Social Entrepreneurship: Chapter 1, 2 and 3
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The Entrepreneurship Process
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Opportunity recognition Concept development Resource determination and acquisition Launch and venture growth Harvest the venture
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Opportunity recognition
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opportunity where others see only threats and tragedies Addressing present or latent demand
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Concept development
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Identify new products or markets Identify and define desired social rewards and how they are to be measured
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Launch and venture growth
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3% annual growth in number of nonprofits from 1996 to 2004 Growth is higher in public charities and private foundations than for nonprofits in general
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Harvest the Venture
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knowing what to do after the goal is reached
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Characteristics of social entrepreneurs
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mission orientation pursuing opporunities continous innovation/adaptation bold action heightened accountability
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Mission orientation
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Adopt a culture to make and keep social value
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Pursuing opporunities
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pursue things that coincide with the mission statement
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Bold action
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Take risks without being limited by lack of resources
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Heightened Accountability
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Need to take responsibility to constituents served and outcomes created
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Psychological traits of entrepreneurs
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Innovativeness Achievement orientation Independence Sense of control over destiny Low aversion to risk (i.e., willing to accept risk) Tolerance for ambiguity community orientation and social concern are vital
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SE as Leaders
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Shape a vision that change public attitudes Have significant personal credibility Generate commitment in terms of values to achieve collective purpose
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SE as personalities
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Achievers Super-salesman Real Manager Expert idea generator
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Myths about SE
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They're against business The difference between commercial and social entrepreneurship is greed
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SE are against business
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They come from business and have succeeded in business
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The difference between commercial and social entrepreneurship is greed
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Assumes that all commercial entrepreneurs are focused on profit, and that none are philanthropic
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Social entr as a creative process
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Opportunity recognition is part of converting an idea to a means of creating social value Background Ideas opportunities
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Background
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knowledge of unmet needs
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Ideas
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thinking of something new
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Opportunities
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willingness and ability to adapt of population to connect with the new thing. only happens when there's a supply and demand for an idea
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Creativity
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Generating ideas to improve the effectiveness of a system Ideas can be adaptive or innovative These are two points on a spectrum of creativity
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Sources of Opportunities
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Technological Change Change in public policy Changes in public opinion Changes in Tastes Demographic Changes
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Technological change
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Using the internet for political fundraising
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Change in public policy
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New opportunities for faith-based groups
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Changes in public opinion
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Opposition to wars (Vietnam and Iraq)
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Changes in tastes
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Ex. higher education adapts to student interests
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Demographic changes
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Serve immigrants and help them assimilate
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Comm enterprise mission statement
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It should be clear and succinct Explain 3 things Something should occur before planning activities
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Explain 3 things
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What the enterprise will do How it is entrepreneurial Why it is important
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Before planning
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A mission statement has goals and measures of progress towards goal
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Mission statement should specify
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What the enterprise will and will not do How it creates and measures value How an enterprise innovates or adapts How success will be measured
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Benefits of a good mission statement
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Provides Focus Helps attract Support
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Provides Focus
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Social entrepreneurs can stay on target as they develop the concept
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Helps attract Support
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As a marketing tool, it brings other resources into the enterprise For example, volunteers, donors, partners
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The initial XYZ mission statement
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general description of what XYZ will and won't do Present a measure of social value It's not clear if it's an innovation Overall goal is too broad
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The revised XYZ mission statement
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More specific about the organization's intended actions More clarity about how it is an innovation More specific measures of success
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Business model
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a plan for how the mission will be achieved and how the enterprise will create value
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description of enterprise will operations
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Its mission Its strategic resources Its partners How it will serve its beneficiaries
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Threats to business models
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Demand side Supply Side
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Demand Side
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A product or service that finds no market - people don't want it Its value is not accepted by clients
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Supply Side
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Too much capital needed, or too much ongoing cost to sustain itself
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Many social enterprises fail
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Persistent lack of income is a common reason A supply explanation would be that costs are too high A demand explanation would be that revenues are too low Both flaws can be examined in the business model
