Innovation in Social Entrepreneurship (1)

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Development Economics

Innovation In SocialEntre reneurshi

Presented toProfessor Hugo Ruiz

Prepared by

Macky ChorgheKatherine Naud

Theresa Krupka

April 9, 2014


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TABLE OF CONTENTS

1. INTRODUCTION......................................................................................................... 3

2. CONCEPT OF SOCIAL INNOVATION ................................................................... 4

2.1PARADIGMS IN DEVELOPMENT COOPERATION........................................................... 4

2.2SOCIAL ENTREPRENEURSHIP VSOTHER PARADIGMS................................................ 6

2.3CHALLENGES IN SOCIAL ENTREPRENEURSHIP............................................................ 7

2.4NEGATIVE CRITICS FOR SOCIAL ENTREPRENEURSHIP.................................................. 8

3. DIFFERENT OPINIONS IN SOCIAL ENTREPRENEURSHIP ........................... 9

3.1FOR-PROFIT ANDNOT-FOR-PROFIT:TWO MASTERS? ................................................ 9

3.2UNCLEAR EXPECTATIONS FOR TRANSPARENCY....................................................... 10

3.3IMPACT OR CLEVER MARKETING? ........................................................................... 113.4NAIVETY.................................................................................................................. 12

4. CURRENT TREND IN THE FIELD OF INNOVATION IN SOCIAL

ENTREPRENEURSHIP ................................................................................................ 14

4.1EVOLUTION OF SOCIAL ENTREPRENEURSHIP............................................................ 14

4.2CURRENT PRACTICES............................................................................................... 15

4.3ROLE OF TECHNOLOGY IN SOCIAL INNOVATION...................................................... 15

4.4SOCIAL ENTERPRISES AND INNOVATORS.................................................................. 174.4.1 ASHOKA: Innovators for the public formed by Bill Drayton .......................... 17

4.4.2 Grameen Bank: Muhammad Yunus ................................................................. 18

4.4.3 TOMS: Blake Mycoskie .................................................................................... 18

5. CONCLUSION ........................................................................................................... 19

BIBLIOGRAPHY ............................................................................................................................... 20


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Innovations in Social Entrepreneurship

1. Introduction

We are in a world that is changing: the population is growing, the urban regions are

taking more space than rural areas, the poverty gap is getting bigger in certain cities and

we know we will soon or later face the scarcity of natural resources. Social

entrepreneurship tries to respond to these issues, usually concentrating more on issues

like lack of education, poverty, hunger, bad health system, etc. through innovation. Social

entrepreneurship is viewed as a process that catalyzes social change and addresses

important social needs in a way that is not dominated by direct financial benefits for the

entrepreneurs (Mair & Marti, 2006). It requires a unique kind of individual; this

individual must be driven, innovative, creative, resourceful, and inspired by the desire to

improve their community. The traditional entrepreneur must discover a gap in the

market for a product or service that its target market desires or will desire. A social

entrepreneur however, must also do this and, in addition, must seek to fulfill a need that

is socially fulfilling and that seeks to improve society as a whole. The beauty of social

entrepreneurship is that it encourages the innovative entrepreneur to tackle the tough

social problems that the government and other efforts have failed to aid.

The focus of todays society has shifted into this perspective that we must not work to

improve our lives, following the survival of the fittest mentality, but rather we should

consider how our actions might affect others. Small business, as an example, are now

considering their impact on the environment; many have started to use environmentally

friendly packaging, encourage recycling by both staff and customers, and support local

community efforts to improve the areas in society that need the help. This is only the

beginning of the social entrepreneurship movement. Not only are businesses starting to

consider their impact on their environment, but also businesses are forming based solely

on the idea that they must strive to help others. The challenge is not in finding a cause,

but rather in gaining access to the capital and resources necessary to make a business

successful, and profitable. For some, this challenge was overcome, and their success is in

their story. In this document, we will explore more about the concepts of innovation and


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social entrepreneurship and its evolution, but also see some other types of nonprofit and

for-profits organizations, challenges that the industry of development cooperation is

facing, opinions and critics about social entrepreneurship, current trends and what are

doing the agencies in the field of development.

