Social Business in India, present and future

1. Social Entrepreneurship
Page 1

2. Why?......bcoz India is already
one of the biggest players….
• http://www.openaction.org/aylluinitiative/#
Page 2

3. • Muhammed Yunus - Social Business.mp4
Page 3

4. Page 4

5. Page 5

6. Page 6

7. What Is Entrepreneurship?
Process of creating value by bringing
together a unique package of
resources to exploit an opportunity
Page 7

8. Defining „social entrepreneur‟
– Development change agent working in the
market as an arena
– Innovative, opportunity-seeking,
resourceful person, group or institution
– Leads creation of enterprises, enterprise
systems or enterprise development
programs demonstrating positive
development impact
Page 8

9. The New Buzzword:
Social Entrepreneurship
So, is social entrepreneurship
basically entrepreneurship
regardless of the context?
Or is “social entrepreneurship”
something truly different?
Page 9

10. What Is Social
Entrepreneurship?
Nonprofits making money
Page 10

11. What Is Social
Entrepreneurship?
Nonprofits making money
For-profits doing things to show they
are not evil
Page 11

12. Nonprofits making money
What Is Social
Entrepreneurship?
For-profits doing things to show
they are not evil
Process of creating value by bringing
together a unique package of
resources to exploit an opportunity,
in pursuit of high social returns
Page 12

13. The only big difference between
commercial and social entrepreneurship:
Denomination of the returns
Social and commercial
entrepreneurship have most of the same
characteristics
Page 13

14. Do Social Entrepreneurs “look”
like Any Other Entrepreneur
Social concern, but also:
Innovativeness
Achievement orientation
Independence
Sense of control over destiny
Low aversion to risk
Tolerance for ambiguity
Page 14

15. Traits of a successful social
entrepreneur
• Willingness to self connect
• Willingness to share credit
• Willingness to break free of established
structures
• Willingness to cross disciplinary
boundaries
• Willingness to work quietly
• Strong ethical impetus
Page 15

16. The Main Difference: The
Measurement Problem
• What is bottomline? Economic profit?
Or something more?
• How do we count it?
• What is “social return on investment”
for venture philanthropists?
• Can we compare investments?
Page 16

17. Focusing on Social Impact
Social entrepreneurs are driven by a social
mission, implying that:
Success is defined by creating the intended
social impact, not simply by
Economic value creation for owners,
managers, and employees, or
Consumption value for customers
Success in achieving this impact is both
Hard to measure in timely, reliable, cost-
effective ways, and
Open to dispute due to value differences
Page 17

18. • Social Entrepreneurs_ Pioneering Social
Change.mp4
Page 18

19. So why does social
entrepreneurship matter?
Page 19

20. What Solutions do we have Today
• Government – alone is not the answer
– Inefficiencies, slow, bureaucratic, prone to corruption….
• Nonprofit Orgs. – inadequate
– dependent on donations (uncertain, demand far exceeds supply)
– “compassion fatigue”
– Raising money takes time and energy, which can be spent
planning growth/expansion
• Multilateral Institutions (World Bank…) - ineffective
– Conservative, slow, under-funded, unreliable
– Success is measured by
a) GDP (might not be helping poor)
b) Volume of loans negotiated (not measuring impact)
– Exclusively work with the government
• Corporate Social Responsibility – still evolving
– “as long as it can be done without sacrificing PROFITS”
Page 20

21. New kind of Business
Social Business Enterprise
– Creating business models revolving
around low-cost products and
services to resolve social problems
– Social business is for „more-than-
profit’ as it combine revenue
generating business with a social-
value-generating structure
– Have 2 characteristic
• Unlimited potential for scalability
• Limited capital requirement
Page 21

22. How can you do business and serve social goals?
Why is profit-making not conflicting with social objectives?
Profits -
– Promotes R&D, innovation, new technologies
– Increases efficiency
– Enables penetration to new geographical areas and serve
deeper layers of low-income people
– Helps recover costs and pay back investors, thus encourages
investments
PMBs (profit max. businesses) vs. SBs (social businesses)
How they are same yet different
– Employ workers, create goods & services for consumers
– Must recover full costs
– Profits are important
– YET objective is to create social benefit and not limited to
personal gains
Can there be a HYBRID i.e.
60% PMB and 40% SB??
Page 22

23. Page 23

24. Page 24

25. Social Entrepreneurship Is a
National Priority
• Continued prosperity requires private
solutions to social problems and
unmet needs
• Social ventures
• Private support for these venture
Page 25

26. Contrast with Business
Businesses also create social impacts, both
positive and negative, typically
– As unintended side-effects that
– Play a relatively minor role in
organizational decision making
Their social benefits result from an “invisible
hand,” not by design
Success is commonly defined in terms of
private value creation (usually profit)
Market discipline helps to reinforce private
value creation Page 26

27. Limits of Market Discipline
Social sector customer and capital markets
are less effective at ensuring intended
social impact as:
 Intended beneficiaries frequently do not
pay full cost
 Payers cannot easily assess the social
impact or the efficiency of operations
 Comparisons across organizations are
inherently problematic
 Rewards to resource providers are not
reliably correlated with performance
Page 27

28. Thus, Social Entrepreneurs . . .
Adopt a mission to create sustained positive
social impact
Relentlessly pursue opportunities to serve
this mission
Continuously innovate, adapt, and learn
Act boldly, not constrained by resources
currently in hand, and
Exercise self accountability for cost-
effectively serving the social mission
Page 28

29. Growing Need for MBA Skills
Used wisely business skills can:
 Create more sustained impact
 Shift philanthropic resources to more
appropriate uses
 Leverage those resources
 Improve financial strength and
capacity of social sector organizations
 Enhance efficiency and effectiveness
Page 29

30. MBAs Can Add Value, but….
It is crucial to
 Respect the work of those in your field
 Be sensitive to the limits of markets and
business methods
 Manage potential risks and challenges
 Prepare for resistance and skepticism
 Learn your chosen field well
 Consider blended /hybrid solutions
 Follow your passion! Page 30

31. Page 31

32. • TAPMI Leadership Lecture 2011 - Harish
Hande.mp4
Page 32