The Contribution of Social Enterprise and Social Entrepreneurship in the Current Economic Climate - Assignment Example

Sосiаl Еntrерrеnеurshiр Name Institution Course Tutor Date The contribution of social enterprise and social entrepreneurship in the current economic climate The social enterprise and the aspect of social entrepreneurship have major contributions to the present economy. This is because the social enterprises engage heavily in social change (Miller, Grimes, McMullen, & Vogus, 2012). Moreover, the social businessmen tend to invest in the social ventures that enable them to create revenues that can sustain them in the market. To conduct effective social entrepreneurship, the social entrepreneurs follow a specific stream of earnings such as taking of loans, form partnership and engage in capital investments, which help in the advancement of their business activities (Abu-Saifan, 2012). Furthermore, social innovators apply a more developed business model that is efficient in the connection of donations, borrowing, and revenue. This paper seeks to explore the manner through which social enterprises and the practice of social entrepreneurship help in the growth of the contemporary economic climate. There is the identification of the differences between social entrepreneurship, entrepreneurship and the profit-related business that have no social impact. There is also the appraisal of the business model, business planning and financial models that are followed by the social enterprises and organisations practicing social entrepreneurship. 1 Differences in entrepreneurship, social entrepreneurship and profit-based enterprises with no social impact. Entrepreneurship refers to the ability and the readiness to cultivate, establish, and accomplish a business undertaking together with the associated threats to generate income, for instance, the start of a new business. This is irrespective of its existence in the same market, just with the intention of generating some income. Social entrepreneurship is the application of methods by a start-up enterprise and the present businesses with the intention of developing, funding, and implementing solutions to issues related to environmental, cultural, and social matters (Lepoutre, Justo, Terjesen, & Bosma, 2013). The social entrepreneur is a vision bearer with the capacity to accomplish systematic, advanced, and long-lasting social variations through a unique invention, following a specific method and dedicated to applying well-known tactics or know-hows, or their mixture. The profit-based enterprises with no social impact refer to the for-profit firms that are started just to make revenue but not aimed at showing any social impact. Such businesses focus majorly on the improvement of their value in the market through the production of increased and quality products, but not pursuing any social impact (Choi, & Majumdar, 2014). It is apparent that social enterprises develop their social mission through the conduct of an entrepreneurship and techniques of acquiring income. Good examples are the UC Social Enterprise Hub, Crowd Funding Project- “learn to undertake micro finance and Crown funding and Enactus” – “global university social entrepreneurship competition.” These are some of the social enterprises of the University of Canberra and are aimed at enhancing social change to the communities. Enactus is an international community of business leaders, academic leaders, and student leaders, which focuses on the projects aimed for the community outreach and the application of their entrepreneurial talents in the transformation of the communities for the creation of a more sustainable surrounding (Miller, et al., 2012). This means that Enactus’ core aim is to bring changes to the communities using the income generated from the conduct of different income-generating projects. Besides their competitions enable the community to earn significant rewards that enable them to meet expenses associated with the community outreach activities. Through the competition between the staff, business leaders, and student, the University of Canberra can make the desired revenue for more influence to the society. Therefore, the social businesses work towards solving the major and challenging problems in the world. The Crowd Funding Project engages in micro-finance and crowd funding linked activities to generate income for the enhanced social innovation (Griskevicius, Cantú, & Vugt, 2012). On the other hand, the US Social Enterprise hub work towards aspiring the businesspeople and equipping them with efficient skills that enabled them to engage successfully in their business activities. These organisations are innovative in means of transforming the society and making the world more sustainable. This social entrepreneurship engages in diverse business activities to make some profit and manage to accomplish their objectives of having a significant social impact (Lepoutre, et al., 2013). Entrepreneurship focuses much on the creation of just new companies and industries (Felício, Gonçalves, & da Conceição Gonçalves, 2013). This means that the aim of the entrepreneurship is only generating income without implementing any solution towards the present social problems, which is the focus of the social enterprises. The work of the entrepreneur is to advance the commercial markets, which is different from the social entrepreneurs who work towards the enhancement of the social nature or conditions. The venture capitalists help in the funding of entrepreneurship while the parties raising and donating finances because of the charitable matters are the fundamental financiers in the projects carried out by the social entrepreneurs. Profit based enterprises with no social impact are run under the objective of making some profit from any method, but not concerned about the occurring social issues. It is clear that the value of these businesses lies in the turnover that is expected to be reaped by investors and businesspersons in the process whereby business-generated products establish themselves in a marketplace whereby they can be bought effectively (Desa, 2012). Therefore, the operators of entrepreneurship and profit-based businesses are responsible for the development of income to be shared by the financiers and the shareholders. On the other hand, the parties running the social enterprises recognize much value on the generated profits since they are useful in enhancing their cause. Therefore the social benefit towards a society and the changing of a community that has no adequate resources for the fulfillment of their needs is what marks the value of the social entrepreneurs (Griskevicius, Cantú, & Vugt, 2012). The three types of enterprises have different techniques through which they create wealth. This is because their missions are dissimilar. The entrepreneurs and the profit-connected entrepreneurs are motivated to invent in a money-generating market whereby there is a definitive gain of the customers. Thus, the innovation practices make wealth. Nonetheless, the success of businesses is measured through the amount of wealth that is created. On the other hand, the social businesspersons emphasize on the creation of wealth (Abu-Saifan, 2012). However, the particular income is not aimed at being used in the same business venture, but it is a tool that is used by the business to enable some social changes. This is also different from the mission of the profit-based enterprises, which focus on having some diversity in their means of economic development and meeting the interests of the shareholders (Montgomery, Dacin, & Dacin, 2012). Therefore, the entire intention of the entrepreneurship and profit-based businesses without social impact is to motivate the public to purchase their products and make some profit, but not changing their conditions in the society. 