Entrepreneurship and New Venture Creation

Social capital is critical in the creation of skills and future careers. In every society, there are gaps that result from the development of different community structures. Social enterprises typically exist to fill the societal gaps. ENVIE and ACTIF were organisations that begun operations to provide skills and employment to the unemployed in the society.

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The Social Enterprises’ Operations

Bruno Lallemand is responsible for starting ENVIE organisation. He had been the coordinator of Emmaus community in Strasbourg, France. Lallemand and a few other social workers used to meet regularly to find a solution to the street families so that they may not become homeless. The community bought and sold refurbished refrigerators, ovens, and laundry machines (Becchetti & Borzaga 2010). The low-income members of the community were the primary clients (Carter 2012).

ACTIF started operations in 1995. The IBM France executives began to discuss the decision on how they would give back to society due to the economic downturn. They copied the model of ENVIE although with a different product. The redundancy programme in IBM France helped to start the project.

The affected staff started by collecting all damaged and old computers, refurbish them, and then resale them at a lower price (Gidron & Hasenfeld 2012). The retired executives thought that they could use their skills to serve the community through such an initiative.IBM France gave them the first grant to begin a feasibility study. The results indicated that primary schools, low-income individuals, and non-profit needed affordable computers. They could either be new or old ones. The partnership agreement with IBM France provided the management with free office space and access to free logistical services. They had to operate from the headquarters in Paris.

ENVIE served three purposes. It provided at-risk youths with employment, ready cheap equipment for the low-income families, and saved the environment by recycling used goods. It had a mission to save the people who could not secure formal employment by providing them with skills and jobs. Its activities were independent of Emmaus. It was also non-profit making organisation. ENVIE hired a professional technician to deal with the repairs.

ENVIE Strasberg became a social integration enterprise which could benefit from the public subsidy and grants. The organisation offered temporary job positions (Hillis & DuVall 2012). The primary purpose of these posts was to enable long-term unemployed people to learn some basics about work. The activity would allow them to advance towards more permanent employment in established companies. Spitz and Lallemand were in charge of the hiring, opening units, and ensuring stability. After each site they started, they replicated the idea to another branch.

ACTIF was a non-profit independent organisation. It provided jobs and computers to the market in all the cities in France. There were three autonomous regional locations for ACTIF: ACTIF ile-de-France, ACTIF-Sud-Ouest, and ACTIF-Sud-Est. They would mobilise local support and recruit volunteers. The boards of directors at the local units had to include the representatives from the volunteers in both the profit and the non-profit programmes. The founders of ACTIF were not experts. The organisation also launched partnerships with other similar minded people and agencies.

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ENVIE expanded its operations in three ways: an existing social enterprise would apply to be part of it or a public official, company and non-profit entity would call upon them to open a branch in their city. Lastly, ENVIE would see the need to have a unit in the location. The new non-profit group had to sign a contract with ENVIE.

A volunteer board of directors headed each entity. Local boards had the local business, social, and institutional leaders with capabilities to help the organisation. Spitz was in charge of making the standard operating procedures for the units, and the head office was in charge of them and supervised their work. The units had to submit 1.5% of their turnover to the head office. The branches could get assistance regarding the audit, monitoring operations, and phone support. The office charged the units an hourly fee for recruitment and training. The sites had some restricted autonomy due to the membership agreement.

ACTIF and ENVIE are both social businesses in France. They sell used consumer products. They specialise in providing on-the-job training for the long-term unemployed citizens. They also provide temporary professional experience. They both make decisions based on community empowerment and focus on non-profit interventions. They both have sustainable comparative advantages. ACTIF relies on IBM for donations and uses its distribution channels. It has also set up profit centers. ACTIF has won community support. They invite the management to open branches in their locality.

The Reason for the Difference

While ACTIF was dealing with computers, ENVIE was dealing with the white products. ENVIE originated from the idea of people collecting old and damaged white products. It developed the idea further by starting to repair such goods and resale at a lower price (Hillis & DuVall 2012). There were no professionals, and it had to find one to train and equip the people they found. Its workers were homeless people who could not get employment.

ACTIF was an idea that came from the top executives of IBM France. After the redundancy, they started the non-profit making organisation to help train those people without skills for future employment opportunities. They did not have to hire professionals because they were qualified folks. They had free space to operate from at the IBM France’s offices. The top management had been in management for some time and had experience in leadership.

ENVIE began its work in 1985. The managers had more experience in dealing with the homeless people. They had been part of the Emmaus community programmes for a long time. On the other hand, ACTIF leaders only knew about managing formal and professional organisations. They had been in the executive positions at the IBM France and were just retiring. They put structures and management control mechanisms. It was a centralised authority.

The branch coordinators were not part of the management decisions. The unit managers had to receive instructions and follow them to the letter. It caused a lot of discomfort among the group leaders. They had to react by asking for positions on the board. They wanted inclusion in the decision-making process.

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ENVIE worked with the young people (Lynch & Walls 2009). The group wanted to give them hope through acquisition of skills for their future employment. It dealt with people who the society had excluded from the job market because of lack of experience and expertise. ENVIE got the annual subsidy of €7,000 for the social integration created. It helped to offset the opportunity cost of employing less productive people.

The supervision was necessary to enhance production. It also relied on donations. For instance, Darty donated the used goods that the retailers collected. It enabled the organisation to open an office in the South. The local community applied to the organisation requesting for a unit in their locality.

