UNIT 5

Social Sectors Perespective

Social sectors encompass a wide range of areas that address societal
needs and challenges. These sectors include education, healthcare,
environmental sustainability, poverty alleviation, and more. Social
entrepreneurship is an approach within these sectors that involves
using business principles and innovative strategies to create positive
social or environmental impact. Here are some perspectives on social
sectors and the role of social entrepreneurship:
1. Identifying Social Needs:
Social sectors are often defined by the pressing needs and challenges
within a society. These needs can include access to quality education,
healthcare, clean energy, and poverty reduction. Social entrepreneurs
identify gaps and inefficiencies in existing systems and work towards
developing innovative solutions to address these needs.
2. Innovative Solutions: Social entrepreneurship focuses on finding creative
and sustainable solutions to social problems. It involves thinking outside the
box and leveraging entrepreneurial skills to create positive change.
Innovations can range from new business models to the use of technology
and alternative approaches to address social and environmental issues.
3. Collaboration and Partnerships: Social sectors often require collaboration
among various stakeholders, including government agencies, non-profit
organizations, businesses, and local communities. Social entrepreneurs
collaborate with these stakeholders to leverage resources, share knowledge,
and maximize the impact of their initiatives.
4. Measuring Impact: Unlike traditional business models that primarily focus
on financial returns, social entrepreneurship emphasizes measuring and
maximizing social and environmental impact. Metrics such as improved
educational outcomes, increased access to healthcare, reduced carbon
footprint, and poverty reduction are crucial for assessing the success of
social entrepreneurial ventures.
5. Sustainability: Sustainable development is a key consideration in social
sectors. Social entrepreneurs strive to create solutions that are not only
effective in the short term but also sustainable in the long run. This
involves considering the environmental, economic, and social aspects of the
initiatives to ensure they contribute to the overall well-being of communities
without depleting resources.
6. Empowerment and Inclusion: Social entrepreneurship often aims to
empower marginalized communities and promote inclusivity. Initiatives may
focus on providing opportunities, skills, and resources to those who have
been historically disadvantaged.
7. Policy Advocacy: Social entrepreneurs may engage in advocacy to
influence policies that support their initiatives and create a more conducive
environment for positive social change. Advocacy efforts can involve
working with policymakers, raising awareness about social issues, and
promoting policy changes that align with the goals of the social sector.
Social Entrepreneurship
Difference between Business Entrepreneurs and Social
Entrepreneurship
Social Entrepreneurship
Social Entrepreneurship
Opportunités for Social Entrepreneurs In India
1. Education and Skill Development:
- Opportunity: Develop programs or platforms that provide affordable and
accessible education and skill development opportunities, especially in
underserved communities. Example: Khan Academy, providing free online
education globally.
2. Healthcare Access:
- Opportunity: Create affordable and efficient healthcare solutions,
particularly in remote or low-income areas. Example: Aravind Eye Care
System, offering high-quality, low-cost eye care in India.
3. Clean Energy:
- Opportunity: Develop renewable energy solutions to address
environmental issues and energy poverty. Example: Solar Sister,
empowering women in Africa to sell solar products.
4. Financial Inclusion:
Opportunity: Create financial services that reach the unbanked or underbanked
populations. Example: Grameen Bank, providing microfinance to lift people out of
poverty.
5. Water and Sanitation:
Opportunity: Implement solutions for clean water access and sanitation in areas
lacking proper infrastructure. Example: [Link], working to provide access to
safe water and sanitation.
6. Agricultural Innovation:
Opportunity: Develop sustainable agricultural practices and technologies to
improve food security.
Example: KickStart International, designing and promoting irrigation tools for small-
scale farmers.
7. Tech for Social Good:
Opportunity: Leverage technology for social impact, such as creating apps or
platforms that address societal challenges. Example: Ushahidi, a platform for
crowd sourcing and mapping crisis information
Opportunités for Social Entrepreneurs In India
Here we are listing some untapped opportunities for the budding entrepreneurs:
• 1. Waste Management:
• In Indian context, this is a journey or race with no 'finish line'. On the ground,
various solutions, best practices and business models have emerged. In some
areas, we see some cases of dramatic turnarounds. In many other cases the
situation is only worsening owing to delays and at best inaction. Progress is visible
in the space of solid waste management. Sewage or liquid waste management is
still largely left to traditional approaches and conventional systems that either
don't work or are fraught with gaps in implementation.
