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Five Stages of Social Entrepreneurship

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Five Stages of Social Entrepreneurship

  1. 10th International Conference of the International Society for Third-Sector Research (ISTR) at Siena University, ItalyFive Stages of Social Entrepreneurship 2012.7.13. Yutaka Tanabe NPM (Non Profit Management) Course, Social Engineering, Tokyo Institute of Technology, Tokyo Japan yutaka.t.aa@m.titech.ac.jp 1
  2. Index• Introduction and Research Question• Literature Review• The comparison between For-profit Entrepreneur and Social Entrepreneur• Methodology• Findings• Limitations & Conclusions• Discussions• References 2
  3. Introduction and Research Question• Social Entrepreneurship (SE) as a field of research is a relatively recent phenomenon (Mair, Robinson, and Hockerts 2006).• Although SE is spreading among practitioners and researchers around the world continuously, the stages of SE don’t seem to be defined yet.• Some successful social entrepreneurs like Muhammad Yunus create a fundamental change in society (Bangladesh), but others stay with little result and financial difficulty on a self-employed scale.• Concept of stages of SE would indicate success factors for practitioners and researchers to find opportunity to tackle social issue, to develop social enterprise from individual-scale to society-scale, and to realize a sustainable society.• The research question would be to define five stages of social entrepreneurship, and to research its effect to SE development. 3
  4. Literature Review1. Non-profit perspective • Creating value and assessing performance -> Growing and exploring new directions (Dees, Emerson, and Economy 2002). • Mission Statement & Opportunity -> Innovation -> Product/ Services & Relations -> Business Model Definition -> Social Outcomes -> Social Transformation (Perrini and Vurro 2006). • Opportunity identification -> Opportunity Evaluation & Exploration -> Opportunity pursuit (Robinson 2006).2. Entrepreneurial perspective • Eckhardt and Shane clarified the role of opportunities in the entrepreneurial process (2003). • Moroz and Hindle demonstrated that there is an urgent need to synthesize what can be taken from the extant body of entrepreneurial process models as one component of a concerted attempt to derive and test what might be called a “harmonizing” model of entrepreneurial process rather than a “unifying” model (2011).Overall, we can assume social entrepreneurial processesdefined by these authors can be improved more to explorekey success factors by mission-driven approach. 4
  5. The comparison between For-profitEntrepreneur and Social Entrepreneur Source of Top priority of Motivation the enterprise For-profit Maximizing ProfitEntrepreneur Profit (If it can pay tax, then it is good for society.) Social Social SolvingEntrepreneur Issue Social Issue 5
  6. Methodology - 5 Stages of Social Entrepreneurship Model -• Social mission creates opportunity to solve social issue and economic value.• Size of Social Entrepreneurship (SE) activity (opportunity) grows according to stages. Contribute to Individualized Organized SocializedOpportunity Sustainability Activity Activity Activity of Society 6
  7. Case Study from Ashoka DataBase - NPO Teach for America -• Social Entrepreneur: Ms. Wendy Kopp• Field of work: Education• Social Issue: Education gap• Mission: “One day, all children in the U.S. have the opportunity to attain an excellent education.”• Business Model: TFA gathers donation from donors/ foundation, then, sends TFA teachers to public schools in poverty area in US. They teach at least 2 years. Budget: $143M in 2009 (Source: Ashoka Fellows Database).• Operation: “Best of the best” recruiting, fundraising, IT investment, training, and reporting, etc.• Ranked #1 of “America’s Ideal Employers” in 2010 (#3 in 2012), surpassing Google, Apple, and Microsoft. (Source: UNIVERSUM, http://www.universumglobal.com/US- Undergraduate-Rankings) 7
  8. Methods for Data Collection• Checking Ashoka Fellows Database• Interviews in 2 TFA schools and HQ• On-site observations 8
  9. (1) Opportunity• Opportunity is to recognize social issue and to start social entrepreneurship. Mission creates opportunity.• TFA Case: “The moment that opened her eyes, she says, was when she witnessed her undergraduate roommate from the Bronx struggling with the academic pace of the college despite being “brilliant,” while their next door neighbors who had attended prep schools were calling Princeton a “cakewalk.”” (Ashoka, http://www.ashoka.org/fellow/wendy-kopp ) Success Factors: She/he will start volunteering or small business to make it happen with strong will. 9
  10. Mission expansion for Social Change (TFA case) Society (Culture, Industry, Policy Sector) Citizens / Corporations which collaborates with TFA Supporters / Alumni of TFA NPO (TFA) Social Mission by Wendy Kopp 10
  11. (2) Individualized Activity• Social entrepreneurship activity by a person. Because it is a small personalized activity, it is difficult to spread rapidly. Social business opportunity is also for an individual; the wage, eventually sustainability, is low.• TFA case: “She developed the concept as her thesis, and despite little reaction from others, felt that the idea was so important that she kept pursuing it.” (Ashoka) Success Factors: Pursuing team-building / alliance, Utilizing management resources (money, person, etc.) by strategy and leadership. 11
