1. Professor Alex Nicholls MBA
Social Entrepreneurship and Social Innovation
Professor Alex Nicholls MBA

2. Boundaries and Discourses
Session 1 2 2

3. Overview Course structure Social entrepreneurship Better World Books
Assessments
Social entrepreneurship
Context
Discourses
Setting the boundaries
Better World Books

4. Course Objectives
To explore the range and nature of social entrepreneurship and social innovation
Key drivers
Contexts
Opportunities and challenges

5. Topics Session 1 Boundaries and Discourses
Session 2 Market Solutions: Social Enterprise
Session 3 Third Sector Solutions: Advocacy and Social Movements
Session 4 Restructuring the State
Session 5 Performance and Impact
Session 6 Towards a Social Finance Market Place
Session 7 Investors and Exit
Session 8 Impact Investing

6. Reading Essential reading Additional reading
Recommended range of material in pack
Additional reading
Useful in topic areas of particular interest
Do NOT have to read it all!
Case Preparation is essential

7. Individual Essay Discursive and analytical
Include theory and original research
Include practical examples
International in scope
Choose from list of questions or devise your own

8. Example Titles
Social innovation is not the same as social entrepreneurship. Discuss
Failure is the best source of successful social innovation. Discuss
How can social entrepreneurship be fostered?
What are the downsides to social innovation?
How does social innovation differ across sectors?
What is the role of government in social entrepreneurship?

9. Example Titles
Is there such a thing as a socially entrepreneurial ecosystem?
Social entrepreneurship is always political. Discuss
Impact measurement is less important than accountability. Discuss.
How can social entrepreneurship scale up most successfully?
Is social entrepreneurship the same across the world?

10. Individual Business Plan
Identify a social/environmental market failure/opportunity
Design an organizational response
To include:
Market survey
Strategic plan
Operations plan
Funding/financial structure/exit
Performance metrics
Governance/accountability structure

11. Key Questions
What contribution can social entrepreneurship make to solving the greatest challenges of our time?
What is the role of:
Government as a regulator, policy maker and investor
Market as source of investment and competition
Civil society as guardian of values and source of non-market innovation
And how do all three work creatively together?

12. ‘Wicked Problems’ Global Financial Crisis (GFC)
Industrialization and climate change
Global security
Health pandemics
Population growth
Water and food shortages
Massive inequality and persistent poverty
Community regeneration
Youth unemployment

13. Social Entrepreneurship
‘Wicked problems need clumsy solutions’
Social entrepreneurship blurs sector boundaries and reconfigures relationships
Public-private partnerships
Social enterprise
Shadow state
Often disrupts ineffective or unjust systems
Requires entrepreneurship and intrapreneurship
Institutional entrepreneurs are champions are critical
Government can generate, sponsor, or catalyse social innovation 13 13

14. Reinventing Government
Increased privatisation of government and public services
Search for better quality/efficiency/legitimacy
Reduction in taxation
Formats:
Outsourcing contracts
Voucher schemes
PFIs/PPPs

15. Social Sector Effectiveness
Move towards more ‘efficient’ business models in social sector
For-profit subsidiary ventures
Cross sector partnerships/hybrids
Drive towards ‘sustainability’
Better responsiveness

16. Predators v Creators

17. Mulgan (2013)
Capitalism rewards innovators, makers, and creators (bees): creating value
Also rewards takers and predators (locusts): capturing value
Capitalism is articulated in the institutions of market and via business
Capitalism is in constant flux and is superbly able to reinvent itself and adapt to changing contexts and critiques: crisis is the norm
Its future can be more creation or more predation

18. Mulgan (2013)
> predation = more state sanctioned monopolies (energy, IP); deeper marketization of public goods; commoditization of ‘lifeworld’; transactions as one off interactions
>creation = better alignment between markets and individual life; linking business to individual meaning and sense-making; civility and empathy; transactions as relationships
Lived Value

19. Sustainable Business Enhanced CSR Triple Bottom Line strategies
Pressure to act as corporate ‘citizen’
Role in solving social problems
Role in social institution building
BoP opportunities

