In 2010, GlobeScan research revealed that confidence in the capitalist free-market system had plummeted during the first decade of the 21st century – from 80% in 2002 to barely 50% in 2010. A majority had lost trust and confidence in business and Government as well.
The present economic system just was not working for the benefit of all society. In response we’re seeing a new breed of entrepreneur seeking to do good by doing business: The Social Entrepreneur.
Social entrepreneurship is one of the 10 trends discussed in our 2014-15 Trends Report.
Download the full 2014-15 trends report here: 10 trends that are changing our world (PDF)
The Harvard Business Review reported 12 months ago that the Social Entrepreneurship revolution had its genesis in the elite INSEAD in Paris and Harvard Business Schools in the mid-1990’s. The question was asked how Harvard and INSEAD could apply their distinctive competencies to improve management in the social sector.
Up until that point business and entrepreneurship largely pursued one key objective: profit. Since then we’ve seen wide recognition, appreciation and adoption of the Triple Bottom Line (TBL) philosophy – sometimes called 3BL – a business model developed to encourage social responsibility and sustainability among businesses worldwide. A TBL company will consider People (both their employees and the members of the community in which they conduct business), Planet (environmental impacts of their business), as well as Profit.
Fast forward those twenty years and as Forbes magazine recently reported, social entrepreneurship has come of age and we are seeing a fourth ‘P’: Purpose. Very often we now see the Purpose of an enterprise is much more than simply making a profit, making a return for the owners and shareholders, but rather there is a greater purpose – a real sense of doing a greater good.
Accelerating this coming of age has been two social changes – one economic and one demographic.
Economically, we are living in a post-GFC world.
Demographically, many Generation Y’s have considered self-employment. Born between 1980 and 1994 this is the most educated, financially-endowed and socially-connected generation in history. What does this mean for their approach to work and business? They have commenced their economic earning years higher up Maslow’s hierarchy of needs than any previous generation. For them, the basic necessities of life are already taken care of. Many were still living at home, or had returned home after time away. They are the KIPPERS – Kids in Parent’s Pockets, Eroding Retirement Savings.
At the peak of Maslow’s hierarchy of needs is self-actualisation and this generation is right up there. Their purchasing decisions and career decisions are not made solely through a financial lens. No, for them other considerations are key. Questions such as: What is the social impact of my purchase? What are the values of the organisation I am working for?
The point is, this generation has had a very different psychographic profile to generations past and this, combined with the economy of the times, has influenced their approach to entrepreneurship.
They are eschewing business to make money for money’s sake. Rather, as social entrepreneurs they are developing innovative business models that blend traditional capitalism with solutions that address the long-term needs of our planet.
| “MBA programs today are minting not just captains of industry, but also crusaders for social good. Any program teaching business skills needs to train their graduates to serve both companies and society. This means equipping would-be entrepreneurs with an understanding of multiple bottom lines and equipping would-be corporate professionals with intrapreneurial vision to connect business interests to social value. Steeped in both social and business principles this new breed of MBAs will be able to navigate complexity and create opportunities to sustain the world we live and work in.”18 - Katie Smith Milway, The Rise of Social Entrepreneurship, Harvard Business Review, 28 Feb 2013 |
| Thankyou WaterA great example is the Thankyou company. www.thankyou.co (not .com). Starting with water, this social enterprise founded by then 19 year old Daniel Flynn in 2009 has now expanded into food and body care lines as well. Once all of the costs of production are taken care of, all profits are directed to life-changing projects in the developing world. |
- Are you considering your customer’s psychographics as well as their demographics?
- Is there a change you can make to take advantage of the changing psychographics of 21st century consumers?
Social entrepreneurship is one of the 10 trends discussed in our 2014-15 Trends Report.
Download the full 2014-15 trends report here: 10 trends that are changing our world (PDF)
