Social enterprise is the business model used to create a social value marketplace and provide the economic foundation for healthy and inclusive communities. We often refer to social enterprise as a verb, as a route to a desired end.
With that design and goal in mind, we realize our biggest challenge is not the oft mentioned, ‘get to scale’ expectations. But in fact the real social enterprise challenge is the threat it poses to the current dominant economic system. Rather than designed to extract private capital for shareholders, social enterprise is designed to contribute and build wealth and capital within the community.
The last 300 years of a purely economic based marketplace has become the dominant culture and practice of business. Social enterprise disrupts that traditional model by focusing on building a new culture and practice based upon accruing social values and community held capital.
And recently our real challenge was eloquently expressed in an episode of Downton Abbey.
Downton Abbey is a television show set in England 100 years ago, and watches the transition of an aristocratic family within the dramatic social and cultural reforms of the time. Violet Crawley, Dowager Countess of Grantham, or ‘granny’ is the matriarch of the Crawley Family, and spokesperson and protector of all things traditional. Granny epitomizes resistance to change when she says: “A peer (royalty) in favour of reform is like a turkey in favour of Christmas!”
I think we can understand the fundamental message from Granny’s viewpoint: the dominant ‘social and economic system’ will not engage in and change or innovate if the change is not directly serving their perceived needs, or protecting and serving their current status and values. Why would an aristocrat wish to share property ownership with the tenants or share decision-making with the peons? Obviously, no more than a turkey would wish to convey its own death sentence by celebrating Christmas dinner!
How does this principle of ‘peers and turkeys’ apply to the potential growth of social enterprise? Because one view is that social enterprise directly challenges the dominant business model of private wealth generation and shareholder supremacy.
While trying to build a social value marketplace we are challenging the dominant market culture and behaviours of solely using a financial measurement of success.
But let’s take a step back and consider; do we in truth aim to undermine the historic foundation in its entirety through social enterprise? Or do we seek real growth in a preferred model of socially enterprising economy and a social value marketplace?
On the macro scale, there might indeed be the opportunity to use an “economy of choice” to influence the dynamics of the hitherto established economy, for consumers and service users looking for a grounded and value adding alternative.
Social enterprise, seeking to use a business model to create social impact, challenges the standard business model value to maximize financial return. And this challenge to the standard model can bring social enterprise as a principle into conflict with those of the traditional “school”. Or – we can identify a space of influence and voice, bring a demonstrable alternative and model an economy “of moderns”….as Downton’s Granny might have said! We know that today’s society does indeed identify increasingly with the need for a more modern way.
Building business skills in the social sector and social values into business schools turns traditional curriculum and learning models upside down. This can but doesn’t have to bring conflict – and it certainly does bring innovation through social enterprise – most often at a furious, exciting pace.
When organizational purchasing seeks to include a social value in the decision making process, it challenges the merits of merely getting the lowest price possible. Social enterprise introduces “modern”, added value and sustainable dimensions into the marketplace; values which multiply and propel whole communities, and their enterprises forward.
So whilst there is a real challenge presented by social enterprise to the traditional economy, should we lift our eyes from that page and see also the opportunity that sits alongside it? And use the innovation so innate within our sector to craft and strongly shape the social economic platform that inspires and dramatically shifts the traditional economy, levering all the opportunity that such a position affords?
Granny didn’t foresee or appreciate the global crises of 2008, neither its causes nor its aftermath. But today’s society does indeed identify increasingly with the need for a more modern way in the wake of these economic tsunamis and ongoing social crisis.
In 2016, consumers, service users and institutional purchasers are increasingly highly discerning. They are actively seeking value. They are actively seeking a value added choice. They know about and look for social and environmental sustainability.
So is the real challenge in fact, right back to our social enterprise community, and for us to provide the resilient avenues and real time alternatives for these choices to be fulfilled?
David LePage, Principal, Accelerating Social Impact CCC
Rachael McCormack, Director, Lanarca