Open access

The Management of
Social Enterprises
Montreal, October 2, 2009
Sybille Mertens
Cera Chair, Centre for Social Economy
Introduction
• Personal story
•
PhD in Economics
•
The Satelllite Account of Nonprofit Institutions
•
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NPO as producers
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NPS as a relevant different sector
From Macro to Micro
• The management of social enterprises - january 2010
•
S. Mertens (editor), in collaboration with M. Boving, C. Davister, A. Henry,
M.Marée and J. Rijpens
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Master Students + Practionners
Introduction
• The current state of knowledge on the management of
associations
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Delimitation of the field
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Specificities
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Litterature review + focus groups + case studies
• The management of social enterprises
•
Questions and first lessons
Plan
• Definitions : What are social enterprises ?
• Roles : Why do they exist ?
• Management : How different is it ?
Definitions
• Social Enterprises
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Private (control)
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Enterprises (risk, economic activity)
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Non-capitalist (not-for-profit, democracy)
• Other concepts : Nonprofit, OBNL, Associations, Social Economy Organisations,
Coop, Third Sector Institutions
• Corporate Social Responsibility
• Other conceptions of Social Enterprises
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Commercial activities of NPOs (financial autonomy)
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Social innovation / Social Entrepreneurship
Roles
• Source : The three-failures theory (Weisbrod 1975, Hansmann 1980 and
1996, Salamon 1987, James 1990, Ben Ner & Van Hoomissen 1992, Steinberg 2006,
Young 2003)
• Main idea from Institutional Economics : Institutional forms are optimal under
certain circumstances.
• Social Enterprises can be the optimal form when For-profit or
Government forms fail.
Roles
Problem
FPO
Gov
Market power
• Higher prices
•Quantity &Quality
reduced
• Inefficiency
Information asymetry
• Opportunism risk
• Limits of regulation
Public goods
• Free rider problem
• Opportunism risk
• Bureaucracy
• Median Voter problem
• Global public goods
• Budget limitations
Roles
• Social Enterprises competitive advantages
• Property rights limited (trust, other resources)
• Local base (social needs knowledge, trust)
• Social Entreprises limits
• Property rights limited (inefficiency, lack of access to K)
• Local base (limited resources, limited action)
Roles
• Production of public goods
• Complementary to public provision
• Delegation with public financing
• Production of trust goods
• Production as a solution to market power
Roles
Field
Work integration
Microfinance
Fair trade
Social services
Green energy
NGOs
Cooperatives
Market power solution Public goods Trust goods
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Management
• Marketing (Sybille Mertens)
• Financing (Arnaud Henry)
• Governance (Julie Rijpens)
• Human Resources Management (Catherine Davister)
Management
• A different model of management
• Based on a system of values
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Solidarity
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Fairness
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Freedom
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Moral responsibility
• Facing complexity
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Social aim versus economic efficiency
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Multi-stakeholdership
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Evaluation
Marketing
• Cultural obstacles
• Mission as indicator
• Multi-stakeholdership : Necessity to be market-oriented (>< productoriented)
• Differenciation : Untangible aspects, trust, loyalty, values, relationship
marketing
• Ideas, values : social marketing
• Competition and cooperation
• Do not neglect traditional marketing
Financing
• Public goods : non exclusion, public and private benefits
• Financing-mix : benefits related to different resources (sales, public
subsidies, fees, gifts, sponsoring, volunteering)
• Multi-stakeholdership : Reporting, Social Return on Investment
• Property rights
• Difficult access to K
• Dvlp of Social and Responsible Investment
Governance
• Property rights : Members, democracy
• Traditional mechanisms : owners’control, market pressure, laws
• Central role for the Board (agency theory, stewardship theory and
resources dependance theory) : dynamic vision
• Managerial Hegemony and Ratification Role
• Multi-stakeholdership : CSR
Human Resources Management
• Informal HRM
• Diversity : gender, age, status, qualifications
• Motivations mechanisms : values, participation
• Professionalisation : managerial profiles, paid staff, executuve
education
• Volunteering : specific questions
Plan
• Definitions : What are social enterprises ?
• Roles : Why do they exist ?
• Management : How different is it ?
+ Bonus : Canada’s Competitive Advantage
Bonus
• In a world of
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Globalisation
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Growing inequalities
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Limited link between economic growth and happiness
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Loss of meaning, fear
• The Competitive Advantages of a Nation is in its capacity
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To deal with complexity
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To be aware of collective needs and solutions
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To restore hope and trust
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To act in concordance with values, even in the economic life
For more information
Sybille Mertens
[email protected]
+ 32 4 366 27 51
www.ces-ulg.ac.be