ACTIF had ready resources at hand. It also had the ready skilled workforce. ACTIF only equipped the new workers with skills through its well-experienced staff (Manville & Greatbanks 2013). It relied on the funds from IBM France for its funds. The first grant was €22,000. Therefore, it was easier to do feasibility studies and start the project on time. Rogulski who was the project leader together with other ten workers categorised their market. They had schools, nonprofit organisations and low-income individuals. ACTIF created opportunities for profit organisations to operate its activities.

According to the leadership, the non-profit centres would not work. It caused the team to rely on the earnings to propel its growth. The company relied on equipping both the youths and the adults with skills (Lynch & Walls 2009). While ENVIE opened its branches and managed them independent of other organisations, ACTIF relied on other support of other agencies. It also generated profits that it reinvested in its operations for growth.

The process of scaling up required talent and trained skills. It also requires that the management works in consultation with the staffs and the unit leadership. Success requires feasibility studies and the use of available mechanisms in a creative way (Noya 2009). Emmaus just transformed its operation to suit the new project. It created jobs. ACTIF just used the IBM channels to access its resources and supply to the clients. Social enterprise requires cooperation with the community.

The social enterprises also need to operate as profitable organisations. They can set up profit centers and make them reliable to the organisation. The centers will prevent the organisation from overreliance on donations. Sometimes donors may change their strategy and this can hamper the activities of the social enterprises. Therefore, they need to start internal development of future leaders. The differences in the two organisations’ growth brings to fore the importance of participatory leadership.

Future Perspective

ENVIE has had over ten years of experience in the market. It is now a reputable organisation in France. The homeless community has gained skills. In 2004, it filled 204 social positions. It should now focus on new dimensions in business. ENVIE can create an employment bureau and register all its trained youths. Since after two years, they have to give space for others, they may enter the job market and remain unemployed.

The bureau will shorten the period for looking for employment. It will collect contacts from all available organisations that deal with white goods and let them post open positions to its website or send via email. ENVIE can start getting their trained youths to apply for the jobs. It can also set up volunteer programmes and enlist its graduates for the practice in various organisations.

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It will require a lot of investment in the programme. There will be advertisements that will cost the team some valuable funds. It will also require the team to set up various desks in their branches and the intended groups. The government may start charging them some fees for such operations. It may also create some competition with the other established employment bureaus.

The organisation should also focus on other products other than the white ones. It can also open up distribution channels for the white goods (Xu & Quaddus 2010). After training the youths, they need an experience in the field. The distribution channels should become profit centres. It will link up with the manufacturers of the goods, and then open up new distribution channels. The goods will be new and only requiring after sale services.

It can also register its trained staff with the manufacturers. They should get further training from there so that they become engineers. The manufacturers can employ them in their firms to start making the products. The process can improve the employment status of many unemployed people in the nation.

ACTIF has been using the company’s channels and hence has remained dependent on the company’s support. It is the time that the leadership should start focusing on a future independent of IBM France. They should start dealing with other computer products in the industry. Overreliance on the company has made it not to expand further in the market. Its sales and profit margins are still very minimal as compared to the market available (Noya 2009). Other brands require their services. ENVIE is making a lot of progress because it is dealing with various brands.

ENVIE is limited to only one brand. It is the vision of ENVIE to give back to the community. However, this cannot be achievable if the company only concentrates on its brand and yet others that damaging the environment. The expansion into other brands will also increase its capacity to train many more youths. It will also enable them to move to more spacious facilities and become independent of IBM France’s limited operations.

It can become very successful if it also expands to other countries. Solving societal problems has no boundaries. Concentration in France only limits its ability to empower more people. It has an enormous task ahead because of the opportunities available.

ENVIE should also start a training facility and institution for the less-skilled market. The institution should first concentrate on the computers to specialise its activities before other products can start. The youths who enlist for the organisation’s activities should attend the training at this facility (Xu & Quaddus 2010). The aim is to improve professionalism and involve accreditation agencies.

Apart from just training on the handy skills, the students should also learn some work ethics. Some of them can be empowered to start their businesses. Sometimes employment vacancies can only become viable when people create those opportunities. About 20% of the educated youths should be able to start small and medium micro enterprises. In this view, they can become the entrepreneurs in the making. Other soft skills can include communication, marketing, and record keeping.

Creating employment should now become the focus. The problem many nations are facing is unemployment. Other than having skills, income is only viable through deployment. The fund’s kitty can involve the amount to lend them to begin businesses all over the country.

References

Becchetti, L & Borzaga, C 2010, The economics of social responsibility, Abingdon, UK, Routledge.

Carter, B 2012, The like economy, Indianapolis, Indiana, Que.

Gidron, B & Hasenfeld, Y 2012, Social enterprises, Basingstoke, UK: Palgrave Macmillan.

Hillis, D & DuVall, J 2012, Improving profitability through green manufacturing, Hoboken, New Jersey, Wiley.

Lynch, K & Walls, J 2009, Mission, Inc., San Francisco, Berrett-Koehler Publishers.

Manville, G & Greatbanks, R, 2013, Third sector performance, Farnham, UK, Gower.

Noya, A 2009, The changing boundaries of social enterprises, Paris, France, OECD.

Xu, J & Quaddus, M, 2010, E-business in the 21st century, Hackensack, New Jersey, World Scientific.

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