2 An evaluation of the business models, financial models and business planning used in social enterprises and social entrepreneurship organisations. Social enterprises and social entrepreneurship firms use amalgamated business model that is characterized by the association of their borrowings, revenue, and donations. Besides, the measurement of the business model applied by the effective social entrepreneurs is integral to the ordinary process of solving a certain problem (Datta, & Gailey, 2012). The business model of the social organizations enable them to solve the business-related challenges in a profitable manner, therefore the elimination of the aspect of depending on donations and fundraising practices. The business model of this type of a business is aimed at creating value and delivering value. In the effort to create value, social enterprises identify the view of their key partners, such as suppliers, stakeholders, and networks. Besides, the social entrepreneurs engage in activities aimed at generating products and services, therefore, the sale of those products and charges towards the offered services enable them to create wealth and revenue. Moreover, the resources used by the social enterprises include money, network partners, assets, as well as equipment. Through the application and efficient distribution of these resources, the social organizations manage to meet their productivity targets and generate the desired revenue. However, they also incur major costs associated with their operations such as paying the salaries of the management teams and other expenses (Felício, Gonçalves, & da Conceição Gonçalves, 2013). In addition, the social enterprises differentiate the problems and solutions through their vision, which focus on the creation of value to the society. This means that the key metrics of these businesses are focusing towards the beneficiaries of their services. Value creation is another aspect of the business model implemented by the social entrepreneurs. This is where the social firms develop a positive relationship with their customers. They do not rely or depend on fundraising or donations, but the income created through the sale of products and services to customers (Montgomery, Dacin, & Dacin, 2012). There is also communication to the users who are the community members. It is clear that the business model built by the social ventures enable them to focus on transforming the communities by enabling them to live a more sustainable life. This is because the products and services offered by the social enterprises are mainly for changing the nature of the environment and helping in the improvement of the society members’ standard of living. The value is also created through having a promising connection with the customers by producing and offering quality products and services, as well as working towards customer satisfaction from the specific provision (Driver, 2012). Social enterprises also look for business partners that focus on enhancing a sustainable environment. The customers of the products produced by the social organisations are supposed to be those who can value the importance of the social impact that is intended to be created, therefore a self-motivation towards the purchase and payment of those products. For example, the Enactus community works with the students at the University of Canberra and the workers who understand the mission of the University and value the value generated by the community towards enabling social transformation. It is evident that social organisations are successful because of the implementation of the effectual business model (Datta, & Gailey, 2012). Besides, the resource and operating strategies followed by the social enterprises enable them to acquire all the needed resources and make the intended business impact towards the members of the society. The finance model applied by the social enterprises focuses on having the sustainability of the environmental, social, and financial sense. Thus, being able to achieve the growth goals and aid in having social changes. This type of business is recognized to follow an economically sustainable technique. Based on the financial model that is implemented in the social enterprises, the generated profit is re-invented. Also, the social businesses focus on achieving their mission irrespective of the focus on making a profit and creating revenue. To accomplish their social goals, the social entrepreneurs ensure that they engage in activities that raise revenue for paying the costs associated with social impact (Felício, Gonçalves, & da Conceição Gonçalves, 2013). Furthermore, social businesses produce and offer less expensive products and services after identifying the nature of the economies of scale. For instance, the University of Canberra's social enterprises engages in projects and activities that are economical and capable of being supported by the students and staff. The business planning conducted by the social enterprises focuses on their mission towards making some transformation to the world and improving the condition of the members of the society. In addition, the social entrepreneurs create value through the involvement and engagement of customers and their employees (Choi, & Majumdar, 2014). This helps in effectively acquiring a market for their products and services, therefore raising the intended income without difficulties. In the business plan of the social enterprises, the ultimate goal is the accomplishment of sustainability through having some aids from the non-profits through some innovative means, but not just relying on the donations and grants. Besides, the profits are re-invented in the businesses for the creation of more wealth. The operations of the social enterprises are focused on generating economic value because of the conduct of revenue-creating activities and enhancing social value through offering support to the communities (Driver, 2012). The social programs in these businesses are planned in a manner that they overlap with their business activities. Besides, the social entrepreneurs operate as the agents to enhance changes in the society, thus implementing the opportunities missed by other businesses and advance their systems. Seemingly, the businesses invent in the new methods and generate solutions towards improving the society. Therefore the core goal of the social entrepreneurship is to offer social effect. This is what makes such businesses to be involved in the practices of directly exchanging products and services that have the potential of creating some earnings (Desa, 2012). Thus, the success of the social organizations is represented by their capability to reverse the injustices, alleviate the sufferings, and change the minds of the members of the society in a positive way. In conclusion, social entrepreneurship and social enterprises are businesses the same with the business entrepreneurship and profit-based organisations with no social change. However, the social enterprises are different based on the nature of their business model. It is evident that the business model that is implemented in the social enterprises aims at creating value through the conduct of social programs alongside the practiced business activities. Despite making of profit and the effort towards the creation of profit, social enterprises differ with other organisations because they re-invent their profit for creating more wealth that supports in their activities towards the transformation of the world. Therefore, social enterprises user their business model, financial model and business planning to lead to a core change to the current economic climate. This is because their business model enables them to combine the donations and income in trying to solve the social and environmental issues for the benefit of the entire world. References Abu-Saifan, S. (2012). Social entrepreneurship: definition and boundaries. 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