Social Enterprise Recommendations Overview

Although (rural) social enterprises have entered the policy discourse, there is a gap between the aspirations/ expectations of policymakers and actual tailor-made support needed and offered to these enterprises. Policymakers should take into account the specific internal characteristics of rural social enterprises, and also the important role that the ‘rural’ and local contexts play as both an enabling and constraining factor for the emergence and actions of these enterprises.

1. More research studies should be done about the role that social enterprises can play in the development of rural areas.

2. In order to better understand the role rural social enterprises can play in fostering more inclusive and sustainable means of development, we need to understand the circumstances under which such development takes place.

3. Further, there is a need to explore the ‘local dynamics’ of these rural and/or remote areas, as it could provide more insights on how different types of ‘rural’ impact shape rural social enterprises.

1. Future research should adopt large-scale databases to confirm whether the SE sector has any influence on the transformation from traditional non-profit organisations (NPOs) to SEs.

2. This research does not generate any quantitative measurements. The use of a metric scale for different kinds of institutional work would also open up new avenues for quantitative research opportunities.

3. Future research should adopt a longitudinal method to observe the SEs over a period of time to offer a more complete picture of the transformation from traditional NPOs to SEs.

4. Further research can be designed to explore barriers and challenges faced by traditional NPOs to perform each of the individual practices, as well as how institutional entrepreneurs attempt to solve these problems creatively.

This work provides a concrete guidelines for managers of traditional non-profit organisations (NPOs) on how to incorporate commercial processes within their organizations.

1. For example, if managers want to lead their organizations to engage commercial revenue strategies, they need to make plans to build commercial revenue-generating mechanisms and establish business partnerships with for-profit organizations.

2. To build commercial revenue-generating mechanisms, NPO managers need to engage in two individual practices: (1) introduce profit-seeking business practices and (2) develop a revenue model for existing social products/services offerings.

3. To establish business partnerships with for-profit organizations, NPO managers also need to focus on two other practices; (1) identify opportunities to actively collaborate with for-profit organizations and (2) manage alliance relationships with for-profit organizations.

1. This analysis of a single case study was conducted tracking the evolution of an organization’s business model as it went from being a traditional, donation-based NPO, to a dynamic sales-driven social enterprise (SE). Time will tell the extent to which the organization “Unidos”’ new market orientation will fulfill its promise of delivering financial autonomy, enhanced scalability, and ultimately, increased impact. Thus, further studies should take a longitudinal approach using a wider time-window to test whether this premise can be empirically validated. Researchers interested in carrying this line of research forward may put their exploratory propositions to the test with other methodological approaches, to validate, extend or challenge the findings.

In increasingly competitive and constrained environments, this article argues that, by considering the various ways how value can be created for, delivered with, and captured from key stakeholders, business model innovation may have the greatest potential to sustain social purpose organizations and increase their social impact. E.g. effective integration of beneficiaries in the workforce and value delivery process.

1. Future research at the individual level could investigate the motives of each stakeholder and, on the organizational level, scholars could examine which forms of stakeholder integration within the social purpose organisations (SPO’s) business model is most effective for strategic or personal reasons.

2. Researchers could explore the various combinations of actions that key stakeholders (beneficiaries, donors, customers, employees, partners, competitors, government) and value processes (value creation, value delivery, value capture) yield.

3.In particular, a relevant research question for scholars concerns the specific outcomes of actions and their combination, investigating which ones are most effective in, for instance, increasing benefits for individual beneficiaries, diversifying income streams, growing the organization, and increasing the SPO’s overall social impact.

1.This study shows that social purpose organisations (SPOs) can integrate beneficiaries productively as a part of their workforce in the value delivery process.

2.This study also shows that particular business model innovations (BMIs) are related to stakeholders such as donors, customers, partners, or competitors. For instance, SPOs may target better-positioned donors to mobilize recurrent monetary or in-kind donations or invite them as private or corporate volunteers in the value delivery process.

1. The public sector can take actions to lessen the complexity of social enterprise business models, as they play various roles even in market-oriented social enterprises, and their involvement appears to be associated with complexity of business models. Complexity, in turn, increases the risk of mission drift and/or financial failure. Predictability and coherence of public policies and practices is vital to minimize the need for sudden actions and complex business models from social enterprises’ part.

2. Public sector actors should follow common guidelines whether they interact with social enterprises as buyers, funders, partners or legislators.

1. More research is needed to elucidate the temporal dynamics of business models in variety of social enterprise settings. For instance, there could be comparative studies examining how social enterprises are able to develop and grow their business models under different institutional settings.

2. This study did not distinguish between the value creation, delivery, and capture elements of business models. Future studies could usefully combine these perspectives by focusing, for example, on activities that affect financial and social value creation, as well as activities that facilitate value capture in these domains.

3. Further studies could examine how abilities such as adaptive culture or paradoxical mindset, for instance, improve social enterprises’ abilities in business model innovation.

1. Social enterprises should be especially aware of the relevant boundary conditions for growth. This means clearly understanding the social enterprise’s mission and whether business growth is to be led by internal or external drivers (or both).

2. It is important to ask what financial risks the company can afford to take and to what extent growth should be steered by social or business opportunities. In other words, social enterprises benefit from a clearly defined growth strategy.

3. Social enterprises benefit from clear goal-setting for business model innovation to address the inevitable question of whether the new business model should prioritize financial or social value or try to balance these.