2. Concept of social innovation

What is social innovation? There are as much definitions as people that analyzed its

concept! Here is one of them: a new idea, product, service or model that simultaneously

meets social needs and creates new social relationships or collaborations. Social

innovations are not only important for the new specific solutions to societal needs, but

they can furthermore impact on society's capacity to innovate. We will later explore

different examples of social innovations and social entrepreneurship enterprises.

Interestingly enough,the success of several entrepreneurs shows us that there is a strong

connection between the concept of seeking for opportunities and creating innovation. In

the book of John Bessant, Innovation and Entrepreneurship (Page 6), we learn that

innovation is driven by the ability to see connections to spot opportunities and to take

advantage of them. The more we seek opportunities, the more we are aware of what the

market looks like, the more we find new contacts, share ideas and create innovation. This

definition of Mr. Bessant can also be applied to social entrepreneurship.

2.1 Paradigms in Development Cooperation

It might be interesting to take a look at the market of development cooperation, in which

social entrepreneurship is evolving. We can provide several different types of help when

it comes to development cooperation. Usually, the origin varies from public initiative to

markets. First, there is the Official Development Aid, involving institutions like OECD,

UN, World Bank, national administrations, bilateral aid agencies, etc. They mainly do

promotion and encourage economic development of developing countries. Trade and

investment is another paradigm in development cooperation that does not only include

importations and exportations, but also be made through foreign direct investment.


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Foreign Direct Investment is an amount of capital invested in the private sector of a

foreign country. An example of that could be an American multinational enterprise that

would create a subsidiary in China in the goal of taking advantage of a lower cost of

labour. A third paradigm is the emigrant remittances, which are an amount of money that

an emigrant (usually working in a developed country) sends to his family (generally

located in a developing country) in order to help them to afford basic needs. The numbers

are impressive: worldwide remittance flows are estimated to have exceeded $414 billion

in 2009, of which developing countries received $307 billion. More specifically, here is

a 2009 chart stating top 10 countries that received emigrant remittances, by percentages

of their GDP:

FIGURE 1: Top 10 recipients of migrant remittances

Figure 1. Top 10 recipients of migrant remittance. Adapted from the World Bank. Retrieved fromwww.web.worldbank.org.

Then, the philanthropy is also a very traditional and popular way to contribute to

development cooperation; it is also sometimes call social investment. A good example of

philanthropy is the Bill and Melinda Gates Foundation, where millions of dollars are sent

every year to developing countries in order to improve health and poverty conditions.

There is also the Corporate Social Responsibility (CSR), which means how does a
http://www.web.worldbank.org/http://www.web.worldbank.org/http://www.web.worldbank.org/


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company includes the triple bottom line (economy, society and environment) in its

strategy in order to have a positive impact on society while growing and making profits.

These companies usually also have to take in account legal constraints, for example:

making sure they leave the land the way it was when they bought it, etc. The Bottom Of

the Pyramid (BOP) is another interesting paradigm, where we consider a poor person as

potential consumers. This theory might change the way we do development markets

because there are over 3 billion people living on less than 2.50 $ per day, which opens a

larger marker than traditionally. Different well-known companies have already adopted

this strategy, for example Danone, Unilever, etc. And finally, we have NGOs, also called

non-profits that are organization that financially depends on public funds and charity in

order to do projects for developing countries.