20. Shared Value 20 20

22. ‘Thin’ v ‘Thick’ Value? Value chains Value cycles Value propositions
Industrial Era Capitalism
Constructive Capitalism
How production, consumption and exchange happen
Value chains
Use resources
Value cycles
Renew resources
Which products and services are produced, consumed and exchange
Value propositions
Command and control demand management
Value conversations
Democratic demand management
Why production, consumption and exchange happen
Strategies
Short-term competitive advantage
Philosophies
Long-term competitive advantage
Where and when production, consumption, and exchange happen
Protection
Dominating markets
Completion
Creating markets
What is produced, consumed and exchanged
Goods
Efficient production
Betters
Holistic production
Haque (2010)

23. Social Entrepreneurship
Public Sector
Private Sector
Private-Public Partnerships
Reinventing Government 2.0
Corporate Social Responsibility 2.0
Social Entrepreneurship
Social Innovation Policy
Social
Enterprise
‘Big Society’
Community 23 23

24. Social Entrepreneurship Debates
Fluid and sometimes controversial phenomenon
Solution to state failures in welfare provision (Leadbeater, 1997; LeGrand, 2003; Bovaird, 2006; Aiken, 2006)
New market opportunity for business: BoP (Prahalad, 2005)
Space for new hybrid partnerships within Civil Society (Austin et al, 2006)
Model of political transformation and empowerment (Alvord et al, 2004; Yunus, 2008)
Driver of systemic social change (Bornstein, 2004; Nicholls, 2006)

25. Social Entrepreneurship Debates
‘Limited’ v ‘extended’ definitions of the term (Perrini, 2006)
Former positions social entrepreneurship as a new aspect of the not-for-profit world
Latter discusses it as a wider societal force for change
Apparent tensions between a ‘big’ and ‘small’ tent approach to social entrepreneurship (Light, 2006)
Enterprise v innovation models

26. Social Entrepreneurship?
Defining features
Dominant logic
Ideal type
Case example

27. Key Field Building Actors
Organisation
Founded
Ashoka (International)
1982
Roberts Enterprise Development Fund (USA)
1997
Community Action Network (UK)
1998
Social Enterprise Alliance (USA)
The Schwab Foundation for Social Entrepreneurship (International)
Skoll Foundation (International)
1999
Social Enterprise Unit, Department of Trade and Industry/OTS (UK)
2000
Social Enterprise Coalition (UK)
UnLtd (UK)
2002 27

28. Logics Of Self-Legitimation
Organization
Dominant Logic
Internal Legitimating Agenda
Social Entrepreneurship Ideal Type
Example Organization
Foundations
Mobilise resources to bring about change
Maximise return on investment
Hero entrepreneur
REDF, Skoll Foundation, UnLtd
Fellowship Programmes
Build networks of learning
Maximise network effects
Schwab Foundation for Social Entrepreneurship, Ashoka
Government
Deliver public goods
Efficiency, responsiveness, sustainability
Enterprise
Office of Civil Society (UK), Office of Social Innovation (US)
Network Builders
Support effective societal solutions
Social justice
Community
Social Enterprise Coalition, CAN, SE Alliance
Academics
Build new learning
Peer acceptance
Discipline dependent
HBS SEI, CASE, Duke
Skoll Centre for Social Entrepreneurship, Oxford
Entertainment Media
Divert and give pleasure
Viewer numbers
Participant Media

29. Social Entrepreneurship?
Cafedirect
Aravind Eyecare
Dwr Cymru
Apopo

34. Defining Features ‘Sociality’ Innovation Market orientation Hybridity
SE often addresses market failures or institutional voids (Mair and Marti, 2009)
Nicholls and Cho (2006) 34

35. Sociality
Context
Socially embedded; politically sensitized; networked;
Process
New employment models; worker participation; close engagement with stakeholders; local focus; green
Outcomes/
Impacts
Reduced negative externalities; filling market voids; improved (welfare) products and services; gender empowerment; more equal supply chains (shared value) 35

36. Innovation Schumpeterian notion of change agents Creative destruction
Resourcefulness: bricolage approach
Innovation in institutional structures
Reconfiguring (social) needs, wants, demands 36 36

37. Innovation Incremental Institutional Disruptive
To address identified market failures more effectively
Negative externalities
Institutional voids
Institutional
To reconfigure existing market structures and patterns
Mobile telephony
Carbon trading
Fair Trade
Disruptive
To change the cognitive frames of reference around markets and issues
Social movements
Microfinance 37 37

38. Market Orientation Reconfiguring markets Addressing Market Failures
BoP
Addressing Market Failures
Private/Commercial Market Failure
Free Rider/Capturing Full Economic Value
Public/Government Market Failure
Collectivity/Democracy
Social Sector Market Failure
Resource dependency
Supplyside bias 38 38

