Wednesday, February 24, 2010

on 'The Meaning of "Social Entrepreneurship" J. Gregory Dees'

I find it very easy to identify as a designer with the definition that Say and Schumpeter set out for entrepreneurs. That an entrepreneur is one who through some manner reinvent the system and reallocate resources in a new and more productive way. What can be considered more productive is of course up for debate. Is it to use fewer resources in production or to create a product with a higher value, or one that has a different end point from previous iterations? The Druker definition also fits in well with a designers outlook, there is an element of blind pursuit of a goal in Druker's definition. The design process starts with a challenge and seeks a solutions thinking free of many real constraints as those constraints are added into the equation new solutions are thought of to work around those new challenges. There is in this a marshaling of resources that do not yet exist in reality and an assumption that those resources can be obtained.

There is something that I find troubling about Dee's concept of what a Social Entrepreneur is. Surely it is very difficult to place a monetary value on the social good that an enterprise produces, but to say that social value should be supported by contributions (not investments) from outside sources as part of a social entrepreneurial venture is very troubling. What is the difference between this and an aid organization except a thin veneer of fees for service. In my mind social entrepreneurship represents the targeting of a different, less profitable, capitalistic opportunity. Pure investment seeks to take as small of an investment of capitol and turn it into as large of a return as possible regardless of external factors or values outside the monetary sphere. Social entrepreneurship in my view should seek to find those cracks where a sustainable profit can be made providing a service for those in need, even if the use of capitol is not maximized to produce the greatest return on investment. The end goal and measure of success has to be profitability, because without it there can not be sustainability of the enterprise. By making profitability the central element of success it ensures that the market is in fact being served and that the good or service provided to the customer is worth the price, not just that the social entrepreneur thinks that they are serving a customer when in fact they are providing a subsidized handout. Aid organizations are the appropriate entities for fulfilling such needs which can not be met by social entrepreneurs.

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