What Is Social Entrepreneurship: How Entrepreneurs Become Agents of Change
Social entrepreneurship is different from business entrepreneurship because the main goal of the former is to promote social development not profits.
“Social Entrepreneurship” is being responsive to the needs of our times. The non-economic motivational underpinnings of social entrepreneurial activity revolve around its passion of accomplishing a social mission, ability to incorporate innovation, strive to create impact not just earn income. These are the very basis for social entrepreneurship.
Social entrepreneurs lead people to greater visions and higher heights. Aside from innovative not-for-profit endeavors, social entrepreneurship can be found in business ventures created for social purposes. Examples include for-profit community development banks and hybrid organizations which combine not-for-profit and for-profit activities.
Social Entrepreneurship Defined
So what does the term “social entrepreneurship” really mean? What does it take to be a social entrepreneur? The meaning is derived from a variety of social entrepreneur definitions all combined to come up with one, comprehensive definition. It is taken from Say’s idea of value creation with emphasis on discipline and accountability, Schumpeter’s notion of innovation and change agents, Drucker’s pursuit of opportunity and Stevenson’s need for resourcefulness.
Social Entrepreneurs Identify and Solve Problems on a Large Scale
Business entrepreneurs identify opportunities and exploit them for financial gain. Bill Gates recognized the future of the personal computer and wrote special software to make that future a reality. Similarly, social entrepreneurs identify opportunities to solve societal problems on a grand scale. Martin Luther King who led the American Civil Rights Movement and Gandhi who led his people to independence were examples of social entrepreneurs. Each one inspired movements in their respective countries that led to major shifts in thinking patterns and improved society as a whole.
Social Entrepreneurs Bring Value to Disadvantaged Communities
A business entrepreneur’s ultimate desire is to add value to their business enterprise and to increase their personal self-worth. People like Bernie Madoff and Donald Trump engage business opportunities to expand their own empires. Social entrepreneurs do not exploit opportunities to bring value to their own bank accounts, but to add value to disadvantaged communities.
Social Entrepreneurs Tap Inspiration and Creativity in Outcasts and Misfits
Business entrepreneurs seek out top talent from Ivy League schools who have proven track records in top management positions. In contrast, social entrepreneurs see past raggedy clothes to draw out the creativity of the downtrodden. In this way, social entrepreneurs are transformational leaders in that they inspire others to take up a vision that is beyond their previously displayed abilities.
How Social Entrepreneurs Become Change Agents in the Social Sector
To effect change, social entrepreneurs do the following:
- Create and sustain social values: Schumpeter said that social entrepreneurs introduced reforms and innovations coupled with a social mission. They get to the bottom of the problem and address the root causes instead of doing superficial treatment of symptoms.
- Recognize and pursue opportunities in service of the goal: Their goals are what separate the social entrepreneurs from business entrepreneurs. A social entrepreneur focuses on a social mission. It is an essential part of business, the core with which the activities of the social entrepreneurship revolve around.
The mission to create social improvement cannot be compromised to attain personal advantages such as profits. Reaping profits, becoming wealthy, or filling the needs of customers form part of social entrepreneurship, but these are simply ways of achieving social ends, not the end goal itself. Profit and customer satisfaction are not the measurements use in creating value but social impact. Social entrepreneurs seek to attain long-term social effects.
- Continuously pursuing innovation, adaptation, and learning: All kinds of entrepreneurs whether business or social are, by nature, innovative. They do not necessarily invent new things but also introduce new ways of looking at or using existing things. Creativity for entrepreneurs is a continuous learning process. Innovation often entails risks. But entrepreneurs are capable of managing these risks.
- Take bold steps even if resources are limited: Limited resources for social entrepreneurs do not pose a hindrance to their desired ends. They augment scarce resources by exploring options such as adding partners, collaboration and soliciting aid from philanthropists. They develop strategies that promote and enhance their social missions or the objectives they seek.
- Accountability to the customers served and for the outcomes of their actions: It is hard to totally wipe out ineffective social activities in business. That is why social entrepreneurs focus on creating social value. To do this, they need to determine correctly the needs and values of the community they revolve in.
They aim to achieve a perfect balance between promoting social development while at the same time providing financial or social return to their investors. This is a huge part of the challenge social entrepreneurs face. The more a person can satisfy all the conditions above, the closer the person is to being a social entrepreneur. It necessarily follows that those who practice innovation and who create more significant social developments will obviously be viewed as more socially entrepreneurial.
Progress of social entrepreneurs is determined by the relevant social, financial, and managerial outcomes, unlike the business entrepreneurship where there is a greater emphasis on size, outputs, or processes.
For social entrepreneurs, the social mission is an intrinsic part of their endeavors. Their objective of attaining socially relevant goals is the basis for perceiving and assessing opportunities. The impact they derived from achieving their social mission is central to social entrepreneurship not wealth creation. Wealth is merely one of the instruments to attain their social goals.
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