39. Market Orientation
Reconfigures commercial markets to capture economic value as a by-product of creating social value
Social enterprises as ‘businesses with a social purpose’ (DTI, 2002)
New market opportunities at the ‘Bottom of the Pyramid’ (Prahalad, 2005; Karamchandani et al, 2009)
Generates innovation in charitable models that fail to deliver mission outcomes effectively
Offers solutions to (social) policy failures and voids 39 39

40. Market Orientation Performance focus Competitive strategy
Impact measurement
Stakeholder accountability
Competitive strategy
Combines value creation and strong values 40 40

41. Microfinance Sociality Innovation/Systems Change Market orientation
Enterprise development of the poor
Innovation/Systems Change
Idea: poor are low risk debtors
Products: financial products to the poor
Market orientation
Build a scalable model
Shift from philanthropic funding to access capital markets

42. Fair Trade Sociality Innovation/systems change Market orientation
Enterprise development of the poor
Capacity building
Innovation/systems change
Marketing model: connecting consumer and producer via labelling initiative
Economic model: reduce inefficiency of global supply chains
Market orientation
Grow ethical consumer market
Develop producer voice

43. BOND Quality in NGOs Sociality Innovation/systems change
Puts beneficiaries first
Innovation/systems change
Bottom-up solutions
Empower beneficiary voice
Market orientation
Build a model drawing on existing practice
Well designed consultation process

44. GAVI Alliance Sociality Innovation/systems change Market orientation
Focus on vaccines for neglected diseases in developing world
Innovation/systems change
Public-private partnership
Use pledges of future aid to back $1b in bonds
Market orientation
Market building for orphan drugs

45. Three Societal Fields Community Business Government
Institutional Logic
Public Benefit
Profit Maximization
Collective Democracy
Ownership
Mutual
Private
Collective
Key Beneficiaries
Clients
Owners
General Public
Strategic Focus
Social Value Creation
Financial Value Creation
Public Service
Accountability
Stakeholder Voice
Published Accounts, Stock Performance
Ballot Box
Resource Strategy
Donations, Grants, Earned Income, Volunteers, Tax Breaks
Debt, Equity, Earned Income
Taxes
Dominant Organizational Structure
Charity,
Co-operative
Private Company
Departmentalized Bureaucracy

46. Boundary Blurring Community Private Sector Public Sector
Profit-Non Profit
Formal-Informal
Social Enterprises
Shadow State
Multi-Sector Collaborations
Private-Public
Private Sector
Public-Private Partnerships
Public Sector 46 46

47. Spectrum Of Action City Year Guide Dogs for The Blind Benetech
cafedirect
Grameen Phone
Voluntary Organisations
Charities
Not-for-Profits
Social Enterprises
Corporate Hybrids 47 47

48. Key Data Sources 2005 IFF Survey for Small Business Service and DTI
15k SEs (IPS and CLGs); 1.2% of all enterprises; £18 billion t/o; 475k staff
Annual Small Business Survey for DTI
55k SEs with employees (62k in 2009); likely to exclude many charities and CLGs
National Survey of Third Sector Organizations , Ipsos/MORI for OTS (using Guidestar data)
82k SEs (ie earning at least 25% of their income)
NCVO Civil Society Almanack (charities only)
36k SEs (ie earning at least 25% of their income)
‘Hidden Social Enterprise’ (Delta Economics) 2010
‘Businesses with a social purpose’ (inc. job creation)
232k SEs (‘wanting to make a difference’)
110k SES (‘wanting to make a social difference’); £17.7 billion t/o 48

49. UK Social Enterprise

50. Size and Scale Bangladesh: GEM 2010 (Bosma and Levie, 2010):
2013 BRAC ran more than 37,000 schools
Provided microfinance products to over 8 million
Engaged 80,000 health volunteers
Employed 120,000 workers
Served >100 million people (Dees, 2010)
GEM 2010 (Bosma and Levie, 2010):
Direct engagement with SE ave % of the total population
Fair Trade:
2013 >£4 billion of sales benefitted >7million in 60 countries
Ashoka’s global Fellowship >2500 members 50

51. Better World Books 51
SKOLL CENTRE FOR SOCIAL ENTREPRENEURSHIP 51

52. Social Entrepreneurship
Competitive advantages
Core competences
Strategic challenges