Social Enterprises as a New Form of Business

Constant focus on exploring new opportunities and bringing something new to different levels of society are the core characteristics of every entrepreneurship. Today, numerous businesses exist in various industries around the globe, and the presence of social enterprises plays a significant role in multiple fields. According to Thomson and Doherty, social enterprises are “organizations seeking business solutions to social problems”. Based on this definition, it is possible to say that generating revenues is not the primary purpose of the social enterprise, but instead, represents a mean of achieving different social goals. In such a way, this type of business combines the social orientation of its operations and the entrepreneurial approach. The purpose of this paper is to analyze the concept of social enterprises, investigate their novelty, observe their options for making business inclusive, and examine possible drawbacks.

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In a global community, the emphasis in entrepreneurship is shifting towards finding the solutions to the existing social problems that touch different levels of societies, rather than generating high revenues. Although the concept of social enterprises has existed in the arena for many years, it has started to gain its popularity and expansion within recent years (Bornstein 1). Based on the fact that social entrepreneurship is considered to be a new branch among the industries, one can claim that the competition is not on the highest levels. Bornstein claims that such organizations are not new, but the scale on which they are gaining momentum and the advanced solutions that they come up with give a new representation for the social enterprises. Besides, social businesses collaborate with different academic establishments, for-profit companies, and governments, which creates “hybrid social-impact businesses,” adding more expertise to the solutions (Bornstein 5). Thus, social enterprises are involved in projects in various industries and elaborate professionals from different fields, aiming to achieve the best results.

It is possible to say that social entrepreneurship stands on the border between charitable and business organizations. Hence, social enterprises need to have consistency in profits because they become the sources of covering the costs for the social issues’ solutions (Peredo and McLean 61). Still, every social entrepreneur must have social interests dominating within the organization to maintain the status of the business and a positive image (Peredo and McLean 61). In such a way, each social enterprise needs to have stable profitability to exist in the market and perform effectively. The assumption about the most successful social enterprises implies that they manage “to demonstrate healthy financial and social returns (Thomson and Doherty 362). Therefore, social enterprise presents a form of business in which the returns are decent in all of the spheres, rather than having high revenues and reduced social outcomes or vice versa. This feature and an objective to operate effectively make social entrepreneurship attractive for businesses.

A great example of a social enterprise that is focusing on the social aspect of the work but also generates profits is the Swan Bakery in Japan. The bakery hires employees who are disabled but still aims to bring excellent quality and service and have a competitive advantage over the rivalries (“Japan”). This example shows that this Japanese establishment emphasizes the significance of providing workplaces to disabled people and wants to be viewed as an equal player in the industry. As a result, Swan Bakery has high social and financial returns.

As it was mentioned above, social businesses actively partner up with different entities, which can have a favorable impact on all the parties involved. Consequently, social entrepreneurship becomes a new platform for businesses to integrate specific objectives, improve the company’s image, and become recognized figures within the societies. Social enterprises develop new approaches to social problems and seek to promote social well-being (Bornstein 9). Thus, it makes other businesses more inclusive into the processes, because collaboration can produce more exceptional outcomes and have a more considerable influence on the environment and social welfare.

However, besides numerous advantages of social entrepreneurship, it also possesses negative sides, which might have an influence on those businesses in the long-term. For example, some of the social enterprises might be too controlling over the operations due to high ethical implications. Also, the shift of the focus from the social goals towards generating higher revenues can occur to the social entrepreneurs. In such a way, different aspects might motivate social businesses to practice control over the operations. Still, the emphasis on having the prevalence of social objectives over others within this type of organization implies that excessive regulations can harm the moral aspects of those enterprises.

In conclusion, social enterprises present a new form of business that is gaining popularity over the last couple of years. Various social entrepreneurs appear within the communities, bringing new solutions to the existing social problems and working on the improvement of the environment. Social organizations must be able to generate revenues to be effective but to remember that the focus should stay on the established social goals. Partnerships with different organizations can bring better outcomes and benefit the members of the collaboration. Each social enterprise should emphasize its original mission and keep the right direction to generate both financial and social returns.

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Works Cited

Bornstein, David. How to Change the World: Social Entrepreneurs and the Power of New Ideas. Oxford University Press, 2007.

“Japan.” Skoll Foundatio. 2010, Web.

Peredo, Ana Maria, and Murdith McLean. “Social Entrepreneurship: A Critical Review of the Concept.” Journal of World Business, vol. 41, no. 1, 2006, pp. 56-65.

Thompson, John, and Bob Doherty. “The Diverse World of Social Enterprise: A Collection of Social Enterprise Stories.” International Journal of Social Economics, vol. 33, no. 5-6, 2006, pp. 361-375.

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