Structural implications for social enterprise sustainability: an international comparative analysis.
Interest in social enterprise is rising internationally as policy makers increasingly view them as an alternative model for service delivery (Defourny & Nyssens 2010). However the conceptualisation of social enterprise varies with context and perspective (Teasdale 2012) resulting in the emergence of a range of organisational legal models (Galera & Borzaga 2009). Moreover the theoretical underpinning of social enterprise in terms of the nature of the relationships and networks important to their success remains limited (Seelos et al 2011). This study incorporated Social Capital Theory to examine how the relationships of alternative social enterprise models influence their sustainability.
The research used a concurrent, convergent mixed methods approach on a sample of 93 social enterprise leaders using surveys and face-to-face interviews. The participants were sourced from a cross-section of social enterprise organisational types from urban and regional locations in Australia and Scotland, allowing for comparative analysis.
Building upon prior findings the results suggest that regardless of organisational form, collaborative networks, resourcing, organisational capabilities and legitimacy are important factors in the success of social enterprises (Sharir et al 2009). However, the research reveals an overarching growth orientation as the dominant factor in the strategic management for sustainability of these ventures. This growth orientation is shown to be generally associated with a strategic intent to achieve profitability. Thus social enterprise leaders, irrespective of organisational type, view a commercially focused growth orientation as an overarching factor that underpins sustainability.
The results also provide insights into the relationships of social enterprise leaders, identifying a mix of strong and weak ties suggesting strategic potential for social ventures (Burt 2001). However important variation is revealed according to social enterprise type, indicating that there is not “a one size fits all” approach. To unlock the potential of such networks requires an understanding of their varied nature as well as the ability to develop and execute appropriately aligned strategies (Adler & Kwon 2002).
Although collaborative networks were shown to be important in accessing resources, the results identify that collaboration is more likely amongst Not- for- Profit social enterprises. Moreover, despite social enterprise leaders exhibiting high levels of trust, this is shown to have no effect on the growth of social ventures irrespective of organisational type. Hence the value-driven trust apparent across the sector is seemingly not being channelled towards sustainability.
Furthermore disparity in the levels of external support available to different social enterprise types was also evident in the results. Hence the study suggests that organisational structure is of significance to social enterprise sustainability. This leads to a number of research opportunities. For example research could be extended to include other organisational forms such as co-operatives and/or additional countries to broaden the analysis. Further exploration of the relationship between structure and growth would be beneficial. Similarly research examining how social enterprises can better leverage their social capital to create collaborative alliances and what role should government play in this process could assist practitioners and policy makers.
Keywords: Structure, sustainability, networks.
References
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Defourny, J & Nyssens, M 2010, 'Conceptions of social enterprise and social entrepreneurship in Europe and the United States: convergences and divergences', Journal of Social Entrepreneurship, vol. 1, no. 1, pp. 32-53.
Galera, G & Borzaga, C 2009, 'Social enterprise: An international overview of its conceptual evolution and legal implementation', Social Enterprise Journal, vol.5, no.3, pp. 210-28.
Seelos, C, Mair, J, Battilana, J & Dacin, T 2011, 'The Embeddedness of Social Entrepreneurship: Understanding Variation across Local Communities', Communities and Organisations, vol. 33, pp. 333-63.
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Teasdale, S 2012, 'What’s in a Name? Making Sense of Social Enterprise Discourses', Public Policy and Administration, vol. 27, no. 2, pp. 99-119.