2.2 Social Entrepreneurship VS Other Paradigms

Even if all these different forms of aid had contributed to improve the conditions in poor

countries, we could do some critics about them, compared to social entrepreneurship. For

example, while today's companies engage in corporate social responsibility, they have

limited flexibility and are often unable to deliver high impact results. Also, corporate

social responsibility is a lot more accessible to big companies than SMEs. However,

large corporations primarily contribute by means of philanthropy as opposed to

sustainable business. Additionally, regarding our current model of philanthropy, while

having certain uses, has limited impact as compared to social entrepreneurship. And

finally, NGOs dont create value, they depend on help coming from public funds or

charity from private sectors, which can vary from a year to another. Social

entrepreneurship, on the other hand, have long lasting impact as they do not rely on a

donation model, but actually create their own revenue to sustain the business. Here is an

interesting chart that put in relation nonprofits and for-profits enterprises, which will be

explained later in this document.


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Figure 2:Profit and Non-Profit view of Social Entrepreneurs

Figure 2. Profit and Non-Profit view of Social Entrepreneurs. Adapted from Technology InnovationManagement Review by A. Saifan, February 2012.

2.3 Challenges in Social Entrepreneurship

When we work in social entrepreneurship, we meet a lot of challenges in every project.

As we have seen in the project cycle management, there are different steps to follow

when we do a project and they may involve challenges. First, it is difficult to know the

market or to have data about for whom the project is for; we call it a hidden population.

That is the case of drug addicts, sex workers, illegal immigrants, etc. Then, another

problem for social enterprises is that we also have to make sure the projects meet some

basic criteria as being effective and efficient, relevant, having an actual impact, etc.

During the implementation phase, a lot of external constraints are also generally met

when it is time to implement the project in a developing country: bad governance and

corruption, poor infrastructures, lack of help on site, etc. One the main challenges,

according to us, is to make sure the project that is done (or the enterprise that is created)

is sustainable. After the project has been implemented, the source of money stops coming

in, but the impact still needs to continue. Finally, another challenge that could meet social

entrepreneurship is the difficulty to evaluate and audit their impact. In fact, it is difficult

to measure qualitative data like when it comes to social issues.


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2.4 Negative critics for social entrepreneurship

While social entrepreneurship is a buzzword nowadays and a very popular concept that

people have a lot of faith in, it is not completely flawless. Mat Despard, teacher of

nonprofit management at School of Social Work at the University of South Carolina

(USA), raised few negative critiques about social entrepreneurship that could help us

pounder. According to him, social entrepreneurship would promote to elevate the

individual (the entrepreneur) more than the team behind him that worked hard to

implement the project. The second critic was that there is poor economy of scale,

generally because social entrepreneurs of often too young and not enough experimented.

This results in the need to raise unrestricted revenue to build infrastructure book

keeping/accounting, program evaluation, information systems, etc. albeit with pooreconomies of scale. Energy and resources get diverted from problem solving to

organization building. The third critic is that, even if the social entrepreneurship

companies are very innovative, they are not recognized enough and their ideas are not

heard. He says: I hear about and interact with organizations in developing countries

with very innovative ideas that routinely go unheard. Another critic is that social

entrepreneur tends to lack of evidence to prove their ideas, as many of them are largely

untested. Its great that these ideas represent new approaches to tackling social

problems, but promotion of these ideas tends to be far out in advance of sufficient

evidence that they merit promotion as the next big thing. Having a commercial

assumption would be another critic we could say. According to Mr. Despard, a strong

bias exists in favor of commercial approaches to addressing social problems, but often

public or private subsidies are needed to catalyze change. The last critic raised by him is

that some social entrepreneurship project lack of ethical framework. Because of the

attention that a social entrepreneur would receive for his ideas, he might be seen as a

desired activity or way of being, not as a tool (among other tools such as political

advocacy and grassroots organizing) to be used to advance human rights. These critics

are a subjective opinion that might help us to ponder, but that still need to be put in

context and are not necessarily generalized in the social entrepreneurship field.


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3. Different Opinions in Social Entrepreneurship

3.1 For-Profit and Not-for-Profit: Two Masters?

Social enterprises could completely transform the way business transform the world.

Before social entrepreneurship, there were two types of enterprises: (1) for-profit

enterprises, in which the primary objective was to make a profit, and (2) not-for-profit

enterprises, in which the primary objective was to fill a social or environmental need.

