a panel of
five qualified observers, purposely invited for this purpose and who were asked to
comment on the adherence of the proposed model to the represented reality.
Three sessions were organized with a duration of 60 minutes each,with a 24-hour break
in between. Given the current situation, the sessions took place virtually, using the
digital platform Zoom.
The five experts were:
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- The representative of an educationNGDO working in Mozambique, outside the
sample studied;
- A beneficiary of an education project of an NGDOin education working in
Mozambique, at the age of 18;
- A client/contributor of an educationNGDO working in Mozambique;
- A partner of an NGDOin education working in Mozambique;
- A representative of the Ministry of Education and Human Development of
Mozambique.
The model was tested according to the approach proposed by Fern (1982).
A discussion of the Mission Statement began. Although there was widespread
agreement with it, the panelists suggested that the existing formulation be
complemented with "human and economic" to specify the type of development targeted
by education NGDOs.
The problem was then analyzed. There was a consensus in the panel on the importance
of the elements formulated. However, it was emphasizedthat it was pertinentto add
individuals and families and not restricting the problem to only to communities.
Regarding the key activities, the panel considered the activities put forwardas valid, but
suggested adding a component relatedto the mobilization of volunteers. Considering
the concrete reality of the country, and the specific experience of the panelists,
volunteers are a determining component of the success of these organizations.
As for the Value Proposition, the panel found interesting the elements included in this
section but suggested a reformulation to make clearer both the concept of value in a
social business model and the scope of it.
As for the relationship with the beneficiaries, the panel considered the objectification in
time steps to be particularly relevant. They proposed, however, that the beneficiaries
should be specified, seeingno advantage ifthey wereonly implied.
The Relationship with Taxpayers block found unanimous support, and it was considered
that it reflects the reality of the population studied.
In the Partners' analysis, the panel considered that the study carried out is correct, but
that the list of the same should not be restricted and therefore it was suggested to be
added "in particular, but not exclusively".
In the Channel block, the panel considered the presentation developed in three
subgroups particularly relevant. Therefore, there was support for the formulation made
of this block.
In the discussion of the elements placed in the Solution, the panel considered that the
formulation developed was clear, but that it would be pertinent to join, at the end, "of
each specific project and/or NGDO".
As for the Indicators/Results, the panel agreed with the chosen elements and discussed
some others that could join those. However, this analysis did not exactly result in a
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155
concrete proposal for the combination of indicators, but only a recommendation to
consider more alternatives.
The panel's assessment of financial sustainability is that, in the proposed model, the
elements presented reflect a satisfactory response to the requirements of the model
used, thus supporting the proposal made.
As far as the Cost Structure is regarded, the panel considered that there could be
greater precision of this element, considering the information collected when assessing
the data collected.
Regarding the appreciation of externalities, and starting with the positive ones, the
panel suggested small improvements in detail that were promptly met and resubmitted
to the same panel for final validation.
On negative externalities, minor changes and details were also suggested and it was
stated that, overall, the proposal presented reflected the opinion of the elements of this
focus group.
Therefore, the validated model presents the following configuration:
Figure 3 - Social Business Model Canvas for NGDOs in the field of education in
Mozambique, after focus group validation
Mission
To promote education as a way to reduce inequalities specific to each locality and as a crucial factor for
progress in terms of human and economic development.
Positive
Externalities
- Capacity building
of the population in
key competencies
- Increased
productivity of the
Mozambican
economy
- Development of
new economic
activities
- Stimulation of
depressed economic
activities
- Improvements in
the health sector
- Increasing
democratic
communitarianism
Problem
Vulnerability of
individuals,
families and
communities
due to low
level of
education.
Key Activities
- Classes/training
- Community
Participation
- Fundraising
- Mobilizing
Volunteers
Secondary
Activities
- Health and wellness
Note: Based on the
activities, define all
necessary resources
Value
Proposition
The generic
benefit offered
is EDUCATION.
Hence the
following:
- Supporting
the
development
of realities in
need is
possible
- Everyone will
find an
intervention
space to give
their
contribution
- The results
are expressive
and clearly
measurable
The beneficiaries
are individuals in
need of
education, by
age groups,
previous
qualification
levels and
geographical
areas
Measuring their
interest and
evolution in order
to provide a
complete and
adapted response
at the various
stages:
- A Priori
- During
- Posteriori
Relationship with
taxpayers
To define a strategy to
attract interest and raise
funds through:
- Sponsors/Associates
- Donations
- Sales
- Events
- Funds and Grants
Solution
Enable access
to education
for all those
Indicators/Results
- Number of Students
- Evolution of school
performance
Communication
Channels
- Social Network
Partners
Detect all those who can
contribute, namely with
goods and services,
Negative
Externalities
- Dependence of
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156
who are
interested
from the
target
audience of
each specific
project and/or
NGDO
- No. of actions taken
- WebSite
- Newsletter
Distribution
Channels
- International
- National
Distribution
- Local Distribution
Sales Channels
- Direct
- Indirect
though not exclusively.
-
Associations/Institutions
- Companies
- Public entities
- Local partners
the population on
the NGO
- Acting in the third
sector
- Diversity of
means among
NGOs
- Possibility of
unbalancing the
economy
- Creation of
segregated
communities
Cost Structure
To make a prior operational risk analysis to
determine the level of sustainable fixed costs,
trying, whenever possible, to replace them by
variable costs, since operational leverage is not
an objective of these organizations.
Financial Sustainability
- Try to forecast costs so that at the end of the year
expenses do not exceed revenues.
- Create a financial cushion to reduce risks
Source: Own elaboration
Conclusion
The present work represents the first case identified in the literature of application and
validation of the Social Business Model Canvas in NGDOs in Mozambique. The results
achieved and described in this investigation support the pertinence of using the
business model as a fundamental framework in the evaluation of the activities of third
sector organizations.
Important implications can be drawn both for the management of these organizations
and management of education in Mozambique. The participation of a representative of
the Ministry of Education and Human Development of the country allowed considering
this second vision in the validated model.
Finally, the main limitations were the fact that it was not possible to include further
observations in our sample, or detailed data on the costs of the NGDOs assessed.
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