• The current solutions are infrastructure based, require large investments and are
always on a catch up mode. But you as an entrepreneur you can tap this
unexploited space with you innovate idea and can churn out money from here
Opportunités for Social Entrepreneurs In India
2. Deep Cleaning Services
For aspiring entrepreneurs this a great sector to tap. Cleaning industry
is still untapped and it needs young blood to step in and change the
face of the sector by using their innovative skills and techniques.
3. Green Infrastructure:
Green Infrastructure is vital in providing and connecting life support
systems for urban environments. It includes parks and reserves,
gardens, waterways and wetlands, streets and transport corridors,
pathways and greenways, squares and plazas, roof gardens and living
walls, just to name a few
Opportunités for Social Entrepreneurs In India
4. Water Management:
• Water is one of the most important element of life. But the scarcity of
drinking water, is appalling. In today’s time, access to clean water is
the biggest achievement for any family living in remote areas of the
country. You, being an entrepreneur, can look into this matter and
figure out the best way to solve this problem with the help of your
entrepreneurial skills.
Social Enterprise Business Models
A social business model is therefore a structure, design or framework that a social business
follows in order to bring about a positive change while maintaining healthy financial
returns.
• The entrepreneur support model that sells business support services directly to the
entrepreneurs in its target population
• The market intermediary model that helps their clients by marketing or selling their
clients’ products or services for them
• The employment model, in which a social enterprise provides their clients with job
opportunities and job training
• The fee-for-service -model where a social enterprise charges the customer directly for
the socially beneficial services it provides
• The low-income client model where a social enterprise generally offers social services
directly (as in the fee-for-service model) while focusing on low-income clients
• The cooperative model, a fee-based membership organization that provides member
services to a group that shares a common need or goal
Social Enterprise Business Models
• The market linkage model that focus on building relationships and
otherwise connecting their clients with markets for their clients’
products and services
• The service subsidization model that funds social programs by selling
products or services in the marketplace.
• The organization support model also sells products or services to
fund social programs (as the service subsidization model). However,
the social programs they fund are part of a separate, parent
organization
Social Innovation
Social innovation refers to the design and implementation of new solutions that imply
conceptual, process, product, or organizational change, which ultimately aim to improve
the welfare and wellbeing of individuals and communities.
Many initiatives undertaken by the social economy and by the civil society have proven to
be innovative in dealing with socio-economic and environmental problems, while
contributing to economic development.
Broadly, the term social innovation has been used to describe:
• Societal transformation
• A model of organizational management
• Social entrepreneurship
• The development of new products, services and program
• A model of governance, empowerment and capacity-building
SOCIAL INNOVATION ACROSS FOUR SECTORS
Social innovation does not refer to any particular sector of the economy, but to innovation in the
creation of social outputs, regardless of where they emanate. As such, social innovation can take
place in all four sectors:
• The non-profit sector – for example, taking youth at risk and pairing them with university
graduates in challenging schools to inspire, motivate and encourage them to become worthy
citizens. Another initiative is offering homeless people a home by teaching them to work with
recycled materials or giving them a job renovating and reselling donated furniture, enabling them
to become home owners.
• The public sector – both in terms of policies and service/business models. Examples include
providing unemployed youth with entry-level positions (including job shadowing, learnerships or
apprenticeships) after a process of job readiness or skills development and government providing
incentives for companies and employers to provide opportunities for unemployed, uneducated
youth.
• The private sector – for example, ethical finance, markets for social or environmental goods, or
what the social entrepreneur and civil society leader Muhammad Yunus calls “social businesses”.
In essence, to create new forms of businesses that offer social return on investment as opposed
to pure for-profit businesses.
• The informal sector – which plays a critical role in the creation of social movements such as the
slow food movement, which started in Italy but has swept across the globe. Another example is
restaurants using surplus food to distribute to homeless people, or donating it to schools to use
as part of feeding schemes, in essence creating a circular economy.
Social Sustainability
• Social sustainability is about identifying and managing business impacts,
both positive and negative, on people. The quality of a company’s
relationships and engagement with its stakeholders is critical. Directly or
indirectly, companies affect what happens to employees, workers in the
value chain, customers and local communities, and it is important to
manage impacts proactively.