  12. (3) Organized Activity• Social entrepreneurship activity is organized because of team building / alliance. It starts to spread rapidly with right staffs. Social Business Opportunity gets bigger; right people hired, trained, and Human Resource / Fundraising Strategy executed.• TFA Case: “Teach For America teachers go through a rigorous recruiting process, and if selected, participate in a summer-long training program after which they are placed in some of America’s poorest schools and perform two years of teaching service.” (Ashoka) Success Factors: Hiring right people, Sharing mission among organization through training, Strategy execution by teamwork, Evaluation. 12
  13. (3) Organized Activity- The Elevator hall for TFA staffs at TFA HQ -TFA mission is always shared among staffs 13
  14. (3) Organized Activity - Students in a TFA Charter School - “2023 is the year whenthese students will graduate college. “ (a TFA staff) 14
  15. (3) Organized Activity - Evaluation - TFA “What the Research Says” TFA Annual Report (2010)https://www.teachforamerica.org/sites/default/files/ http://www.teachforamerica.org/assets/documents/ Research_on_Teach_For_America_2012_1.pdf 2010-annual-report.pdf 15
  16. (4) Socialized Activity• Social entrepreneurship activity to solve social issue with society scale. Misson-shared people will play a key role in society to realize the SE mission. Culture, Industry, Policy Sector will change (Social Change).• TFA Case: “Approximately 65 percent of Teach For America’s participants decide to remain teachers or move on to become principals, school board members, or education sector planners and public policymakers... the majority of alumni, such as Michelle Rhee, the Chancellor of Washington D.C. schools, are staying in education, many of them taking dramatic steps to transform the education system.” (Ashoka) Success Factor: Social Impact (culture / industry / policy change), Evaluation 16
  17. (4) Socialized Activity - Mission Expansion among Society - • Alumni of SE have a crucial role as those of McKinsey do. • Alumni who hold and cherish the SE’s mission, then she/he will expand it among society. “The 100 MostInfluential People in the World” (TIME) Mr. Kevin Huffman Mr. Bill Draiton Ms. Cami Anderson Ms. Kanoko Ohishi (Tennessee State Education (Founder & CEO, Ashoka) (Social Entrepreneur) (CEO of MEDIVA, Japan) Commissioner) 17
  18. (5) Sustainability• Contribute to Sustainability of Society (Industry, Culture, Policy-making): Socialized Activity creates outcome to solve the social issue and contribute to fix our society.• TFA Case: “(Teach for All) works to support the development of Teach For America’s model around the world by increasing and accelerating the impact of independent social enterprises that enlist their nation’s most promising future leaders in addressing educational need.” (Ashoka)• Success Factor: Mission-driven operation with leadership, Hiring right people, Policy-making, Evaluation 18
  19. Findings(a) Mission make it possible to grow SE from individualized activity to well-organized, and socialized activity.(b) Alliance with (local) government or policy proposal facilitates SE to be a socialized activity.(c) The domain of public sector, private sector, and citizen sector will be integrated in the future. Social Entrepreneurs are nothing special then. All jobs will pursue common good. 19
  20. Limitations & Conclusions• Top priority is the key to define Social Entrepreneurship as our research.• We need to research other cases than TFA to check the feasibility of the model of 5 stages of social entrepreneurship. 20
  21. Discussions• What do you think about the comparison between for-profit entrepreneur and social entrepreneur?• What do you think about the 5 stages of social entrepreneurship for future improvement?• What do you think about the success factors in the stages of social entrepreneurship? 21
  22. References• Dees, G. (1998). The meaning of “Social Entrepreneurship”• Dees, G. & Anderson, B. B. (2006). Framing a theory of social entrepreneurship: building on two schools of practice and thought• Dees, G. Emerson, J. Economy, P.(2002). Strategic tools for social entrepreneurs. Wiley.• Mair, J. Robinson, J. Hockerts, K. (2006). Social Entrepreneurship. Palgrave Macmillan• Moroz, P. & Hindle, K. (2011). Entrepreneurship as a Process: Toward Harmonizing Multiple Perspectives. Entrepreneurship Theory and Practice.• Rose, S. Ackerman. (2005). Competition between non-profits and for-profits: entry and growth. Voluntas Volume 1, Number 1, 13-25• Kerlin, J. A. (2006). Social Enterprise in the United States and Europe: Understanding and Learning from the Differences.Voluntas Volume 17, Number 3, 246-262• Churchill, N. & Lewis,V. (1983). The Five Stages of Small Business Growth. Harvard Business Review.• Bloom, P. & Dees, G. (2008). Cultivate your Ecosystem. Social Innovation Review. Stanford University.• Sherman, D. (2005). Social Entrepreneurship: Pattern-Changing Entrepreneurs and the Scaling of Social Impact• Eckhardt, J. & Shane, S. (2003). Opportunities and Entrepreneurship. Journal of Management. 22