Social entrepreneurship seeks to fit comfortably into both types. Social enterprises make

a profit and fill a social need, a double bottom line.

However, not everyone agrees on how to fulfill this goal. The existing system is designed

for the previously mentioned types of organizations. Questions arise. Should social

enterprises be classified as for-profit or not-for-profit organizations?

If social enterprises seek private or public ownership, they cannot file as nonprofits.

Nonprofits have no owners, and therefore, no shareholders. This means that all profits

must fund the mission. While this system can work well for charities, it interferes with

the social entrepreneurs goal to create a fundamentally beneficial organization that

generates profit. Further complications arise with the transparency required for not-for-

profits. Such transparency is not required for normal businesses and can lead to conflict.

An example of such conflict involves Kiva, a micro-lending website that encourages

individuals to lend small amounts of money to people who need it. According to the

Harvard Business Review, their advertisements create the illusion of person-to-person

giving, which fosters donation, even though the funding process is much more complex.

A normal business could be forgiven for such simplification, but nonprofits are held to a

higher standard of transparency, thus creating controversy. Kiva is willingly transparent,

but in this way threatens the very mission that it is trying to fulfill. Would Kiva and other

such enterprises have an easier time if they filed as for-profit companies?

On the other hand, for-profit social enterprises must play a careful balancing game.


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They have responsibilities to both shareholders and stakeholders and must be certain not

to shortchange either. This requires talent and commitment from the organizations

leaders, especially in times of controversy and change.

According to Nonprofit Quarterly, Some say the distinction between for-profit and

nonprofit is overrated. In other words, social enterprises could theoretically file as either

one and still serve their function. The article continues, However,when we look at the

issues of ownership, transparency, and profits, we see that the distinction between

nonprofit and for-profit is fraught with questions of democracy, responsibility, and the

highly subjective concept of social good. Those details (ownership, transparency, and

profits) immensely affect how an organization works, especially when it is still starting

out.

For these reasons, the way we see social enterprises may be changing. Instead of having

to choose whether to be considered nonprofit organizations or for-profit companies, some

have proposed a new legal form that more closely matches the dual goal of social

enterprises: Community Interest Companies (CIC). This would combine features of a

company with features of a charity.

3.2 Unclear Expectations for Transparency

Transparency means different things for nonprofit and for-profit organizations.

Businesses are generally required to post their financial statements, whereas nonprofits

must also make public information about exactly where donations go and other more

specific information. This makes a radical difference between nonprofit social enterprises

and for-profit social enterprise because public expectations radically change. However, as

social enterprises enter the picture, so do new expectations about transparency across the

board. The dualism that used to be seen in business types is replaced by a spectrum of

models, and the dualism that used to be seen in transparency expectations is replaced by

stronger expectations of transparency for every type of business model.


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According to the ASAE Center for Association Leadership, Transparency is being

hailed as the new competitive advantage, and "trustworthiness" is the new mantra for

leadership both in and out of the nonprofit sector. Therefore, it is becoming more and

more necessary that social entrepreneurs embrace this mindset. Where does this stronger

expectation come from? According to the article, technology. Technology in the form of

the Internet, social media, and organization websites, has both created the expectation

and also produced the tools to deliver greater organizational transparency. It makes

sense.

Organizations are jumping in. Buffer, a social media sharing company, has revealed its

pay structure, including the salary of its CEO, according to The Guardian. And Everlane,

a clothing vendor, includes precise details on its website, from which factories producedwhich clothing to the waist size of the model and the size shirt shes wearing. This new

trend is likely to grow, instead of disappear, and it is in this environment that social

enterprises must develop.

The information that social enterprises share in order to be transparent will not always

help their image. In fact, it can threaten to destroy them. Kiva, a micro-lending

organization, has been attacked for misleading advertising. This attack is only possible

because Kiva proactively makes itself and its operations transparent. Over time, however,

Kiva saved its reputation and today continues its mission. Transparency requires

authenticity and willingness to respond. This will be a new valuable skill for all business

leaders, including social entrepreneurs.