• Businesses social license to operate depends greatly on their social
sustainability efforts. In addition, a lack of social development, including
poverty, inequality and weak rule of law, can hamper business operations
and growth.
• At the same time, actions to achieve social sustainability may unlock new
markets, help retain and attract business partners, or be the source for
innovation for new product or service lines. Internal morale and employee
engagement may rise, while productivity, risk management and company-
community conflict improve.
Risk Management in Social Enterprise
Risk management is a crucial aspect of running any business, including social
enterprises. Social enterprises, which combine business principles with a
social mission, face unique challenges and opportunities. Effectively
managing risks is essential for their long-term success and impact. Here are
some key considerations for risk management in social enterprises:
1. Identify and Assess Risks:
- Financial Risks: Social enterprises often operate with limited resources.
Identify potential financial risks such as insufficient funding, cash flow
issues, or unexpected expenses.
- Reputational Risks: Since social enterprises are closely tied to social
missions, reputational risks can have a significant impact. Identify risks
related to public perception, stakeholder relationships, and partnerships.
- Operational Risks: Assess risks related to day-to-day operations, including
supply chain issues, technology failures, and human resource challenges.
2. Mission Alignment: Ensure that risk management strategies align
with the social mission of the enterprise. Balancing financial
sustainability with social impact is crucial.
3. Legal and Regulatory Compliance: Stay informed about and comply
with relevant laws and regulations. Noncompliance can result in legal
challenges that may jeopardize the enterprise's mission and
sustainability.
4. Stakeholder Engagement: Engage with stakeholders, including
beneficiaries, investors, employees, and the community. Understanding
their perspectives can help identify potential risks and develop
strategies to mitigate them.
5. Diversification of Funding Sources: Social enterprises often rely on a
mix of earned income, grants, and donations. Diversifying funding
sources can help reduce dependence on a single revenue stream and
mitigate financial risks.
6. Monitoring and Evaluation: Establish a robust monitoring and
evaluation system to track both financial and social performance.
Regular assessments can help identify emerging risks and assess the
effectiveness of risk mitigation strategies.
7. Partnership Due Diligence: Conduct thorough due diligence when
entering into partnerships. Ensure that partners share the same values,
and assess the potential risks associated with the partnership.
8. Adaptability and Innovation: Social enterprises operate in dynamic
environments. Build a culture of adaptability and innovation to respond
effectively to changes in the social, economic, and regulatory
landscape.
9. Insurance and Risk Transfer: Explore insurance options to mitigate
certain risks. Consider transferring specific risks through insurance
policies, particularly those related to property, liability, and key
personnel.
10. Crisis Management and Contingency Planning:
Develop a comprehensive crisis management plan that outlines steps
to be taken in the event of unforeseen challenges. Having contingency
plans in place can minimize the impact of crises.
Marketing Management for Social Ventures
• Marketing strategy is the key element in building a sustainable business venture.
It starts with clarifying the vision, mission and values of the social enterprise,
analyzing the potential users and competitors and elaborating the market
determinants such as product, price, placement and promotion. Managing
effective distribution systems, promotion and communication are important
factors in achieving the desired social impact.
• Marketing for social entrepreneurship is a social and managerial process in
which individuals and groups receive what they want and need through the
exchange of products and values. The task of marketing is to identify and define
specific markets for specific products.
Marketing research and analysis
The first step in successfully positioning the new business venture, is to conduct a
thorough marketing research, analyzing who the existing and potential users of the
products and services will be, what is the market size and who are the competitors.
The market should be analyzed in terms of demographics, social-economical and
geographical distribution and size. Useful question that should be asked on this
stage are:
• Who are you targeting?
• What are the main characteristics of the target group?
• How many people you want to reach?
• Where are those people?
Marketing Management for Social Ventures

• Marketing for social entrepreneurship is a social and

managerial process in which individuals and groups receive
what they want and need through the exchange of products
and values. The task of marketing is to identify and define
specific markets for specific products.
The Four Ps of the marketing mix
• The Four P’s is a common tool to analyze the marketing mix
of the business venture. The four P’s represent the product,
price, placement and promotion and aims at comprising all
aspects of the production and deliverance processes in a
simple and convenient manner.

• The product or service that is created through a user-driven

design is the core of the marketing strategy.
