Differences of Social Enterprises Corporate Enterprises Non-Profit Organizations

What Distinguishes Social Entrepreneur and Corporate Entrepreneur

Social entrepreneur use entrepreneurial talent to create social change Social value aim Corporate entrepreneur use entrepreneurial wealth to create personal wealth economic value aim Social or environmental problem is core of social enterprise New market need is core of economic enterprise Social enterprise emerges because others have not attempted or failed Market failure is an opportunity for social enterprise A product can have high social value but low 2 market value (low cost houses/folk arts)

1.

Social and Corporate Enterprise: Differences (1)

Corporate Entrepreneurship To increase personal and stakeholder wealth To address unfulfilled market needs Non-Profit Organizations To mitigate social problems

Dimens Social ions Entrepreneurship Motive To bring about social change and mitigate social problems To address long standing social problems

Primar y goal

To address immediate problem disaster relief

Second Growth through ary economic Goal sustainability Sustainable social change

Customer satisfaction Corporate Social Responsibility Brand image

Growth through economic sustainability May or may not aim for social change

1.
Dimensions Antecedent conditions

Social and Corporate Enterprise: Differences (2)

Social Entrepreneurship Government and market failure to address long standing social problems Social value Mitigate social problem Sustainable social change Corporate Entrepreneurship Non-Profit Organizations

Growing market Existing market or potential need or social market growth problem Economic value Social Value Wealth creation Mitigate Social Problem

Value Creation Outcomes

Role of Direct involvement of Direct Entrepreneur entrepreneur in all involvement of stages of venture entrepreneur in all stages of venture Transformational leader Transactional leader

NPOs are headed by advisory board small NPO are headed by transactional leader
4

Dimensions Social Entrepreneurship

Corporate Entrepreneurship

Non-Profit Organizations

Collaboration occurs at all levels (Levels of Trust on collective collaboration) experience of population, employees and partners Collaborative capacity building Collaboratio n needs

No involvement of target population High level of collaboration can occur within the organization

Intra organizational collaboration is high Inter organizational collaboration declining due to resource competition

IntraOrganisatio nal/ Inter Organizatio nal Population/ Market

Involvement of target population in decision making, implementation and evaluation of programme

Inter organizational collaboration is low and mainly for economic gains

Population level collaboration may occur depending on nature of services provided

5

Dimensions

Social Entrepreneurship

Corporate Entrepreneurship

Non-Profit Organization

Organizatio Porous-social n value creation boundaries takes place within and outside organizations Collaboration with other organizations Organisatio Flat or horizontal n structure Ownership Collective Ownership and population are guided by common vision

Rigid social value creation is tied to economic value within organizations Competition with different organizations Hierarchical (vertical) Single ownership or entity controlled by a few employees

Rigid/Porous differs based on contextual circumstances and type of services provided

Mainly hierarchical Restricted to board family

Social Entrepreneurship Vs Government

Social entrepreneurship does not control resources. They have to leverage resources that others control Social entrepreneurship is inductive and outward looking It moves from observation and experimentation to institutionalization and independent adoption Government moves in reverse direction. Starts with policies and ending with programmes Gove follows top-down approach. SE follows bottom-up approach SE experiments with ideas until solution is reached. Grammeen bank experimented seven years by lending loan to men then switched to men 7 Govt implements without experimentation

Corporate Social Entrepreneurship (CSE)

Corporate Social Entrepreneurship

A New Paradigm
CSE is a business strategy that promotes a social cause and ensures a profit. CSE creates social value that generates business value.
CSE Examples:
E-choupal Company initiative of Indian Tobacco

Project Shakti of Hindustan Unilever Limited (e.g organic food products, textiles coloured with natural dyes)

Two Aspects of CSE CSE must elicit sufficient resources and commitment to be sustainable CSE must generate utilitarian benefits and altruistic benefits

Choupal Saagar Bringing modern outlets in Rural India

9

CSE Concept
Corporate entrepreneurship aimed at spotting and redefining market opportunities through innovative strategies, process and organizations that would generate competitive advantage Similar to this, Social Entrepreneurship emerged which aimed at achieving greater social impact through innovation and adaptation. The Corporate Social Entrepreneurship draws on three conceptions of entrepreneurship - innovative strategies, process and organizations

10

Why invest in CSE?

PUSH FACTORS:

(a)

Changing expectations of public and key stakeholders such as consumers, employees and communities regarding companies. Society feels companies should come forward to address social problem not just confined to produce goods Expectations Product inputs along with supply chain have been produced in social and environmental friendly manner. Push factors are focused on protecting society or environment rather than creating economic value 11

Why invest in CSE?

(b)

PULL FACTORS - comprise positive incentives that give opportunities for greater value creation. Consumer ready to pay more if product is produced in social and environmental friendly way. Companys social commitment is also important for communities, employees and investors.
12

How to Do CSE - LEADERSHIP

Four areas need to be reorganized in a company LEADERSHIP:
Vision: Leader needs to envision a company in which the social dimensions is integral to company Legitimization: Leader needs to create an internal environment that signals the desirability of CSE process Empowerment: Leader needs to empower other leaders and change agents to execute the plan

13

How to Do CSE- STRATEGY

STRATEGY:
Alignment: The social and business dimensions of the company strategy must align with each other Leveraging Core Competencies: Discovering creative ways to mobilize and deploy key assets technology, talent, image, infrastructure, distribution channels Partnering: Creating alliances with other entities. Partnering helps gaining new resources. Partnering on cause related marketing, event sponsorship,
14

How to Do CSE - STRUCTURES

STRUCTURES Structure needs to follow strategy
Structure should be T shaped. Vertical component that deepens the companys social commitment and horizontal one entrusted with the mission of spending it across ground
Finding new forms of interdepartmental collaboration is part of CSE Integrating social entrepreneurship dimension to daily operations of company
15

How to Do CSE - SYSTEMS

SYSTEMS - Systems need to follow structures
Decisions making process that integrates consideration of economic and social value creation Combined learning and performance oriented measurement and management systems Effective economic and social value communication process. Social performance should be integrated in regular corporate reports. Separate corporate reports to spotlight achievements and new targets of social goal
16

Role of Corporate Social Entrepreneurs (a)

CSEs are change agents in transformation process. They play seven roles:

1. Advocates for the cause. They continually stand up and push for generation and integration of social and business value as a central belief of company 2. Communicators are active listeners to various stakeholders and are able to speak to groups in ways that reveal how social action is relevant to their needs 3. Creators and inventors of new possibilities. Entrepreneurs invent new resource design and actions. They are creators of new resources.
17

Role of Corporate Social Entrepreneurs (b)

4. Catalysts inspire and create synergies in work of others. Entrepreneurs catalyze a process that brings transformation 5. Coordinators reach across internal and external boundaries, inspiring, mobilizing actions

6. Contributors support the work and success of others. CSEs need to enhance success of other groups 7. Calculate the transformational process within the organization. Calculate the cost and benefit of social entrepreneurship process
18