3.3 Impact or Clever Marketing?

Social entrepreneurs face another challenge when developing and implementing their

social enterprises. First they must maintain a balance between service and profit, then

they must clearly transmit their deeds to the public, then they must monitor the way in

which they advertise.


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Monitoring advertisements is very important, especially for the reasons described with

Kiva. Managers must also remember their ethical responsibilities as leaders to fulfill their

missions without misleading or taking advantage. The Fair Trade label, for example, is an

attempt to alert consumers to products that humanely treated everything and everyone

involved in production. Many argue, however, that the increased price on these products

is unnecessary. If people are still willing to pay these prices, then companies can get

away with price increases, but they should carefully weigh all the implications.

Another point to note is that when discussing social enterprise, social entrepreneurs can

learn from both charitable and profitable organizations. Each of these models lends

experience that can help the social entrepreneur as this new sector further develops.

3.4 Naivety

Social entrepreneurship is not a new concept, but it has only become popular in the late

twentieth century. As a new type of organization in practice, this sector is especially

prone to certain types of naivety in regard to: current efforts, ethics, and public reception.

According to professor Neil Edgington, Too oftenaspiring (and usually young) social

entrepreneurs assume they need to start their own organization. This assumption comes

from two sources, which both include a lack of research. The first source of this

assumption is lack of knowledge of current projects. When a social entrepreneur comes

up with a mission, he often skips the step of seeking out other organizations that are

already serving the same mission. When he skips this step, he destroys opportunities to

partner with the existing organization and instead must spend precious donations or

investment capital on creating an entirely new organization. In this way, instead of

creating a large economy of scale, the mission is now scattered into many organizations

that are trying to serve the same people without streamlined operations.

The second source of this assumption is lack of research into proven methods. In the field

of social entrepreneurship, innovation is welcome. This innovation, however, should be


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carefully backed by previous research and planning. If not, the entrepreneur risks wasting

donors and investors money on a model that will not work.

A third assumption is not necessarily part of an entrepreneur's decision to begin a social

enterprise, but he should consider before beginning that one insufficient reason to start a

new organization is pride. Without proper research, planning, or commitment, an

entrepreneur can seek to build a social enterprise for self-serving reasons. This ultimately

causes the mission to suffer, and is not a sufficient reason to begin a project.

Social enterprises can also fall prey to naivety in regards to ethics. Because of social

media, big names in social enterprise can become very famous and highly praised. We

have previously discussed the ethical considerations of blending for-profit and nonprofitbusiness models. Now, however, let us consider the ethical implications of new social

enterprises. Like any new organization in a fragile environment, new social enterprises

can drastically throw off the current system balance. For example, Toms may supply

shoes to a community that needs them, but this could put the local shoemaker out of

business and unable to provide for his family. This is a consideration that the company

should take before flying into a new area.

In a similar vein, social entrepreneurs should not think of themselves as the cure for an

impoverished population. Ultimately, outside forces providing for a local community is

an unsustainable way to live. The best social enterprises are ones that empower the local

population to improve their own situation. A social enterprise should eventually be able

to hand off its work to the local people.

Finally, many social entrepreneurs can enter a naivety with public reception. Just because

they have good intentions does not mean that their work will be praised. People will

almost always be able to think of more direct ways to help somebody with their money,

and many people have not adjusted to the idea that a profit-making business can also help

people.


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If social entrepreneurs consider each of these points when planning their businesses or

organizations, they may be able to avoid much of the costly ignorance that can come

when a lot of passion for a cause is not matched by research.

4. Current Trend in the field of Innovation in Social Entrepreneurship

The concept of Social Entrepreneurship is not a famous idea, but it has recently

become famous amongst researchers and society. After the publication of the famous

read The Rise of Social Entrepreneur byCharles Leadbeater, activities related to

societal development falls under the category of Social Entrepreneurship. Even though

the term Social Entrepreneur is a modern term, the people who strived to transform the

society can find its rubric way back in the late 19th century. However, the current trendfocuses on socio-economic practices that balance earning profits and non-profit change

for the community.