The Four Ps of the marketing mix
The Four Ps of the marketing mix
• The price is a key element that determines not only the competitiveness of the
product/service but also its accessibility to the audience, thus reflecting the social
outcome of the venture.
• The goal of the social enterprise is to make the product or service as accessible as
possible, and that means offering the value needed to produce the desired social
outcome in the most affordable manner.
• In the same time the quality should not be compromised in order to secure lower
price. Optimizing the costs of production is the key to success in both: maximizing
customer benefits and ensuring financial sustainability of the enterprise.
• But affordability does not depend only on managing manufacturing costs. It can
also be attained through external financing, creative payment or distribution
schemes. These multiple aspects should all be reflected in the marketing and the
business plan.
• The cost refers to what you’re paying to produce, promote, and distribute your
product or service, while the pricing refers to what you’re charging your
customers or clients.
The Four Ps of the marketing mix
• In certain cases, the price for the product or service could be placed
below the cost of production, if other activities or sources of revenue
could subsidize it and ensure the financial viability of the enterprise.
• Placement refers to the distribution channel that are employed in
delivering the product and the service to the end users. Accessing
more people or larger target audience is a key factor for the success
of the social enterprise.
• Promotion focus on building relationship with the potential
customers. Effective promotion heavily relies on understanding
customers’ behaviors and preferences and on resources that the
company has for advertising
 Legal Framework
• For each project to extract natural resources from the ground, there are rules that govern the
rights and responsibilities of governments, companies, and citizens. Together these rules are
called a legal framework, or legal architecture.
• A well-designed legal architecture should provide rules for how state institutions are structured;
how companies acquire and manage licenses; the fiscal terms governing payments between
companies and the state; environmental management; relationships between extractive projects
and neighboring communities; the behavior of public officials active in the sector; public
information disclosure and accountability and how the government will manage natural resource
revenues.
• Legal frameworks comprise a set of documents that include the constitution, legislation,
regulations, and contracts.
The most common types of business entities include sole proprietorships, partnerships, limited
liability companies, corporations and cooperatives. Here's more about each type of legal structure.
Legal Framework
The legal framework for social ventures can vary depending on the country and legal system in which the
venture operates. However, there are common legal structures and considerations that social entrepreneurs
often explore. Here are some key elements of the legal framework for social ventures:
1. Legal Structure:
- Nonprofit Organizations: Many social ventures choose to register as nonprofit organizations or charities. This
legal structure is often associated with tax benefits and restrictions on profit distribution.
- Social Enterprises: In some jurisdictions, there are legal structures specifically designed for social enterprises,
such as Benefit Corporations (B Corps) or Community Interest Companies (CICs). These entities are typically
required to balance social and environmental goals with financial returns.
2. Registration and Compliance: Social ventures need to comply with registration and reporting requirements
of the jurisdiction in which they operate. This may include registering with a government agency, filing annual
reports, and adhering to specific legal guidelines for their chosen structure.
3. Tax Considerations: Nonprofits often enjoy tax-exempt status, meaning they are not required to pay certain
taxes. Social enterprises may also benefit from tax incentives or concessions, depending on the jurisdiction.
4. Governance Structure: Social ventures need to establish a governance structure that aligns with their
mission. This may involve the creation of a board of directors, committees, or advisory boards to ensure
accountability and transparency.
5. Mission Lock: Some legal structures for social ventures include provisions to "lock in" the social or
environmental mission. For example, Benefit Corporations often have a commitment to consider
the impact of their decisions on various stakeholders.
6. Impact Measurement and Reporting: Social ventures may be required to measure and report on
their social and environmental impact. This can be part of their legal obligations or a voluntary
commitment to transparency.
7. Intellectual Property: Social ventures may need to consider intellectual property issues related to
their mission. This could include trademarks for branding associated with the social cause or
protecting innovative solutions to social problems.
8. Contractual Agreements: Social ventures often engage in partnerships or collaborations. Clear
and welldrafted contracts are essential to ensure that all parties understand and uphold the social
mission.
9. Employment and Labor Laws: Social ventures need to comply with employment and labor laws,
including fair wage practices and non-discrimination policies.
10. Social Finance and Investment: If the social venture seeks external funding, it may explore social
impact investing or other forms of socially responsible finance. Legal structures and agreements
related to investments should align with the social mission.