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Social Entrepreneurship is a movement adopted globally and is generating solutions to the unsolved problems. It is articulating a whole new approach towards humanity by transforming the way people think about how to bring a positive difference to the world.
Social Entrepreneurship quoted as “entrepreneurial sector which is augmented by a social cause” has become an important economic activity across the lengths and breadths of this planet. Some of the most eye catching innovations have their root in the developing countries & involve framing up of new business models which serve human needs such as provision for low cost eye care surgeries by Arvind Eye care, Amul which generated employment for millions of dairy farmers, Jaipur rugs, etc.
Social Entrepreneurship usually starts with localised and small efforts but they tend to serve problems which have a global relevance. The novel solutions which social entrepreneurs confirm for the local context get duplicated in other geographies of this world and gyrate whole new industries to benefit the masses. This sector has gained the central position of the business world due to increasing global connectivity and the cut throat competition for philanthropic cash pool. But there are a lot of challenges faced by social entrepreneurs.
Some of these are: -
a) Funding – Social businesses can be run either as a profit or a non-profit organization. Quite a few of these after gaining sufficient consumer attention earn income through the sale of their socially beneficial products or services. But many don’t which is a darker side of this sector. For those who don’t have sufficient assets to sustain rely on corporate investments, government support, donations, etc. the main reason is investors are sometimes thoughtful over the fact that whether the business is actually non-profit or not. The trust factor interrupts.
b) Communicating the Objective: - the social enterprise has both a commercial and social value attached to it. Sometimes it becomes difficult to communicate the objective to the bottom of the pyramid. So the statement of objective should be simple and convincing enough to drive important decisions of future.
c) Strategy Adopted: - The very important premises of any business are its long term goals and the strategy adopted to achieve those. Multiple social benefits can create a clutter of goals; all of these must be evaluated on the grounds of relative cost to make sure that true value is created. A competitive strategy develops a unique proposition which gives an edge to the business over its competitors.
d) Commitment to the mission: - Review of strategies should happen over a regular interval of time but the mission of the firm should remain constant to avoid any confusion and digression from the core competence and objective.
e) Socio-Economic and political nuances faced in the respective geographies.
Microfinance has helped in strengthening the roots of social entrepreneurship but there are gaps or one can say business model which can benefit healthcare and education are yet to be articulated. The main issue faced in these two sectors is maintenance of quality due to availability of many low cost alternatives.
Recently Google announced it is setting aside one percent of its profit and equity to “make the world a better place.” On similar lines, Bill Gates gave a speech to the World Economic Forum stating the need for “creative capitalism” to fight poverty. These are the two most visible recent examples as far as new business strategies are concerned for social entrepreneurialism to fight the nuances of this complex world.
Types of Social Entrepreneurship: -
a) The Leveraged Non-Profit – This business model leverages the available resources to respond to the social needs. These are distinguished in terms of the innovative approaches they use to run their business but their roots lie in the older era.
b) The Hybrid Non-Profit: - this business model can take a number of forms but it is distinctive over the fact that it uses profit to sustain its operation and lay less of a emphasis on loans, grands, funding from both the corporate as well as the government. These are used to fight market failures.
c) The Social Business Venture: - This business model is framed in a way to bring about a change but through social means.
Technology has proved to be vital for the success and spread of social entrepreneurship. Internet, social networking have help in successful collaborations of many social entrepreneurs giving way to new ideas and gaining more visibility. It is a medium which helps in constructive dissemination of resources, the content can be read and heard by a larger pool of audiences; thus creating more awareness.
In a nutshell, the challenge is not to make social entrepreneurship so big that it becomes just another phrase for gaining more funds. Instead it should be made so innovative that draws out new lines for the society as a whole and lay out more opportunities for the budding generation garnering them with a bundle of joy and success.
This article has been authored by Lovina Murdia from SIMSR
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