4.1 Evolution of Social Entrepreneurship

Social Entrepreneurship is relatively a new term. It came into notice just few decades

ago. But its usage can be found throughout history. It is a result of a great contribution of

brilliant social workers that took the initiative to directly confront social needs through

their products and services rather than indirectly socially responsible business practices.

It all started in 1840, when the workers cooperation was set up in Kochdale to provide

high quality affordable foods in oppose to highly processed factory foods. There were

several social entrepreneurs whose main intention was to bring positive change in the

society. An online blog titled Management Study Guide (History of Social

Entrepreneurship) provides us with some examples of the social enterprise even before

the term was known. This includes Vinoba Bhave, the founder of Indias Land Gift

Movement, Robert Owen, the founder of the first nursing school and the developer of the

modern nursing practices. They had established such foundations and organizations in the

19th century that is much before the concept of Social Entrepreneurship used in

management. In addition, there are many societies and organizations that work towards


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empowering child rights, women equality, sustainable environment and proper disposal

of waste goods. Along with societal development, social entrepreneurs also work towards

addressing the environmental problems and financial issues for rural and urban poor.

4.2 Current Practices

Nowadays, the concept of social entrepreneurship has widely been used in different

forms. The initiation of Grameen Bank by Muhammad Yunus, Ashoka: The innovator for

the public by Bill Drayton has spread the meaning of the term. In fact, all the well-

established firms are adopting the concept of social entrepreneurship and trying to

improvise the issues and problems in the society they are operating in. They try to

address the social issues by opening school in the remote areas, educating women for

family planning, giving access to finance to farmers and poor with low interests and

encouraging sustainable environment by going green.

Like most other organizations, non-profit and social entrepreneurs are motivated to

innovate. They are considered as innovation-centric. Many social entrepreneurs are

utilizing a hybrid and sophisticated business model that combines revenue, borrowing

and donations. They make use of unique set of strategies that will lead to incremental

Social Innovation. Social innovation is taking a wider step in the world as people

realized the need to work together to find solution to ever-lasting list of problems. New

initiatives are launched all over the place whether by research institutes, companies or by

independent organizations. Those engaged in social innovation apply their own definition

of social innovation, but all definitions have one goal in common: working together

towards a sustainable society. Social innovation has an inter-sectorial approach and is

universally accepted. In addition, it focuses on new work and new forms of cooperation.

4.3 Role of Technology in Social Innovation

The birth of social entrepreneurship was sandwiched by the entry into modern society of

the mobile phone and the personal computer, the two invention that have revolutionized


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an individuals relationship with their devices. This has led to the current reality where

digital technology influences all aspects of our professional lives. As children of the same

era, it is not surprising that social innovation and technology are interacting with each

other in constant, often profound, and ever deeper ways. Technology is imperative to the

success of the social entrepreneur. Technology simplifies processes, allows access to

broad databases of resources, and even assists in reducing costs to the entrepreneur.

Technology can be used to promote the social enterprise at a reasonably low cost, and is

requisite in a society whose main medium of communication is through the web.

The path to innovate society is to find a necessary solution to many diverse issues.

Integrating these issues by promoting social infrastructure to sophisticated technology.

Hiroki Nakanishi, the president of Hitachi Ltd. (March 2013) highlighted that, the worldis issues such as chronic traffic congestion, environmental pollution, global warming and

depletion of energy resources. Hitachi is working towards to make business and life more

comfortable by enhancing social infrastructure through information technology. The

figure 3 below explains how can we make social innovation a reality through social

infrastructure and information technology.

FIGURE 3: Social Innovation Through Information Technology

Figure 3.Social Innovation Through Information Technology. Adapted from How Information TechnologyDrives Social Innovation by Hitachi Data Systems and Hitachi, Ltd., March 2013.


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The Internet technology allows for the pooling of design resources using open source

principles. These media allow ideas to be heard by broader audiences, help networks and

investors to develop globally, and achieve their goals with little or no start-up capital.

The rise of open-source appropriate technology as a sustainable development paradigm

enables people all over the world to collaborate on solving local problems just as open

source software development leverages collaboration (Pearce, 2012). One of the best

example of the same could be about the US-based nonprofit Zidisha leverages the recent

spread of internet and mobile technologies in developing technologies to provide an

eBay-style micro-lending platform where disadvantaged individuals in developing

countries can interact directly with individual "peer-to-peer" lenders worldwide, sourcing

small business loans at lower cost than has ever before been possible in most developing

countries. Technology has just begun to integrate in the field on social innovation and

there is more scope for it to develop and assist in providing sustainable solutions to the

long-term social issues.

4.4 Social Enterprises and Innovators

They come from across the country, and serve a wide variety of communities. Some are

national organizations whose names are recognized; while others are smaller local

ventures. But they are all successful social enterprises. The following are some of the

social enterprises that exist in todays economy.

4.4.1 ASHOKA: I nnovators for the publi c formed by Bi ll Drayton

Bill Drayton founded the social enterprise named ASHOKA: The Innovators for the

Public in the year 1981. This organization is dedicated in finding the social entrepreneurs

in the world and giving them access to funds through its system of social venture capital.

This organization operates around 70 countries and support the network of 3000 social

entrepreneurs, some of which have gone on to develop leading social businesses that have

made a huge impact on communities around the world. Changemakers, Ashoka U, social


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venture, and full economic citizenship are some of the programs initiated by this social

enterprise.

4.4.2 Grameen Bank: Muhammad Yunus

Grameen Bank is a Nobel Prize winning micro-finance organization and community

development bank found in Bangladesh by the famous social innovator, Muhammad

Yunus. This bank provides micro-credit loans to those in need to help them develop

financial sufficiency. Founded in 1983, the bank has brought in a net income of more

than $10 million, and his work with his organization landed Yunus a Nobel Prize in 2006.

Besides micro-credit program, the organization also initiated Village Phone pragramme

(for women to provide wireless phone services in rural areas) and Struggling Membersprogramme (lending small loans to the beggars).

4.4.3 TOMS: Blake Mycoskie

TOMS is a company based in California, that operates a non-profit subsidiary, friends of

Toms. When TOMS sells a pair of shoes a pair of shoes is given to an impoverished

child, and when Toms sells a pair of eyewear, part of the profit is used to save or restore

the eyesight for people in developing countries. TOMS is also a very good example of

how technology can influence social innovation. Blake Mycoskie extensively used the

Internet in piloting TOMS shoes.

The above-mentioned social enterprises are few of the successful organizations, which

serve the needs for social change. There exists high number of similar organizations,

which are continuously dedicated in bringing improvements in the society. We perceive

that social change is taking place at a very slow pace with people still in poverty and

living without basic necessity; However, we should not forget that its a long term process

and someday this enterprises will reach their goal of making this world socially stable

and connected.


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5. Conclusion

The rise of technology and a new social mentality has created social enterprise, a new

form of organization somewhere between nonprofits and for-profits. Social enterprises

must face many challenges in starting up their organizations. Not only must they findinvestors that do not mind a focus on social work or donors that do not mind a profit, but

they must also continuously reevaluate their efforts to fulfill their missions, transmit their

efforts clearly to the public, and answer all the criticisms that will come their way.

Some successful examples of social enterprises include ASHOKA, Grameen Bank, and

TOMS, but these organizations have thrived in spite of criticism and challenges. Social

enterprises must research current needs, efforts, and successful methods. With proper,

careful balancing of profit and purpose, social enterprises can do a lot of good and may

become a sharpened tool good for the reformation of broken, forgotton parts of society

and the world.


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Innovation in Social Entrepreneurship (1)